The general outlines of the carbon tax plan proposed last week by a group of GOP stalwarts has been around for a while. Former Secretary of State George Shultz and former Treasury Secretary Henry M. Paulson Jr. have been touting such a tax as a way to fight climate change for several years now. It was a good idea when first proposed — and it’s an even better idea now.
The plan announced last week comes with more weight, more names and more detail; enough to make it a viable strategy for the Trump administration. The plan deserves serious consideration, although a regulatory rollback that is part of the plan needs to be done very carefully.
The plan announced by the Climate Leadership Council (which includes not only Paulson and Shultz, but such GOP luminaries as James A. Baker III and Martin Feldstein, as well) would place a gradually increasing tax on carbon emissions. The plan suggests that the tax start at $40 a ton and increase steadily over time.
That revenue then would be returned to “the American people on an equal and quarterly basis” with a family of four receiving about $2,000 in carbon dividend payments in the first year, with the amount going up each year as the tax increases. This would create “a positive feedback loop: the more the climate is protected, the greater the individual dividend payments to all Americans,” according to the plan. The plan also calls for border carbon adjustments on imports and exports.
The one area of concern is the fourth “pillar” of the carbon dividends plan, which calls for a significant rollback of environmental regulations “that are no longer necessary,” including repeal of the Environmental Protection Agency’s Clean Power Plan. If some regulations are really unnecessary, OK. But don’t repeal them until that’s known for sure; that’s especially true of the Clean Power Plan.
Climate change is a real threat. It’s happening now. Most Americans recognize that: A Yale study after the election found that significant majorities of registered voters want the government to do something about it and support measures such as a carbon tax.
Here’s the administration’s chance: Take a look at this plan created by thoughtful Republicans. It could, as the plan touts, “strengthen our economy, reduce regulation, help working-class Americans, shrink government and promote national security.” Those are all good goals.