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We need climate policy beyond individual action---that seems indisputable given the scope of the challenge.  And maybe, just maybe, Whitehouse officials are now planning out what it might look like.

What's the problem?  The usual climate policies discussed by pundits and wonks alike have issues: a) they're complex and/or b) are easy to oppose politically.  The most common two climate policies are Cap and Trade and Carbon Taxes.

It turns out that there is a dark horse policy that is the simplest I know of.  When I first heard it, I thought to myself: now why didn't I think of that?  It has a certain undeniable common sense to it.  It's The Clean Energy Dividend.

Enter James Hansen.  Bill McKibben has taken to calling Hansen America's top climate scientist, and I think that's right in more ways than one.  A few years ago, James Hansen began advocating for a simple and effective alternative to these two approaches, now crisply labeled by Dan Miller as the Clean Energy Dividend.  Hansen has been researching climate change for longer than most anyone discussing the subject today, and his wisdom on the matter shows.


The Clean Energy Dividend works like this:

  1. At each mine (e.g. coal), well (e.g. oil), or port of entry, a fee is applied per ton of carbon.
  2. 100% of the proceeds from these fees are equally distributed as dividends to the American people.

That's it.  When you think about it, it has a certain obvious common sense to it.  Carbon put into the atmosphere is pollution in the skies, and that's shared.  Nobody owns the skies---we all share it.  So the money collected for putting pollution up there comes back to the people in the form of dividends---a regular check in the mail.

While the mechanism on the front end is the same as a carbon tax, it isn't a tax since it's revenue neutral: 100% of the proceeds are returned to the people.  If you're responsible for an average amount of carbon emissions you would see a net zero impact on your finances: you'd pay more for gasoline or electricity or products, but you'd receive that surcharge back as a dividend payment. However, by shifting your use towards clean energy or simply decreasing energy use overall, you as an individual or family can receive more in dividend payments than you pay in surcharges---in fact, it's estimated that something like 2/3 of Americans would come out ahead under this policy (i.e. would get more in dividend payments than paid in surcharges).  Another benefit is that carbon emissions are strongly correlated with income, so it would not be a regressive mechanism like carbon taxes and cap and trade can be.   There's also precedence for dividends: Alaska, for example, issues dividends to its residents for their share of Alaska's oil bounty.

There are a number of other benefits over and above cap and trade. As Hansen explained:

Consider the perverse effect cap and trade has on altruistic actions. Say you decide to buy a small, high-efficiency car. That reduces your emissions, but not your country’s. Instead it allows somebody else to buy a bigger S.U.V. — because the total emissions are set by the cap. In a fee-and-dividend system, every action to reduce emissions — and to keep reducing emissions — would be rewarded.
There's no concept of "carbon offsets" in a Clean Energy Dividend system: no polluter can reach for indulgences to cheaply avoid the fee. It's a direct, simple mechanism, and one that can be easily explained to the average voter. It's also something that's hard to inveigh against as a partisan scheme (though no doubt some will try): there was a mostly ignored bipartisan attempt at something similar (still a bit rough around the edges and doesn't really get all the way there in that it's not 100% dividend) and the approach in general would rely upon a free-market energy transition rather than a government-directed one. And under a proper carbon policy, a properly regulated free-market transition to a post-carbon world might be a good thing in this instance.  Hansen again:
To compound matters, the Congressional carbon cap would also encourage “offsets” — alternatives to emission reductions, like planting trees on degraded land or avoiding deforestation in Brazil. Caps would be raised by the offset amount, even if such offsets are imaginary or unverifiable. Stopping deforestation in one area does not reduce demand for lumber or food-growing land, so deforestation simply moves elsewhere.

Once again, lobbyists are providing the real leadership on climate change legislation. Under the proposed law, some permits to pollute would be handed out free; and much of the money actually collected from permits would be used to pay for boondoggles like "clean coal" research. The House and Senate energy bills would only assure continued coal use, making it implausible that carbon dioxide emissions would decline sharply.

