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A Republican Plan for Climate Change?

A group of conservative Republican leaders has published a credible sounding proposal for slowing climate change, a goal previously championed mostly by liberal Democrats.  The proposal, if scientifically and economically valid, could unite those who care about our climate across partisan and culture war divides. We face an increasingly urgent threat to mankind’s future.  This proposal deserves immediate objective study and all the collaboration we can muster.

The idea is called a “Carbon Dividends Plan”.   They have organized as “The Climate Council“.  You can click the link to see their work and hear them discuss it.  Here are the basics:

  • Create a gradually increasing tax on carbon dioxide emissions to be collected at the point where fossil fuels enter the economy (the refinery, mine or other point of origin).
  • Distribute all proceeds from the tax directly back to individual Americans on a per person basis as tax-exempt income.
  • Protect our economy by adding a tax at the border for carbon-based products imported from nations that do not have a comparable form of emission reduction.
  • The tax will raise prices and thereby motivate less consumption of fossil fuels that produce greenhouse gasses.  And it will allow repeal of many environmental regulations that were designed for that purpose.

The carbon tax idea has long been a favorite of liberals.  Most economists and climate experts agree that it’s likely to be successful at reducing emissions.  It will let the free market do the work of determining which uses of fossil fuels will continue, which will be replaced by clean energy sources, which clean energy sources will be developed, and where they will be located.

The creative parts of the plan are the immediate redistribution of the tax to individual Americans and the gradually increasing tax rate.  For the first time, Republicans can see a way to achieve greenhouse gas emission goals that is consistent with their economic and political philosophies:

  • There would be no growth of federal revenue.
  • There would be a reduction in spending for enforcement of regulations.
  • The steady and gradual approach of the plan provides businesses with a stable environment where new rules would be less likely to disrupt their long-term strategies.

The plan says that because wealthier Americans consume more carbon than others, they will pay more taxes than those with less income.  It estimates that most Americans (approximately the 70% with middle to lower incomes) will receive more in dividend income than they pay as carbon tax.

The proposed starting point is a tax of $40 per ton of carbon.  It would increase annually at the rate of Consumer Price Index inflation plus two percent.  The estimate is that a family of four would receive $2000 per year in distributions plus a share of any related import taxes.  As an example of price changes, it is estimated that gasoline prices would rise initially by 36 cents per gallon.

The estimated effect of the plan on climate change is better than anything that we’ve seriously considered.  Proponents say it would reduce our greenhouse emissions by 28 percent by 2028 compared to a 16 percent reduction by Obama Administration regulations.  That reduction is near the high end of the US target as described in the Paris Climate Accord.

The  founders of the Climate Leadership Council include Cabinet Secretaries under President Reagan and both Presidents Bush:  James Baker, Henry Paulson,  and George Schultz along with Republican economic advisers.  These conservatives have accepted that climate change is an immediate and growing threat to our nation and world.  They have also concluded that human actions can greatly reduce damage that is coming our way; and they are proposing action.

It is noteworthy that none of the plan’s proponents are current officeholders.  Many Republican leaders (including President Trump) deny human influence on climate change.  The Carbon Dividends Plan can succeed only with bi-partisan support.  Some of the statements by proponents may seem condescending and offensive to liberals but it would be a foolish mistake to focus on that.  For the first time, we have capable and articulate conservative leaders who agree with the goal of aggressively reducing greenhouse gasses. Liberals should support careful study of the proposal.  If it will work as described (and I think it looks credible) then we shouldn’t quibble about insults or slights.  We should help build a consensus to reduce the emerging damage to our climate and our world.

There will inevitably be problems and disagreements with a policy change of this magnitude.  Some states and communities would benefit from the changes.  Others might be harmed and need help (coal-producing areas for example).  Controversy is inevitable but if we set aside other differences to collaborate on protecting our climate this proposal may point the way to success.

Some links of interest are:

Washington Post story describing the proposal: https://www.washingtonpost.com/news/energy-environment/wp/2017/02/07/senior-republican-leaders-propose-replacing-obamas-climate-plans-with-a-carbon-tax/?utm_term=.366ae54b5f9c

Nature editorial http://www.nature.com/news/us-republican-idea-for-tax-on-carbon-makes-climate-sense-1.21477

Link to download CLC proposal pdf : https://www.clcouncil.org/wp-content/uploads/2017/02/TheConservativeCaseforCarbonDividends.pdf

Climate Leadership council website: https://www.clcouncil.org/