The conservative case for carbon dividends

By the Climate "Leadership" Council: a who’s who of conservative elder statesmen, this statement is the first time leading Republicans put forth a concrete, market-based climate solution. The idea is essentially Hansen's fee-and-dividend, though naturally they don't mention H; and thankfully they're prepared to say "tax" instead of H's weaselly "fee". Although they do lead with the idea of "dividends"; the inevitable tax component is only visible if you read on. The initial rate is $40 per tonne, which is fair enough. The Carbon Tax Center seem happy enough. As they say, there's a political “swap” in the Council’s proposal to rescind the Obama administration’s Clean Power Plan which will make some people sad, but if it gets this passed I'd be happy enough.

Various obvious suspects are against it, so that's good. Vox, I think nominally leftish, can't bring themselves to say anything good about it, because their main aim is to snipe at the Republicans; dull1. Salon is generally happy, as is the FT. Which, after noting the difficulties of border adjustments, comments the overall thrust of the plan is right. Human-caused climate change is real, and imposing some kind of price on carbon emissions is the best way to address it.

The plan itself is here. It has four pillars:

1. A gradually increasing tax on carbon dioxide emissions, to be implemented at the refinery or the first point where fossil fuels enter the economy, meaning the mine, well or port. Economists are nearly unanimous in their belief that a carbon tax is the most efficient and effective way to reduce carbon emissions. A sensible carbon tax might begin at $40 a ton and increase steadily over time... Fine.

2. Proceeds from this carbon tax would be returned to the American people on an equal and quarterly basis via dividend checks, direct deposits or contributions to their individual retirement accounts... This amount would grow over time as the carbon tax rate increases, creating a positive feedback loop: the more the climate is protected, the greater the individual dividend payments to all Americans. The Social Security Administration should administer this program, with eligibility for dividends based on a valid social security number... Fine. Is the "you need a social soc number" a sop to the anti-illegals? Well, never mind. I think if you're a pure economist you might prefer it to go into general taxation, but as a way of selling it to people it's sensible.

3. Border adjustments for the carbon content of both imports and exports would protect American competitiveness and punish free-riding by other nations, encouraging them to adopt carbon pricing of their own... Probably going to turn out to be really finickity (or would be, if ever implemented).

4. Significant regulatory rollback: the elimination of regulations that are no longer necessary upon the enactment of a rising carbon tax whose longevity is secured by the popularity of dividends. Much of the EPA’s regulatory authority over carbon dioxide emissions would be phased out, including an outright repeal of the Clean Power Plan... Bound to wind some people up, but again: probably worth it for the benefits.


1. As several commentators - one the piece's author - point out, this isn't fair. It is more an expression of my view of what I perceive as the overall negative tone of the piece. There are certainly some positive things said within it.


* Brian at Eli's likes it.

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"Vox, I think nominally leftish, can’t bring themselves to say anything good about it"

hey now! i called it both "elegant" and "promising" (along with lengthy explanations for why). as for dull, well, that i can't do anything about

[On reflection, I've decided my original text isn't fair, and noted that. "Dull" doesn't apply to your text directly, but to what I thought was unduly conditioned negativity -W]

By brad plumer (not verified) on 15 Feb 2017 #permalink

Vox, I think nominally leftish, can’t bring themselves to say anything good about it

Points 1, 2, and 3 in the Vox article are saying good things about the proposal. The last 3 points say negative things.

The sticking point is that while it's nice to see old-line GOPers push for real solutions to real problems, they have no political power. So, it just rings hollow.

[They have no direct power, yes. They might have influence; I don't know how the US system works -W]

By numerobis (not verified) on 15 Feb 2017 #permalink

Vox said: "To date, exactly zero Republicans currently in Congress have publicly endorsed a carbon tax. On the contrary, last June, every single member of the House GOP voted for a resolution saying a carbon tax “would be detrimental to American families and businesses, and is not in the best interest of the United States.”"

Zero support is zero support.

By Phil Hays (not verified) on 15 Feb 2017 #permalink

ya know, what we need is a secret ballot for Congresspersons.
Rumor has it these people are smarter in private than in public.

By Hank Roberts (not verified) on 15 Feb 2017 #permalink

"On Tuesday, Rep. Lamar Smith, chairman of the House of Representatives Committee on Science, Space and Technology, asked the EPA's inspector general to investigate whether EPA staff were using encrypted messages to coordinate efforts to derail the new administration's agenda, in possible violation of federal records laws."

