Climate change is a threat to our environment and our economy, and we cannot afford the risk of inaction. With our free market economy, the best solution is a simple, transparent tax on carbon that unleashes the power of the market and enables America to lead the way toward a new, clean energy economy. Importantly, a carbon tax produces revenues that can be used to help American businesses and families. But there are many options for how to use these revenues. Critics of carbon taxes frequently cite slower economic growth, increasing taxes on the poor, and hurting coal workers as reasons for opposition. But finding a bipartisan solution for how to allocate the revenues from a carbon tax to address these concerns is the best way to address climate change, increase economic growth and ensure that everyday Americans don’t get left behind.
That’s why I introduced the Tax Pollution, Not Profits Act, which applies a tax on greenhouse gas emissions equal to $30 per ton of carbon dioxide or carbon dioxide equivalent. In my legislation, half of the revenues are used to lower the corporate tax rate from 35% to 28%. This will make our businesses more competitive in the global economy and lower consumer prices across the board. My legislation dedicates the other half of the revenues to help American families. Coal workers will be taken care of with funding for job training, health benefits, and early retirement. Low income households will receive monthly payments to make up for increased energy costs and the rest of the revenue will go towards tax credits to middle class households. The legislation is a win for the environment and a win for our economy.
Congressman Delaney’s bill to introduce a carbon tax for the United States is a welcome positive step to address the climate change problem. Carbon taxes should be one important component… Read more »
Every aspect of economic activity affects greenhouse gas emissions and, hence, the global climate. Since individuals and businesses bear virtually no cost for emitting greenhouse gases in the absence of… Read more »
As an economist I wholeheartedly support carbon taxes as a primary approach to carbon emissions policy. Given the inter nation character of the problem, a tax is much easier to… Read more »
Bruce, your proposal is certainly on the right track. As you suggest, the necessary goal is to make clean energy cheap enough for the poor to afford — without subsidies.… Read more »
Lewis, Thanks for you comments which are well taken. My antidote to Congress doing nothing is to set my carbon tax small enough to be almost nothing ( :)),… Read more »
By dedicating revenues generated through a carbon tax or some kind of “pollution fee” to lowering the corporate tax rate and to compensating families for higher energy costs, modeling has… Read more »
I commend Congressman Delaney on considering a carbon fee to reduce fossil fuel greenhouse gas pollution. As Joseph Aldy states above, “A well-designed carbon tax should be cost effective, efficient,… Read more »
While I have not studied the REMI report in detail, its rosy conclusions seem suspect. First, this critique of a similar plan seems applicable: “…even in the unlikely event that… Read more »
Lewis: It is important to note that the current price of fossil fuels does not cover its true cost to society. The external costs of fossil fuels are real and… Read more »
Congressman Delaney deserves credit for putting forth the carbon tax concept. I would like to post some cautionary notes, along the lines of “a carbon tax can be good energy… Read more »
There are a number of subtle economic assumptions in some of the above comments that need a second look. First, as we would phase out fossil fueled electricity on our… Read more »
Excellent points, Herschel.
Any carbon fee program must assume that the underlying activity will be phased out as the price rises, and as such the price must rise to offset the lost income,… Read more »
This discussion might benefit from having a cost estimate to work with, as given below. My concern is that we may be overestimating the amount of money that may come… Read more »
Let’s not underestimate the power of a dynamic economy to invent new approaches to generating energy, storing energy, and becoming more energy-efficient as we start to properly price carbon and… Read more »
This is a good step forwards. Like others so far, I would support it, subject to caveats. Two of the caveats are NOT a responsible basis for amending the bill:… Read more »
Congressman Delaney poses a vital question: What should Congress do with the revenue from a carbon tax? In principle, Congress could use the revenue to pay for offsetting tax cuts,… Read more »
David: The Fee and Dividend (F&D)policy that I describe above addresses all of the concerns that you raise and is simpler and more transparent than offsetting tax cuts and payments… Read more »
Fee and dividend may be better policy, but it won’t do as much for GDP growth as cuts to our excessively uncompetitive corporate tax rate would do. Plus, there is… Read more »
William: While I may disagree with you about whether F&D or tax offsets would lead to more economic growth, I sadly don’t disagree with you about the current level of… Read more »
Hi Dan: The fee & dividend approach would indeed be highly progressive and if implemented well could solve the problem of matching actual carbon revenues and actual amounts recycled. But… Read more »
Donald: A couple of comments on your reply. First, the true cost of fossil fuels (direct and external costs) is very high so they do not benefit the economy over… Read more »
Re: “Using some revenue to offset that drag, such as by lowering other taxes, would also make sense. Cuts to corporate income taxes, which can reduce incentives to invest domestically,… Read more »
You are conflating two issues. Yes, we need to address deficits, which have been declining as our economy returns to growth. But there is no political path to a new… Read more »
The economic incidence of a carbon tax depends heavily on what happens to the revenue. My paper with Adele Morris provides new estimates for the net burden on households by… Read more »
This carbon tax is clearly not a climate policy, else it’s proponents could and would make a case for its impact on global warming. Would the congressman please tell us how… Read more »
Of course it is climate policy. The most efficient and effective way to address the challenge of climate change is with a global, uniform price on carbon. Incentives work. Behavior… Read more »
