Lots of talk.
But with all the good intentions and chatter, progress has been very slow. For example, the carbon emissions in Washington State was higher in 2013 than in 1990. There are similar statistics for King County and Seattle. Total emissions is not down at all... they are up.
The essential fact is that the amount of carbon per person in the Northwest has declined slightly, but increasing population has more than neutralized the added efficiencies from better gas mileage cars and the like. And the situation is much worse worldwide, as global population increases and countries such as China and India use vast amounts of coal and fossil fuels to improve the living standards of their populations. And, of course, there is the fracking revolution, resulting in increasing oil and gas production in the U.S. As a result, the amount of carbon in the atmosphere is rising rapidly...in fact accelerating upwards (see below).
Catastrophic warnings and exaggeration of current climate variations by environmentalists (and local media outlets like, the Seattle Stranger and occasionally the Seattle Times) are doing little. Laying guilt trips on folks is clearly ineffective. It is obvious that few folks will really sacrifice voluntarily to reduce global warming, and the most rabid environmental types still take their airplane trips.
The solution to this issue is elsewhere and inevitably technological. One approach is to plan for the warming and create a resilient society. Clearly a good move. The other is to develop effective technologies to use less energy and to develop clean energy sources. We must do this as well.
But there is a problem. Fossil fuels are really quite cheap--mainly because of the huge increase in fracking during the last ten years. Gas prices are up slightly over the last two years but still quite modest (see graph....about $2.60 a gallon on average)
And at the same time, natural gas is getting less expensive (see below).
With cheap fuel costs, folks are increasingly buying bigger cars (SUV are all the rage), air travel remains affordable and increasing rapidly, and folks are still doing a lot of driving. The use of renewables is growing, but still represent only a few percent of the energy mix. (I always find it amusing that local environmentally oriented politicians never talk about the huge regional industry producing intensive fossil-fuel burning devices---Boeing).
As long as energy is cheap and the costs of burning fossil fuels (air pollution, global warming) are not made part of the price, progress towards reducing its usage will be undermined.
Carbon taxes and caps
During the past few years there has been intense interest in using economic tools to restrain the growth of carbon emissions in Washington State and elsewhere, tools such as carbon taxes and caps on emissions, to name a few.
In 2016, an initiative to initiate a revenue neutral carbon tax (I-732) was defeated. In 2017, Governor Inslee's cap on carbon emissions was found to be illegal, and last month, a carbon tax bill in the WA State Legislature (I-4849) was defeated.
In this and my next blog, I will review these prior attempts to carbon reduction and discuss what I believe is the only viable route: a revenue-neutral carbon tax that put the funds back into the pockets of WA State residents.
Suggested Rules
Any economic approach to reducing carbon emissions here in Washington Sate should have four key attributes:
1. It is effective in significantly reducing carbon emissions. The penalty for using carbon should be large enough to provide a sufficient price signal to push folks to reduce their emissions and to encourage alternative technologies.
2. It is not regressive, with poorer people not paying more than their reasonable share.
3. It is simple, objective, and not in control of one political party or group.
4. It can serve as a model for the rest of the nation. A carbon tax that helps the situation ONLY in Washington State will not have much impact. We need a measure that could be used in other states and will encourage the development of technologies that can be used around the world. It must be a bipartisan, since our nation is split between two parties.
There are two main types of carbon taxes: (1) revenue-neutral taxes that return all the carbon taxes to citizens and (2) carbon taxes that use funds for a variety of purposes, such as making investments in alternative energy technologies or for more general "social justice" goals.
Another approach is to dictate carbon reductions through "caps" on carbon emission. Some caps simply limit carbon emissions with no money changing hands (like Governor Inslee's executive action that was found unconstitutional) or ones where organizations can trade and sell rights to emit carbon, with money changing hands (cap and trade). But the cap approach has run into problems in both Europe and California, and has inherent weaknesses that allow such an approached to be "gamed."
In my next blog, I will examine past and current attempts at a carbon tax in Washington State and make the case for a revenue-neutral approach.
