This proposal is textbook good (PDF):
Hoping to jump-start the debate on climate change, a group of high-profile Republicans that includes three former Cabinet secretaries is calling for a substantial new carbon tax, and then to offset the pain higher prices cause the middle class by returning all money raised to American taxpayers.
The plan, set to be released in Washington, includes a direct challenge to Republican politicians who have denied or played down the idea that human behavior is a significant factor in climate change.
President Donald Trump, of course, is on that list. ...
The group is meeting Wednesday morning at the White House with Gary Cohn, the former Wall Street executive who is Trump's top economic adviser. Among the key White House advisers tentatively scheduled to join or at least drop by that meeting are Ivanka Trump, her husband, Jared Kushner, and Chief of Staff Reince Priebus.
Additional meetings with Trump Cabinet members and key congressional players also are scheduled beginning Wednesday. They also hope to meet with Vice President Mike Pence.
The group, which is releasing its plan under the auspices of the Climate Leadership Council, includes James Baker, the only person to have served as White House chief of staff, treasury secretary and secretary of state.
"We have a Republican administration now -- a Republican administration that could show leadership on this issue and present to the blue collar workers who were so important to Trump's victory -- something that does not increase, build government, that is conservative, that is free market -- let the market determine -- and there is some support out there for that now and from some quarters that normally didn't support this kind of thing," Baker told CNN.
Baker believes returning the carbon tax proceeds in checks to families would have appeal with Trump's blue collar base. The logic behind a carbon tax is that it makes polluting the atmosphere -- such as by burning coal, oil and natural gas -- more expensive. And it creates an incentive for companies and people to move toward cleaner, renewable sources of energy.
The idea of a major carbon tax -- the group suggests an initial rate of $40 a ton and then escalation from there -- is at first glance a non-starter in a Washington now run by a GOP president skeptical that climate change is real and a Republican Congress looking to cut taxes.
But Baker and others in the group believe they can at least change the conversation by adding new ideas and new pressure for Republicans to use their power to act. ...
Some of the specifics:
*An Escalating Carbon Tax: Starting the tax at $40 a ton, with an understanding it would eventually have to be raised to $50 or more to have the desired impact on consumption and emissions. At $40 a ton, the group estimates its carbon tax would raise $300 billion annually. At $40, the tax would add an estimated 36 cents per gallon to gas prices.
*Carbon Dividends: All revenue from the new tax would be rebated back to American taxpayers. The plan calls for the Social Security Administration to administer the plan and estimates the typical family of four would receive $2,000 a year. Conservative critics of the carbon tax, including the Koch brothers organizations, have criticized carbon tax proposals as unfair to working families. The dividend idea in the new plan is designed to address that and to keep the proposal neutral from a government revenue perspective.
*Border Adjustment Fee: High carbon imports would be subject to a tariff adjustment similar to the proposal House Republicans are considering as part of their broader tax reform proposal.
*Regulatory Rollout: The plan calls for the repeal of the Obama administration's Clean Power Plan and a host of other Environmental Protection Agency regulations aimed at reducing carbon emissions. To make this politically palatable, the authors call for an initial carbon tax rate high enough to guarantee emissions reductions that exceed those forced by current regulations.
The New York Times editorial authored by Martin Feldstein, Ted Halstead and Greg Mankiw begins like this:
CRAZY as it may sound, this is the perfect time to enact a sensible policy to address the dangerous threat of climate change. Before you call us nuts, hear us out. ...
Yes, this is crazy timing. Nevertheless, Godspeed.