MyDD :: Moveon Pressures 2008 Candidates to Follow Dodd's Lead

Moveon Pressures 2008 Candidates to Follow Dodd's Lead

by Matt Stoller, Thu Apr 26, 2007 at 02:06:15 AM EST

The discussion on yesterday's 'Cap and Trade' scam post was fascinating. It occurs to me that we're really getting into substance on the liberal blogs - when was the last time you heard pundits on TV screaming at each other about a cap and trade system versus a carbon tax? Here's a follow-up with more info on why I prefer a carbon tax from the Carbon tax center. And here are Al Gore's recommendations, which includes both a cap on emissions and a carbon tax. He argues for an ELECTRANET, which would be 'a smart electricity grid that allows individuals and businesses to feed power back in at prevailing market rates,' as well as an SEC regulatory requirement to have companies disclose carbon emissions as a relevant 'material risk' on their corporate filings. Those are really compelling suggestions.

The big news is that Moveon is urging their members to contact the other Presidential campaigns and support a carbon tax. Here's what they quote from Dodd:

You cannot be serious about acting on the urgent threat of global warming, about making us less captive to Middle East oil, or investing in renewable energy, unless you have a corporate carbon tax that eliminates the last incentive there is to pollute--that it's cheaper.

Once again, the way to think about global warming on a policy level is to recognize that the ability to emit carbon into the atmosphere is a public commons and needs to be treated as such. A carbon tax is a way of pricing this ability appropriately. It's a useful and important tool that we need to begin discussing to seriously deal with the problem.

Tags: global warming, Chris Dodd, 2008 (all tags)

Permalink :: 21 Comments :: Post a Comment

Re: Moveon Pressures 2008 Candidates to Follow Dod (none / 0)

"A carbon tax is a way of pricing this ability appropriately. It's a useful and important tool that we need to begin discussing to seriously deal with the problem."

- This is all true, but Dodd can support the carbon tax because he is a second tier candidate. Clinton or Obama won't support any new taxes for any measure because that would be playing into Republican hands. Democrats are extemely fearful of being labeled as the"tax and Spend" Democrats. No matter what the issue, taxes= NO Democratic support except for a few Senator and Reps. It took this long for the entire partty to unify on the issue of Iraq, it's going to take a whole lot longer to pass any effective Global Warming legislation

by bsavage on Thu Apr 26, 2007 at 02:35:06 AM EST

Re: Moveon Pressures 2008 Candidates to Follow Dod (none / 0)

I don't follow. You can implement a carbon tax and reduce payroll taxes and keep it revenue neutral. Perhaps you should find some polling data on this, as the last polling data I saw on taxes suggested that the public is ready for a new conversation.

by Matt Stoller on Thu Apr 26, 2007 at 03:09:02 AM EST
[ Parent ]

I'll admit I haven't (none / 0)

read up that much on the candidates' carbon plans, and even though Edwards has one

http://johnedwards.com/about/issues/ener gy/new-energy-economy/

I haven't delved into that much... but I think he has a carbon auction permit in coordination with caps on CO2 emissions.

so what that does is create monetary value for those who don't produce carbon and can then sell the permits to those who would be penalized otherwised.

so while it is not a direct TAX it is putting monetary value on not producing carbon emissions that effectively produces a monetary penalty for those that produce Co2 while monetarily rewarding those that don't.

Call it "Medicare Option" not public option

by TarHeel on Thu Apr 26, 2007 at 07:58:49 AM EST
[ Parent ]

Re: I'll admit I haven't (none / 0)

It's a better cap system than the one the others are proposing, but we still need a carbon tax.

by Matt Stoller on Thu Apr 26, 2007 at 09:00:23 AM EST
[ Parent ]

Why? If we already have increased ... (none / 0)

... the price of using carbon, the next priorities for having in the package are New Energy R&D support and performance standards in important sectors.

Unless you are using the carbon tax to finance a technology switch with a lot of bang for the buck, I don't see the urgency of having two different ways of pushing up the price of carbon.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 11:16:45 AM EST
[ Parent ]

I looked at Edwards Plan when it came out ... (none / 0)

... and concluded (dKos diary) that it is not a home run, but it is probably a triple.

Yes, the MoveOne.org demand is one of those "smuggle a shaky premise into the question" affairs.

