Dr. Hansen Warns Congress: Climate Chaos Ahead! Tax Carbon to Spur Clean Energy Revolution

Yesterday, I cycled over to the Longworth House Office building to meet my former EPA colleague, Julie Simpson, who's on a fellowship to Rep. Moran's office focusing on environmental issues. Together, we heard NASA's lead climate scientist Dr. James Hansen deliver fearsome news: our burning of fossil fuel is pushing Earth's climate into instablilty. As I reported at the Carbon Tax Center site, Dr. Hansen strongly advocated a gradually-increasing revenue-neutral carbon tax to spur a clean technology revolution. He recommends that all carbon tax revenue be directly distributed in equal "dividends" to individuals.

After the hearing, Julie and I headed downstairs for lunch, and were thrilled to find ourselves in line with Dr. Hansen and his sister. After asking, we joined them for lunch. Quite an honor to "break bread" with the world's leading climate scientist who's repeatedly stood up to those seeking to ignore or silence him. I asked Dr. Hansen's opinion of "clean coal," sharing my concerns about the vast additional coal energy needed to separate CO2 from hot flue gas and sequester it deep in the ground. Dr. Hansen is a quiet, calm professorial type, but his answer was forceful and unequivocal: "There is no such thing as clean coal, and there never will be."

Hansen will lead a peaceful protest this Monday at the U.S. Capitol power plant to call on Congress to phase out coal power, a leading cause of global warming. See Capitol Climate Action for his short video calling for action.

Staff on Capitol Hill are working long hours on a whole range of emergencies, including climate legislation. Many members of Congress are finally taking the climate threat seriously. But many still deny or minimize the crisis, and many others still seem to think "cap-and-trade" with its alluring name and hiding of the price, will magically do the trick.

Much more work ahead.

Climate for Change in Washington, DC (or "Elasticity of Thermal Underwear")

Grey, chilly February morning. Sparrows, crows at my feeder -- pushing, squawking, scolding for perches above the grain trough. Competition eclipses nutrition. Or is it just sport? I recognize the game.

Slept well: cool air, warm blankets. Heat's off in my DC row house-- buffeted by a foot of attic insulation, neighbors, thick walls. Thermal underwear tops my list of global warming reduction technologies. Pays for itself daily. Feeling bouyed, reflective after two days of meetings between carbon tax coalition and Capitol Hill staff.

Our coalition is growing, bonding: Carbon Tax Center, Climate Crisis Coalition, Friends of the Earth, Friends Committee on National Legislation, Get America Working, Climate Policy Center. Dedicated, passionate local activists from adjacent Maryland and Virginia districts.

"Revenue-Neutral Carbon Tax" seems less quixotic now. Smart, urbane Hill staff ask incisive questions about pricing carbon emisssions, adjusting rates to meet scientific standards. We, carbon tax advocates are no longer the "lepers" of the environmental movement. Questions are about "how", not "why" to price CO2 emissions. About rates, revenue-recycling, payroll tax reductions, price elasticity, expectations, energy efficiency and technology substitution. We're way behind, the hour is very late, but the "denier in chief" has left town. Not a second too soon.

Debated "tax vs. cap" on Progressive Democrats of America's climate activists' conference call last evening. About 50 participants. Thoughtful questions. The word is getting out: Cap-and-trade is a hidden, volatile, regressive tax to fund favorite projects including the thermodynamically questionable "carbon capture and sequestration" a.k.a., "clean coal."

A carbon tax can be simple, quickly-implemented and fair. Most importantly, transparent prices are effective. Can't say who "won" the debate. My rival, NRDC's Dan Lashof is no lightweight. Listeners' questions made me think we're toe to toe with what was presumptive winner. Complex stuff. Someone asked how cap-and-trade can be internationalized. My answer: It's a nightmare. And India and China won't do it. Carbon tax is straightforward -- we tax other countries' goods on import. If they enact their own carbon taxes, they keep the revenue. India and China might do that.

