By Amy Harder
What to do with the money raised from a carbon tax looms as the biggest sticking point to the policy as it slowly emerges from political purgatory in Washington.
The big picture: I know, we’re talking about a fantasy here because Republicans controlling most of Washington right now, including President Trump, categorically oppose carbon taxes. But the policy is slowly gaining support in pockets across the political spectrum, which could pick up momentum after the 2020 elections. So let’s suspend our disbelief and look at this tussle over the cash, which is central to everything.
Driving the news: After a decade of stasis, some lawmakers, think tanks and advocacy groups are beginning to push policies with various prices per ton of carbon dioxide emissions, as well as different uses for the money.
- One proposal pushed by oil companies and former GOP politicians that starts at $40 a ton of carbon dioxide emitted would raise $200 billion a year. A $20 per ton tax would raise more than a trillion dollars over about a decade.
- Putting aside conservative opposition to creating any new taxes, divisions are emerging over how to use carbon-tax revenue, like sending it back to consumers or investing in renewable energy.
- This tension gets at the heart of the challenge of addressing climate change: Make fossil fuels more expensive without hitting pocketbooks too much, and/or make cleaner energy technologies cheaper.
“Fighting about that — what to do with the money raised from a carbon tax — is the hardest thing to overcome in Congress.”
— McKie Campbell, former Republican staff director, Senate energy committee
Among the public, the most popular use of money raised from a carbon tax is to restore the environment, according to a recent poll by the University of Chicago’s Energy Policy Institute and the AP–NORC Center for Public Affairs Research.
- More than two-thirds of respondents said they would support a carbon tax if money went toward those goals.
- The next most popular uses of the money are renewable energy and public transportation.
- What people say they want may not be what ends up happening. Washington state voters rejected a ballot initiative last November setting an initial price of $15 per ton of carbon dioxide emissions and directing the money toward similar priorities.
- It failed mainly because big oil companies poured $30 million into fighting it, citing exemptions other industries received.
Continue reading at Axios…