By Hank Roberts (not verified) on 15 Feb 2017 #permalink

I like the dividend approach. Seems much more likely to get buy-in and, by and large, seems much fairer than most tax reductions (income tax reductions miss the unemployed and what's to stop sales tax reductions being whittled away through opportunistic price rises?). The one sticking point as you point out is unauthorised immigrants (11m of them according to Pew, I assume in the poorest deciles) who will be hit hard.

I wonder If the carbón tax will allow for the fact that some oil molecules aren't burned? Examples would be plastics and asphalt. Will there be tax credits for those disposing of CO2 by injecting it underground? Will the tax apply to CO2 produced from wells in New Mexico, which is reinjected in enhanced oil recovery projects? Also, will the tax be adjusted using a reliable parameter, for example the last 30 years' average temperature over USA territory?

[My guess is that the not-burned fraction is too small to worry about, but that people will worry about it anyway. And much plastic does end up burnt anyway -W]

By Fernando L. (not verified) on 16 Feb 2017 #permalink

>"This amount would grow over time as the carbon tax rate increases, creating a positive feedback loop:"

They don't mention it would also decrease over time as people switch to electric vehicles and renewable electricity. Not sure whether this should be hidden or if it should be announced clearly as 'no people shouldn't become slobs not doing anything and planning to live off the rising dividend income'.

WMC writes: "I don’t know how the US system works"

That's understandable. However, in recent years you often seem to rely too heavily on "Timmy" as your window into how the US system works. This is one of those cases where it is leading you astray.

My guess is that most of your US readers and most USAians who are concerned about AGW would prefer a carbon tax to direct regulation of emissions. But we recognize that for now at least this is impracticable, for several very strong reasons. Not being familiar with all the workings of US politics, you apparently believe that your readers are stupidly ignoring the benefits of a carbon tax out of sheer obdurateness or something, and as a result you continue to needle us about this on a more or less monthly basis.

[If you don't want to read posts about carbon tax, then I suggest you don't. I find it interesting, so will continue to post news as I come across it -W]

The facts of the matter are this:

The handful of old codgers you cite are no longer in any position of influence within the Republican party. The party as it actually exists today is absolutely 100% opposed to any carbon tax. Out of approximately 300 Republican representatives plus senators, exactly zero have endorsed or even expressed any openness to a carbon tax. The Grover Norquist types who determine the party's agenda on taxation are adamantly opposed to a carbon tax. With the Republicans currently controlling both houses of Congress, the White House, and most of the courts, there is simply no prospect of a carbon tax in the US for the foreseeable future.

No doubt your reaction will be "your main aim is to snipe at the Republicans; dull". Reality is in fact sometimes dull. I would like Congress to provide free unicorns to all citizens, but should Vox point out that this is impossible, calling Vox's argument "dull" would not in fact be useful.

So. In the current USA as it actually exists, as opposed to in some alternate universe, there are two options:

(1) Reduce CO2 emissions by regulation, per the court's 2007 ruling instructing the EPA to enact such regulations.


(2) Do nothing and wait for CO2 emissions to start falling by themselves.

Saying "Well, dummies, a carbon tax would be much better than regulations" is non-responsive. Those of us on this side of the Atlantic have to operate in the context that actually exists here.

If your argument is that regulating CO2 is worse than doing nothing, then make that argument. Otherwise, do us all a favor and stop annoying your readers with supercilious remarks about the obvious virtues of a carbon tax.

#9 (1) is no longer an option.

By Phil Hays (not verified) on 16 Feb 2017 #permalink

This is obviously a very good approach--they even start higher than I have been advocating ($12) which is very good.

There will then begin a debate on whether that constitutes the only necessary action, with folks like 'Timmy' arguing in the affirmative. I will be on the opposite side of that argument, but I will be arguing for what amounts to small beer compared to some regulars here--investment in R&D and storage, with some X prizes to spur innovation, dismantling some archaic route restrictions for air travel and continuation of existing subsidies for fossil fuels.

But the fact is that actions taken in the past decade have invalidated the RCP 8.5 hypothesis (I won't dignify it with the words 'scenario' or 'projection'). Adding a carbon tax is the keystone to a successful strategy--y'all should help it along..

You guys are winning! Don't stop now.

