Waxman and Markey attempt to reignite US carbon tax debate

The Congressmen behind the ultimately doomed effort to deliver a US carbon trading scheme have reignited efforts to introduce a carbon pricing mechanism, teaming up with former opponents to issue a renewed call for a more coherent US climate change policy.

Democrats Henry A. Waxman and Edward J. Markey teamed up late last week with Republicans Sherwood Boehlert and Wayne Gilchrest, formerly Congressmen for New York and Maryland districts, to pen a joint editorial in the Washington Post arguing that a carbon tax could tackle both the environmental and the fiscal crisis the US faces.

Warning that the US debt ceiling is likely to have to be raised again at the end of the year, the former and current Congressmen argue that an overhaul of green taxes could help address the “seemingly intractable challenges” of debt and climate change.

“The debate over how to reduce our nation’s debt has been presented as a dilemma between cutting spending on programs Americans cherish or raising taxes on American job creators,” they write.

“But there is a better way: we could slash our debt by making power plants and oil refineries pay for the carbon emissions that endanger our health and environment. This policy would strengthen our economy, lessen our dependence on foreign oil, keep our skies clean – and raise a lot of revenue.”

The group argues that the best approach would be to revive plans first put forward by Waxman and Markey in 2008 for a national emissions trading scheme, noting that such a scheme could “raise $200bn or more over 10 years and trillions of dollars by 2050 while cutting carbon emissions by 17 per cent by 2020 and 80 per cent by 2050”.

“A market-based policy would be a catalyst for international action, help protect US families from ecological disasters and level the playing field for clean-energy sources such as wind and solar,” they continue. “It would spur research into and development of electric batteries, carbon capture, storage technologies and the like.

“And it would provide urgently needed certainty for business and industry. During the past Congress, the chief executives of leading energy, chemical and manufacturing companies endorsed comprehensive climate legislation. They told us that they have deferred hundreds of billions of dollars of investments until they know what they will be required to do to protect the planet.

“And they said that delay in addressing climate change puts our country’s competitiveness in jeopardy, allowing China to race ahead of the United States in building the clean-energy industries of the future.”

The foursome also argues that with Democrats and Republicans at loggerheads over how to tackle the deficit, an entirely new approach for generating revenue could end the deadlock over spending cuts or tax hikes for the wealthy.

The intervention looks to be part of a push to try and secure a revamp of US climate change policy if President Obama secures re-election later this year.

Environmental issues look set to be a key battleground during this year’s presidential elections with each of the candidates for the Republican nomination attacking Obama’s green policies and questioning scientific understanding of climate change.

You can return to the main Market News page, or press the Back button on your browser.