Long list of follow-up items. Call my sweetie. Take clothes off the line. Pay the electric bill. Global warming, Congress, prices, clothespins. Advocate exponentially, act arithmetically?

Ingrid Jackson asks candidates THE CLIMATE QUESTION

EGROM FALCUOR!

Bravo! to Ingrid Jackson for speaking truth to power at Tuesday's Presidential "debate." After pointing out how fast Congress moved in the face of an economic crisis, Ingrid asked the candidates what they would do in their first two years to address the climate crisis and create green jobs. Interviewed afterwards, she said neither candidate responded with the sense of urgency she feels. Ingrid, I'm with you!

Obama promotes "clean" coal, technically "carbon capture and sequestration" or CCS. The idea: "capture" the CO2 released from burning coal, then pump it into empty gas formations deep in the Earth where we hope it will stay-- forever. If these processes are even possible on a large scale, we know from thermodynamic calculations that they'll require vast amounts of energy. (Think about separating gases and about pumping them long distances and deep into the Earth or the oceans.) Estimates by the Nobel-prize winning IPCC suggest that CCS would require 30 - 60% more energy than otherwise would be needed to make electricity. The additional energy and capital cost of CCS equipment would push electricity costs up roughly 80 - 120%. But right now, wind power is available to consumers in many states for about 15% more than dirty coal power. Here in DC, it's called "Power Choice." So wind is already cheaper than "clean" coal is expected to be for electricity generation. And the cost of wind energy should decline as we scale up. Conversely, capturing and sequestering carbon from "clean" coal is likely to become more costly (both in dollars and energy) as the easy and close places to store CO2 underground are filled up and we have to pump waste CO2 further and deeper.

McCain advocates drilling and nuclear. (Is nuclear better than Bush, Palin and Homer Simpson's "Nuke-you-lar"? Sorry, couldn't resist.) Nobody would operate a nuclear power plant in the US without insurance. And no insurance company writes policies to cover the huge damages of a nuclear disaster, at least not at prices utilities could profitably afford. So Congress committed our tax dollars to insure the owners of nukes. The nuclear power industry would not exist if it had to buy adequate insurance at market prices. The risk is too vast. If the insurance companies won't cover nuclear, why are we willing to take such risks? Not convinced? Read about the Chernobyl nuclear disaster.

Hats off to Ingrid. Too bad our choice is between a) Obama's "clean coal": mountaintop removal, toxic air and water with staggering costs and b) McCain's nuclear: uranium mining and processing, radioactive air and water, with the risk of accidents like Chernobyl and the intractable problem of nuclear waste disposal for a few million years. How about c) wind, solar , geothermal and conservation, please? How about pricing carbon pollution to push everyone -- the entire energy market -- towards conservation, renewables and yes, Ingrid, green jobs?

Why do candidates avoid mentioning conservation? The U.S. wastes about half the fuel we burn. What about insulating our houses, turning off lights, turning down thermostats and avoiding aggressive driving? What about flying a lot less? (A 4,000 mile round-trip produces approximately eight tons in CO2-equivalent gases per passenger. Roughly the same amount of CO2 produced yearly, per person, to power the average American car and supply heat and electricity for the average home.)

When will major party candidates level with us? As environmental scientist, ethicist and population activist Paul Erlich points out, it's time to re-think what it means to have a good life. Can't we be happier with more love, more learning, more community, and less waste, less stuff, less travel, less of everything we've been told to by advertising to buy. And what about the old idea we should only buy what we have money for?

Ingrid may be too young to have heard John Lennon's song "Gimme Some Truth" but that's what she was very earnestly asking for. We didn't hear much truth about the climate crisis in the debate, but maybe her question will remind us to keep asking. We're running out of time.

"Fierce Urgency" of Climate Crisis compels Carbon Tax

Effective climate policy finally got a hearing on Capitol Hill last week.

