On Earth Day (April 22) this year, many Americans are appalled at the new administration's lack of commitment to protect the environment and limit greenhouse gases. Although a decision to renege on the Paris climate agreement has been deferred, President Trump's executive order to abandon the Clean Power Plan casts great doubt on the U.S.'s ability to honor its pledge to reduce greenhouse gas emissions 26 percent to 28 percent below 2005 levels by 2025. Coming up short on the Paris commitment would tremendously set back global efforts to keep temperatures from warming more than 2 degrees Celsius above preindustrial levels.
Crossing the 2C threshold, scientists and economists warn, will lead to consequences the world is ill-prepared to handle — food shortages, coastal flooding, epidemics, mass migrations, destabilized nations — and ocean warming and acidification will wreak havoc in our fisheries. Here in Alaska, erosion already threatens coastal communities, while thawing permafrost, increased flooding and landslides, and larger wildfires are predicted to damage our infrastructure and burden our economy.
With the executive branch now shirking responsibility to deal with climate change, Congress must act, and act soon. America can meet its obligation with a market-based solution that appeals to policymakers and business leaders across the political spectrum: a steadily rising fee on carbon with revenue returned to American households.
Known as carbon fee and dividend, this policy would assess a fee on the carbon dioxide content of fossil fuels — coal, oil and gas — at or near the first point of sale. The fee starts at $15 per ton of CO2 and increases $10 per ton each year, sending a powerful signal to the marketplace to move investments and jobs toward clean energy and efficiency. Much like Alaska's Permanent Fund dividend, revenue from the fee will be returned to all households, shielding families from economic impacts of higher fuel prices, with most households coming out ahead. (A study from UAA's Institute for Social and Economic Research confirms the same holds true for rural Alaskans.) In order to protect American jobs and maintain a level playing field for U.S. businesses, a border adjustment tariff will apply to imports from nations that lack an equivalent price on carbon. The revenues from that tariff will be rebated to American exporters shipping to those same countries.
How effective is this policy? Regional Economic Models, Inc. released a study in 2014 that found after 20 years, a carbon fee and dividend would cut CO2 emissions by half. The study also showed this fee and dividend will add 2.8 million jobs, primarily because of increased spending in labor-intensive industries as a result of the dividend. This shatters the myth that carbon pricing would destroy the economy.
Because it employs market forces rather than regulations to accomplish its objectives, carbon fee and dividend enjoys support from conservatives. Tax policy is a well-accepted, market-based way to achieve economic goals. In fact, the Climate Leadership Council, including Republican elder statesmen George Shultz (Reagan's secretary of state), James Baker (Bush Sr.'s secretary of state) and Henry Paulson (Treasury secretary under George W. Bush) released a substantial climate plan in February. Their proposal, The Conservative Case for Carbon Dividends, starts at a higher price — $40 per ton of CO2 — but increases at a slower rate. Even major international oil and natural gas producers have called for carbon pricing.
What are the chances that Congress will act? Much better than most people realize. Many Republicans in Congress understand the risks currently unfolding with the changing climate, and they want to take action.
Early in 2016, Florida Reps. Carlos Curbelo (R) and Ted Deutch (D) formed the bipartisan Climate Solutions Caucus in the House. The caucus, now with 36 members, has equal numbers from both sides of the aisle. Encouraged by their constituents, more and more are joining every month.
Last month, 17 Republicans in the House, led by Elise Stefanik (N.Y.), Ryan Costello (Pa.) and Curbelo, introduced a resolution calling on the House to "create and support economically viable, and broadly supported, private and public solutions to study and address the causes and effects of measured changes to our global and regional climates, including mitigation efforts and efforts to balance human activities that have been found to have an impact."
Rep. Curbelo has emerged as a true leader among Republicans on the climate issue. When EPA Administrator Scott Pruitt denied the link between climate change and CO2 emissions, Curbelo issued a statement calling Pruitt's comments "reckless and unacceptable." Curbelo also wrote a letter to Secretary of State Rex Tillerson urging the administration to remain in the Paris climate agreement.
While GOP members of the Climate Solutions Caucus have not yet backed a revenue-neutral carbon fee, with enough support in their districts they could be persuaded to sign on. On the day Trump signed his executive order to roll back climate rules, Curbelo issued a critical statement:
"… today's rollback of emission standards is misguided. Climate change is occurring and it is not a coincidence global temperatures have risen at the same time tremendous amounts of carbon dioxide have been added to the atmosphere. We see the effects of climate change firsthand in South Florida, resulting in rising sea-levels, bleached coral reefs, and salt water intrusion. Climate change is also a threat to our national security and local economies across the country. We cannot, and must not, ignore these challenges.
"I continue to believe economic growth and dealing with this threat are not mutually exclusive … Weak environmental policies ultimately lead to the destruction of jobs and quality of life …"
This Earth Day, as we take stock of our world and the steps needed to preserve a hospitable climate, Americans are ever more alarmed by the callous disregard of the current administration toward the threat of global warming and ocean acidification. Fortunately, another branch of government can correct Trump's misguided policies. By enacting a fee on carbon with revenue returned to households, our Congress can avert disaster, create jobs and assert U.S. leadership on the greatest challenge humanity has ever faced.
George Donart and Tim Hinterberger are members of the Anchorage chapter of the Citizens' Climate Lobby.
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