Marin Voice: Let's use the economy to fight global warming

The Environmental Protection Agency's new rules to reduce carbon emissions from power plants are a big step in the fight against global warming. But power plants are just 40 percent of the problem. What else can the U.S. do to reduce more carbon sooner, but won't disadvantage our economy?

The conservative state of Alaska has a model. It's called the Alaska Permanent Fund.

It works like this: When energy companies take gas and oil from state lands, the state collects a royalty, or tax. Then, each year, it disburses a portion of this money to each of its citizens in equal shares.

We could do something similar at the national level. We could institute an annually escalating carbon tax assessed at the mine, well, or port of entry, and return the money each year in equal shares to every American citizen over 18.

This revenue-neutral plan is the basic proposal of Citizens' Climate Lobby. Rather than disadvantaging our economy, a revenue-neutral carbon tax and dividend would use our economy's power to drive innovation and long-term efficiency. As it is now, our economy rewards creating permanent and ultimately high-cost carbon pollution.

That's because existing tax rules create what amounts to a fiduciary duty for corporations to use our atmosphere as a free dump. A carbon tax flips that right-side up: if polluting is a foreseeable, escalating cost, then corporations would have a fiduciary responsibility to reduce their exposure to them.

A carbon tax would even motivate China, the world's biggest carbon emitter, to curtail its carbon output to stay competitive.

The real power of the plan lies in the per-capita dividend. The dividend would offset any potential regressive quality of the tax. Moreover, it would reward diligent saving and smart consumer spending. Rather than regressive, a carbon tax-and-dividend is empowering.

A carbon tax is non-ideological. It leaves investment decisions to individuals and corporations. It inspires innovation, and that'll create jobs. It reduces the need for complex regulations. It decreases government involvement in micro-level decisions and in picking technological winners.

A carbon tax is efficient. It takes the burden off volunteerism, which is no match for the scale of our fossil-fueled economy. It unifies today's grab bag of federal, state, and local carbon reduction programs with a fundamental market force.

A national carbon tax-and-dividend can work alongside or in place of California's cap and trade system. It can work alongside the EPA's new rules.

Economic incentives work. Carbon taxes in British Columbia and Sweden have significantly reduced carbon emissions even as those economies have grown and thrived. A new study by Regional Economic Models Inc. shows a tax that escalated by $10/metric ton of carbon dioxide every year through 2035 would create 2.8 million net jobs, while reducing carbon emissions by 52 percent, compared to business as usual.

Supporters of a carbon tax span the political spectrum from President Ronald Reagan's Secretary of State George Shultz to President Bill Clinton's economic adviser Larry Summers and Nobel economist Joseph Stieglitz.

The recent National Climate Assessment shows we're already feeling the effects of global warming. Droughts and storms are becoming more extreme. Agriculture is threatened. We owe it not just to future generations but to ourselves to stand up to this challenge, before the costly damage begins to accumulate. A national carbon tax and dividend is a simple, effective, and fair way to do it.

Ray Welch of San Rafael and Peter Joseph of San Anselmo are active in Citizens' Climate Lobby. For more information, visit