There are of course a few open questions that need addressing, though they're not hard to deal with. For example, how do we handle product imports? Clearly we wouldn't want to ignore the embodied carbon footprint of goods purchased from overseas, as that would unfairly benefit outsourced manufacturing. In the absence of a consistent and accurate carbon accounting scheme that can be applied to overseas manufacturers (something that would be hard to oversee in the first place), it might be easiest to average the carbon fee across all products from a country by unit weight, volume, or nominal price using estimates for the country's carbon emissions and manufacturing output.  There's also the question of children---one suggestion is that children receive a half share of the dividend each.

There's also the question of the psychology of it. Would people learn to associate Clean Energy Dividend checks from the government as refunds on surcharges they see in daily purchases, or would they treat it as a sort of tax refund check to be spent? (And would it make a difference how they view it in the first place?) It seems that more frequent dividend payments would be preferable---say, monthly---rather than infrequent, yearly disbursements.  (Dan Miller suggests direct deposit as a simpler mechanism for frequent dividends.)


For those wondering about some of the issues with Cap and Trade and Carbon Taxes, briefly: neither has shown much strength, either as policy or in terms of political support. Cap and trade has been implemented in Europe with mixed results: instances of wholesale fraud but also arguments that these are fixable design flaws. Carbon taxes have been implemented in fewer places and have seemingly little political support.

In my mind the key problems with these two approaches are, in the case of cap and trade, complexity, and for both together that they are not revenue neutral. The latter fact makes it easy to characterize such policies as expensive and bad for individuals.  The taxes collected by the government in both approaches are unlikely to be spent solely on decreasing fossil fuel use via other means (such as renewable energy investment)---it's hard to imagine legislatures being that enlightened. In addition, cap and trade has been and is likely to be easily gameable, with industries wagering that investing 10 million lobbying dollars up front might save them from 10 billion dollars in cap and trade costs down the line; such lobbying efforts typically aim at securing higher emissions allowances or ensuring that the caps remain high.

Originally posted to barath on Wed Jan 23, 2013 at 07:57 AM PST.

Also republished by Community Spotlight.

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Comment Preferences

  •  Home Rooftop Solar Works Somewhat the Same Way (26+ / 0-)

    because it makes individuals producers getting returns on avoidance of carbon. It's also nearly as simple as the clean energy dividend because they both don't require government to construct or upgrade anything, they're both straightforward financial policies.

    Any scheme that puts money or obvious daily savings into the hands of masses of people creates the maximum public support per pound of carbon withheld from the atmosphere.

    Right now what we need to generate most is public support, and both this dividend and rooftop solar strike me as being the strongest and simplest programs for doing that. It won't be long before there's growing support for other measures such as large green generating facilities and the smart grid.

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Wed Jan 23, 2013 at 08:08:03 AM PST

  •  The dividend can work with cap and trade or a tax (13+ / 0-)

    Great diary!  I'd point out that California just approved a dividend to rate payers from the proceeds of our cap and trade auction in November.  Makes me think it might help build support here.

    Hay hombres que luchan un dia, y son buenos Hay otros que luchan un año, y son mejores Hay quienes luchan muchos años, y son muy buenos. Pero hay los que luchan toda la vida. Esos son los imprescendibles.

    by Mindful Nature on Wed Jan 23, 2013 at 08:08:33 AM PST

  •  Brilliant! I am hoping to hear in the State of the (6+ / 0-)

    Union speech real, substantive action on the climate crisis. This could be a major piece of it.



    Is it true? Is it kind? Is it necessary? . . . and respect the dignity of every human being.

    by Wee Mama on Wed Jan 23, 2013 at 08:11:36 AM PST

    •  Wouldn't this though just encourage offshoring (2+ / 0-)
      Recommended by:
      elfling, Kobuk Sands

      carbon/energy wasteful enterprises? So instead of say making aluminum cans here it'll be cheaper to make them in Mexico and ship them across the border?

      In order to work don't we need some kind of import tariffs on just about all manufactured goods?

      In general though I think it's a great idea.  

      Ask top al Qaeda leaders about Obama's foreign policy. Wait, you can't. They're dead. -Paul Begala

      by Fickle on Wed Jan 23, 2013 at 10:58:09 AM PST

      [ Parent ]

      •  import duty when they enter the country (6+ / 0-)

        Collect the carbon valuation when they cross into the US. We already collect duty on certain imported products, this would work the same way.

        However we'd then need to decide whether to refund the carbon valuation when exported products leave the country. I'd vote against this, but it'd be a valid question.

