Huge News: Putting a High & Rising Price on CO2 Could Balance the Budget (New Plans Proposed)

The road to the future could be smoothed by a long term program based on BUDGET BALANCING, CARBON PRICING and FINANCIAL TRANSITION tools. These tools must be used to address defined National goals which have yet to be clarified by our national political and technical leadership.

The USA has been hampered by inadequately planned/managed tax, infrastructure, commerce, education, and social policies. All need active evaluation (say once every 5 years, looking forward to the next 15 to 25 years), a balancing of the projected program needs and revenues, and identification of needs for policy change.

Policy planning and change were made by many other nations following the petroleum supply “wake-up calls” of the 1970s. These proactive nations have not been dragged into making costly international security expenditures, as has the USA. Nor have they excessively suffered from adverse balance of payments with others linked to funding the world terrorism battles. Congress has allowed continued reliance on obsolete/unsustainable policies which are being driven by political contributions and stealth funding by interests from the advocacy, defense, education, energy, finance, insurance, pharmaceutical, science, and transportation sectors. Each sector has drawn battle lines which often conflict with the interest of “We the People”. 

A well-structured plan for BUDGET BALANCING, CARBON PRICING and FINANCIAL TRANSITION could address today’s problems; and promote orderly phase-in of economically beneficial, environmentally benign, CLEAN ENERGY SOURCES and CLEAN ENERGY CONVERSION TECHNOLOGIES (whatever they may be, based on predictable investment economics, NOT unpredictable subsidies granted by politicians, or casino-like roulette of the commodity market).

The starting point must be that REVENUE from any CARBON PRICING plan must be specifically allocated, $ for $, for DEFICIT REDUCTION and any other Congressionally-declared PUBLIC PURPOSE. Hopefully, Congress will plug tax loopholes which favor entrenched economic sectors and promote research to meet 21st Century needs.

CARBON PRICING could take the shape of a consumption tax, levied at the point of delivery (plant storage facility or fuel pump), adjusted for fuel type, and progressively increased to achieve the policy goals of Congress and the President.
REVENUE COLLECTION should be essentially the same as currently done, without any new bureaucracy. Over the past 12 years gasoline prices have increased over $2.00/gallon, lining the pockets of OPEC and the speculators. It is time for Congress to subdue the consumption beast for a PUBLIC PURPOSE. See   www.eia.gov/emeu/steo/pub/special/summogas.html  for retail gasoline prices of that era.

FINANCIAL TRANSITION could be softened by beginning with a low, and progressively increasing consumption tax rate, say 20 cents/gallon and $??/ton coal in 2011, then upping the rate 10 cents/gallon, etc. each year for, say 10 years. This is approximately half the increase we have experienced during the last 12 years. Once the changed consumption and revenue patterns are understood, a well-lead Congress could review the program and make necessary changes to ensure that DEFICIT REDUCTION and other Congressionally-declared PUBLIC PURPOSE are being achieved.

If the USA adopted visionary energy policy in the 1980s based on known long-term supply and prudent National interest, things could have been different in 2011. Think about the alternative picture of the USA with a world-revered treasury; and a post-Vietnam, recovered shining image. Also think about today’s foregone possibilities for achieving clean energy. Congress can still set the stage for 15 – 25 years of real progress, instead of perpetual partisan bickering while we taxpayers pay their undeserved salaries.

If the bag of 2011 burdens was lightened by a sustainable economy and modern energy policy, it would be so much easier to balance the budget, pay down the debt, and honor social commitments.  Action is needed now because 2021 will arrive sooner than we may like.