The "fierce urgency" of the climate crisis compels effective action, warned Rep. John Larson (D-CT) at Thursday’s House Ways and Means Committee’s packed hearing on climate change revenue measures. Hurricane Ike’s devastation of coastal Texas imparted deeper meaning to Martin Luther King’s phrase. Witnesses pointed to storm-related damage as one of many ways in which failure to reduce the greenhouse gas emissions that drive global warming will destroy ecosystems and economies alike.

New York Mayor Bloomberg kicked off a day of testimony calling for revenue-neutral carbon tax as the most effective and transparent way to "use capitalism" to create the incentives for everyone to reduce fossil fuel use and for development and implementation of low-carbon alternatives.

Earlier in the week, a panel of politically-diverse economists recommended distributing revenue from either a cap-and-trade auction or a carbon tax to individuals rather than doling out the funds (or equivalent in pollution permits) to energy firms.

The focus on effective policy rather than the tired refrain of denial and delay felt refreshing, even inspiring. Expert panels discussed potentially effective measures like a carbon tax with a direct dividend; the discussion has moved beyond clumsy and ineffectual cap-and-trade measures that have dominated for years and which have produced no greenhouse gas reductions in Europe.

The deniers and delayers got their appearance; Heritage Foundation's David Kreutzer asserted that nothing the U.S. could do would matter and that climate legislation is too costly. Maybe that's progress; industry shills seem to have moved from denying the climate crisis to quibbling about the cost. (Gargantuan storms like Katrina and Ike are hard to ignore so they're changing the subject to money.)

The conservative / industry line on global warming closely tracks their half-century old script on smoking and lung cancer. No surprise, it's the same crowd. Their game plan:

1) Deny. "Smoking doesn't cause cancer." ("Global warming is a hoax.")

2) Generate controversy: "You can't prove smoking causes lung cancer." ("You can't prove global warming is real.")

3) Blame the victim. "It's your fault, there are warnings on the label — why did you start? You could have quit." ("It's your fault, you're addicted to oil, you should be "energy independent".)

4) Assert that it's impossibile to do anything. "Banning or restricting smoking wouldn't matter, people would smoke anyway." ("Pricing or regulating greenhouse gas emissions and developing alternatives won't matter, the Chinese and Indians will burn coal anyway.")

5) Argue cost-benefit; assert that it's too expensive to do anything. "Tobacco is very profitable. Regulation costs more than our profits and would put poor tobacco farmers out of business. ("Fossil fuels are necessary for economic growth, serious action to reduce their use would destroy our economy and hurt poor people.")

6) Bankruptcy. (Coming attractions.) "We're bankrupt and can't pay for the harm we've caused." (Bankruptcy is depolyed only after executives and the savvy "insider" shareholders have taken their money out of the company or out of the country. It's standard strategy in Superfund cases -- the polluters delay while they move their assests, then leave taxpayers stuck with the cleanup bills.)

Science will prevail, but climate change grows exponentially and irreversibly, so if industry shills like Heritage can stall for a few more years, it will be too late to save much of civilization or Earth's biodiversity.

Socrates said "There is no evil but ignorance." Heritage is doing its best to keep us in the dark. The Committee gave them their say, but maybe their script is finally wearing out.

It's not a question of whether the U.S. acts alone, it's whether the world's largest economy takes the lead in pricing carbon emissions. As Dr. Frank Ackerman of the Stockholm Environment Institute put it, “If the U.S. leads, the world will follow, but if we don’t, the worst consequences” can be expected.

Like The“Boy Named Sue,” Carbon Tax Advocates Battle Bias Against Name

In his hit "A Boy Named Sue," Johnny Cash sang of a boy whose father named him “Sue” and left him to make his way in the world. “Sue” grows up seeking revenge on his papa. They finally meet in a barroom brawl, and Sue gains the upper hand. But he spares the life of the man who saddled him with a girl’s name after his dad explains, “I knew you'd have to get tough or die. And it's the name that helped to make you strong."

