CTC’s Special Request for Your Support

On January 20, 2009, less than ten weeks from today, the United States will have a new president and a new Congress. After eight years of obstruction by the Bush administration, and years of delay before that, the United States is finally poised to take action to reduce greenhouse gas emissions.

On December 9, six weeks before Inauguration Day, the Carbon Tax Center is holding a briefing on Capitol Hill to articulate to the incoming Administration and Congress why a tax on carbon emissions must be the centerpiece of a new U.S. climate policy. Headlining the briefing is NASA climatologist James Hansen, a powerful advocate of a carbon tax. Dr. Hansen will be followed by two eminent economists, Prof. Gilbert Metcalf of Tufts and Dr. Robert Shapiro, currently at Sonecon and formerly U.S. Under Secretary of Commerce for Economic Affairs. James Hoggan, chair of the David Suzuki Foundation and a highly regarded Canadian pollster, will speak on public opinion regarding British Columbia’s carbon tax and the impact of the Liberal Party’s carbon tax proposal on last month’s Canadian national election.

The briefing is being hosted by Rep. John Larson of Connecticut, a member of the tax-writing Ways and Means Committee and author of a carbon tax bill introduced last year. Mr. Larson is Vice Chair of the Democratic Caucus, making him the fifth-ranking Democrat in the House, and has been mentioned as a possible successor to Rahm Emanuel, Chair of the Caucus and soon to be chief of staff to President Obama. The briefing will run from 9 a.m. to 11:30 a.m. and will take place in a Ways & Means Committee hearing room, B-318, in the Rayburn House Office Building. The Climate Crisis Coalition has joined us as conference organizer, and Friends of the Earth and the Environmental & Energy Study Institute are serving as co-sponsors.

We are particularly pleased that James Hansen has agreed to be our keynote speaker. For over 20 years, Dr. Hansen has distilled mounting evidence that rising levels of atmospheric carbon dioxide will soon lead to disastrous climate change into urgent calls for action by the United States and other major emitters. Dr. Hansen courageously rebuffed efforts by the Bush administration to muzzle him and has continued to combine world-class research and public education on the imminence of potentially devastating climate change with exhortation for action. At the top of Dr. Hansen’s agenda, and a focal point of his presentation at our briefing, is the need for carbon pricing delivered through steep but equitable revenue-neutral carbon taxes.

Following Dr. Hansen’s keynote address, economists Metcalf and Shapiro will detail the mechanics of carbon taxing, and Mr. Hoggan will share his research findings on public opinion concerning Canada’s experience with carbon taxes.

We invite you to join us at the December 9 briefing. To ensure its success, including vital follow-on work, we ask for your generous financial help.  Political dynamics in Washington have changed dramatically and CTC intends to be fully engaged to ensure that carbon taxing gets a full hearing. Your support will enable us to take full advantage of this long-awaited opportunity to effectively advocate for a U.S. carbon tax.  Please click our Donate Now button or click here for instructions on making a contribution.

We established the Carbon Tax Center in January 2007. As we look back on our first year, we are thrilled by what we’ve accomplished.

CTC has established a reputation as the go-to web site for objective, non-partisan information on carbon taxes, with hundreds of hits almost every day. We have participated in conferences and debates in New York, Washington and Boston, we have appeared on national television, and we’ve been featured in newspapers, magazines and blogs. Congressional staff, academics, students and interested citizens of all stripes and from many countries have all turned to our site to get up to speed on a topic that is going to become increasingly vital as Congress and a new President grapple with reducing greenhouse gas emissions and limiting the damage from climate change.

The good news is two-fold. One, CTC has established a very solid foundation. Two, there is widespread support for revenue-neutral carbon taxes across the political spectrum from economists, business leaders, pundits and other opinion leaders. Just take a look at our Supporters page.

But we are not naïve. We know that powerful polluters who use the atmosphere as a free dumping ground are not going to give up that entitlement without a struggle. We know that cap-and-trade has well-connected advocates, many of them with a strong economic self-interest to favor their second-best alternative over carbon taxes. We know that carbon tax opponents have tremendous financial resources they will exploit to maintain their advantages.

