Different Approaches to a Solution









Liberal Form of Carbon Tax:

Impose a fee on carbon, and use the revenue for deficit reduction and to fund carbon-saving activity such as public transport, renewable energy, and a better long-distance power grid.  Often, they go so far as to say that some of the money should go to ends completely unrelated to climate change, just a laundry list of things the left would spend a windfall on.

Drawbacks:
  • The right will never, ever buy into this, because it grows the government.  And with the advent of Uber-type transport based on self-driving cars, it's not clear that traditional public transport will be the most desirable way to organize our cities.

  • Also, there will be inflation in the price of energy-intensive goods and services due to the carbon tax, and poor people will have difficulty making ends meet.

  • To eventually meet the desired reductions in carbon emissions a decade or two down the line, the tax will have to grow to several dollars per gallon of gasoline (several hundred dollars per ton of CO2).  It would be impossible to pass such a high tax as the first step, even if Democrats had a filibuster-proof majority in congress.  It needs to start low and gradually be raised. If, when the tax is introduced at much lower levels, the money is not returned to citizens, people will view it as a burden and there will never be a political constituency behind eventually raising it sufficiently for it to achieve the desired reduction in emissions.

Conservative Form of Carbon Tax:

Impose a fee on carbon, and have the government return all the money to the public in tax cuts, thus avoiding growth of the public sector.  Revenue Neutral.

Drawbacks:
  • Ideally, it should be a federal carbon fee, and there is no federal sales tax, so it can't be returned in a sales tax cut.  The cuts would have to be to corporate or income taxes.

  • The bottom 50% of the population pay almost no income tax, so they would get practically no tax relief, yet they would face higher energy costs without any help meeting those costs.  So this effort would be a massive redistribution of wealth from the poor to the rich, which the left would never cooperate with.  And it is just generally politically infeasible to impose a scheme which would result in such a major hardship for such a large share of the voters.

Endorsed By:



Climate Scientist
James Hansen




Climate Scientist
Katharine HayHoe




Former Fed Chairs
Alan Greenspan & Paul Volcker




Rep Francis Rooney R-FL




Former Secretary of State, Secretary of Treasury George Shultz







Carbon Fee and Dividend:

Impose a fee on carbon, and have the government return the money equally to everybody in the form of a monthly dividend immediately, before the politicians can get their grubby fingers on it.  Revenue neutral.

Drawback:
  • Unlawful residents would be negatively impacted, since they would face higher energy costs yet not receive the dividend.  However, by the same argument, social security, medicare, medicaid, and unemployment insurance should all be discontinued, since unlawful residents pay taxes that support those programs and don't receive the benefits.  It is virtually impossible to run any kind of decent society without sometimes negatively impacting unlawful residents. That's just a basic, unavoidable fact of reality.
Some Details of the Carbon Fee and Dividend:
  • The carbon fee should be imposed at the wellhead, or when fuel is imported.

  • The dividend payments should be frequent, perhaps monthly, because poor people who really need the dividend to make ends meet in the face of higher energy costs often can't wait a year for the help.

  • The fee should also be imposed on gases released into the atmosphere as a side effect of production, and it shouldn't just be a simple fee on carbon, since some chemicals are more potent greenhouse gases.  So a severe fee should be imposed on methane that is leaked into the atmosphere without being burned in natural gas drilling, since methane is much more potent than CO2 as a green house gas.

  • Duties (called border adjustments) should be imposed on goods imported from countries that aren't imposing similar carbon fees, to protect American producers from unfair competition from goods imported from countries that don't have such fees.  This gives other countries an incentive to impose their own carbon fees, so they get the money rather than our government getting the money.  This avoids the need for grandiose international treaties that are nearly impossible to get together and even harder to enforce.

  • In practice, most voters would be getting more money back in the dividend than they would be paying in higher energy costs, so they would come out ahead, which would create a political constituency to keep raising the fee until it is high enough to motivate the desired reductions in emissions.

  • The incentives provided by the carbon fee will render a lot of legislation redundant and unnecessary, so that regulations can be repealed, moving decision making from bureaucracy and courts to more efficient and optimal market-based decisions.
Current Action on Carbon Fee and Dividend:
  • The Energy Innovation and Carbon Dividend Act (EICDA) is a bill in the federal house of representatives.  Initially sponsored in the last session by several Republicans and numerous Democrats, it was re-sponsored in the current session, and as of March 27, 2019 is co-sponsored by a Republican and 25 Democrats, and gaining 2 or 3 more representatives every week.

  • The Climate Leadership Council is a Republican group with a plan very, very similar to the EICDA, except that they don't have a bill in congress, and their version exempts the fossil fuel industry for legal liability for any fraud they may have perpetrated by telling the public that climate change is not real while internal documents showed that they knew this wasn't the case.  The EICDA does not have this exemption -- it leaves open the possibility of legal action against fossil fuel companies.

  • The idea of a carbon fee and dividend as the right approach to solving climate change is endorsed by:
    • all living ex-Fed chairs
    • 27 Nobel Laureate economists
    • 15 former chairs of the Council of Economic Advisors
    • 2 former treasury secretaries
    • and 3508 other US economists.
    The endorsements above are for the general concept of a carbon fee and dividend, and not specifically the EICDA or the Climate Leadership Council's proposal.  There are other endorsements and editorials supporting the idea.

