Bloomberg’s Mary Duenwald surveys the scene.
It looks as if the U.S. may be uniting around an increasingly realistic view of the health, environmental and climate costs of burning coal. Add in the economic forces acting against coal at a time of low natural-gas prices, and there’s reason to think policy makers might now be encouraged to enact a tax on carbon emissions as part of a broader tax-reform package to help reduce the deficit.
CNN’s Steve Hargreaves considers the options.
The question now is this: when do we see an actual proposal to limit greenhouse gases, and what does it look like? One option is some type of tax on carbon, coming in 2013 as part of broader negotiations over the budget and deficit … The idea has bipartisan support. Conservatives like it as the money can be used to reduce the deficit or cut other taxes, and liberals like it because it makes cleaner energy like wind and solar more competitive. “If we’re going to do a grand deal on taxes, [a carbon tax] will be high on the president’s list of priorities,” said Dan Clifton, a partner at Strategas, a research firm that serves institutional investors. “But it would have to be part of a compromise for Republicans to accept something.” Clifton puts the chances of a carbon tax up for serious debate at 20% currently, but higher if a grand deal on taxes takes shape.
More from Reuters.
With many scientists blaming climate change for fueling stronger weather events like the deadly Superstorm Sandy, some green groups have said Congress should look at passing a carbon tax. That could raise significant revenue for the debt-ridden federal government, but many Republicans would reject supporting anything resembling a tax, said Scott Segal, a partner at Bracewell & Guiliani, a law and lobbying firm. Still, the idea of a tax that could raise $144 billion in revenue by 2020 will receive a lot of discussion and study, Segal said on a conference call on Wednesday.
Some in Washington have held out hope that Congress might pass a carbon tax in the near future as part of a larger deal on the budget or tax reform. Norman Ornstein, a congressional expert with the American Enterprise Institute, noted yesterday in an interview that some of his colleagues are eyeing that option. A budget bill “is more likely to just simply focus on the things we did the last time we had tax reform,” he said, such as changes to the corporate and income tax code. “But it’s possible that it will open up this process to something more bold,” he said.
But Book expressed skepticism. “The partisan nature of the Congress right now and the prospect of a 2014 opportunity in the Senate is that you probably don’t get a deal on that in the next two years anyway,” he said. There would be a better chance of passing a landmark carbon-related law after the midterm election, he said.
And Reuters again.
The aftermath of Superstorm Sandy, which devastated parts of the U.S. East Coast last week, has raised fresh questions about the links between climate change and extreme weather events, which also makes the idea of a carbon tax more appealing.
A carbon tax is a mechanism to charge emitters of greenhouse gases, such as power plants and oil refiners, for each ton of carbon dioxide they emit. Prospects for such a tax as a way to address pollution and climate are probably dim in a still deeply-divided Congress, but some analysts say the measure would be more attractive if positioned as a source of new revenue.
Think Progress notes that Senate Leader Harry Reid was advocating for a price on carbon as recently as August. Matthew Yglesias says it’s a pipe dream, but at least it’s the right pipe dream to be talking about.
Here again is everything you need to know about the Conservatives’ carbon tax farce.