Climate Chatter: What’s All This Talk About a Carbon Tax?

A prelude to something real or just so much hot air?

In last Saturday’s New York Times columnist Tom Friedman argues in “It’s Lose-Lose vs. Win-Win-Win-Win-Win” that a carbon tax’s time has come: in one fell swoop it “could close the deficit and clean the air, weaken petro-dictators, strengthen the dollar, drive clean-tech innovation and still leave some money to lower corporate and income taxes.” Instead of being off the table while Congress debates a slew of less palatable options to address our fiscal troubles, he argues, a carbon tax should be on the table.

This wasn’t the first time Friedman has waxed enthusiastic about the advantages of a carbon tax, not by a long shot. (See here, here and here.) In fact way back in 2008, when much of the U.S. environmental community was embracing cap and trade (before it kinda fizzled out on the domestic front in 2010), I had the chance to sit next to Friedman at a dinner at Duke University and I recall him, even back then, expressing skepticism about cap and trade and extolling the virtues of a carbon tax.

Talk of Carbon Tax Bubbling to Surface Again?

But Friedman’s op-ed got me thinking. This wasn’t the only article about a carbon tax I had recently read. Was it my imagination, or has there been an uptick of interest in a carbon tax of late? Was Friedman’s latest carbon-tax foray an isolated event or part of a more general trend? And if there has been an uptick, is it possible the time for a carbon tax has indeed come?

To answer the first two questions, I jumped onto Google Trends and searched the term “carbon tax” from 2004 (the earliest time Trends is available) to the present. And lo and behold we have seen an uptick, albeit a modest one but still an uptick.

From about 2006 to mid-2009, the search rate steadily increased from near zero to the period’s all-time peak in March 2009, around the time that the Democratic-controlled Congress began serious discussions about climate legislation and debate about the relative merits of a cap-and-trade program and a carbon tax. (In fact, check out the “regional interest” section on the Google Trends page and you’ll see that these searches were made predominantly in D.C.)

But following March 2009, perhaps reflecting a consensus that any bill passed by Congress would feature cap and trade, “carbon tax” searches dropped precipitously, reaching a low that ran from 2011 to 2012.

But in late 2012, perhaps coinciding with Obama’s re-election and his post-election statements about climate change, the term “carbon tax” picked up again in Google searches, hitting another peak that, while nowhere near the highs of 2009, was significantly higher than 2011 and 2012’s lows. (Little known fact: Amidst Obama’s strong public stand on fighting climate change in November, the president quietly nixed any EU-assessed carbon-emissions fees for U.S. airlines on travel to and from Europe.)

The search rate then fell a bit in late 2012 but has since recovered this year.

Alas, a Search Trend Does Not Political Change Make

So the answer apparently is yes, there has been an uptick in interest about a carbon tax — at least on the Web.

I suspect that a good deal of the increase this year is due to the fact that a carbon tax is in play in both houses of Congress.

In the House of Representatives, Henry Waxman (D-CA), Sheldon Whitehouse (D-RI), Rep. Earl Blumenauer (D-OR) and Sen. Brian Schatz (D-HI) have offered up a “discussion draft,” whose carbon tax revenues would possibly go to a variety of things ($ub req’ed) including deficit reduction.

In the Senate, Senators Barbara Boxer (D-CA) and Bernie Sanders (D-VT) have proposed a bill that would target carbon at large upstream sources like coal mines, oil refineries and points of import; it has about 60 percent of the revenue it would bring being returned to consumers.

The National Academy of Sciences also got into the act recently, touting in a report (“Transitions to Alternate Vehicles and Fuels” [pdf]) “policies including a price floor for petroleum-based fuels or taxes on petroleum- based fuels” as a way to “encourage consumers to reduce their use of petroleum- based fuels” and lower the nation’s greenhouse gas emissions.

Of course not all the carbon-tax searches strike a warm and fuzzy chord; a good deal of them are from opponents of a carbon tax. For example, the aforementioned Friedman op-ed received a good deal of pushback. And just days before the Friedman piece was published, the House took action on a carbon tax, action of the kind that would block real action: 26 Republican representatives introduced legislation that would cut off funding for continued U.S. participation in the Intergovernmental Panel on Climate Change while 104 House members introduced a resolution opposing a carbon tax, labeling it as “job-killing.”

To the question of whether the time has come for a carbon tax, Joe Barton (R-TX), one of the sponsors of the resolution, was very resolute: “A carbon tax is a bad idea whose time has still not — and will never — come.”

(Course, one man’s no-new-taxes-ever-on-carbon-or-anything is another’s well-maybe-on-carbon-if-done-right.)

With 104 representatives out of the 435-member House already on record against a carbon tax, and the Republicans holding a majority in the lower chamber, it’s hard to imagine a scenario in which such a carbon-tax measure could successfully navigate its way through Congress and arrive on President Obama’s desk for his signature. So my assessment: there may be an uptick in interest in a carbon tax, but its time has not yet arrived. But you know, the election of 2014 is not that far off. Things can change.

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