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View Diary: The Best Climate Policy is Also the Simplest (61 comments)

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  •  While (19+ / 0-)

    a long time supporter of / believer in 'partial dividend', let us raise some issues with a 100% dividend:

    1. This buys into concept that 'people know best how to spend their money' when there are social goods that require investment.

    2. This does a form of putting out resources for consumption.

    3. Remember that much of the Social Cost of Carbon is for tomorrow yet we are taking payments to account for future costs and distributing them to people today.

    4. We need to make massive (MASSIVE) investments in clean energy, energy efficiency, ecological system restoration, climate mitigation, climate adaptation, resiliency, education, science, ...  At least some of the 'dividend' should be used for these public goods.

    My perspective

    Massive revenues

    How to use the revenue?

    First, we should recognize that this is to mitigate an issue of global and not just national challenges.

    Second, we should be clear in understanding that this will be politically and socially difficult.

    Third, we should be aware of inequities in society and that this program could worsen the equities.

    Thus, first off, roughly half the revenue should go directly to every cititizen (resident in the United States) on an equal basis.  (With, perhaps, minors money going half to their guardians and the other half into a Energy Bond program where they could withdraw the money, 20% per year, starting at age 18.)  Thus, if you pollute less than 50% of the average American, you would actually earn money. As one tends to have a larger carbon footprint the higher ones income, this would also provide a path for somewhat balancing economic disparities in the nation. Finally, this would provide a path toward guaranteeing political and social support by putting money back into people’s pockets.

    Depensing the remaining half …

    The majority of the maining fees should be used (by agreement with an international monitoring) toward moving toward sustainable energy (energy efficiency, renewable energy), global warming mitigation (including carbon sequestration), and environmental action.

    Etc ...

    There are real serious issues that are hidden behind the 'simple' -- for example, that a Cap & Dividend would create wealth transfer to areas where the Federal gov't invested heavily in hydro & nuclear power (Pacific Northwest) from areas which are currently coal-heavy in electricity when what we need to be doing is investing to drive down the coal electricity usage.

    For some thoughts: http://getenergysmartnow.com/...

    Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

    by A Siegel on Wed Jan 23, 2013 at 09:09:36 AM PST

    •  I agree in concept... (7+ / 0-)

      Like I wrote in another comment, while I think I agree in principle that there are other approaches that in an ideal world would work better, the benefit that a 100% dividend has is that it gives no room for lobbyists to try to carve up the pie of where the money gets invested (e.g. do we really want investments in "clean coal" coming from the fee proceeds?).  Similarly, lobbyists can't get around emissions as easily as they might with cap and trade since the fee is applied evenly based on the amount of carbon.

      It's also hard for either party's politicians to argue, in an attempt to kill such a bill, that there are giveaways to their opponent's contributors (not that they won't try, but it'll be hard).  Simpler is better.

      So yes, there are social goods that need investment, but in the absence of a congress that will invest in social goods, it seems that we're more likely to get a good outcome by not linking that investment with climate policy.

      contraposition.org - thoughts on energy, the environment, and society.

      by barath on Wed Jan 23, 2013 at 09:19:47 AM PST

      [ Parent ]

    •  A Siegel (4+ / 0-)

      I would be curious to get your take on this (and anybody else feel free to chime in).

      On top of the dividend plan outlined in the diary and in your comment, there are still other things we should be doing on top of that.  One of the ones that I would support but really haven't heard it discussed much is the idea of a tax on electricity based on consumption.

      I would imagine (but haven't seen hard data on it) that you could plot monthly usage of electricity by each residentila user of a given electrical company and it would roughly create a bell curve shaped distribution..  Each tail of the curve would either represent the few one bedroom studios at one end or the few mansions at the other end with the vast middle occupied by the middle class dwellings.

      Given this data you would then create different taxes (and hence different electricity rates) based on the level of consumption.  In the first year of implementation you would perhaps tax the top 5 percent of the users at one rate, the top 2 percent at a different rate and the top 1 percent at yet another rate.  The top 1 percent would be taxed so that alternative energy is cheaper than what they would be paying for their dirty energy.  The top 2 percent would pay roughly the local equivalent of alternative energy and the top 5 percent somewhere in between the typical rate and the alternative energy rate.

      Over the course of say 10 or 20 years what you would expect to see is that the top consumers would either be investing in energy conservation to get out of the top rates or they would be financially persuaded to move to alternative energy.  In time, today's top consumers would have all conserved a lot of energy or bought alternative sources of energy and the middle consumers would be sliding up the list toward the top as the top consumers no longer would be consuming much, if any, fossil fuels.

      This seems like such an easy, market based approach that would get the biggest bang for the buck and would also consistenly have the top 1 to 2 percent of consumers for any given year be interested in moving to lower consumption/alternative energy.

      Makes too much sense to me but I frankly haven't seen a real discussion of the pros and cons of such a solution.  You obviously could tweak how many different rates you have and the amount of the tax increases to be more in line with the pace of change that you want and what is politically bearable.

      Is it feasible?  Does it make sense?  What are the flaws in this approach?  Given your background I would be very interested to read what you have to say.

      We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

      by theotherside on Wed Jan 23, 2013 at 11:03:03 AM PST

      [ Parent ]

      •  I think this is how a carbon tax works (1+ / 0-)
        Recommended by:
        6412093

        I'd say taxing electricity doesn't help as much as taxing carbon.  Many places also have graduated rates by tier of use (note the biggest users are commercial users not mansions).  

