Sunday, August 22, 2010

Fee and Dividend for Carbon Dioxide Reduction

Dr. James Hansen, head of the NASA Goddard Institute for Space Studies, has long warned of the disastrous and irreversible climate change that will occur if fossil fuels, especially coal, continue to be our primary energy source.

For the last year or two he has argued vigorously against cap and trade as a viable CO2 emissions reduction scheme, instead proposing a fee and dividend approach that would be paid by energy suppliers at the source (the mine, or port of entry), and transferred directly to consumers to compensate them for increased energy cost. Further, nations that export products to the U.S., but do not reduce CO2 emissions, would see import tariffs imposed on their products, with that revenue forwarded directly to consumers as well.

Up until now, I've been pretty sure that cap and trade was the only viable option for carbon reduction, since fee and dividend would surely be condemned by lobbyist-puppet Congressmen as a "vicious new energy tax designed to bankrupt American business, and finance Obama's ambition to turn America into socialist state." Well, Republicans did that with cap and trade, they vilified a purely market based solution. They called it tax and trade. Plus, cap and trade will be so watered down by Congress (caps set to low, offsets given a away to deep pocketed energy companies who finance campaigns), and it will be administered by the likes of Goldman Sachs, and their ilk, with big fees going to them, and little of the revenue returned to consumers who will suffer energy price increases (Hansen breaks it down). So, I figure, Hansen is probably right. Fee and dividend offers Congress the fewest opportunities to screw up, and dividends go to consumers, not Goldman Sachs.

Read James Hansen's  December 6, 2009 Op-Ed in the New York Times, "Cap and Fade". And then tell your representatives to do something real. Now. Your grandchildren will thank you. Too late is coming soon to a climate near you.

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