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Opinion The ‘smart’ carbon pricing plan

Birds fly over a closed steel factory where chimneys of another working factory are seen in the background in Tangshan, Hebei province, China on February 27, 2016.
Birds fly over a closed steel factory where chimneys of another working factory are seen in the background in Tangshan, Hebei province, China on February 27, 2016. (Kim Kyung Hoon/Reuters)

The July 6 op-ed by James A. Baker III and Greg Bertelsen, “The smart way to cut emissions and outmaneuver our rivals,” credited a Baker-Shultz plan to put pressure on China and others by placing a fee on all carbon emissions “in the United States.” It failed to note, however, that tracing carbon emissions upstream and across borders, so that a high-emitter “pays” the carbon tax through lost business or price concessions is a long-recognized (but difficult) means of putting pressure on countries that resist or undercut global environmental standards. The only novel element in the Baker-Shultz plan appears to be that “all of the revenue from the [carbon tax] would be returned to Americans in the form of a quarterly dividend . . . rather than giving all that money to the federal government.”

The key choices affecting carbon emissions are made upstream, not at the consumer level. Insulating the consumer from the impact of the tax would, however, reduce the incentive for consumer choices that could influence producer choices. The authors claimed this rebated fee “would not expand the federal government and therefore should not be considered a tax.” The authors noted European moves to charge imported goods for their emissions. We were not given any new ideas on how to gain the cooperation of high-emission countries. Rather, we were left with a sketchy picture of a domestic rebate scheme that could lessen the leverage that the United States has internationally. Their “smart way” is not apparent to me.

Cecil Hunt, Bethesda

Climate change damage is greatly accelerating, so we must address how to greatly decelerate greenhouse gas emissions. The carbon tax framework proposed by James A. Baker III and Greg Bertelsen was a made-to-order game changer.

 There will be reshuffling in the employment area as a result of a carbon tax. So it seems prudent to add to the framework a set-aside of some of the carbon fee collected to help provide a soft-landing for those in the petroleum and natural gas sectors and related jobs whose earnings decline as a result of the carbon tax. 

To keep from being outmaneuvered by our industrial rivals, we also need to ensure that our chemical industries that use petroleum as a basic raw material do not flounder as a result of price increases caused by the carbon tax. 

Mark Gill, Chantilly

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