And we are mindful that the “T” word is unpopular with politicians. Fortunately, awareness is growing that “putting a price on carbon” is an essential element of any successful strategy to significantly reduce greenhouse gas emissions. While debate continues over the two basic ways to put a price on carbon, a carbon tax or cap-and-trade, we remain convinced that the advantages of carbon taxes are becoming increasingly clear.

A legislated price on carbon is unlikely before a new Congress and President take office, providing time for careful examination of the relative merits of a carbon tax and cap-and-trade. We intend to use the time to frame the choice between an equitable revenue-neutral carbon tax and cap-and-trade schemes that provide huge windfalls to polluting industries and the financial community. This will help voters and elected officials grasp the huge benefits of the prompt reductions in greenhouse gas emissions that will result from an easily implemented revenue-neutral carbon tax, compared to the excruciatingly slow reductions that would result from the endlessly tendentious process of implementing a cap-and-trade scheme.

CTC intends to play a central role in the ongoing debate. To do so, we need your generous financial support. As you make your end-of-year contributions, please think of the Carbon Tax Center and click our Donate Now button or click here for instructions on making a contribution.

Thanks and Happy New Year!

Daniel Rosenblum
Charles Komanoff
Co-Directors

Photo: Peter Bowers / Flickr

Welcome to the latest issue of CTC’s newsletter, A Convenient Tax, summarizing the Carbon Tax Center’s progress in advancing carbon taxes in the United States. (For Issue #2, click here.)

These are heady times for CTC. Each week, and sometimes every day, brings a major development in carbon pricing. Sometimes it has our fingerprints, and sometimes it’s a product of our work to establish a carbon tax as "the gold standard" way to put a price on carbon (as The New York Times quoted us last week).

In Just the Past Two Weeks …

New York’s Mayor Bloomberg delivered a powerful plea for a revenue-neutral carbon tax in a speech to the U.S. Conference of Mayors last Friday. Here’s the lede of The Times’ on-line account:

Mayor Michael R. Bloomberg announced today his support for a national carbon tax. In what his aides called one of the most significant policy addresses of his second and final term, the mayor argued that directly taxing emissions of carbon dioxide and other greenhouse gases that contribute to climate change will slow global warming, promote economic growth and stimulate technological innovation — even if it results in higher gasoline prices in the short term.

Echoing the Tax vs. Cap page on our Web site: Bloomberg noted that cap-and-trade is at risk from gaming, profiteering and volatility, while a straightforward carbon tax offers the essential attribute of price certainty. What is more, Bloomberg spoke as the former businessman he is:

Having spent 15 years on Wall Street and 20 years running my own company, the certainty of a pollution fee — coupled with a tax cut for all Americans — is a much better deal. It would be better for the economy, better for taxpayers and — given the experiences so far in Europe — it would be better for the environment. I think it’s time we stopped listening to the skeptics who say, "But for the politics" and start being honest about costs and benefits. Politicians tend to prefer cap-and-trade because it obscures the costs. Some even pretend that it will lower costs in the short run. That’s nonsense. The costs will be the same under either plan — and if anything, they will be higher under cap-and-trade, because middlemen will be making money off the trades. A direct fee will generate more long-term savings for consumers, and greater carbon reductions for the environment.

By 10 a.m. last Friday, CTC’s blog had a link to the Times’ story, framing Bloomberg’s speech in terms of swelling political support for carbon taxing. Since then, AP, Reuters and Newsweek (in a cover story this week) have reported on Bloomberg’s carbon-tax call.

We can’t say whether the mayor took his cue from us, or the center-right American Enterprise Institute (which issued its own report in June backing carbon taxes), or from his own internal compass. But back in July, in a piece on Gristmill, we linked Bloomberg’s NYC congestion pricing initiative with carbon taxing. We also drew Rep. John Dingell’s attention to the parallels, during a conversation with him last month (see below).