By Tom Fuller (not verified) on 17 Feb 2017 #permalink

>"There will then begin a debate"
Seems to assume that this carbon tax will be implemented and that the debate would only start after that. Both seem fairly dubious.

Like so many before him, Tommy misunderstands the purpose of the RCPs.

By Steve Bloom (not verified) on 17 Feb 2017 #permalink

Actually, Sierra Steve, like so many before you you misunderstand... just about everything.

Those who made the RCPs were very clear about their purpose. They were inputs into climate models starting with an assigned total of watts per square meter at TOA. Such as 8.5 watts per square meter, please provide intermediate inputs to this GCM.

When they published their RCPs, they were also very clear that they were not models, not projections and not scenarios based on any real data. They were exercises and the numbers those exercises yielded are synthetic data.

When Manabe built one of the first climate models, he remarked that climate models were incredibly useful for understanding the climate and not at all good for projecting or predicting it. He predicted that nonetheless that is what would be done with model output.

In the same fashion, all those who built the RCPs strongly asserted that they were not projections, predictions or scenarios. I wonder if they also felt confident that they would be misused in the same manner as Manabe's model?

By Tom Fuller (not verified) on 18 Feb 2017 #permalink

I'd like to believe they are sincere but can't help the cynicism; I think the more certain they are carbon pricing is politically impossible the more confident they are in suggesting it. If it's in the form of this or nothing or comes with a repeal but not replace lack of true commitment, it can look even more like the insincere holding up a bar too high - a bar they perhaps have no burning commitment to go over themselves. This is a political party that has been consistent in it's opposition and obstruction to strong climate action.

[I doubt the party is unified on this; I also think that those proposing this do mean it; it would be rather pointless otherwise. That doesn't mean their chances of success are high -W]

By Ken Fabian (not verified) on 18 Feb 2017 #permalink

The Republican party is very unified on issues. I doubt if even an ice free Arctic Ocean one month and a Ross Ice Shelf collapse the next month would budge the unity of the core Republican party against any acknowledgment of climate change. Trump, on the other hand, isn't a real Republican, and has taken stands not in keeping with the rigid ideology. Some of which he hasn't yet reversed. Yet. Such as Trump's protectionism and his love of Putin and Russia. And Trump's disdain for the Constitution and the rule of law.

These Republican emeritus types proposing a carbon tax date to a time when the party was not as rigid as it is today. While I hope and suspect that they are sincere, they are not at all typical of the current officeholders. This is an empty proposal from the out of touch. Almost all current office holders are far more concerned about a primary challenge from the ultra right wing than they are about winning the general election. Even if they had a personal belief about climate change they wouldn't dare to mention it, much less act on it. Trump might support a carbon tax, if it served the purposes of making Trump richer, more loved or more powerful.

Trump is changing the Republican party. Short term this is a very bad thing, but longer term it might not be. If we survive to the longer term, that is.

By Phil Hays (not verified) on 19 Feb 2017 #permalink

Thank you, Tommy, for elucidating that RCP 8.5 isn't even an hypothesis, rather just a modeling benchmark, and so can't be said to be invalidated because there's a problem with the single specified pathway.

The real question is whether the 8.5 is at all plausible via any pathway. Sadly yes. Do you know why?

By Steve Bloom (not verified) on 19 Feb 2017 #permalink

FWIW I completely agree that a carbon tax is a complete non-starter in Congress at the moment, but that could change very quickly if there's a large enough backlash against Trump in 2018/20. What we will see short-term is lots of state and local action, which should help prime the pump for the post-Trump era.

By Steve Bloom (not verified) on 19 Feb 2017 #permalink

Have you been reading Science of Doom's latest posts? seem like a sad demise from their earlier 'science' posts on the greenhouse effect. A very poor attempt at an economic analysis.

[I read some of them; they seemed sane to me. Which do you object to? I hope your objection isn't the standard "I don't like these conclusions there must be an error in the analysis" -W]

By Nathan Tetlaw (not verified) on 20 Feb 2017 #permalink

Yes, Sierra Steve,

[I know you didn't start this but can we please, without prejudice, drop the practice of offering people nicknames that they clearly don't want? Calling, e.g., Tim Worstall "Timmy" is fine, because (a) I do it and (b) he does it. But let's be polite to our fellow-commentators here -W]

RCPs can't be invalidated. They can't be validated either. There's a word for that.