        •  How does one measure carbon valuation? (1+ / 0-)
          Recommended by:
          6412093

          The proposal would result in major US job losses in steel, aluminum, autos, trucks, appliances, semiconductors, etc.. and other manufacturing that are electricity intensive and a severely damaged trade balance and loss of tax revenues.

          Computer server farms - which are very electricity intensive would also leave the US.

          Making Aluminum and recycling Steel requires massive volumes of electricity - electricity that could range from 100% green to 100% coal.  These metals could come in the form of Al or Steel or as components in finished products - such as cars, appliances, wind turbines, etc.

          The most important way to protect the environment is not to have more than one child.

          by nextstep on Wed Jan 23, 2013 at 12:00:47 PM PST

          [ Parent ]

        •  You'd get shot down by the WTO (3+ / 0-)
          Recommended by:
          NoMoreLies, Bisbonian, 6412093

          I imagine. They don't like people getting in the way of despoiling the planet.   They love subsidizing industries with weak enviroental and worker protections

          Hay hombres que luchan un dia, y son buenos Hay otros que luchan un año, y son mejores Hay quienes luchan muchos años, y son muy buenos. Pero hay los que luchan toda la vida. Esos son los imprescendibles.

          by Mindful Nature on Wed Jan 23, 2013 at 12:14:07 PM PST

          [ Parent ]

          •  One: We INVENTED the WTO (0+ / 0-)

            and we can un-invent it.  It's mainly powered by American force, so if we don't maintain it, it will fall apart.  Second, they can't make too much of a stink if we're merely applying the same standards across the board as we do to domestic production, and can prove it.

  •  I favored this approach in the past but (3+ / 0-)
    Recommended by:
    barath, DBunn, homo neurotic

    IIRC there were some solid arguments why this straightforward approach might be slightly too simplistic.  The theoretical benefits of a cap and trade program is that the cap is gradually reduced, which is the goal of fighting AGW.  Under a dividend type program there would be no guarantee that the reductions that we would see would materialize (although, admittedly a higher price for carbon based fuel would tend to lower their demand).

    I've got to run to do some work but I'll try to remember a couple of the other "cons" against this approach.  However, with that said, I might still support this idea if it was tweaked in a few different ways.  Simpler is better.  "Buying off" the public may be a necessary evil of combatting this problem and this definitely has both a carrot and stick aspect.

    Hopefully a good discussion ensues.

    We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

    by theotherside on Wed Jan 23, 2013 at 08:33:25 AM PST

  •  Great concept (4+ / 0-)
    Recommended by:
    barath, Wee Mama, homo neurotic, Bisbonian

    The ease of explanation is beautiful.

    The incentives are in all the right places, and none of the wrong ones.

    The system is so simple that there are no ways to game it, and very few loose threads for lobbyists to pick at (the treatment of imports being one of them, however).

    After the Clean Energy Dividend is successfully implemented in the USA, the next step would be to take it global. But we need to take the first step first, of course.

    Reminds me of what Peter Barnes calls the Sky Trust in his book Capitalism 3.0. Are you familiar with that?

  •  While (19+ / 0-)

    a long time supporter of / believer in 'partial dividend', let us raise some issues with a 100% dividend:

    1. This buys into concept that 'people know best how to spend their money' when there are social goods that require investment.

    2. This does a form of putting out resources for consumption.

    3. Remember that much of the Social Cost of Carbon is for tomorrow yet we are taking payments to account for future costs and distributing them to people today.

    4. We need to make massive (MASSIVE) investments in clean energy, energy efficiency, ecological system restoration, climate mitigation, climate adaptation, resiliency, education, science, ...  At least some of the 'dividend' should be used for these public goods.

    My perspective

    Massive revenues

    How to use the revenue?

    First, we should recognize that this is to mitigate an issue of global and not just national challenges.

    Second, we should be clear in understanding that this will be politically and socially difficult.

    Third, we should be aware of inequities in society and that this program could worsen the equities.

