Groups of Republican college students calling themselves Students For Carbon Dividends are organizing support for a plan put forth by James Baker and George Schultz. Each man served as Secretary of State under Republican presidents — George W. H. Bush in the case of Baker and Ronald Reagan in the case of Schultz. The Baker/Schultz plan is simple. It would impose a tax of $40 a ton on all carbon emissions. People like Elon Musk have warned repeatedly of the harm that comes from what economists call “untaxed externalities.” That’s econo-speak for passing off some (or all) the costs of doing business for others to pay.
The Baker/Shultz plan would correct some of the imbalance in the current economic structure that allows fossil fuel companies to avoid paying for the harm they do to the environment. It is enough? Too much? Those are questions yet to be determined, but it’s a place to begin the discussion. For economists, the result is greater “efficiency,” which is code for saying it will encourage people to do the right thing without a lot of rules, regulations and the enforcement bureaucracy that go with them.
As an example, that greater efficiency would tilt the economic calculus away from gas guzzling behemoths and toward low or zero emissions vehicles. Instead of the EPA forcing companies to build certain cars, consumers would simply exercise their right to make a decision based on their needs and desires commensurate with their ability to pay.
Raising The Price Of Gasoline
The proposal would add about 36 cents per gallon to the cost of gasoline. That would hit some families hard, but the money collected would be redistributed to the American people. A family of four would receive a rebate of about $2,000 per year under the plan. In fact, the sponsors prefer to call their proposal a carbon rebate rather than a carbon tax. That’s smart marketing. No person ever born ever wants to pay a tax, but all of us like rebates.
Resources for the Future, an independent economics think tank, estimates that a $40 revenue-neutral carbon tax would prevent 16.8 billion metric tons of carbon dioxide being added to the skies over America every year. The Climate Leadership Council, which includes Michael Bloomberg, Stephen Hawking, and Steven Chu among its members, is in favor of the plan. It believes the Baker/Schultz program would make it possible for the United States to meet all of its commitments under the Paris climate accords signed in 2015.
College Republicans Have Their Say
Students For Carbon Dividends currently has 34 chapters on various college campuses. 23 of them are groups that call themselves College Republicans. “Adult leaders have not acted efficiently or effectively on this issue, and we are stepping forward to fill the void,” Alexander Posner, the founding president of Students for Carbon Dividends and an American history major at Yale University tells The Atlantic.
“I think a lot of young conservatives are frustrated by the false choice between no climate action and a big government regulatory scheme. They feel pressured that those are the only two options, and they’re hungry for a conservative pathway forward on climate,” Posner says. “The other thing that’s unique here is that the elder statesmen of the Republican Party are kind of uniting with the younger generation, to press the middle generation to act on climate.”
“This solution is not necessarily perfect, but it’s a good one that we can work with Republicans on, and it’s an improvement on the status quo,” says Jordan Cozby, a history major from Huntsville, Alabama and president of the Yale College Democrats. “Recognizing that the balance of power is the way it is, it’s unlikely that Democrats or any pro-climate members of Congress will be able to push through a partisan, Democratic climate plan. So what are the solutions we can look for with the current circumstances?” He adds that the proposal needs to be “as robust and environmentally conscious” as possible “before any of the regulations are pulled back.” No bait and switch for young Mr. Cozby.
“I’m very pleased to see College Republicans leading on this issue,” Edward Maibach, a professor of climate change communication at George Mason University told The Atlantic in an e-mail.
“The Republican party has a clear climate change problem. Being on the wrong side of the scientific facts is bad for the party, bad for the country, and bad for the world.
“When College Republicans come out in large numbers in support of a revenue-neutral price on carbon, it will speak loudly to Republican members of Congress who are going to need the support of those voters at the next election, and the next, and so on. Thankfully, young voters will be around for a long time. It’s best to earn their support now.”
Is $40 A Ton Enough?
The Baker/Shultz plan is no panacea. $40 a ton is higher than many politicians would be willing to support, but may not be high enough to accomplish its main mission, which is to dramatically reduce carbon emissions as quickly as possible. Some have suggested much higher carbon fees will be needed to reduce carbon emissions significantly.
Even if such a plan is enacted, the rebate may not be enough to offset the higher cost of living average Americans will experience if Republican tax policies that massively favor the wealthy are allowed to stand. Couple that with the increases that cutting Medicare, Medicaid, and Social Security will entail and most families will find themselves worse off than they were before even with the rebate.
The Reagan era drumbeat against big government — a mantra generously supported by the Koch Brothers and their minions — looks like so much applesauce, now that Republicans, who beat their chests about budget deficits for a generation, threw their vaunted principles overboard at the first opportunity to please wealthy backers. Why should anyone trust these charlatans not to just pocket the money raised by a carbon fee to pay for more giveaways to the rich?
It would be easier to have confidence in the bona fides of Republicans if they did not insist on shattering any reason to trust them at every opportunity. Still, the fact that younger people are willing to pay some attention to climate change is encouraging, although it may come too late to have any meaningful effect on the Earth’s environment.