Carbon Cashback - Lifting the ‘Shade’
A price on carbon is key to reducing carbon emissions as it focuses on systemic behavior change. It achieves this by creating financial disincentives to consume fossil-fuel-intensive products and services. When coupled with a rebate of the carbon revenue, households can adapt to the cost increases of these products and services. Importantly, they can seek lower-cost (lower carbon) solutions and save money. Just as important companies will respond to these price signals by becoming more energy efficient and switching to cleaner technologies in an effort to lower costs.
Despite carbon pricing’s increasing popularity (over 40 countries have implemented a carbon tax), effectiveness (Sweden and British Columbia are examples), and inevitability (governments have introduced carbon border adjustments to protect local industry and encourage trading partners to adopt pricing), some continue to express doubt about its ability to address emissions and its role as a critical climate policy.
Support for Carbon Pricing
The following summarizes the support that exists for carbon pricing. These may help lift the shade that some have cast on carbon pricing.
The International Monetary Fund calculates that the failure to tax fossil fuels to properly reflect and discourage their social and environmental damage represents a global subsidy of $420 billion every year to the oil and gas industry. The question to ask any opponent of carbon pricing is, “why do you want to continue to subsidize fossil fuels?”
Those who wrongly imagine that carbon pricing is supported only by economists and oil companies haven’t done their homework. The premier carbon fee and dividend bill introduced in the last Congress, the Energy Innovation and Carbon Dividend Act, had more than 90 Democratic co-sponsors, including at least 42 members of the Progressive Caucus, 14 members of the Congressional Black Caucus, 13 members of the Congressional Hispanic Caucus, and 29 members of the Congressional Asian American Caucus. Those members realized that the causes of economic and environmental justice are best served by a powerfully effective climate policy (carbon pricing) combined with a progressive allocation of revenue (carbon dividend or cashback).
Senator Bernie Sanders wasn’t speaking for oil companies when he declared, “A carbon tax must be a central part of our strategy for dramatically reducing carbon pollution . . . a carbon tax is the most straight-forward and efficient strategy for quickly reducing greenhouse gas emissions.” Nor were two Jacobin magazine writers when they published an essay, “Why Socialists Should Back a Carbon Tax.” Nor was the CEO of the sustainability advocacy group CERES when she backed carbon pricing. Nor was the California Environmental Justice Advisory Committee when it supported a carbon fee.
We agree that everyone should educate themselves about this vitally important issue. Yes, Food and Water Watch opposes carbon pricing. On the other hand, the renowned climate scientist James Hansen says it would be “the most effective and direct underlying force for a global climate solution.” The National Academies of Sciences, Engineering and Medicine issued a major report in 2021 on Accelerating Decarbonization of the U.S. Energy System which declared, “The advantages of an economy-wide price on carbon are that it would unlock innovation in every corner of the energy economy, send appropriate signals to myriad public and private decision-makers, and encourage a cost-effective route to net zero.”
The Intergovernmental Panel on Climate Change, representing the best experts from around the globe, reported last year, “There are several advantages for environmental taxation including environmental effectiveness, economic efficiency, the ability to raise public revenue, and transparency (very high confidence). These gains can provide more resource-efficient production technologies and positively affect economic competitiveness. . . Pricing of greenhouse gases, including carbon, is a crucial tool in any cost-effective climate change mitigation strategy, as it provides a mechanism for linking climate action to economic development.”
Pope Francis backs carbon pricing. Well-reported are his statements on the need for aggressive climate action laid out in his 2015 encyclical Laudato Si’. “Pope Francis says that carbon pricing is “essential” to stem global warming — his clearest statement yet in support of penalising polluters — and appealed to climate change deniers to listen to science.”
The Lancet Commission on Health and Climate Change, representing some of the world’s leading public health authorities, declared in 2015: “The single most powerful strategic instrument to inoculate human health against the risks of climate change would be for governments to introduce strong and sustained carbon pricing, in ways pledged to strengthen over time until the problem is brought under control. Like tobacco taxation, it would send powerful signals throughout the system, to producers and users, that the time has come to wean our economies off fossil fuels, starting with the most carbon intensive and damaging like coal.”
Paul Hawken, Author of Drawdown, expressed his support of pricing at the October 2022 UH Better Tomorrow series webinar. “Carbon pricing is definitely the most significant single policy that there could be.”
Anu Hittle, former Hawaii State Climate Change Mitigation and Adaptation Coordinator, wrote in a 2020 post, “If you agree that life, property and nature are worth preserving (and are hurt by CO2 because it produces climate change), then a carbon tax can be a good thing because it could make us choose items that are “carbon-free” and so, a lifestyle that encourages the preservation of the things we value—healthy people, markets and ecosystems.”
Leah Laramee, coordinator Hawaii Climate Change Mitigation and Adaptation Commission), offered the following in her supportive testimony for HB1146 (Carbon Cashback bill): “This measure is the most effective tool in a suite of policy tools that need to be undertaken, and is one that would address much needed equity and regressivity issues that already exist in Hawaiʻi.”
These are just a sample of the expert opinions supporting carbon pricing and carbon cashback. We urge fellow climate and social activists to join us in working to make this policy part of our collective response to the most urgent crisis of our time.
