High-profile Republicans propose tax on carbon emissions

A group of Republican elder statesmen released a plan to fight climate change on Wednesday with a proposal to replace the Obama administration’s climate policies with a tax on carbon emissions.

Led by former Secretaries of State James Baker III and George Schultz and former Secretary of the Treasury Henry Paulson, the Climate Leadership Council says their “Carbon Dividends” plan, which includes a tax of $40 for each ton of carbon producer, is a “conservative climate solution.” They say the plan is revenue neutral and based on free-market principles.

The group estimates that the tax, which would be imposed on emission sources such as mills and refineries, then built into the price of the products, would raise $200 billion to $300 billion dollars a year. This revenue would then be returned to consumers at an estimate of $2,000 a year for a family of four. 

The plan also calls for an outright repeal of the Obama administration’s Clean Power Act and the “elimination of most if not all onerous EPA regulations,” Baker outlined during a press conference in Washington on Wednesday morning.

Baker also pitched his plan to the White House on Wednesday where he met with Gary Cohn, President Trump’s chief economic advisor, Reince Priebus, Kellyanne Conway, and Vice President Mike Pence, according to a source with knowledge of the meeting.

Baker told reporters that he had no assurance that the plan is “something that the administration will grab hold of,” but argued that the risks associated with climate change – even for skeptics, including himself – are too great to ignore.

“We need some sort of an insurance policy and if we can get an insurance policy that is a conservative approach based on the free market, that limits government and doesn’t expand government, and that is competitive internationally — that’s a win-win,” Baker said. 

While Trump campaigned extensively on the promise to repeal the Clean Power Plan, a set of regulations to reduce carbon pollution, Baker admitted that it will be an “uphill slog” to convince a president who has previously stated that climate change is a hoax invented by the Chinese to buy into his plan. 

“Republicans have not been at the table because we are skeptics or deniers,” Baker said on Tuesday night during an interview with CNN. “But if you see what’s happening to the environment, even if it’s happened before 10,000 years ago, that’s a risk we shouldn’t have to take.”

Congressional Republicans have also largely been unwilling to consider a carbon tax. However there is one influential Republican who does support it: newly-confirmed Secretary of State Rex Tillerson, who publicly backed a revenue neutral carbon tax as CEO of ExxonMobil. 

“Replacing the hodge-podge of current, largely ineffective regulations with a revenue-neutral carbon tax would ensure a uniform and predictable cost of carbon across the economy,” Baker said at the press conference, quoting Tillerson.  

“It would allow market forces to drive solutions. It would maximize transparency, reduce administrative complexity, promote global participation and easily adjust to future developments in our understanding of climate science as well as the policy consequences of these actions.”