A Conservative Plan to Combat Global Warming
A carbon tax is the simplest and economically most efficient way to limit carbon dioxide emissions. Ideally, the tax would be imposed on businesses and households at the same time that cumbersome environmental regulations are eliminated.
CAMBRIDGE – I recently joined several other former senior Republican officials in proposing a plan to limit carbon dioxide emissions. The group includes Jim Baker, Henry Paulson, and George Shultz – all of them Republican former treasury secretaries – as well as my Harvard colleague Greg Mankiw, who served as Chairman of the President’s Council of Economic Advisers under George W. Bush. I served in the same role under President Ronald Reagan.
I cite these participants to emphasize the level of conservative support for this proposal, which comes at a time when Republicans have generally opposed government efforts to limit CO2 emissions, while Democrats have favored such plans. We hope that Republican support for our plan will provide the basis for bipartisan legislation.
The plan calls for combining taxes on all sources of CO2 with a rebate of the collected revenues to all households on a per capita basis. Experts tell us that a tax of $40 per metric ton would achieve greater reduction in CO2 than all of the existing emissions regulations. Our plan therefore calls for legislation that eliminates all of this intrusive regulation in tandem with the tax-and-dividend plan.