Carbon tax backers quietly forge ahead

Activists are quietly forging ahead with their campaign for carbon taxes despite long odds on Capitol Hill.

Bob Inglis, a former GOP House member from South Carolina, is part of a very loose collection of policy wonks and advocates fighting to change the politics of taxing emissions.
 
“It’s a longer-term play here,” Inglis said.

Inglis, who launched the “Energy and Enterprise Initiative” at George Mason University last year, sees several forces converging that will enable a carbon tax to surface in a broader fiscal policy deal.
 
It would happen, he said, by “immaculate conception,” but not until 2015 or 2016.

“It will be nobody claiming paternity for it. It will just develop on its own,” Inglis said in an interview Thursday.
 
Proposals to impose taxes on emissions from burning coal and oil have been around for years.
 

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But they’ve gained new traction and fresh opposition of late, owing to the collapse of cap-and-trade legislation in 2010, the Beltway search for new revenue sources and the renewed attention to climate change.
 
Advocates range from longtime backer Al Gore to Inglis to Art Laffer, one of the godfathers of conservative economics. They all back a “revenue-neutral” carbon tax that would be offset by reductions in personal taxes.
 
Other proposals call for using a tax on various industry sectors — such oil and coal producers or power companies — to pay for deficit-reduction, consumer rebates, green energy programs or some combination.
 
Tyson Slocum, head of the energy program at the left-leaning group Public Citizen, said there are discussions occurring in “multiple types of formats” and “involving a lot of different kinds of stakeholders.”

None of it is going very far right now.
 
White House spokesman Jay Carney said in late 2012 the administration would “never” propose a carbon tax.
 
And the entire House GOP leadership has signed an anti-carbon tax pledge by the conservative group Americans for Prosperity.
 
A slew of conservative groups are actively collaborating to prevent the idea from gaining momentum.
 
“There is no permanent victory in Washington,” said Benjamin Cole, communications director for the conservative American Energy Alliance. “There continues to be people on the left and the right that are advocating a carbon tax.”
 
Officials with an array of conservative groups oppose carbon taxes, including Heritage Action for America — the political arm of the influential Heritage Foundation — and Grover Norquist’s Americans for Tax Reform.
 
The conservative groups have stepped up their efforts since the revelation last July that an ad-hoc, left-right coalition was holding a series of meetings to discuss carbon tax proposals and how to advance them.
 
Groups involved in those talks have included the Republican group ConservAmerica, Public Citizen, the American Enterprise Institute and the Union of Concerned Scientists, among others.
 
“We recognized there is a need to be a little more organized on our side as well,” said Cole.
 
But carbon tax advocates are convinced that several factors could change the politics in their favor — albeit slowly.
 
Inglis is logging heavy miles on the campus and editorial board circuit to promote his “revenue-neutral” plan. He sees wooing college kids — especially conservative students — and op-ed writers as one part of a larger plan.
 
By his reckoning, building a base of support to make a tax less radioactive to GOP lawmakers, and giving them cover at home, will merge with two other forces to give a carbon tax new life in the last two years of Obama’s term.
 
One will be Wall Street clamoring for deficit deal.
 
“The reason I think it is ’15 or ’16, is by then perhaps New York will be calling Washington and saying, ‘Do something about that structural deficit. It is messing with the bond market,’ ” Inglis said.
 
The other will be a less antagonistic view toward President Obama, by then a very lame duck, among Republicans.
 
“The rejection of him as a person, as a president will decline. So there will be more of a solution-orientation, a little less of an aversion to any cooperation,” Inglis said.
 
His George Mason University group is looking to fill new jobs and planning a new web-based advertising campaign aimed at convincing conservative voters to back action on climate.
 
As they try and lay the groundwork, Inglis and other carbon tax backers are pointing to small signs of progress.
 
The idea surfaced — albeit without endorsement from lawmakers — in a broad paper on energy tax policy options that was released last month by the powerful Senate Finance Committee.
 
“I think the very fact that they mentioned it was significant,” said Adele Morris, a Brookings Institution scholar who has written widely on the idea of taxing carbon emissions.
 
“The mere fact that it is not off the table suggests to me that there is room for discussion,” added Morris, policy director for Brookings’ Climate and Energy Economics Project.
 
Morris argues that as lawmakers look to reform the corporate tax code, they’ll need new sources of revenue to offset calls to lower the overall corporate rate.
 
That’s especially true, she said, given the challenges of “broadening the base” by ending credits and deductions that often have their own political constituencies.
  
Inglis argues that taxing emissions to confront climate change is a crucial part of a free-market, conservative energy policy.
 
His goal involves a “true-cost” competition between various energy sources in which all subsidies are stripped away, but the cost from the damage from carbon pollution is factored in.
 
That kind of policy, he argues, can help end what he calls an “inferiority complex” among conservatives when it comes to climate change.
 
“We apparently think we are no good at energy and climate, therefore it leads to us just sort of pooh-poohing the science, throwing rocks at other people’s houses, Al Gore’s house, rather than stepping forward with a solution,” Inglis said.
 
“But the interesting thing is, we have the solution that is going to work, which is a true-cost comparison between competing fuels. That is bedrock conservatism,” he said.
 
Inglis said he’s seeking funding, without success so far, for his initiative from Exxon Mobil, a company that calls carbon taxes the best option if policymakers decide to impose a cost on greenhouse gas emissions.
 
Exxon officials have made clear that they’re not actively lobbying for a carbon tax.
 
Slocum said support from the oil-and-gas industry for carbon taxes is critical, since Republicans leaders are unlikely to bend an ear to liberal groups like Public Citizen, the Natural Resources Defense Council and the Sierra Club.
 
“You have to have extractive industries do more than just saying, ‘We like this approach,’ ” Slocum said. “They actually have to become an advocate. That is going to have to be a game-changer in order to convince Republican leadership to jump on board.”