To lead the world on climate, Biden needs a carbon price
In a matter of days, President Biden will arrive in Glasgow for the UN’s COP26 climate conference. This summit brings together almost every country in the world to discuss climate action and, hopefully, commit to it.
Earlier this spring, at an Earth Day climate event in Washington, Biden pledged that America would reduce emissions 50 percent of 2005 levels by 2030. That means shifting rapidly to clean energy throughout our economy so we can avoid the worst impacts of climate change. At COP26, America will be scrutinized to see if we will deliver on that pledge.
Make no mistake: Delivering on that pledge is vital. Don’t forget, we are only months removed from a president who intended to take America out of the Paris Agreement entirely, making the U.S. a global outlier on climate. To rebuild trust with the international community and to position America as a leader on solving the climate crisis, Biden must ensure that we keep our commitment to reduce our emissions as much as promised.
Congress is currently hashing out a sweeping budget reconciliation bill that could set those emissions cuts in motion. As congressional Democrats finalize the reconciliation package over the coming days, they need to keep in mind that the eyes of the world are watching Biden at COP26. The more ambitious their plan, the better equipped Biden will be as he communicates America’s climate priorities to the world.
The best way to show the world that America is serious about climate action is with a federal price on carbon. A carbon pollution fee is endlessly adaptable and could be designed to give part of the revenue collected from corporate polluters like oil companies to American families, while exempting everyday Americans from paying additional fees at the gas pump. This policy has sound potential climate impacts and political viability. And polling suggests that the American people agree. In June 2020, Pew Research found a bipartisan majority of Americans — 73 percent — support taxing corporations based on their carbon emissions.
Modeling from Resources for the Future shows that a carbon fee alone could deliver 45 percent emissions reductions by 2030. If consumer gasoline were exempted, the carbon price would still deliver cuts of 44 percent below 2005 levels. By combining a rising price on pollution with other climate policy measures being discussed, such as clean energy tax credits, the package will certainly achieve the necessary emissions reductions.
It’s a relief to see an American president who is recommitted to climate action. But commitments and intentions are only as good as their follow through. As Biden arrives in Glasgow, the world’s eyes will be on him — and there will be plenty of people watching to see whether his rhetoric matches the reality of Congress’ action. Setting Biden up to take the podium at COP26 with a framework that includes a carbon fee would give him important leverage on the world stage and ensure we’re at the table with other climate-ambitious nations.
Several key international players have already taken this step and implemented their own carbon prices. Canada’s carbon price has been in place for two years now, and it was recently raised by Prime Minister Justin Trudeau’s government and upheld by the Canadian Supreme Court. The European Union’s carbon price has reached new records this year.
In addition, Canada and the EU are both planning carbon border adjustment mechanisms (CBAMs) that add a layer of economic pressure on other countries’ climate policy choices, including America’s. Canada and the EU are the two largest buyers of U.S. exports, and soon they will be charging us a carbon price when certain products arrive at the border. The EU’s CBAM is set to go into effect in January 2023, just over 13 months from now.
These moves make it clear that other countries are starting to call the shots on climate, and their carbon prices mean they hold the strongest cards in our trade relationships. This is the crux of the issue Biden faces as he heads to COP26. If America doesn’t take serious climate action, not only will our climate pledges ring hollow today, but our window to lead in the clean-energy economy of the future will slam shut.
To put America in the strongest possible position — both at this year’s international climate conference and in our trade relationships for years to come — it’s time for Congress to come to an agreement. We need a budget reconciliation bill that will cut emissions 50 percent by 2030, and we need it to include a price on carbon pollution.
Mark Reynolds is the executive director of Citizens’ Climate Lobby, a national grassroots advocacy organization working to advance climate policies in Congress.
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