You still didn’t offer an alternative impact on world temperatures. Zeroing out CO2 emissions in all the developed countries still gets you less than 1/2 degree moderation (and the tax… Read more »
David: As William pointed out, a properly implemented carbon fee with border adjustments can lead to a worldwide uniform carbon fee. Also, as pointed out in the above discussion, putting… Read more »
Dan: There is very little that should be avoided at all costs. Kevin Anderson’s assertions and invocation of “widespread” views are not sufficient reasons to totally ignore costs. In any… Read more »
We do not believe there should be a different approach in developing or developed countries. That paradigm is a recipe for failure, as developing countries are the leading emission producers.… Read more »
What we never get is what carbon tax would be necessary or how much temperature moderation you get from the one being proposed. The tax under discussion here, as proposed… Read more »
The point is not that taxing carbon won’t reduce emissions. The point is that no matter how much we in the US (and/or the rest of the developed world) cut… Read more »
David: I do not believe that your comment that “recent estimates of the equilibrium climate sensitivity don’t show us getting near 4 degrees of warming for centuries (if ever)” is… Read more »
Below is a list of recent research estimating the equilibrium climate sensitivity (ECS). The ECS address the critical question of how much warming will we get from additional CO2 instead… Read more »
David: I refer you to the IPCC AR5 report: http://www.ipcc.ch/pdf/assessment-report/ar5/wg1/WG1AR5_Chapter10_FINAL.pdf See Figure 10.20 on Page 925. As you will see, there have been many studies, using several different methods, to… Read more »
The more recent ECS estimates are coming in at lower levels than the AR4. The West Antarctic Ice Sheet collapse has been in works for quite a while. The “collapse” will… Read more »
David: I believe your position is that we should continue business-as-usual fossil fuel emissions and avoid taking actions such as putting a price on carbon or capping emissions with regulations.… Read more »
New information on anoretic ice melt from Scientific American … http://www.scientificamerican.com/article/stable-antarctic-ice-is-suddenly-melting-fast/ “Overall, the ice shelves along the southern Antarctic Peninsula have lost almost one fifth of their thickness since the… Read more »
David Kreutzer: It is rather shocking to see an opinion from a Heritage Foundation employee, an entity which claims to support free market principles, and especially from an individual with… Read more »
David: Your point appears to be that a carbon fee imposed by developed countries, with resulting emission cuts, will not have any appreciable effect on global temperatures. I agree, we… Read more »
[…] would you spend revenue from a carbon tax? TPC’s Donald Marron offered his take in response to Maryland Democratic Congressman John Delaney’s query. The tax proposed by Delaney could… Read more »
So I read all of the counter arguments to Congressman Delaney’s proposal as coming down to either “a carbon tax would be hard” or “there isn’t the political will do pass… Read more »
The carbon tax is an elegant mechanism for imposing a price on carbon dioxide emissions from the energy sector, especially when compared to the alternatives. The patchwork of federal regulations… Read more »
Catrina: I agree with you that an effective carbon tax can replace a myriad of regulations. However, I believe you are conflating policy targets with climate targets. The current policies… Read more »
I would like to emphasize a few fossil costs that contribute to the un-level playing field of energy pricing that Elias Hinkley’s article, referenced in his comments, described so well.… Read more »
In AR5, the IPCC acknowledged the good news that the Earth’s green plant coverage has increased 6% since 1982; that plant fertility, precipitation, and growing seasons are increasing; and that… Read more »
Here is some non-political research and conclusions that are the opposite of your assertions … There is a strong scientific consensus and growing public awareness that rising atmospheric carbon dioxide… Read more »
The 2,500 climate scientists who participated in AR5 considered thousands of studies, weighed each according to its quality and coherence with other lines of evidence, and developed some level of… Read more »
From the IPCC …. “Only the collapse of marine-based sectors of the Antarctic ice sheet could cause GMSL rise substantially above the likely range during the 21st century. Expert estimates… Read more »
Ike: Your personal “Don’t worry, be happy” interpretations of IPCC and other climate science unfortunately does not match the climate scientist’s interpretation of their own work. Every major scientific academy… Read more »
Dan, Your linked document (did you even read it?) is more than ten years old and dates from before AR4 in 2007 let alone AR5 in 2013. It contains the… Read more »
Ike: Your information is cherry picked, misleading, and just plain wrong. I stand by what I said. I won’t engage you in a point-by-point rebuttal again because it detracts from… Read more »
Wow…so flooding brings “improved rainfall”? And drought increases crop yields? The USG now estimates we will lose over 50% of US crop land this century. The deniers like to say… Read more »
Again, you reveal you haven’t read the most reputable sources. IPCC 2013 says unequivocally that there is no evidence to date of increased droughts or flooding or hurricanes on a… Read more »
Here are some quotes from the 2014 IPCC Synthesis Summary Report …. They were selected to address some of the things you addressed. “Warming of the climate system is unequivocal,… Read more »
Jane et al., there is only one report in each IPCC AR cycle that is written by consensus of the 2,500 international climate scientists themselves: the Working Group 1 report.… Read more »
Taxing pollution is a solid economic policy approach that addresses the negative economic consequences of pollution. But the flaw is to just look at carbon while not addressing other pollutants… Read more »
[…] an online discussion forum hosted by OurEnergyPolicy.org, Rep. Delaney asked for comments on his proposal. [These are […]
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Congressman Delaney I fully understand your goals and as a political animal you are looking at a government solution to a very serious problem. While I very much applaud your… Read more »
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