30 Dec 2011

What if U.S. needs new, real, money in 2013? Carbon tax could become ‘least, terrible’ option

Written by Jim Pierobon

As the next Congress goes to work in January 2013, this scenario could play out almost purely because it makes the ‘math’ work for a workable fiscal policy.¬†If Barack Obama is re-elected President and Democrats regain control of the U.S. House of Representatives — or not — there almost surely will come a time when federal lawmakers have to raise new revenue.

As Jason Grumet, President of the Bipartisan Policy Center envisions it, “when you cross that threshold, when you say you have to tax something. Taxing something you don’t like (e.g. carbon) may be more attractive than taxing something you like. As a fiscal policy, it looks about as bad as anything else. It’s the least worst of several terrible options.”

In a fundamentally different kind of conversation in 2013 where “math now matters more than policy arguments¬† . . . if you can raise the money, they want to talk to you,” Grumet told The Energy Fix this month during the annual energy policy conference organized by the American Council On Renewable Energy (ACORE).

While there certainly won’t be a shortage of proposals to tax carbon or fossil fuels, there surely will be robust opposition to every single one . . .until no other option exists.

Watch Grumet elaborate on how these dynamics could play out here.

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