Dingell’s Got the Right Idea
In case you hadn’t heard, Representative John Dingell of Michigan is proposing a carbon tax. He is inviting the public to comment:
Some have suggested that he isn’t really sincere on the matter. Here is the New York Times’ take:
A tax on carbon emissions, covering everything from gasoline to electricity use, is the climate solution that economists and environmentalists have long dreamed of because it’s probably the most powerful, least bureaucratic way to discourage pollution. It has been favored by everyone from Al Gore to Alan Greenspan — everyone, it seems, except a single elected official of any significance. Until Mr. Dingell came along.
For understandable reasons, though, the economists and environmentalists aren’t quite sure what to make of his conversion. They suspect that he is really a double agent, cynically supporting an infeasible solution — a big tax increase — as a way to maintain the status quo. But they also wonder whether they may be able to use him even if he is trying to use them.
There is no question that Mr. Dingell has given people ample reason to doubt his sincerity. The biggest head scratcher came during a July interview on C-Span, when he said that he seriously doubted that “the American people are willing to pay what this is really going to cost them.” He would propose a carbon tax, he added, “just to sort of see how people really feel about this.”
Since then, though, he has explained away the interview by saying that it’s the job of political leaders like him to persuade Americans to change their minds. He has also been offering eloquent, full-throated defenses of the tax. And here’s the thing: he has a really good argument.
Whether he is sincere or not, at least it opens up a high profile forum for this debate. And this is a very important debate. I think a clear message that gas prices are headed up – so that people can plan for the rise – is the best way to get people to conserve. Had we done this 5 years ago, gas prices might still be setting near $3.00 a gallon, but the U.S would likely be using less fuel. Why? Because the recent price rise would not have caught the general public by surprise, and consumers could have begun adjusting their lifestyles. They would be financially better off for having done so.
Furthermore, a carbon tax makes alternative energy solutions more competitive. This will encourage a wider variety of options, which is much more preferable to the current system in which the government attempts to pick technology winners by providing narrowly targeted subsidies.
Even if Dingell isn’t serious, I applaud him for raising the profile of this issue.
Update: Engineer Poet at The Oil Drum also put up an essay on this today:
He goes into more detail on exactly where the money goes.