America needs to go on a low-carbon diet, and a well-designed carbon tax would be a sensible way to help do it.
Evidence of looming environmental catastrophe because of excess atmospheric carbon dioxide is all around us. Coral reefs are dying faster than expected. Polar ice caps are melting down. Coastal areas are flooding more frequently. Storms are stronger. Economies, jobs and nature are suffering. We need a way to protect the planet for future generations.
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A big reduction is needed in the amount of carbon dioxide released though the burning of such fossil fuels as coal, oil or natural gas. A carbon tax — levied on the amount of carbon that is burned — could raise the cost of burning hydrocarbon fuels, encouraging conservation and the use of alternative energy. In theory, a carbon tax would connect the environmental cost of carbon to its use. Now, the cost — from rebuilding after storms to the spread of diseases — is shifted to other places in the economy.
In January, a group of well-known Republicans, including James A. Baker III, Henry Paulson and George Shultz, proposed a carbon tax starting at $40 a ton that would go up over time. The revenue from the tax would be given back to Americans through quarterly dividends of about $2,000 in the first year to offset higher energy costs and build political support for the concept.
The dividends would discourage politicians from campaigning on the promise of eliminating the carbon tax, as happened in Australia. Some members of Congress are talking about using carbon tax revenues as part of a tax reform package. That would imperil the future of the tax.
If structured properly, such a carbon tax would have several benefits. It would boost the use of low- or zero-carbon energy alternatives. It would strengthen America’s future as an energy-independent nation and weaken the hands of Russia and other oil-rich nations. It would help protect the environment.
It’s an idea that has succeeded elsewhere. Britain implemented a carbon tax in 2013, and its carbon emissions declined to 36 percent less than in 1990. The emissions are believed to be as low as they were in 1894.
The Obama administration sought to meet goals set by the 2016 Paris Agreement on climate change through such measures as setting carbon pollution limits on power plants, boosting fuel-efficiency requirements for vehicles, developing ways to capture carbon dioxide and encouraging renewable energy.
But those policies are under assault in Washington, D.C., where climate change deniers have a strong voice in the Trump administration and in Congress. Last month, President Donald Trump signed an executive order designed to void President Barack Obama’s climate change rules.
Another option — “cap and trade” — would set a maximum of permitted emissions and allow companies that exceed the limit to buy credits from companies that don’t. A 1990s cap-and-trade program helped reduce the amount of acid rain in the United States.
The carbon tax, though, is getting support from prominent business leaders, including heads of large energy companies. They prefer it to what might be an alternative, an assortment of regulations that vary by locality throughout the country. It would be predictable, straightforward and easier to administer than a cap-and-trade system. If the business leaders put their lobbying might behind a carbon tax, they might be able to make it happen.
To work, a carbon tax would have to be designed properly. If the tax just becomes a cost of business that gets passed on to consumers, we wouldn’t get any environmental benefits. The tax must be coupled with strict carbon pollution limits.
The longer we dither, the less we can do to spare our Earth the most devastating effects of climate change. A carbon tax would give companies an incentive to quickly chip away at carbon use, perhaps in surprising ways. It would be nice to have good news about global warming for a change.
A carbon tax is just one of the tools we can use to ease climate change. But given its support in the business community, it would be foolish not to push for its enactment into law.