    Thus, first off, roughly half the revenue should go directly to every cititizen (resident in the United States) on an equal basis.  (With, perhaps, minors money going half to their guardians and the other half into a Energy Bond program where they could withdraw the money, 20% per year, starting at age 18.)  Thus, if you pollute less than 50% of the average American, you would actually earn money. As one tends to have a larger carbon footprint the higher ones income, this would also provide a path for somewhat balancing economic disparities in the nation. Finally, this would provide a path toward guaranteeing political and social support by putting money back into people’s pockets.

    Depensing the remaining half …

    The majority of the maining fees should be used (by agreement with an international monitoring) toward moving toward sustainable energy (energy efficiency, renewable energy), global warming mitigation (including carbon sequestration), and environmental action.

    Etc ...

    There are real serious issues that are hidden behind the 'simple' -- for example, that a Cap & Dividend would create wealth transfer to areas where the Federal gov't invested heavily in hydro & nuclear power (Pacific Northwest) from areas which are currently coal-heavy in electricity when what we need to be doing is investing to drive down the coal electricity usage.

    For some thoughts: http://getenergysmartnow.com/...

    Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

    by A Siegel on Wed Jan 23, 2013 at 09:09:36 AM PST

    •  I agree in concept... (7+ / 0-)

      Like I wrote in another comment, while I think I agree in principle that there are other approaches that in an ideal world would work better, the benefit that a 100% dividend has is that it gives no room for lobbyists to try to carve up the pie of where the money gets invested (e.g. do we really want investments in "clean coal" coming from the fee proceeds?).  Similarly, lobbyists can't get around emissions as easily as they might with cap and trade since the fee is applied evenly based on the amount of carbon.

      It's also hard for either party's politicians to argue, in an attempt to kill such a bill, that there are giveaways to their opponent's contributors (not that they won't try, but it'll be hard).  Simpler is better.

      So yes, there are social goods that need investment, but in the absence of a congress that will invest in social goods, it seems that we're more likely to get a good outcome by not linking that investment with climate policy.

      contraposition.org - thoughts on energy, the environment, and society.

      by barath on Wed Jan 23, 2013 at 09:19:47 AM PST

      [ Parent ]

    •  A Siegel (4+ / 0-)

      I would be curious to get your take on this (and anybody else feel free to chime in).

      On top of the dividend plan outlined in the diary and in your comment, there are still other things we should be doing on top of that.  One of the ones that I would support but really haven't heard it discussed much is the idea of a tax on electricity based on consumption.

      I would imagine (but haven't seen hard data on it) that you could plot monthly usage of electricity by each residentila user of a given electrical company and it would roughly create a bell curve shaped distribution..  Each tail of the curve would either represent the few one bedroom studios at one end or the few mansions at the other end with the vast middle occupied by the middle class dwellings.

      Given this data you would then create different taxes (and hence different electricity rates) based on the level of consumption.  In the first year of implementation you would perhaps tax the top 5 percent of the users at one rate, the top 2 percent at a different rate and the top 1 percent at yet another rate.  The top 1 percent would be taxed so that alternative energy is cheaper than what they would be paying for their dirty energy.  The top 2 percent would pay roughly the local equivalent of alternative energy and the top 5 percent somewhere in between the typical rate and the alternative energy rate.

      Over the course of say 10 or 20 years what you would expect to see is that the top consumers would either be investing in energy conservation to get out of the top rates or they would be financially persuaded to move to alternative energy.  In time, today's top consumers would have all conserved a lot of energy or bought alternative sources of energy and the middle consumers would be sliding up the list toward the top as the top consumers no longer would be consuming much, if any, fossil fuels.

      This seems like such an easy, market based approach that would get the biggest bang for the buck and would also consistenly have the top 1 to 2 percent of consumers for any given year be interested in moving to lower consumption/alternative energy.

      Makes too much sense to me but I frankly haven't seen a real discussion of the pros and cons of such a solution.  You obviously could tweak how many different rates you have and the amount of the tax increases to be more in line with the pace of change that you want and what is politically bearable.

      Is it feasible?  Does it make sense?  What are the flaws in this approach?  Given your background I would be very interested to read what you have to say.

      We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

      by theotherside on Wed Jan 23, 2013 at 11:03:03 AM PST

      [ Parent ]

      •  I think this is how a carbon tax works (1+ / 0-)
        Recommended by:
        6412093

        I'd say taxing electricity doesn't help as much as taxing carbon.  Many places also have graduated rates by tier of use (note the biggest users are commercial users not mansions).  