Carbon tax advocates understand how "Sue" felt. We’re often ignored or ridiculed, and have to fight to be taken seriously. “Life ain’t easy for a boy named Sue.”

While carbon taxes are ignored, life has been easy for the competing carbon-reduction scheme known as cap-and-trade. Big Green groups like Environmental Defense and the Natural Resources Defense Council have strongly backed cap-and-trade, as have some major corporations seeking to promote their green credentials and secure prime seats at the bargaining table. Politicians seem loathe to mention carbon taxes. John McCain and Barack Obama (as well as Hillary Clinton) support a carbon cap-and-trade system. Few members of Congress dare to support a carbon tax.

Yet economists across the political spectrum are virtually unanimous: a revenue-neutral carbon tax would reduce emissions far more effectively than a cap-and-trade system. Some even suggest that cap-and-trade's complexity and volatility would cause it to fail altogether. Nevertheless, the political class insists that the public will never accept anything called a “tax.” And so, in a classic self-fulfilling prophecy, Congress hasn’t seriously entertained a carbon tax and media coverage is almost entirely focused on cap-and-trade.

Across the border, the picture is quite different. The leader of Canada’s (centrist) Liberal Party, Stéphane Dion, is advocating a carbon tax re-framed as a ”Green Shift” that would tax fossil fuels and redistribute the revenues to taxpayers by reducing other taxes and direct payments. Dion and the Liberals are taking plenty of flak for advocating a tax, but, like Johnny Cash’s “Sue,” they’re hitting back hard, pointing out that a revenue-neutral tax is not a government money grab but an effective and progressive way to nudge the economy toward a low-carbon diet. Dion’s plan would bind the government to return every dollar collected for carbon pollution to Canadians via other tax cuts, annually verified by the Auditor General. Canada’s third largest province, British Columbia, started a revenue-neutral carbon tax this July, and other provinces are considering following suit.

Cap-and-trade advocates don’t broadcast the inconvenient truth that higher fuel prices are an element of both cap-and-trade and carbon tax systems, and indeed, that a price on carbon emissions is central to any serious policy to combat global warming. Advocating a carbon tax, Canadian environmentalist David Suzuki puts it this way: “We pay $90 at ton to put garbage into landfills – yet we act as if the atmosphere is limitless and don’t pay a price for [dumping carbon into] it. That doesn’t make any sense.”

Cap-and-trade would reduce emissions — and raise prices — by gradually reducing the number of pollution permits. This would require setting up a whole new market with its own currency (auctioned, tradeable permits) and a regulatory bureaucracy dedicated to overseeing the new market and its participants. Setting up and managing such a bureaucracy is an enormously high price to pay just to avoid saying the word "tax" or having to explain a “revenue-neutral carbon tax.”

To many environmental advocates conditioned by years of “settle for what we can get” politics, advocating a policy called a tax is about as appealing as being a boy who has to explain why his name is “Sue.”

But just as the boy named Sue was tough inside, a carbon tax is straightforward and plays no favorites. The underlying idea is simple: reduce carbon emissions by imposing a comprehensive tax on coal, oil and gas where they enter the economy. The tax must be high enough and increase steeply and predictably enough to affect consumer and business expectations and behavior via the pull of price signals. As the tax pushes the cost of coal power above that of wind energy, entrepreneurs will build, and consumers will purchase power from windmills, not coal mines and coal-fired power plants. When heating bills exceed the cost of attic insulation and energy-conserving windows along with the hassle of installing them, homeowners and landlords will hire renovators instead of paying the higher fuel and utility bills. When airfares exceed the cost to build and run a network of high-speed trains, perhaps Congress will get busy and authorize it.

