In Focus: Carbon tax and dividend is a double win

October 5, 2013 

The latest report on climate change by the Intergovernmental Panel on Climate Change released Monday (www.ipcc.ch) comes to even stronger conclusions than the previous report six years ago: Warming in the climate system since 1950 is unprecedented over decades to millennia.

Co-chairman Thomas Stocker said: -- Continued emissions of greenhouse gases will cause further warming and changes in all components of the climate system. Limiting climate change will require substantial and sustained reductions of greenhouse gas emissions.

-- As the Earth warms, we expect to see currently wet regions receiving more rainfall, and dry regions receiving less, although there will be exceptions.

-- As a result of our past, present and expected future emissions of carbon dioxide, we are committed to climate change, and effects will persist for many centuries even if emissions of carbon dioxide stop.

-- We have a 1 trillio-ton carbon budget, more than half of which has been spent. We will go “over budget” and hit the tipping point on global warming by 2040 if we don’t reduce emissions starting now.

Since Congress has failed to address it, the president is stepping up with regulations to limit carbon emissions. We think a market-based solution, a revenue-neutral carbon tax, is more effective.

The Citizens Climate Lobby’s legislative proposal suggests a tax on carbon that starts low — $15 per ton of CO2 — and ramps up, adding $10 per ton each year. For simplicity, the tax should be applied as far upstream as practical.

Distributing the carbon tax revenue back to the public, preferably through equal payments to all households, would give consumers the additional income to deal with price increases associated with the carbon tax.

To protect American businesses from unfair competition — and to keep jobs from going overseas — the carbon tax should include border adjustment tariffs on imports from nations that don’t have equivalent carbon pricing. Rather than enrich the U.S. Treasury, other nations will want to implement their own carbon tax and keep that revenue within their borders.

A number of conservatives — among them Art Laffer (former Reagan economic adviser) and Greg Mankiw (economic advisor to George W. Bush and Mitt Romney) — support a revenue-neutral carbon tax. Mankiw said the carbon tax “is more effective and less invasive than the regulatory approach that the federal government has traditionally pursued.”

A tax on carbon would fix the distortion in the marketplace that leaves fossil fuels unaccountable for the damage they do to society: security costs related to imported oil, loss of coastal property because of sea level rise and loss of summer snowmelt for irrigation. As renewable energy like solar and wind becomes competitive with and eventually cheaper than coal, oil and gas, the economy will transition to carbon-free energy and greater fuel efficiency, lowering greenhouse gas emissions.

The Herald reported on the coal export hearings held here Tuesday. Opponents fear the effects of adding more CO2 to the atmosphere, increased train traffic, pollution from diesel and coal dust, noise and potential for accidents. Proponents state that it means more jobs and trade. But to mitigate climate change the coal should stay in the ground!

If a revenue-neutral carbon tax were implemented tomorrow, companies like REC in Moses Lake would probably see an expansion of their business and the number of jobs they support. Solar panels, like those in Ellensburg, could become more commonplace. Yakima Valley farmers could continue to count on snowmelt as a natural source of water during summer. As Art Laffer said, “Reduce taxes on something we want more of — income — and tax something we arguably want less of — carbon pollution. It’s a win-win.”

Ask your representative to support a carbon tax and dividend! For more information, visit www.citizensclimatelobby.org.

Alexandra Amonette is an environmental chemist and geologist. Steve Ghan is a highly published climate scientist and contributing author to three different IPCC reports. Both live in Richland.

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