A recently re-introduced bill in Congress, the Energy Innovation and Carbon Dividend Act, has merit because it tackles climate change with no cost to most U.S. citizens. This should appeal to many of us who are fiscally conservative here in Far Northern California. Yes, no new taxes!
The federal government charges a fee to large carbon polluters (think big oil, coal and natural gas) based on how much carbon they release. All the money collected is returned to U.S. families in equal monthly dividend payments. (All adults get the same amount!)
Economics tells us that if our government charges Shell a fee, they will in turn increase the cost of gas. However, dividends put more money in the pockets of Americans allowing them to pay these increased costs. Households in the bottom three quintiles come out ahead, getting more money back then they pay out for the increased costs. Those in the top two quintiles either break even or pay out some relatively small amount. The wealthy pay the most.
Each year the fees charged gradually increases. Higher costs incentivizes transition to cleaner energy. The fossil fuel companies adapt, gradually finding new ways to provide clean energy, energy storage, etc. Clean energy becomes cheaper than gas. Such an economic-based plan has the support of 3,500 U.S. economists.
And it should appeal to those of us concerned about excessive government spending and taxation. It’s a win-win!