Endorsed By:



Freshman Rep
Alexandria Ocasio-Cortez D-NY





Climate Scientist Michael Mann





The Sunrise Movement





Supporters in the House
Far-Left Solution: AOC's "Green New Deal"

  • Radically expand the size of the public sector.

  • Have the government dictate exactly which technologies will be employed in every context.

  • Have byzantine, detailed regulations describing every energy-consuming activity to be undertaken by anyone.

  • Abundant talk of irrelevant far-left items that have nothing whatsoever to do with the environment:
    • health care reform
    • wage stagnation
    • deindustrialization
    • strengthening trade unions
    • income inequality
    • race
    • gender
    • indigenous peoples
    • homelessness
    • the disabled
    • infrastructure
    • education, including higher education
    • a job guarantee at a wage much higher than current minimum wage
    • "economic security" - whatever that means
    Note that a jobs guarantee has been implemented at a full scale nowhere in the world.

Text of resolution.

Most supporters of the GND (Green New Deal) are under the mistaken impression that it's all about climate change, when nothing could be further from the truth. It contains basically everything AOC would do if she were appointed queen.

A poll was done by Yale which basically asked people "Would you like to solve climate change and create jobs in the process?" with no mention of who was behind it or the many environmentally irrelevant far-left items in the plan.  This fraudulent poll is widely cited as evidence for bipartisan support for Alexandria Ocasio-Cortez's GND.

The Republican senate majority leader Mitch McConnel tried to force the senate to vote on the GND, which was very shrewd, because it would put the senate Democrats, several of whom are presidential hopefuls, into a no-win situation. If they voted against it, they would be smeared as "climate deniers"; if they went on record as voting for it, then by 2020 the Republicans could make sure that everyone knew how it was chock full of far-left insanity and their vote would be an embarrassment to them. The senate Democrats evaded the trap in two ways -- first, they unanimously voted for a measure that was not the Green New Deal, and then, when the Green New Deal came up, most of them abstaining from voting, except for a few who voted against it, and with 100% Republican opposition, the bill failed 0-57.

Drawbacks:

  • Will scare the living daylights out of conservatives, and cause them to doubt the sincerity of the motives of the climate scientists, feeding climate skepticism.

  • Many Democrats are endorsing this plan without examining the details.  Conservatives are absolutely certain to make sure the public knows all about those details by 2020, which will be a major embarrassment to the many Democrats endorsing the GND now.

  • In practice, putting such a large share of the economy into the public sector has been tried in many countries, with large costs in lost productivity, corruption, mass starvation, and horrific human rights violations.

  • If you want to craft legislation to solve a problem, you should start out with a narrow, focused bill that does nothing other than address the problem and add things to it only to lure in reluctant constituencies. This bill starts out ridiculously broad, shamelessly pandering to every far-left constituency imaginable. And those aren't the constituencies that are reluctant to dealing with global warming


Endorsed By:



Rep. Matt Gaetz R-FL
Republican Green Real Deal:

Asserts that global warming is a serious problem warranting action.

Text of Resolution

Speaks about encouraging invetment, but utterly vage about exactly how the desired investment is to be encouraged.

Advocates nuclear energy and carbon capture & sequestration, which the AOC/Sunrise Green New Deal does not.

Most of the actions advocated are in the form of deregulation and tax cuts.

In contrast to the Green New Deal, it is actually entirely focused on climate change.

Drawback:
  • Lacks credibility in that it fails to mention any means whatsoever of discouraging people from burning as much fossil fuel as they want.

Cap and Trade:

Issue "carbon credits" to factories, or to countries, or auction them off to the highest bidder, where a carbon credit is permission to emit a certain amount of greenhouse gases. This has been tried many times with varying success. Over time, the total amount of credits is reduced as emitters clean up their act.

Sometimes the carbon credits are issued to polluters (be they factories, or countries) according to how much they were emitting before the scheme began.

If an emitter is able to reduce emissions, they may have a surplus of carbon credits that they can sell to make money. If an emitter increases emissions, they need to find someone that they can buy credits from. So everyone has an incentive to reduce emissions.

There have been cases where companies go bankrupt and shut their doors, but keep alive a shell company to receive their carbon credits, which they then sell.

John McCain had cap and trade as part of his campaign platform when he ran for president in 2008.

If the carbon credits are just arbitrarily given to companies, they become an arbitrary windfall and reward for past bad behavior. If they are auctioned off by the government, that can just amount to an awkward carbon tax funding the growth of the public sector.

Most observers today agree that a carbon fee or tax is a better approach than cap and trade.

Drawbacks:
  • It is hard to predict the future demand for carbon credits, and thus hard to predict their future price, which makes it difficult for emitters to make plans.

  • The scheme is hard to tweak right, and can completely fail. Europe has a cap and trade scheme which basically failed -- emissions turned out to be lower than expected, and the price of a carbon credit dropped so low that it failed to provide the desired incentive. And a scheme can fail in the opposite direction, where the price of a carbon credit rises so high that it strangles the economy.

Technical Details

There is a lot to be discussed in terms of technical details, but we are going to be mostly doing that in our lectures, discussions, and presentations, not on this website.

In the lectures we will be talking extensively about the science of climate change and engineering and economics of various solutions.


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