        Hay hombres que luchan un dia, y son buenos Hay otros que luchan un año, y son mejores Hay quienes luchan muchos años, y son muy buenos. Pero hay los que luchan toda la vida. Esos son los imprescendibles.

        by Mindful Nature on Wed Jan 23, 2013 at 11:52:18 AM PST

        [ Parent ]

        •  I'm not sure you are entirely correct on this (1+ / 0-)
          Recommended by:
          A Siegel

          In a carbon tax program both the low consumption household and the high consumption household would pay the same rate.  Sure, the high consumption household would end up paying far more money in carbon taxes but that is merely due to their consumption.

          My idea would end up creating a market that would be the size of 1, 2 or 5 percent of the local market year after year for energy conservation measures and for alternative energy (primarily but not limited to PV).

          As far as electricity consumption goes there are many ways to break it out but EIA often breaks it out between residential, commercial, industrial and even transportation.  Your point is valid that the residential sector is not the main consumer of electricity but that is the easiest portion to relate to and also the easiest to implement my tax idea.

          If you wanted to expand the discussion on how to implement the basic idea I've presented to the commercial arena we can certainly do that.  It's just tougher to come to agreement.  For example, a large business that has 5,000 employees working out of one location might actually be very efficient in their electricity consumption and use, say 50 kwhs per person per day, while a small business that employs 10 people might be highly inefficient and use 100 kwhs per person per day.  Which company should pay the higher rate?  (Note: kwh figures are merely for discussion purposes and may or may not be efficient use of the electricity)

          We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

          by theotherside on Wed Jan 23, 2013 at 01:41:31 PM PST

          [ Parent ]

      •  Sigh ... (1+ / 0-)
        Recommended by:
        theotherside

        I wrote a 10+ point response that was ever so insightful (making fun of myself) and accidently hit the 'cancel' button and it disappeared.

        Shorter version.

        1.  Interesting.

        2.  Think it is too slow to achieve change but could be part of a larger program.

        3.  Very hard data / data analysis challenge against all the variables (size of household, work patterns, etc ...)

        4.  If try to control by (3), then run into serious privacy issues in US culture.

        5.  I like the idea of higher rates as (wasteful) usage goes up but would want to see this controlled by # of people, living patterns, etc ...  Sadly, by the way, too many utilities give discounts for more use (a quantity discount).

        Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

        by A Siegel on Wed Jan 23, 2013 at 03:29:37 PM PST

        [ Parent ]

        •  Well, I guess I owe you two "thanks!" (0+ / 0-)

          As to your points:

          2.  Agreed that by itself it is too slow.  If we ever seriously debate this on the national stage (ie legislation is being drawn up) I am still open to pure cap and trade or cap and dividend and this would be an ancillary consideration.  With that said, it would be interesting to see how quickly we could ramp up energy conservation and PV and wind installations.  To account for 1,2 or 5 percent of the residential market per year wouldn't be a bad rate but perhaps I'm not aiming high enough.

          3.  Make it simple.  The only thing to consider is the consumption of a household and it will be compared to all the other households served by the same electric company.  The benefit of this is that the top consumers in every city throughout the entire country get hit with the higher rates and it therefore creates immediate energy conservation and alternative energy markets in every city.

          Maybe I'll flesh it out a little more in a diary with some charts and graphs so that people better understand the potential impact that this would (possibly) create.

          We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

          by theotherside on Wed Jan 23, 2013 at 04:27:41 PM PST

          [ Parent ]

          •  RE "make it simpl (0+ / 0-)

            compare two households both with 2000 square foot homes.

            1.  Single person, travels frequently, works hellish hours at office.

            2.  Family of five, work from home, daycare center in house

            Imagine that (2) uses exactly same amount of electricity as (1).  (1) would be better bet for energy efficiency focus and for 'penalizing' with higher fees but we need much data for that.

            Also, how to integrate natural gas, propane, electricity, etc ...

            Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

            by A Siegel on Wed Jan 23, 2013 at 05:36:44 PM PST

            [ Parent ]

        •  numbers 2 and 3 good objections that (0+ / 0-)

          I hadn't thought of. Add 6)very unlikely to make it through Congress)

          if necessary for years; if necessary, alone

          by SouthernLiberalinMD on Wed Jan 23, 2013 at 04:42:34 PM PST

          [ Parent ]

      •  I think it's a great idea, but (0+ / 0-)

        it involves raising still more taxes on the wealthy, so the chance of it getting through the "we did that already!" Congress seems slight.

        if necessary for years; if necessary, alone

        by SouthernLiberalinMD on Wed Jan 23, 2013 at 04:41:41 PM PST

        [ Parent ]

      •  it sounds like (0+ / 0-)

        you are talking about an inverted block rate (the more you use, the higher the rate):

        0 - 2,500 kWh - $0.10/kWh
        2,500 - 5000 kWh - $0.15/kWh
        etc.

        but with a sliding scale based on usage:
        top 1% - $0.20/kWh
        1-10% - $0.15/kWh
        etc.

        With a renewable energy out:
        RE - $0.12/kWh

        so, you can buy your way out of the steeper rates by investing in RE.

        Is that what you are saying?

        Javelin, Jockey details, all posts, discontinue

        by jam on Thu Jan 24, 2013 at 11:19:44 AM PST

        [ Parent ]

  •  great stuff -- t'd & r'd (4+ / 0-)

    mostly on board with this -- it certainly seems to meet the test of a creative and constructive approach.

    here's the one bit that doesn't sit quite right with me (and, yes, i do feel quite the fool with taking issue with james hansen on anything)...

    as much as, why hell yes, i'd personally love to receive a dividend check in the mail, i'd need convincing that the collected carbon fee is best spent by giving it it individuals.

    the atmosphere and the chemicals we belch into it do not recognize borders. the cumulative impacts are global, pervasive and interconnected.

    i'd suggest considering all funds captured through such a program go in entirety to fund r&d and implementation of scaled up clean renewables. make the polluters pay for what will eventually replace them.

    that aside, applause from me.

    "i hear you're mad about brubeck ... i like your eyes. i like him too." -donald fagen

    by homo neurotic on Wed Jan 23, 2013 at 09:19:42 AM PST

  •  Yeah, good luck with that (0+ / 0-)

    It will immediately be labeled as a tax increase and socialism.  Actually that's what it is, and it's a good idea, but politically would likely be easy to attack.

    The dirty-energy-funded politicians will argue that it's a tax that will increase the cost of energy for everyone and also the cost of manufacturing and transportation, and so jobs will move overseas where energy is cheaper and all goods you buy will be more expensive too as the cost gets passed on.  They will also argue that the administration costs of the program means the entire thing will be a net waste.

    Unless you can find ways to successfully counter those kinds of arguments I suspect this idea will not get very far.  It really appears to be the same thing as a carbon tax.

    •  Let them argue (3+ / 0-)
      Recommended by:
      too many people, cynndara, offgrid

      We have to beat them that's all.  Slave owners used to throw all kind of arguments out.   That doesn't mean abolishing slavery wasn't a good idea

      Hay hombres que luchan un dia, y son buenos Hay otros que luchan un año, y son mejores Hay quienes luchan muchos años, y son muy buenos. Pero hay los que luchan toda la vida. Esos son los imprescendibles.

      by Mindful Nature on Wed Jan 23, 2013 at 11:53:25 AM PST

      [ Parent ]

    •  Then point again to the Alaska oil dividend. n/t (0+ / 0-)

      When banjos are outlawed, only outlaws will have banjos.

      by Bisbonian on Wed Jan 23, 2013 at 06:44:10 PM PST

      [ Parent ]

      •  Alaska divident is different (0+ / 0-)

        AFAIK it's not an extra tax put on top to fund it.

        But more importantly it was put in during a time when politics was more sane.  If Democrats tried to put it in today they would probably be crucified by conservatives.  If Republicans tried to put it in...well, they wouldn't.  They'd likely hand the money back to private industry.

  •  I Met James Hansen and We Talked About This (0+ / 0-)

    In I think 2009 at a speech he gave at the University of Montana.

    Since then I've come across a tremendous book on this idea by energy economist, Steven Stoft, called

    Carbonomics: How to Fix the Climate and Charge It to OPEC
    . You can read more about it at its link: Carbonomics

    Stoft goes into great detail about how the Clean Energy Dividend is supported by economic theory and why a market driven solution works better than cap-and-trace or mandatory restrictions.