The big development the previous week was President Nikolai Sarkozy’s promise to consider a French revenue-neutral carbon tax and his urging that Europe examine the option of a European levy on imports from non-carbon-taxing countries. Sarkozy’s pledge puts pressure on the United States to do the same, a point made by New York Times columnist Roger Cohen as President Sarkozy arrived in the U.S. this week for meetings with President Bush.

Next Week

Special Invitation to NYC-area readers: CTC co-director Dan Rosenblum will be featured at a NYC Bar Association "Tax vs. Cap" debate in mid-Manhattan next Tuesday morning, Nov. 13. Go here for location, time and registration.

Congressional Support Grows for a Carbon Tax

In our last newsletter we reported on carbon tax bills introduced by Representatives Stark (D-CA) and Larson (D-CT). The two have now joined forces, with Rep. Stark and eight other members co-sponsoring the Larson bill. (Our Bills page has a list of the 10 sponsors and a summary of both bills.)

We stopped by Rep. Larson’s office recently in Washington and were deeply impressed with his staff’s and Mr. Larson’s commitment to a carbon tax. The news that Rep. Larson, the fifth highest member of the Democratic House leadership, will be participating in the United Nations Climate Change Conference in Bali next month is also heartening.

Eclipsing this, however, is the hybrid carbon tax proposal floated by the venerable John Dingell, a member of the House of Representatives since 1955 and long-time chair of its Commerce & Energy Committee. Rep. Dingell’s staff reached out to us in late June for help estimating the carbon, petroleum and revenue impacts of a carbon tax that also included a surcharge on gasoline and jet fuel. Over the ensuing three months we refined our tax impact model (see below) and ran at least a dozen scenarios, which we discussed with his staff in a stream of telephone discussions and e-mails.

When Mr. Dingell released his proposal on the evening of Sept. 26, we were ready with a blog post on both our Web site and Gristmill, branding the idea a "hybrid carbon tax," praising Dingell’s vision, and quantifying the impacts. We’ve also taken the fight to those of our fellow environmentalists who have let their battles with Dingell over car mileage standards blind them to what Dingell calls The Power in the Carbon Tax. (For the record, we strongly support tougher CAFÉ standards but we regard the hybrid carbon tax as an even bigger breakthrough.) Mr. Dingell expressed his gratitude in a phone call last month. (Click here to participate in a public poll on Dingell’s hybrid carbon tax on his Web site.)

Needless to say, a carbon tax bill won’t pass Congress until 2009 at the earliest — public education is needed non-stop until the White House and Congress resolve to make carbon pricing a central element in climate policy. CTC is laying the intellectual and political foundation now for action in 2009.

Carbon Tax Research — National and State

Seeking out and advancing knowledge about carbon taxes is a big part of our mission. To analyze Rep. Dingell’s draft proposals, we scaled up our state-level carbon tax spreadsheet into a national 4-Sector Model — so-called because it disaggregates the U.S. carbon economy into four discrete pieces (electricity, automobiles, airlines and "other"). The model now encompasses the entire U.S. and includes the capability to model a supplemental tax on petroleum products (gasoline and jet fuel, in this case). Advocates and legislative staff in Colorado, Washington State, Oregon, California and Minnesota are currently using it to estimate impacts of state-level carbon taxes.

Much is still to be done on the modeling front. Our next steps are to incorporate "upstream" carbon costs in fuel prices and to reconcile our more-conservative model results with the "bigger bang" predicted by carbon tax supporters at the American Enterprise Institute and several resource think-tanks. We’re also stepping up our cataloging of carbon pricing research. Work at universities and think tanks is proliferating, and we want to establish CTC as the foremost English-language clearinghouse.