Both an effective tax and an effective cap and trade system raise the cost of using carbon compared to the cost of not using carbon. And the jump from "a carbon tax puts that wedge in place" to "only a carbon tax can put that wedge in place" simply does not stand up to scrutiny.

And we have a cap and trade system in the House (Waxman H.R. 1590) and Senate (Sanders-Boxer S. 309) that have received solid positive ratings (legislative fact sheet, pdf) by the National Resource Defence Council. So we ought to be getting behind those, so that the political argument can be about getting those approaches through the Congress and signed by the New Democratic President.

I would assume that a Carbon Tax organization would propose and promulgate the argument that a Carbon Tax is intrinsically superior to a cap and trade, because if you were not convinced of that, for whatever reason, you would be more likely to join a group fighting global warming with a broader perspective.

However, that does not change the basic policy rule of bringing the market correction as close to your desired target as possible. If there is a free ride cost that we can estimate, put a tax in place that eliminates the free ride. If we have a quantity goal, put in place a quantity restriction.

In this case, estimates of the cost are all over the map, in part because so much depends on what new technology we will develop and how rapidly we get started on social tasks like retrofitting our outer suburbs (dKos diary). However, we now have a scientific consensus that we should be aiming for 80% reduction in CO2 by 2050, so we now have a quantity target to aim at.

The estimates of the level of Carbon Taxation that we will require to reach any given substantial goal are just estimates ... which means there are a range of estimates, which means there is the opportunity for antagonistics interests to cherry pick the estimate that offers the lowest tax.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 09:04:32 AM EST
[ Parent ]

Yes, but does his proposal do that? (none / 0)

If you repeal payroll taxes and replace them with carbon taxes, then you still need a cap and trade, because the level of carbon taxes to replace social security and Medicare less than the level of carbon taxes needed to get carbon used down by 80% by 2050.

And of course, once you do that, you can't afford to get carbon used down by 80% ... all technological improvements and investments in existing effective technologies that improve the effectiveness of the carbon tax will undermine the revenue raised for social security and medicare.

If it is a social dividend, that is a different matter ... but not even Gore is proposing a social dividend.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 09:13:50 AM EST
[ Parent ]

Re: Moveon Pressures 2008 Candidates to Follow Dod (none / 0)

I know you are right on the public being supportive but nothing effective will get implemenen ted until 2009. I'm used to Democrats screwing things up, so its hard to be opimistic about good policies.

by bsavage on Thu Apr 26, 2007 at 04:52:09 PM EST
[ Parent ]

Re: Moveon Pressures 2008 Candidates to Follow Dod (none / 0)

Matt, this was a great, timely piece of news--thank you.

Now I hope we can encourage Moveon and other organizations to do the same with our 2008 candidates on trade policies. I sound like a broken record saying this, but fair trade should be pushed the same way.

by IrishCatholicDemocrat on Thu Apr 26, 2007 at 02:53:21 AM EST

2008 Candidates (none / 0)

I expect Edwards will probably support a carbon tax.

The sharpest criticism often goes hand in hand with the deepest idealism and love of country. ~RFK

by Vox Populi on Thu Apr 26, 2007 at 05:32:09 AM EST

I expect he will analyze the issue for himself ... (none / 0)

... and will come to his own decision what contribution a carbon tax can make to strengthening his policy.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 09:16:30 AM EST
[ Parent ]

Did Gore invent the ELECTRANET? (none / 0)

GORE IS REALLY SMART. I am also convinced that an electric power feed back grid is one of the best ways to reduce dependency on carbon fuels. It will provide incentive for entrepreneurial investment by individuals and smaller-scale businesses but, much like the internet, it will have an impact on an amazing overall scale. The big utilities should be willing to act more as regulators in a system depending less on huge investments in centralized power plants, although this will be part of the equation. Small is Beautiful--and very dynamic.

Great post Matt.

by anothergreenbus on Thu Apr 26, 2007 at 05:51:00 AM EST

Re: Did Gore invent the ELECTRANET? (none / 0)

The smart grid certainly does complement decentralized electricity supply into the grid ... but it offers substantial benefits for utility grade renewable resources even independent of consumers swapping between buying power from the grid and selling power to the grid.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 09:07:46 AM EST
[ Parent ]

Conservatives for Carbon Tax (none / 0)

One thing that alarms me is the amount of conservatives who are coming out for a carbon tax. A common thread in their reasons is that a carbon tax is a way to shift taxation from income to consumption. David Frum is now for a carbon tax, for crying out loud!!