    Wonderful read and some of the best climate scientists in the world are now quoting Stoft.

  •  I support a Carbon tax. (6+ / 0-)

    However, to get it through the Congress, you need a stronger hook, and I wonder whether a better strategy would be to earmark the proceeds from that tax to deficit reduction. Fiscal conservatives would have a much harder time arguing against a carbon tax if it were specifically targeted to deficit reduction because it would get them out of a dilemma in which they are pledged not to raise income tax rates but also cannot risk the ire of voters in slashing social security and medicare. This would enable Republicans to sidestep the whole issue. If it were then coupled with a tax code reform program, they might go for it.

    For if there is a sin against life, it consists perhaps not so much in despairing of life as in hoping for another life and in eluding the implacable grandeur of this life. - Albert Camus

    by Anne Elk on Wed Jan 23, 2013 at 11:20:21 AM PST

    •  I don't like (1+ / 0-)
      Recommended by:
      Anne Elk

      this nearly as much, but politically it's something to think about.

    •  Deficit reduction? I'd disagree. People -- Dems (1+ / 0-)
      Recommended by:
      offgrid

      & Repubs -- would like the rebates.  

      Screw the deficit-reduction bs artists, imo.  They're lying anyway.  As is evidenced by what the do (raise the deficit) when they're in power.

      A few thousand $ for each citizen would do the trick, Republican "leadership" be damned!

      •  Look, despite what people around here (0+ / 0-)

        seem to think, we actually do have a debt and deficit problem. It isn't a figment of someone's imagination. It really does exist, and it really is a problem. That said, do we have to freak out about it? No. But we do have to deal with it. This is a way to deal with it. We tried the whole "give the money back to the taxpayers" in 2001. Didn't work out too well. We need the carbon tax, clearly, but we need to use it to cut our indebtedness, something that the Republicans, who are in the majority in the House and will be for a decade, ought to like.

        For if there is a sin against life, it consists perhaps not so much in despairing of life as in hoping for another life and in eluding the implacable grandeur of this life. - Albert Camus

        by Anne Elk on Wed Jan 23, 2013 at 04:55:52 PM PST

        [ Parent ]

        •  I guess we just disagree. I'm not worried about (1+ / 0-)
          Recommended by:
          PatriciaVa

          the debt at this point, though I don't think we should ignore it when the economy heats up. Did you see Krugman's excellent piece on its relative unimportance the other day?

          http://www.nytimes.com/...

          Climate change, rebuilding our infrastructure, doing the various jobs of governance that were abandoned under Bush, all imo are much more pressing than paying down the debt.

          And (also imo), we should do this with new taxes on finance and the wealthy....the ones that stole and continue to steal the money from the 99%.

  •  Revenue could be distributed to the people (0+ / 0-)

    injured by carbon pollution but it would have to be a pretty high tax.  Given the most recent evidence, it might be better to put aside any remaining in speeding up the transition to clean energy.  Also, remember the tax should be very high not only because your hurting people and bringing our environment to the brink of disaster but because you're subsidizing dirty energy when you don't.  The truth is clean energy is cheaper right now then any form of dirty energy.  We're just subsidizing it by shortening our lives.  I would say a $120 dollars per cubic ton and that could also pay off the debt and make up for all the unneeded financial oil subsidies the industry has been taking advantage of for years.

  •  Let's get real! (1+ / 0-)
    Recommended by:
    ChuckInReno

    I disagree with the title of this diary.  There is nothing  simple or best  about a policy that cannot be enacted. Cap and trade, tax and dividend, or cap and dividend ALL require Congressional action.

    The President has some existing authority under the Clean Air Act and other laws to make some major, bu t not sufficient progress.  

    Supporting the President on moving fast forward with what he can do with executive powers and educating the country, including denying the permit for the Keystone pipeline, is where our energy shoud go.

    "Anyone who believes exponential growth can go on forever in a finite world is either a madman or an economist."

    by oregonj on Wed Jan 23, 2013 at 11:53:47 AM PST

  •  This sounds exactly like the carbon tax (0+ / 0-)

    supported by Citizens Climate Lobby -- it's revenue neutral in that it returns all the proceeds to the citizens. It's also called a tax-and-dividend approach.

