Letter: Fee and dividend aids economy
Members of the Citizens Climate Lobby from the Roaring Fork Valley recently met with the staffs of Sen. Gardner and Rep. Tipton. I’d like to echo support for their platform as a fellow member of the Citizens Climate Lobby (CCL). Climate change concerns aside, I’m in favor of the fee and dividend policy for economic development. I’ve worked in leadership positions for the past 15 years in the renewable sector.
The fee and dividend approach that CCL advocates enables economic productivity.
Commercial facilities in the U.S. spend over $69 billion on energy. This equals 900 kWh of electricity. According to the U.S. Energy Agency, 30 percent of this consumption is not necessary. That’s a huge hit to corporate balance sheets. And totally avoidable. Specifically, this energy waste equals $20 billion of lost profits.
If American corporations were incentivized to save, waste wouldn’t be the case. Wasted building or transportation energy reduces shareholder profits. Energy waste is directly correlated to economic waste. Both are efficiently remedied via market forces by the fee and dividend. Modeled on the Alaska Permanent Fund, which annually pays Alaskans hundreds of dollars in public dividends from oil/gas revenue, the carbon dividend will return cash to every American.
Best, CCL’s fee and dividend approach is rooted in conservative economics: This is an example of the “Pigovian fee.” Arther Pigo developed the notion of economic externalities. A Pigovian tax or subsidy corrects unaccounted-for externalities. Pollution — as excess atmospheric carbon increasingly can be classified — illustrates a negative externality, laden with latent profit. But currently, Congress and taxpayers are leaving this revenue on the table by allowing carbon emissions to be free.
The University of Maryland released a study, “Assessment of the Economy-wide Employment Impacts of EPA’s Proposed Clean Power Plan” on 14 April. It predicts that 272,900 jobs would be added between 2020 and 2040 by implementing the plan. The purpose of this regulation is to reduce carbon emissions. But it will also reduce waste and create jobs.
Look at the economic opportunity. This is not a tax. Nor would fee and dividend be absorbed by the black hole of the federal budget. All money collected is returned to citizens. Bottom line: The Citizen Climate Lobby’s initiative for fee and dividend yields a leaner and more productive American economy.
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