We Can Still Price Carbon With a Republican House

With Republicans in control of the House, Obama all but declared cap-and-trade dead. But there's a different approach that can get the job done more effectively and remain consistent with Republican values.
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Now that Republicans have taken control of the U.S. House, environmentalists are wringing their hands, seeing no possibility that Congress will enact effective climate and energy legislation in the near or distant future.

In his post-election news conference last week, President Obama all but declared cap-and-trade dead: "There are a lot of Republicans that ran against the energy bill that passed in the House last year. And so it's doubtful that you could get the votes to pass that through the House this year or next year or the year after."

Despite the gloom and doom, I remain optimistic that we can put a price on carbon that speeds the transition to clean energy, thereby lowering the level of greenhouse gases that cause climate change.

How can we do this with Republicans in charge of the House, given that only a handful of them voted for last year's bill?

By coming up with a solution that does not conflict with core beliefs of the GOP. Specifically: Don't raise people's taxes and don't increase the size of government.

Cap-and-trade ran afoul of both these tenets. It would have raised the cost of energy for consumers, becoming a "hidden tax." It would have collected massive amounts of revenue to be doled out for legislators' pet projects, and it would have established a huge bureaucracy to monitor carbon emissions and regulate a carbon trading market.

But there's a different approach that can get the job done more effectively and remain consistent with Republican values. It goes like this:

Place a fee (Go ahead. Call it a tax.) on carbon at the source -- the mine, well or port of entry. Increase that fee gradually so that clean energy becomes competitive with fossil fuels within a decade. Now here's the part that the GOP will love and some Democrats will hate: Take the revenue from that carbon fee and give it all back to the American people, every single dime, preferably in the form of monthly payments.

Won't that raise the cost of energy? Won't people's electric bills go up? Yes, that's what it's designed to do -- increase the cost of energy produced by fossil fuels. And that's why we give the revenue back to every household -- so that people can afford the energy they need.

With a predictable price on carbon, investors will pour billions of dollars into clean-energy projects, creating millions of new jobs and propelling America into a new era of economic prosperity.

That's the assessment of a publication -- "Building a Green Economy" -- recently issued by Citizens Climate Lobby. The report cites a Department of Energy study saying that wind power would account for 20 percent of America's energy needs by 2030, which would support some 500,000 jobs. If there's a price on carbon -- which the DOE doesn't factor in -- the number of jobs would be significantly higher. Add to that the jobs in solar power, energy efficiency and building out the smart grid, and our nation is out of the doldrums and back in business.

The bottom line, literally, is that there's a tremendous economic upside to a simple approach that levels the playing field for wind, solar and other forms of clean energy. There's also a horrific downside for failing to wean ourselves off fossil fuels: Rising seas that displace hundreds of millions of people, the disappearance of glaciers that provide water for much of humanity, severe droughts that cause food shortages and famine.

As another international climate conference convenes in Cancun at the end of the month, no breakthroughs are expected. That's because a global agreement still awaits a commitment from America to lower greenhouse gases.

Republicans now share power -- and responsibility -- with Democrats in Congress. Both sides must now come together to lead our nation and our world toward a prosperous and sustainable future.

The carbon fee and dividend offers the most promising path they can both agree on.

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