Bill McKibben on Why Cap-and-Dividend is the Best Approach to Setting a Price on Carbon
Yale Environment 360 is running a new interview with Bill McKibben on why he's no focused full time on organizing a citizen's movement around climate change which is interesting in the whole (as McKibben's thoughts most often are), but the really poignant thing in it is why he thinks a cap-and-dividend approach to setting a price on carbon is the right way to go:
e360: What do you think the costs are going to be to the public for a transition to this new kind of economy or putting a price on carbon? You hear arguments everywhere from the great opportunity of renewable energy to some numbers that have come out lately out of Washington that are really hyping big costs of a price on carbon. How do you see all that?
McKibben: The only way that it works fast enough to make a difference is if the carbon carries a cost. That’s been the problem all along. Carbon didn't carry a cost, hence we are in the trouble we are in. The question is how do you do that in a way that doesn't bankrupt everybody and that lets you do it politically.
The smartest answer to all of this has come in recent years from Peter Barnes and others who have proposed this cap and dividend proposal and [U.S. Rep.] Chris van Hollen just introduced this in the House. You make Exxon and Peabody Coal, or whoever, buy permits every year at auction to release CO2, right? They pay lot of money for them, and they pass the cost on you and the price [of gasoline] goes up to $4 at a pop and you abandon your Forest Ranger fantasy and decide to drive a small car or walk or whatever it is you are going to do.
The question becomes what you do with all that money that you just made off this auction of the permits. The utilities would like you to basically give the permits to them for free. That's ridiculous. Congress would pretty much like to take the money and spend it on something, windmills in my state, or whatever. Personally, I think that for most part that is a harder argument to make, given the things Congress has spent money on in the recent past. Corn-based ethanol being exhibit A.
So the soundest proposal, probably, is to take that money, and write a check to everybody in the country every six months... Here's your climate check. Your share of the sky. Just the way that Alaska writes everybody a check every year for their share of oil revenues in the state. So, you know, I am still getting the price at the pump to clean up my act, and I am being made whole, more or less. It's not a perfect system, but if you game it out politically, it is probably the best chance we have.
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