    While I agree that this is the best, I'm having trouble understanding on what grounds you say that this isn't the same as a carbon tax, given that this is precisely the model of carbon tax that groups such as Citizens Climate Lobby have been pushing for.

    Please visit: http://www.jkmediasource.org

    by Noisy Democrat on Wed Jan 23, 2013 at 12:02:22 PM PST

  •  It can't actually be a 100% return to the people (0+ / 0-)

    because there's some cost in collecting, administering, and distributing the money. So my first question is, how much would that cost?

    Fry, don't be a hero! It's not covered by our health plan!

    by elfling on Wed Jan 23, 2013 at 01:08:57 PM PST

    •  Take this with a big grain of salt (0+ / 0-)

      but if you recall several years ago everybody was given some kind of tax rebate which was a check from the government.  At the time I think I heard that the administrative costs were 1 to 2 percent.  If this were a quarterly event, it would be interesting to hear the argument whether this would cause the administrative costs (on a percentage basis) to actually go up or down.

      But it would be interesting to go back and see if there was any good reporting on what the administrative costs were.  Of course, as I get older, I can't even remember when that was.  Was that shortly after Bush got elected the first time?  Or was that part of the stimulus in 2008/2009?  

      We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

      by theotherside on Wed Jan 23, 2013 at 04:36:12 PM PST

      [ Parent ]

  •  The simplest solution is to eat less and go vegan (1+ / 0-)
    Recommended by:
    Bisbonian

    Seriously. This needs to be part of how we respond to climate change.

  •  Side benefits, too. (0+ / 0-)

    Applying the tax to imports would finally force manufacturers and retailers to pay for the costs of offshoring to avoid environmental regulation.  Chinese use of coal and Beijing air pollution are abysmal, and the carbon costs of shipping across the Pacific ocean significant.  A universal carbon tax would heavily penalize companies that offshore manufacturing to China, raising the costs of their goods to capture these convenient "externalities" and encourage repatriation of domestic production.

    I've got nothing against the Chinese (really; my father was an ardent Orientalist), but using them as a dumping-ground for low-wage work and environmental damage is bad for both of our societies.  Tax-and-dividend sounds like an excellent treatment.

  •  Nice Idea....... (1+ / 0-)
    Recommended by:
    Words In Action

    Looks like a carbon tax to me
    I'm 100% in favor

    Please see the following
    https://petitions.whitehouse.gov/...

    Please sign this petition
    Thanks
    Barry Allen

  •  asdf (0+ / 0-)

    Alexander the Great met the famous philosopher and wanted to reward him:

    "What can I do for you?" the emperor asked.

    "Stand aside. You're blocking my sunlight," Diogenes replied.

    if necessary for years; if necessary, alone

    by SouthernLiberalinMD on Wed Jan 23, 2013 at 06:30:42 PM PST

  •  Great quick 1st step; then supplement (0+ / 0-)

    The revenue-neutral aspect (along with the simplicity) of this dividend appears likely to enable more public support and less Congressional resistance than many policies.

    If correct that it would also redistribute purchasing power to lower income citizens, then this would be a huge benefit, especially so long as the economy continues to need stimulus.

    Supplemental legislation would be important to pursue with all deliverabe speed, especially to mitigate uneven regional impacts.

  •  This is a carbon tax (0+ / 0-)

    with benefits. I am a big fan of carbon tax, but I fear the economic dislocation that would result. There has to be some way to reduce the short-term disruption and pain that will be caused to lower middle class and poor people, especially those living in cold areas.

    Distribution of this tax is an important and complex consideration.

    -5.38, -2.97
    The NRA doesn't represent the interests of gun owners. So why are you still a member?

    by ChuckInReno on Wed Jan 23, 2013 at 10:02:15 PM PST

  •  I like this, because the poor would benefit (0+ / 0-)

    This would be a stimulus on the economy at the same time.

    Getting a regular income like that, however small, would really help a lot of people.

    Women create the entire labor force. ---------------------------------------------------------------------------------------- Sympathy is the strongest instinct in human nature. - Charles Darwin

    by splashy on Thu Jan 24, 2013 at 03:28:03 PM PST

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