During the debate leading up to the defeat of the Lieberman-Warner cap-and-trade bill in June, proponents argued that a cap with auctioned permits would generate revenue just as a tax would, and that these revenues could be allocated to alternative energy projects and other "good works." But this idea has three serious flaws:

1. Congress favors powerful corporations and other big campaign donors, so unsurprisingly Lieberman-Warner would have given out the auction revenue as subsidies for ethanol, nukes, "clean coal" research, and "transition adjustments" for the same fossil fuel industries that would have paid for pollution permits

2. It's far too early in the technology race for Congress or anyone else to know which technologies will work the best for reducing greenhouse gas emissions. In contrast, a tax on carbon pollution would set the market to work on finding, developing and deploying those technologies.

3. Because poor families spend a larger fraction of their incomes on utilities and fuel, both a carbon tax and cap-and-trade would disproportionately impact lower income people unless linked to a dividend or tax shift to distribute the revenue to everyone. Rich people (who fly more, drive bigger vehicles and live in larger and multiple homes) burn far more fossil fuel than poor people, so the rich would pay most of the revenue into a carbon tax, while a dividend would spread that money equally over all income groups. The Carbon Tax Center figures that the bottom 2/5 of households would be net gainers under a carbon tax with dividend, while the middle quintile would break even and the top 2/5 would pay more carbon tax than their dividend. Under a carbon tax-and-dividend, we'd all pay higher prices for fossil fuel but we'd all get the same dividend. So those who use less than their share of fuel (lower income folks and those who learn to reduce carbon impacts) would pay out less in increased prices than they would receive in dividends. We'd be PAID to conserve the carbon recycling capacity of the atmosphere while the wasters at the top were penalized.

The bottom line: a carbon tax with dividend (or tax shift) will push everyone to reduce fossil fuel use without hammering the poor.

Unless the U.S. and other nations attach strong, clear price signals to carbon emissions, we won’t develop and implement low-carbon technologies. Instead, the world will continue to waste energy and spew carbon, and global warming will cascade into a chaotic and unmanageable avalanche. A revenue-neutral carbon tax is the right medicine for this grave condition. It would be tragic if its jarring name kept the best medicine on the shelf while the patient languished and perished.

Great week for truth in carbon pricing

Three heartening developments:

Obama gained high ground by acknowledging the inconvenient truth: reducing fossil fuel prices in the face of climate catastrophe isn't a good idea.

British Columbia initiated a revenue-neutral carbon tax with dividend to create incentives for a more carbon-efficient economy.

Two courageous EPA enforcement attorneys exposed the manipulations and failures of cap-and-trade.

Maybe good politics and good policies are beginning to align.

Along with Al Gore and NASA's Dr. James Hansen, economists from left to right (Rob Shapiro, Bill Nordhaus to Greg Mankiw and Ken Greene) agree: pricing greenhouse gas emissions is a necessary first step in any effective effort to combat global warming. And like the EPA whistleblowers, they agree that a revenue-neutral carbon tax would work much better than cap-and-trade.

Because I'm convinced that a gradually-increasing revenue-neutral carbon fee would stimulate our entire economy towards efficiency and renewables (and create incentives for our trading partners to follow suit) I volunteer for the Carbon Tax Center.

We have much work ahead to build support for a carbon fee and dividend system, but after this week, I have hope.

Carbon Footprint

"Big Foot" (NEW YORKER, 2/25/08) by Michael Specter, describes the complexities of calculating the "carbon footprint" (climate impact) of various food products. Specter also described the similarly complex "cap and trade" system often discussed as a way to reduce greenhouse gas emissions.

My response, published 3/24/08:

Specter notes that we need price incentives to reduce greenhouse-gas emissions. But there’s a simpler alternative to cap and trade, which is a complex (and volatile) system. A carbon tax levied on fossil fuels as they enter the economy (through importation or extraction from the earth) would allow the prices of goods and services to reflect their carbon footprint; and a Congressional Budget Office study concluded that the net benefits of a tax could be roughly five times as high as the net benefits of an inflexible cap. Simple, fair, direct, and, perhaps most important, predictable.


James Handley

Washington, D.C.