This article is not super recent, but I came across it while doing research for my environmental policy class. Last month, Bernie Sanders and Barbara Boxer introduced a bill proposing for the first time that the U.S. impose an upstream carbon tax on the top 3,000 or so GHG polluters in the nation. The tax would raise about $1.2 trillion over 10 years and reduce carbon emissions by 80% relative to 2005 levels.
To sweeten the deal, 60% of the tax funds will go back to U.S. citizens as a monthly rebate, just like Alaskans get from their oil industries. The rest will go towards funding energy research and renewable energy initiatives. It certainly sounds like a win-win, but reading it reminded me of the tax-rebate problem we talked about earlier in the semester. Going by that model, if energy prices were to rise, we would technically be worse off even with the rebate (not counting the long-term benefits from lowered emissions). The bill is not expected to go anywhere, but if it were being seriously considered, I can’t help but wonder if receiving a rebate would be enough to soothe everyday Americans in the face of higher energy prices, or would we really still feel the pinch and resist it?
The article is here.