MEDIA PACKET, NOV. 12, 2014
No more excuses for Congress’ failure to act on climate change
Now that the U.S. and China have reached an agreement to cut carbon emissions, it’s time to enact a market-based solution to global warming. By placing a fee on carbon and giving the revenue back to households, we can cut carbon AND add millions of jobs to our economy.
With the United States and China striking a deal to reduce greenhouse gas emissions, Congress has finally run out of excuses for its failure to act on climate change. Whenever talk of solutions has surfaced on Capitol Hill, opponents trotted out the dubious talking point that it didn’t matter what America might do to cut emissions as long as China, the world’s largest emitter, remained on the sidelines.
President Obama and Chinese President Xi Jinping have announced an agreement between the world’s two largest carbon polluters to reduce the greenhouse gas emissions responsible for much of global warming. Obama pledged that the U.S., as the New York Times reported, “would emit 26 percent to 28 percent less carbon in 2025 than it did in 2005. That is double the pace of reduction it targeted for the period from 2005 to 2020.”
We can now relegate that lame lament to the same list that includes “the dog ate my homework.”
China agreed it would cap and start to reduce emissions no later than 2030, a remarkable commitment for a nation with more than four times the population of the U.S., one that is undergoing the most explosive industrial growth in the history of civilization.
So, what other excuse might be left? Why isn’t Congress working at this very moment on legislation to price carbon?
The other lame but popular excuse to avoid action is to say that pricing carbon will kill jobs and strangle our economy.
That excuse, too, is no longer valid, if it ever was.
In June this year, Citizens’ Climate Lobby released a study from the highly-respected firm, Regional Economic Models, Inc. (REMI). We asked REMI to gauge the impact of a steadily-rising fee on the carbon dioxide content of fossil fuels, with the revenue from that fee returned to all households as direct payments in equal shares. The fee assessed would start at $10 per ton of CO2 and increase by $10 a ton each year. Also factored in were border tariffs on imports from nations that have no equivalent price on carbon. These “adjustments” at the border would maintain a level playing field for American companies and keep businesses from moving overseas.
The findings from the REMI study were better than hoped.
After 20 years, the REMI study found that emissions would come down by 50 percent (chart above), putting the U.S. on track to achieve the 80 percent reduction needed by mid-century to avoid catastrophic consequences from climate change.
On the economic side, the REMI study found that CCL’s proposal would add 2.8 million jobs after 20 years (chart above). This happens because of the economic stimulus of recycling the carbon fee revenue into the pockets of people who are likely to spend the money.
Other findings from the REMI study:
- 13,000 lives are saved annually after 10 years, with a cumulative 227,000 American lives saved over 20 years.
- $70-$85 billion increase in GDP from 2020 on, with a cumulative increase in national GDP due to Fee & Dividend of $1.375 trillion.
- Size of monthly dividend for a family of 4 with two adults in 2025 = $288, and in 2035 = $396. Annually, this is $3,456 per family of 4 in 2025 ($1152 per capita–children get 1⁄2 dividend).
- Electricity prices peak in 2026, then start to decrease.
- Real incomes increase by more than $500 per person in 2025. This increase accounts for cost of living increases.
The deal struck with China underscores the great sense of urgency to reduce carbon emissions before the world surpasses a tipping point, beyond which catastrophic changes will become irreversible. The Intergovernmental Panel on Climate Change issued the starkest warning ever in its latest report.
One way or another, the U.S. will honor its commitment to lead global efforts to fight global warming by reducing our emissions. The question for Congress is this:
Will we achieve those emissions reductions through government regulations or through a free-market approach that grows our economy?
For Republicans who now control both the House and the Senate, this should be a no-brainer.