Media Continue to Rely on the Carbon Tax Center

Maybe it’s our revamped Web site. Or maybe carbon taxing is moving into the mainstream. Or both. CTC has been in the news a lot lately. Some recent highlights: mentions in two separate on-line New York Times articles on the same day (Friday, Nov. 2), in the news story reporting on Mayor Bloomberg’s carbon-tax address in Seattle, and in an analytical piece, The Real Climate Debate: To Cap or to Tax? • publication of a feature story on carbon taxes in Tikkun magazine • mentions in Conde Nast’s Portfolio.com, Forbes.com, the Minneapolis Star-Tribune and literally hundreds of environmental and climate blogs. • We maintained our standing as the leading site on Google for those searching "carbon tax." • Our Web site continues to receive over 500 visits each week.

Going Forward

The next eighteen months are shaping up as the period in which competing policies to reduce carbon emissions will be examined for their effectiveness, cost and political viability.

CTC’s strategic goal continues to be to shape that debate and properly frame the issues by working with environmental organizations and other allies to solidify support for the concept of putting a price on carbon, while educating and inspiring opinion leaders, grassroots organizations and decision-makers to go for the "gold standard" of carbon taxes rather than settling for the less predictable, less transparent, less universal and less equitable cap-and-trade approach.

As The Times noted last week:

"Making the price predictable is the most significant move you can make to control global warming," says Charles Komanoff, a long-time environmental economist who [with Dan Rosenblum] has recently started the Carbon Tax Center as an advocacy group. "It would tilt literally billions of energy critical decisions toward using less carbon."

If you agree, please help us as we develop the intellectual ammunition, provide technical assistance, assist local, state and federal carbon tax initiatives, energize a broad coalition of interest groups, and mobilize public support for fair and effective carbon taxes.

CTC is proving its effectiveness daily. To continue playing our essential role, we need your financial help. We gratefully thank all of you who have already donated to CTC. We ask carbon tax supporters who are not yet CTC contributors to become so today.

You can contribute to CTC in three ways, of which two are tax-deductible:

Write a check or money order to ELPC (Environmental Law & Policy Center), writing Carbon Tax Center in the memo line; mail it to ELPC at 35 East Wacker Drive, Suite 1300, Chicago, IL 60601. ELPC is CTC’s fiscal sponsor.

• Tax-deductible:

Make an on-line contribution via Groundspring by clicking on the DONATE NOW box on our website, www.carbontax.org.

• Not deductible:

Write a check or money order to Carbon Tax Center and send it to our New York City mailing address: CTC, 636 Broadway, Room 602, New York, NY 10012.

Please be as generous as you can, and please donate today. Thank you.

Sincerely,

Charles Komanoff
Daniel W. Rosenblum

(Note: We’ve changed the newsletter’s name. While the “truth” about global climate change may have been inconvenient, the carbon tax for combating it is straightforward, transparent and simple to administer — in a word, convenient! — CK & DR)

Welcome to the first issue of A Convenient Tax, the Carbon Tax Center’s newsletter. It’s been a very successful initial two months. Here are highlights.

Our Successful Launch

In just two short months the Carbon Tax Center (“CTC”) has established a strong presence in Washington DC, New York City, within the environmental community and throughout the Blogosphere. Here’s a quick snapshot of what CTC has accomplished since our Jan. 22 start.

• Created the first Web site (www.carbontax.org ) devoted to taxing carbon emissions.
• Formed a working partnership with veteran Washington (DC) environmental advocates who are committed to advancing a carbon tax in the current (110th) Congress and enacting one as soon as possible.
• Provided technical assistance to legislative staff of a senior House Ways & Means Committee member (and gained a higher tax level in his anticipated carbon tax bill).
• Raised probing questions about the “cap-and-trade” approach advocated by some large environmental groups and corporations, while maintaining a united front on the necessity of putting a price on carbon emissions,
• Presented the case for “Carbon Taxes First” to an overflow Capitol Hill briefing organized by the Environmental and Energy Study Institute (EESI), and at other meetings in New York, Washington and Westchester County (NY).
• Developed a preliminary analysis suggesting that CTC’s proposed 10-year phased-in $370/ton carbon tax (ramped up by $37/ton, the equivalent of a 10c/gallon addition to petroleum prices, each year) could reduce U.S. emissions of carbon dioxide by at least one-third.
• Shared information and strategy with carbon tax advocates in several dozen states, including developers of carbon tax proposals for Colorado, New York and Washington, DC.

