Environmental VAT, and Dividend
The climate change debate has become more clear from the time of Al Gore’s An Inconvenient Truth. We have measured and observed increases in global temperatures, warming oceans, shrinking ice sheets, glacial retreat, decreased snow cover, sea-level rise, loss of Arctic sea ice, increases in extreme weather events, more frequent species extinctions, coral reef destruction, ocean acidification, more prolonged flu season and increases in also zoonotic diseases. Let us be clear we are no longer arguing about if climate change is happening or if greenhouse gases are the cause. I know that isn’t going to convince everyone - if you are still reading you probably agree so let us start from there.
Climate change is a man-made issue. Energy consumption is putting more greenhouse gasses in the atmosphere than the earth can remove which, contributes to an increase in temperature. While Carbon Dioxide isn’t the only greenhouse gas, Ozone, HFCs, CFCs, Water Vapor, Methane, and Nitrous Oxide, it’s the second most common and sticks around longer. So what are we to do about it? Some are calling for environmental remediation, some are calling for adaptation why not attacking the problem head-on?
One of the most practical attempts at dealing with this was The Waxman-Markey Bill it was a simple cap and trade policy. In economics, a cap and trade policy is meant to reign in the negative externalities of actions by putting a price on them. In this instance it was carbon, sadly this bill didn’t pass but laid the groundwork for future legislation like the Green New Deal.
I’m not certain we will get there in the near term or that there is the will to do so, maybe we should start with something practical?
I like the H.R.763. The bill’s framework is a sensible solution in it doesn’t impose a massive tax, or require a reinvention of our economy. It also corrects the issue of negative externalities like pollution. Most importantly it improves on the Waxman-Markey bill. Not only does it create a revenue stream which it redirects it in a way that benefits citizens. It collects the money in a trust and distributes it to Americans as payment at the end of the year. The point of the distribution is to be more progressive. That is to say the payments to the lower, and middle-income distributions are more than they paid in. A basic example is if we charge 10 dollars a ton and we estimate the per capita carbon emissions in the US at 20 tons each person would be expected to pay 200 if the tax were passed on to the consumer. We should make it so those at or below the median income get paid back credit of 15 dollars for the per capita rate to get more than what they paid in but also to have some leftover to invest. Just to finish this up it corrects the issue of negative externalities, incentivizes more environmentally friendly energy production directs money to those most in need and leaves money for investing in green technology.
check out some of the bills below
H.R.763 — Energy Innovation and Carbon Dividend Act of 2019 Dividend
https://www.congress.gov/bill/116th-congress/house-bill/763
H.R.2454 — American Clean Energy and Security Act of 2009https://www.congress.gov/bill/111th-congress/house-bill/2454
H.R.5185–116th Congress (2019–2020)
https://www.congress.gov/bill/116th-congress/house-bill/5185?q=%7B%22search%22%3A%5B%22green+new+deal%22%5D%7D&s=2&r=2