Local View: Flag has been planted on carbon-pricing solution
With the defeat of the latest effort at setting a price on carbon in Washington state and the outrage expressed by the rural French "yellow jackets" over an attempt at carbon pricing, pricing carbon appears to be politically hazardous. So, if raising the price on carbon pollution is "Economics 101," per Janet Yellen, former head of the Federal Reserve, why have attempts at carbon pricing failed?
Part of the explanation may be that rural people have had it with urban elites collecting money from rural areas and spending it in urban areas. This real or perceived slight by rural voters had a large part to play in the election of President Donald Trump, the close vote regarding independence in Scotland, and the defeat of the Washington state and French plans. Indeed, many carbon pricing plans involve little more than relieving the middle class of its money to give the government more cash. Small wonder rural and middle-class families overwhelmingly vote against carbon pricing as it has been presented to them.
The solution, therefore, is to financially protect low- and middle-income families today in order to earn their acceptance of effective climate action over time.
This is why I'm thrilled that the Energy Innovation and Carbon Dividend Act of 2018 has been introduced in the U.S. House of Representatives and Senate by members of both parties. Closely patterned after the Citizens' Climate Lobby's carbon-fee-and-dividend proposal, the bill would set a gradually rising price on carbon but would return all proceeds except minimal administrative costs back to the households in a monthly dividend check. The vast majority of low- and middle-income families stand to receive more from the dividend than what they would pay in increased fuel costs.
Reading the bill, one can see it was crafted in a bipartisan fashion. The fee starts at $15 per ton the first year and then increases $10 every year thereafter — unless greenhouse-gas reductions are not met; then, a quick-time increase of $15 a year would kick in to catch up. The EPA regains its ability to regulate greenhouse gasses if targets are still not met after 10 years.
Conservatives get a market mechanism to repair a market failure, and liberals get a regulatory backup. Everyone gets a stable climate and cleaner air.
Over 30 years, the bill promises to reduce greenhouse-gas emissions by 91 percent, unlock enormous innovation in non-fossil fuel development and production, and create millions of jobs, many in the very rural areas that have been economically left behind.
Farmers, who are experiencing so much financial stress right now, would not pay the fee on fuel or on the emissions from their land. It turns out that the amount of fuel used by farmers is a very small part of the problem. Controlling emissions from farm operations would be better served by the popular but underfunded grant programs in the Farm Bill that farmers are using to green-up their operations.
A Border Tax Adjustment clause in the bill specifically would protect our iron and paper industries against foreign competition.
Finally, the bill has an automatic sunset clause upon accomplishment of the emission reductions to allay conservative concerns about bureaucratic immortality.
This is an excellent bill. The flag has been planted with a bipartisan approach. Please write or call Congressman Pete Stauber and Sens. Amy Klobuchar and Tina Smith and tell them to support the Energy Innovation and Carbon Dividend Act.
Dr. Eric Enberg practices family medicine in West Duluth and is the group leader of the Duluth Citizens' Climate Lobby (citizensclimatelobby.org/chapters/MN_Duluth). He also is a member of the Duluth Climate and Environment Network.