CTC Media Highlights

• CTC’s comprehensive, accessible web site attracts 100-150 visits a day from across the USA as well as Canada, Europe, Asia and Australia, making www.carbontax.org the #2-ranked site on Google for those searching “carbon tax,” surpassed only by Wikipedia. Note: On April 12 we leapfrogged Wikipedia, making us #1 on Google.
• Prominent and complimentary coverage of CTC’s launch in the online version of the New York Times in late January, in Times columnist John Tierney’s Science Blog.
• Time Magazine‘s use of CTC’s estimate of the carbon-reduction impact of a carbon tax in its Global Warming Survival Guide (under solution #5: Pay The Carbon Tax ).
• Strong presence in online discussions of carbon taxes and cap-and-trade, including repeated mentions of CTC in Gristmill and Slate.
• Attack on carbon taxing and CTC by climate deniers at Accuracy In Media.

Going Forward

The climate debate “has shifted incredibly quickly,” wrote New York Times economics columnist David Leonhardt this week, and “the political debate now revolves around what … action should be [taken].” The next two years are the crucial period during which competing policies to reduce carbon emissions will be examined for their effectiveness, cost and political viability. CTC’s strategic goals focus on shaping that debate and properly framing the issues by:

• Working with environmental organizations and other allies to solidify support for the concept of “putting a price on carbon.”
• Gradually educating opinion leaders, grassroots organizations and decision-makers that while cap-and-trade is also a vehicle to put a price on carbon, carbon taxes are far superior because they provide a more predictable and less volatile price and are transparent, immediate, universal and equitable.

While CTC’s action plan will necessarily remain flexible, we anticipate engaging in the following activities during the next one to two years:

• Continuing to develop intellectual ammunition on key issues including revenue recycling, tax equity, “co-benefits” of a carbon tax (e.g., for national security), and the potential “bang” for each carbon tax “buck.”
• Providing technical assistance to opinion leaders, grassroots organizations and decision-makers, including responding to requests for technical information from political campaigns.
• Assisting local and state-level carbon tax initiatives seeking to build on Boulder’s partial carbon tax adopted last November.
• Spearheading a sign-on statement by economists and other experts calling a tax on carbon emissions more effective, transparent and equitable than a carbon cap-and-trade regime.
• Working with a broad coalition of interest groups (labor, environmental, economic justice, national security, etc.) to support carbon taxes through a national sign-on statement and other actions.

That’s how things look at this juncture (April 1, 2007). It’s clear to us that CTC is proving its effectiveness every day. But we can’t continue to play our essential role without your financial help. We heartily thank all of you who have already donated to CTC. We ask carbon tax supporters who are not yet CTC contributors to become so today.

You can contribute to CTC in three ways, of which two are tax-deductible:

• Tax-deductible: Write a check or money order to ELPC (Environmental Law & Policy Center), writing Carbon Tax Center in the memo line; mail it to ELPC at 35 East Wacker Drive, Suite 1300, Chicago, IL 60601. ELPC is CTC’s fiscal sponsor.
• Tax-deductible : Make an on-line contribution via Groundspring by clicking on the DONATE NOW box on our website, www.carbontax.org.
• Not deductible: Write a check or money order to Carbon Tax Center and send it to our New York City mailing address: CTC, 636 Broadway, Room 602, New York, NY 10012.

Just as a carbon tax now will send climate-appropriate price signals to businesses and individuals and help lock in low-carbon investment for the long haul, your financial support today will enable CTC to build on our current successes and chart a growth trajectory. Please be as generous as you can, and please donate today. Thank you.

Sincerely,

Charles Komanoff
Daniel W. Rosenblum