        Hay hombres que luchan un dia, y son buenos Hay otros que luchan un año, y son mejores Hay quienes luchan muchos años, y son muy buenos. Pero hay los que luchan toda la vida. Esos son los imprescendibles.

        by Mindful Nature on Wed Jan 23, 2013 at 11:52:18 AM PST

        [ Parent ]

        •  I'm not sure you are entirely correct on this (1+ / 0-)
          Recommended by:
          A Siegel

          In a carbon tax program both the low consumption household and the high consumption household would pay the same rate.  Sure, the high consumption household would end up paying far more money in carbon taxes but that is merely due to their consumption.

          My idea would end up creating a market that would be the size of 1, 2 or 5 percent of the local market year after year for energy conservation measures and for alternative energy (primarily but not limited to PV).

          As far as electricity consumption goes there are many ways to break it out but EIA often breaks it out between residential, commercial, industrial and even transportation.  Your point is valid that the residential sector is not the main consumer of electricity but that is the easiest portion to relate to and also the easiest to implement my tax idea.

          If you wanted to expand the discussion on how to implement the basic idea I've presented to the commercial arena we can certainly do that.  It's just tougher to come to agreement.  For example, a large business that has 5,000 employees working out of one location might actually be very efficient in their electricity consumption and use, say 50 kwhs per person per day, while a small business that employs 10 people might be highly inefficient and use 100 kwhs per person per day.  Which company should pay the higher rate?  (Note: kwh figures are merely for discussion purposes and may or may not be efficient use of the electricity)

          We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

          by theotherside on Wed Jan 23, 2013 at 01:41:31 PM PST

          [ Parent ]

      •  Sigh ... (1+ / 0-)
        Recommended by:
        theotherside

        I wrote a 10+ point response that was ever so insightful (making fun of myself) and accidently hit the 'cancel' button and it disappeared.

        Shorter version.

        1.  Interesting.

        2.  Think it is too slow to achieve change but could be part of a larger program.

        3.  Very hard data / data analysis challenge against all the variables (size of household, work patterns, etc ...)

        4.  If try to control by (3), then run into serious privacy issues in US culture.

        5.  I like the idea of higher rates as (wasteful) usage goes up but would want to see this controlled by # of people, living patterns, etc ...  Sadly, by the way, too many utilities give discounts for more use (a quantity discount).

        Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

        by A Siegel on Wed Jan 23, 2013 at 03:29:37 PM PST

        [ Parent ]

        •  Well, I guess I owe you two "thanks!" (0+ / 0-)

          As to your points:

          2.  Agreed that by itself it is too slow.  If we ever seriously debate this on the national stage (ie legislation is being drawn up) I am still open to pure cap and trade or cap and dividend and this would be an ancillary consideration.  With that said, it would be interesting to see how quickly we could ramp up energy conservation and PV and wind installations.  To account for 1,2 or 5 percent of the residential market per year wouldn't be a bad rate but perhaps I'm not aiming high enough.

          3.  Make it simple.  The only thing to consider is the consumption of a household and it will be compared to all the other households served by the same electric company.  The benefit of this is that the top consumers in every city throughout the entire country get hit with the higher rates and it therefore creates immediate energy conservation and alternative energy markets in every city.

          Maybe I'll flesh it out a little more in a diary with some charts and graphs so that people better understand the potential impact that this would (possibly) create.

          We cannot solve our problems with the same thinking we used when we created them. Albert Einstein

          by theotherside on Wed Jan 23, 2013 at 04:27:41 PM PST

          [ Parent ]

          •  RE "make it simpl (0+ / 0-)

            compare two households both with 2000 square foot homes.

            1.  Single person, travels frequently, works hellish hours at office.

            2.  Family of five, work from home, daycare center in house

            Imagine that (2) uses exactly same amount of electricity as (1).  (1) would be better bet for energy efficiency focus and for 'penalizing' with higher fees but we need much data for that.

            Also, how to integrate natural gas, propane, electricity, etc ...

            Blogging regularly at Get Energy Smart NOW! for a sustainable energy future.

            by A Siegel on Wed Jan 23, 2013 at 05:36:44 PM PST

            [ Parent ]

        •  numbers 2 and 3 good objections that (0+ / 0-)

          I hadn't thought of. Add 6)very unlikely to make it through Congress)

          if necessary for years; if necessary, alone

          by SouthernLiberalinMD on Wed Jan 23, 2013 at 04:42:34 PM PST

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      •  I think it's a great idea, but (0+ / 0-)

        it involves raising still more taxes on the wealthy, so the chance of it getting through the "we did that already!" Congress seems slight.

        if necessary for years; if necessary, alone

        by SouthernLiberalinMD on Wed Jan 23, 2013 at 04:41:41 PM PST

        [ Parent ]

      •  it sounds like (0+ / 0-)

        you are talking about an inverted block rate (the more you use, the higher the rate):

        0 - 2,500 kWh - $0.10/kWh
        2,500 - 5000 kWh - $0.15/kWh
        etc.

        but with a sliding scale based on usage:
        top 1% - $0.20/kWh
        1-10% - $0.15/kWh
        etc.

        With a renewable energy out:
        RE - $0.12/kWh

        so, you can buy your way out of the steeper rates by investing in RE.

        Is that what you are saying?

        Javelin, Jockey details, all posts, discontinue

        by jam on Thu Jan 24, 2013 at 11:19:44 AM PST

        [ Parent ]

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