Join us at Show Me Progress!

by clarkent on Thu Apr 26, 2007 at 10:01:38 AM EST

And if you directed part of a social ... (none / 0)

... dividend to the "business contribution" to payroll taxes, you'd even see some so-called conservatives give some support to that idea.

There is a fault line in the radical right wing movement, where part of their support base is small business, but a lot of their policies support big business to the detriment of small business. The endless "tax cut" mantra is their promise that they will make up for the pain they cause directly with reduced taxes.

One of the examples of that is the long term secular shift which saw payroll taxes take over from corporate income taxes as the second largest component of income taxation. That, obviously, helps capital intensive large corporations, but hurts those small businesses that happen to be more labor intensive ... particularly manufacturing firms that are skilled labor intensive, because of the massive wave of increasingly skilled labor intensive products produce on razor thing or non-existent margins in China.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 11:30:15 AM EST
[ Parent ]

Originality (none / 0)

Without singling out any particular candidate (I'm honestly not), I find it interesting that the outside-the-box ideas that change the way we conceive of government and the future of this country are (mostly) NOT coming from presidential candidates.

I was thinking last night that a great question for candidates of any party would be "what are you going to inspire this country to do?"

by Lucas O'Connor on Thu Apr 26, 2007 at 11:28:48 AM EST

Financial Times Agrees (none / 0)

The Financial Times agrees that we need carbon taxes (h/t European Tribune):

The burgeoning regulated market for carbon credits is expected to more than double in size to about $68.2bn by 2010, with the unregulated voluntary sector rising to $4bn in the same period.

The FT investigation found:

Widespread instances of people and organisations buying worthless credits that do not yield any reductions in carbon emissions.

Industrial companies profiting from doing very little - or from gaining carbon credits on the basis of efficiency gains from which they have already benefited substantially.

Brokers providing services of questionable or no value.

A shortage of verification, making it difficult for buyers to assess the true value of carbon credits.

Companies and individuals being charged over the odds for the private purchase of European Union carbon permits that have plummeted in value because they do not result in emissions cuts.

[...]

While short-term politics favour markets, taxes would be better in the long term, because industry needs certainty for investments years hence. A government committing to painful taxes signals the seriousness of its intentions.

[...]

. . . markets are bound to be more complicated than taxes. When in doubt, keep it simple. Markets for carbon are potentially good. But taxes would be better.

by tgeraghty on Thu Apr 26, 2007 at 12:22:10 PM EST

There's massive support from a prog. ... (none / 0)

... source.

And, yes, I'm being sarcastic.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 01:39:42 PM EST
[ Parent ]

Re: There's massive support from a prog. ... (none / 0)

Well, they did also say:

Both carbon taxes and markets put undue burden on the poor. Governments should counter such regressive carbon taxes by lowering taxes on labour.

So there you go.

by tgeraghty on Thu Apr 26, 2007 at 03:50:15 PM EST
[ Parent ]

Re: There's massive support from a prog. ... (none / 0)

I have a comment elsewhere somewhere where I mention the fault line in the radical right wing coalition between those small business who are substantial employers and capital intensive megacorps.

While I am in favor of increasing the direct income of the poor ... making more jobs available, raising the minimum wage and also making cardcheck union registration the choice of the workers rather than the choice of the employers would help here ... I quite like the provision of additional social income ... such as universal health coverage, including bringing those currently covered by the "indigent care" Medicare system into the same Health Market plan that members of the middle class will be obtaining.

However, it is also appealing, here in Ohio, to include a pro-active industrial policy that helps build the New Energy industries so that we can put more of our income into work done in our state and less of our income flowing overseas to pay for oil imports.

The words of the prophets are written on the subway halls
and tenement halls

by BruceMcF on Thu Apr 26, 2007 at 04:06:13 PM EST
[ Parent ]

Re: There's massive support from a prog. ... (none / 0)

OK, to be fair they also say this:

Smart market design could overcome most problems with tradeable permits: price caps could prevent undue harm to the economy; and intelligent regulatory regimes could prevent other forms of gamesmanship.

by tgeraghty on Thu Apr 26, 2007 at 03:52:15 PM EST
[ Parent ]

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