With climate on the agenda, a carbon fee and dividend policy should be considered
A few weeks into the new administration, the federal government is off to a roaring start on climate change. Democrats have indicated climate change is a priority issue they intend to tackle. President Biden signed a raft of executive orders related to climate change, elevating the issue across the federal government. The Senate Majority leader directed all relevant Senate committees to begin holding hearings on climate. And the Speaker of the House, no stranger to the fight for climate legislation, is ready for round two.
Republicans, too, know their constituents are struggling with the impacts of climate change, and their younger voters in particular are eager for representation in this national discussion. Senator Daines has addressed citizens across Montana about the need to mitigate climate change. There’s no question of congressional climate action this year—it must happen.
As Congressman Rosendale and Senators Tester and Daines and their colleagues in Congress evaluate policy options, they should consider the broadly popular carbon fee and dividend. A price on carbon can quickly slash our emissions and save lives—plus, when designed right, it can actually pay people and benefit American business. Endorsements from the scientific community, health organizations, economists, and businesses show that this is the consensus solution. Let’s explore why.
As we all understand by now, it’s imperative that the world reach net-zero greenhouse gas emissions by 2050. That target comes from the Intergovernmental Panel on Climate Change’s game-changing 2018 report. In that same report, the IPCC specified that “carbon pricing is a necessary condition of ambitious climate policies.” A steadily rising carbon fee could slash emissions enough to reach the net-zero by 2050 target. The National Academies of Sciences, Engineering and Medicine reinforced that message in a new report, naming a carbon fee as one of the solutions to reach net-zero. Scientists are committed to solving this problem, so they’re throwing support behind the most effective solution available.
Deep emissions cuts will not only help the climate, but will also be a huge boon to public health. We could save 4.5 million American lives over the next 50 years by replacing pollution with clean air. That’s why the Lancet Commission endorses carbon pricing, calling it “the single most powerful strategic instrument to inoculate human health against the risks of climate change.”
In addition to health benefits, a carbon fee can provide economic benefits to Americans, too. A fee and dividend structure, sometimes called a “carbon cashback,” will actually put the carbon fee revenue into people’s pockets to spend as they see fit. If these payments are monthly, as in the Energy Innovation and Carbon Dividend Act, 85% of Americans come out ahead or essentially break even. Treasury Secretary Janet Yellen is a longtime supporter of this approach. She affirmed in her January confirmation process that she is “fully supportive of effective carbon pricing,” adding, “I know that the President is as well.”
Economists across Montana have endorsed the Carbon Dividends policy.
A carbon fee is better for business, as well. The U.S. Chamber of Commerce recently announced its support of a “market-based approach to accelerate emissions reductions.” A carbon fee is considered a market based approach, giving businesses the ultimate say on how they shift to clean energy. It is far more predictable and durable than regulations, which can change with the stroke of a new President’s pen. Businesses across Montana, from architectural firms to fly fishing to the Montana Ski Area Association have endorsed the carbon fee and dividend policy as embodied by the Energy Innovation and Carbon Dividend Act.
With scientists, public health professionals, economists, and businesses supporting a carbon fee, Congress should listen closely. Plus, the American people themselves expect results. Public polling shows 60% of people nationwide and 52% of people in Montana want Congress to do more to address global warming. That desire defies partisanship among the American people, with majority support for climate action from Republican and Democratic voters. An effective carbon fee would fit the bill and put America on the fast track to a healthy, prosperous future.
Mark Reynolds, Executive Director Citizens Climate Lobby; Dave Atkins, Missoula Chapter Citizens Climate Lobby, Forester and Ecologist