Recently, I received a request from Janet Yellen, Chair of the Climate Leadership Council, the sign the “Economists' Statement on Carbon Dividends.”
I won't sign. Here's why.
The heart of the Council's proposed “Carbon Dividends Plan” (CDP) is a “robust and increasing” tax on carbon emissions, $43/ton when it begins in 2021 (equivalent to a tax of $0.38 per gallon of gasoline). This tax would represent the estimated cost imposed by carbon emissions, and increase at a rate that takes into account discounting for time and carbon “decay,” the rate at which excess carbon naturally leaves the atmosphere.