In The Blogs

→ Assignment 2020, Climate Change, Congress

A Carbon Tax Hail Mary?

| Fri Dec. 4, 2009 5:39 PM PST

On both the left and the right, there are mutterings that the Senate should ditch cap-and-trade legislation in favor of a carbon tax. But is a carbon tax the silver bullet its supporters claim, or simply a product of wishful thinking?

At an Energy and Natural Resources Committee hearing on climate policy this week, Republican Sens. Lisa Murkowski of Alaska and Bob Corker of Tennessee repeatedly suggested that a carbon tax would be simpler and more transparent than a cap-and-trade scheme. Corker has also argued that a tax could return the revenues to consumers via rebates.

For carbon tax fans, these kinds of remarks are signals that their favored policy isn't a lost cause. That's the case made by the US Climate Task Force, a project founded by former Clinton administration officials Robert Shapiro and Elaine Kamarck.

Advertisement

Earlier this week, the group unveiled new polling data this week commissioned from Hart Research Associates, which it says shows that Americans overwhelmingly prefer a carbon tax to other forms of regulating greenhouse gas emissions. The majority of respondents reported that they have not heard of either the carbon tax or cap and trade. Without hearing an explanation of the concepts, 29 percent had a negative view of cap-and-trade, while 36 percent said they have a negative view of a carbon tax. But after some explanation, 58 percent said they liked the idea of a carbon tax, compared to 27 percent who favored cap-and-trade.

These results aren't exactly convincing. The respondents only picked the tax once they received a personal explanation of two very complex policy options. It seems like unrealistic to expect that this type of comparative explanation could be undertaken for the population at large.

And the idea that the carbon tax is suddenly politically viable seems similarly naïve. Apart from the recent comments from Corker and Murkowski, very few senators have indicated that they would vote for a carbon tax. Proposals offered by Rep. John Larson (D-Conn.) in the House, and a tax-like bill introduced by Sen. Maria Cantwell (D-Wash.) in the Senate have gone nowhere. For all the difficulties that cap and trade is experiencing in Congress, it has been able to attract enough votes to pass the House. The carbon tax hasn't even come close to winning that measure of support.

Advocates of a carbon tax argue that it's better because its simpler, and so it wouldn't encourage the giveaways and concessions over allocations and subsidies that have watered down the cap-and-trade bills. But if lawmakers suddenly launched a carbon tax bill tomorrow, there would be the same scramble by industry groups to carve out loopholes and exceptions. "Coal interests would have the same reaction to a tax that they would be to cap-and trade," said David Hawkins, director of the Natural Resources Defense Council's climate center, at the hearing. "They would be looking for exceptions. A tax approach sounds simple when your talking about it from a theoretical standpoint, but you're going to confront exactly the same considerations that you're talking about with a cap." The biggest problem here isn't with cap and trade. Its with the special interest-driven politics of the US Congress.

Kate Sheppard covers energy and environmental politics in Mother Jones' Washington bureau. For more of her stories, click here. She Tweets here.

Comments

"Advocates of a carbon tax

Submitted by Anonymous (not verified) on Fri Dec. 4, 2009 4:58 PM PST.

"Advocates of a carbon tax argue that it's better because its simpler"

Tell the Truth Kate, advocates of a carbon tax argue it's better because it's a direct tax on carbon and inherently gets the incentives right in comparison to the easily gameable cap and trade.

"These results aren't exactly convincing. The respondents only picked the tax once they received a personal explanation of two very complex policy options. It seems like unrealistic to expect that this type of comparative explanation could be undertaken for the population at large."

Yeah, you're the same sort of douchebag self-identified bullshit progressive who gave us the public option, because you knew single payer would never pass.

In the meantime, it's pretty obvious to anyone with a human brain explaining cap and trade is a much harder job than explaining a carbon tax.

i hate it, it's got Exxon written allll over it.

Submitted by 05kenshin (not verified) on Fri Dec. 4, 2009 11:03 PM PST.

i was worried about this--i'm afraid that Exxon has been pushing for a carbon tax in Australia, and until we started to get real suspicious of it, they'd been pushing it hard here. i think it's horrible.

folks to the very far left on this issue had brought up how much better carbon tax was supposed to be, and i've always wondered why they were so convinced--even had one person tout how Exxon was for carbon tax and all, and asked, "doesn't that make u think a little?"

i figured it was a win-win situation for oil industry--they probably have been using a loophole in taxes/fees for a while now, and figure that a carbon tax would be the best way to get out of being accountable for their pollution--just listen to the things ms. senator from oil/alaska is saying...power companies are the only ones to bear the burden? she is looking for an exemption for oil, and that is all.

either they get a carbon tax, or they do what they did in Australia, and ruin the legislation or postpone it further--where most of their money is spent lobbying and advertising anyways...win/win situation all around.

i'm afraid that Australia, which just saw their legislation fail utterly, has given the oil industry more incentive to try this same tactic here in the US. In Aussie, i think that the far right and the far left came together to diss a cap and trade bill...the far right cuz they didn't want one, the far left cuz they wanted a carbon tax.

now, it's our turn. i don't see anything here except a ploy to ruin this legislation, delay affecting climate change, further split up progressives on this issue and/or make us look stupid...and of course, make obama look completely ineffective.

i really, really wish progressives would stick together a bit more, and concentrate on how this piece of legislation (and our movement) needs strengthening, not abandoned.

and i honestly don't even like the idea of a carbon tax anyways. we have a smart commodities & futures reg commission, unlike the novice one in the European union--cap and trade really does have conservatives running scared, that's why they spend sooo much time trying to fool people about it.

(we just need to keep the futures & commodities reg commish OUT of the fed...i'm really not sure why obama wants the fed to control them...administrations do change u know, look at the EPA under bush jr. i know this idea has got to be a former clinton admin appointee...)

Carbon Tax

Submitted by James Handley (not verified) on Sat Dec. 5, 2009 3:09 AM PST.

When cap/trade advocates run out of excuses for a system that would --

a) enshrine coal (coal stalwart Rep. Boucher promotes it) and,

b) enrich Wall St (NY Sen. Gillibrand lusts for a new trading market),

then cap/traders lamely assert that a carbon fee isn't viable and would be perverted in the same way cap/trade legislation has been.

Three observations:

1) British Columbia enacted a revenue-neutral carbon tax last year. Premier Gordan Campbell was re-elected despite challengers smearing his carbon tax. It's popular in BC and would be here if as they did, we recycled carbon revenue, e.g., to cut payroll taxes. The Hart poll showed that clearly.

Social enteprenuer Bill Drayton of “Get America Working,” implores: “aim higher” by linking a win for workers with a win for climate, Huffington Post, 11/17. http://tinyurl.com/yfa8fgb.

2) Disbursements of tax revenues must to go thru appropriations committees. Cap/trade was gamed from the beginning: the Energy & Commerce Committe got to dole out the goodies (free allowances).

3) You say, "It seems... unrealistic to expect that this type of comparative explanation (of cap/trade) could be undertaken for the population at large." The Hart poll questions were short and the explanations (published with the poll) were just a few sentences long.

Cap/trade's mind-numbing complexity doesn't mean the public should accept it, quite the opposite. Sen. Rockefellar recently noted that less than half the Senate understands cap/trade. Warren Buffet warns, "Don't buy what you don't understand."

For more on how we can "tax what we burn, not what we earn," see http://www.carbontax.org. We're aiming higher -- for more jobs and a liveable planet.