Doing nothing on climate change costs more than doing something, even Gov. Jay Inslee’s modest carbon tax, writes columnist Jon Talton.
If you want less of something, tax it.
This simple axiom informs Gov. Jay Inslee’s proposal for a tax on carbon in Washington state.
Carbon emissions are the worst driver of human-caused climate change, which is already proving costly and disruptive. It’s only going to get worse.
National action currently is impossible because the federal government is controlled by the Republican Party, which denies the settled science of climate change and actually wants to increase production and burning of carbon-belching fossil fuels. President Donald Trump withdrew the United States from the Paris Climate Agreement, where most nations pledged ambitious steps to reduce emissions.
It falls to the states to act.
Since 2012, California has implemented and expanded a cap-and-trade program. At the risk of oversimplifying, this set up a market for carbon-emitting industries to get permits that can be traded with other firms based on need. The permits are capped, thus limiting total carbon output and encouraging the move to cleaner technologies.
The Golden State’s program is complex (and flexible) and has its critics. But it’s working so far and even had some bipartisan support. Californians pay more for such things as gasoline — costs are passed on, of course. But the state economy has performed strongly. And recent fires and floods, some climate-change related, show Californians have real skin in the game.
Another model is found in British Columbia, which has taxed carbon since 2008 (and Canada is remaining in the Paris accords). That measure was first introduced by the right-leaning Liberal Party; most conservative parties outside the United States accept the reality of climate change.
Gasoline costs more, but emissions have gone down. The B.C. economy has done well. And voter support has grown. Important to that backing is the way the plan is structured: Funds raised by the tax are returned to households and businesses as tax breaks and credits.
In Washington, Inslee in 2015 failed to persuade legislators with a cap-and-trade plan. The new carbon tax is another market-based method to reduce emissions.
Whether it goes anywhere in the new Legislature is an open question. The fossil-fuel lobbies are strong, even though some companies — including Microsoft and REI — are backing the plan.
Unlike California, Washington is a purple state — or it was until the unpopularity of Trump. Republicans controlled the state Senate until this year and could do so again. The steadiness of this brick in the Blue Wall is uncertain, however passionate the voices in Seattle.
Washington also has skin in this dangerous game. Climate change poses major risks to fisheries, forests and water supplies. (The sleeper story here is the destabilization due to climate refugees from the Southwest in the coming decades, but that’s another column).
Would Inslee’s plan work? Much would depend on the details, such as pricing and how the revenue is used. The state also needs to think more holistically about climate, including the need to lure clean energy tech companies and invest in building rail transit faster and more extensively.
Based on the experience in British Columbia, a smart plan would succeed — with some disappointments. Chief among these is the lack of similar actions in most other jurisdictions and the outsourcing of emissions to industries elsewhere, whose products are imported to B.C.
This underscores the need for truly global action, which made Paris so important, particularly when the United States under Barack Obama and China came together to make it happen.
Even then, some prominent economists say carbon needs to be priced much higher to dampen emissions with the appropriate price signals. That would also reflect carbon’s actual costs to the environment, rather than the price that is subsidized by everything from roads to armed forces that keep oil lanes open. Their target: A tax of $40 to $80 a ton by 2020. Inslee’s plan is $20 a ton. British Columbia’s tax is about $24 a ton in U.S. currency.
Doing something is expensive. Making a transition to cleaner energy, less sprawl and more fuel-efficient transportation would create millions of jobs. But advocates shouldn’t diminish the pain of the transition.
I’m skeptical that techno-magic alone will solve things. Electric cars are expensive and still need to be made by, and usually charged from, fossil-fuel inputs. Carbon capture — where CO2 is pulled out of the atmosphere and somehow stored — is unproved and unlikely to undo the level of pollution.
Most Read Business Stories
- Amazon can keep Parler offline, judge rules
- Amazon, Virginia Mason team up on COVID-19 vaccine pop-up clinic
- Lawyers advise Ethiopian Airlines against 'financially disastrous' settlement offer by Boeing over 737 MAX crash
- Amazon, Costco not among major retailers shunning MyPillow and its Trump-boosting CEO
- Western Washington home sales, prices climbed in 2020. See how home prices rose in 23 counties.
Doing nothing will ultimately be much more expensive — but over a long timeline, allowing for denial and special interests to stymie action. Even so, the economics are undeniable.
Modern humans have never faced an existential crisis like this before.
Hitler and the Nazis required the expenditure of lives and treasure, but the matter was straightforward after the isolationist America Firsters were pushed aside. The Cold War required patience to keep it from turning hot, but both American leaders and voters could comprehend it.
Climate change is different. It’s been creeping up on us for decades. Carbon wasn’t such a menace when the much dirtier Industrial Revolution got started. The planet’s population was around 1 billion. Today it’s at least 7.6 billion.
Addressing climate change requires not only some different jobs, but changing living arrangements that many people cherish. For Americans, the status quo means the drive from suburban pod to Walmart to imbibe of the 10,000-mile supply chain — all of which dumps carbon into the global commons of the atmosphere.
The pockets of the Koch brothers and other fossil-fuel barons are deep, but the pull of custom is powerful, too.
As a result, Inslee faces a tough lift. It’s a fight worth making. Even state-by-state efforts help.
Maybe at some point enough people will wake up. Maybe at that point it won’t be too late.