By the Climate “Leadership” Council: a who’s who of conservative elder statesmen, this statement is the first time leading Republicans put forth a concrete, market-based climate solution. The idea is essentially Hansen’s fee-and-dividend, though naturally they don’t mention H; and thankfully they’re prepared to say “tax” instead of H’s weaselly “fee”. Although they do lead with the idea of “dividends”; the inevitable tax component is only visible if you read on. The initial rate is $40 per tonne, which is fair enough. The Carbon Tax Center seem happy enough. As they say, there’s a political “swap” in the Council’s proposal to rescind the Obama administration’s Clean Power Plan which will make some people sad, but if it gets this passed I’d be happy enough.
Various obvious suspects are against it, so that’s good. Vox, I think nominally leftish, can’t bring themselves to say anything good about it, because their main aim is to snipe at the Republicans; dull1. Salon is generally happy, as is the FT. Which, after noting the difficulties of border adjustments, comments the overall thrust of the plan is right. Human-caused climate change is real, and imposing some kind of price on carbon emissions is the best way to address it.
The plan itself is here. It has four pillars:
1. A gradually increasing tax on carbon dioxide emissions, to be implemented at the refinery or the first point where fossil fuels enter the economy, meaning the mine, well or port. Economists are nearly unanimous in their belief that a carbon tax is the most efficient and effective way to reduce carbon emissions. A sensible carbon tax might begin at $40 a ton and increase steadily over time… Fine.
2. Proceeds from this carbon tax would be returned to the American people on an equal and quarterly basis via dividend checks, direct deposits or contributions to their individual retirement accounts… This amount would grow over time as the carbon tax rate increases, creating a positive feedback loop: the more the climate is protected, the greater the individual dividend payments to all Americans. The Social Security Administration should administer this program, with eligibility for dividends based on a valid social security number… Fine. Is the “you need a social soc number” a sop to the anti-illegals? Well, never mind. I think if you’re a pure economist you might prefer it to go into general taxation, but as a way of selling it to people it’s sensible.
3. Border adjustments for the carbon content of both imports and exports would protect American competitiveness and punish free-riding by other nations, encouraging them to adopt carbon pricing of their own… Probably going to turn out to be really finickity (or would be, if ever implemented).
4. Significant regulatory rollback: the elimination of regulations that are no longer necessary upon the enactment of a rising carbon tax whose longevity is secured by the popularity of dividends. Much of the EPA’s regulatory authority over carbon dioxide emissions would be phased out, including an outright repeal of the Clean Power Plan… Bound to wind some people up, but again: probably worth it for the benefits.
1. As several commentators – one the piece’s author – point out, this isn’t fair. It is more an expression of my view of what I perceive as the overall negative tone of the piece. There are certainly some positive things said within it.
* Brian at Eli’s likes it.
* Yellen Touts Carbon Tax as ‘Textbook Solution’ to Climate Change: Yellen joins former Walmart Inc. Chairman Rob Walton, former Treasury Secretary Lawrence Summers and former Secretary of State George Shultz in delivering a pitch for the carbon tax-and-dividend plan, released Monday along with an analysis of its potential emissions reductions..