That your lot seems to think that's a good thing is... interesting. Not scientific, but... interesting.

[As for "which one are we on" I'm not sure; but I think SoD's… and comments thereon are helpful. Better pointers are welcome -W]

By Tom Fuller (not verified) on 20 Feb 2017 #permalink

I don't particularly mind Sierra Steve, although it's anachronistic. Fuller hasn't objected to Tommy AFAIK, but I'll stick to the former per your request.

So, Fuller, thank you for the self-correction. (Sincerely, BTW, it being such a rarity on the 'toobs). What would that word be, BTW? I can think of a phrase: Never intended to be more than a modeling benchmark.

That limitation is neither a good nor a bad thing, noting that *all* the specified pathways were hostages to fortune the moment they hit paper around 2010.

Trends in carbon feedbacks, entirely missing from the pathways, are OTOH very bad news. You might want to look some of that up. But let me help you out with a summary:

In particular, estimate of permafrost C loss for 2100, 150 Pg ~2014, looks like it's about to be revised to be about double that. Forests and soils globally aren't too happy either. Too much of that will more than cancel out the benefit of all those shut-down coal mines. Sadly, at least the permafrost component is now self-sustaining in that no amount of emissions reductions can stop it. That may be true for a lot of the rest. It all adds up to an all too plausible pathway for 8.5+.

By Steve Bloom (not verified) on 20 Feb 2017 #permalink

TBC, IMO we shouldn't be speaking of being on track for any of the RCPs as such, although comparing forcings and some other characteristics is fair enough.

By Steve Bloom (not verified) on 20 Feb 2017 #permalink

I stopped reading SoD after he nearly went off the rails on the deglaciation stuff. It was entirely too much work keeping his brilliant hypothesis from seeing the light of day, although I must admit to some curiosity about what it might have been.

By Steve Bloom (not verified) on 20 Feb 2017 #permalink

> "So the cost of sea level rise for 2100
> in the US seems to be a close to zero cost problem"

You have to take into account the vast new oysterbeds, from which vast profits can be made.

By Hank Roberts (not verified) on 21 Feb 2017 #permalink

Are oyster shells particularly susceptible to dissolving as a result of ocean acidification or have I missed something?

By the time that happens perhaps we will have genetically engineered organisms where different strains accumulate lead or iron or... in their bodies are easily sortable and provide materials in just the right form for our flexible 3D printers.

Who knows?

Maybe we will want to build cities from scratch because of some new infrastructure. Hyperloop or something?

But equating it to estate taxes and keynesian stimulus does seem silly. Estate taxes raise money for government which destroying cities doesn't do. Which stimulus would you prefer build a useful asset or pay people to dig a series of holes and pay another group to fill them in? That is clearly a tough decision for some people. That is only "somewhat unconvincing"?

This is basically what I thought a carbon tax should be when I gave it some earnest consideration a while ago. The dividend is nice, being basically an admission that everyone has the right to tip x tonnes of CO2 into the atmosphere each year, and if you choose not to, you should get paid for it.

Anyway, its eminently sensible, which means conservatives will reject it out of hand, until one day they see the need to do something about global warming, and then they'll choose it because its sensible.

By John Brookes (not verified) on 27 Feb 2017 #permalink

Speaking of carbon feedbacks, read it and weep:

"Soil organic carbon harbors three times as much carbon as Earth’s atmosphere, and its decomposition is a potentially large climate change feedback and major source of uncertainty in climate projections. The response of whole-soil profiles to warming has not been tested in situ. In this deep warming experiment in mineral soil, CO2 production from all soil depths increased significantly with 4°C warming—annual soil respiration increased by 34-37%. All depths responded to warming with similar temperature sensitivities, driven by decomposition of decadal-aged carbon. Whole-soil warming reveals a larger soil respiration response than many in situ experiments, most of which only warm the surface soil, and models."

I have to check back and see what method was used for the in situ experiments on permafrost. Potentially that too could get worse.

How are the boreal /rainforests doing this week?

Paper is OA, BTW, so no reason to miss out on the weeping.

By Steve Bloom (not verified) on 10 Mar 2017 #permalink

IIRC we kind of knew that, Phil. Important point AFAICT is that there's no tropical thermostat, which had it existed would have been a negative feedback. Less negative feedback => more warming, and of course heat gained in the tropics doesn't all stay there.

By Steve Bloom (not verified) on 10 Mar 2017 #permalink