An unrelenting string of extreme weather events, including Superstorm Sandy that devastated the New York area in 2012, and topped by Typhoon Haiyan, which reportedly packed the strongest storm winds ever recorded when it laid waste to Guiuan province in the Philippines, bring the message home: Earth’s climate is changing in costly and painful ways. Yet we’ve barely started transitioning from fossil fuels to renewable energy and efficiency. Many factors stand in the way, including this: the price signals are too weak. The prices of fossil fuels don’t come close to reflecting their true costs. This puts clean efficiency and renewables at a stark disadvantage. A robust and briskly rising U.S. carbon tax will reduce the emissions that are driving global warming and generate revenue to pay for cutting regressive taxes that thwart job-creation.
- A carbon tax is a direct tax on the carbon content of fossil fuels (coal, oil and natural gas).
- A carbon tax is the most economically efficient means to convey crucial price signals that spur carbon-reducing investment. Our spreadsheet shows how fast emissions will fall.
- Carbon taxes should be phased in so businesses and households have time to adapt.
- A carbon tax can be structured to soften the impacts of added costs by distributing tax revenues to households (“dividends”) or reducing other taxes (“tax-shifting”).
- Support for a carbon tax is growing among public officials; economists; scientists; policy experts; business, religious, and environmental leaders; and ordinary citizens.
Our Read These First page is a good place to learn about carbon taxing. Another is a point /counterpoint last year in Today’s General Counsel magazine between Carbon Tax Center director Charles Komanoff and a top fossil fuel industry lobbyist. And read our blog post summarizing the comments we submitted to the Senate Finance Committee on Jan. 31. They point the way to a new policy path: replacing the U.S.’s contradictory and costly energy subsidies with a carbon tax.
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