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Charles Zhu

Jul 15, 2014
06:06

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Hi, I've shopped this around to some friends who work in national public policy and in Congress. Here are comments I need to address from them: - need upfront summary of your proposal (use existing taxes, focus on transpo + oil, start in a state and move national) - the major hurdle I see is that the proposal ultimately means paying more at the pump and that's a nonstarter at the moment - how do you build new constituencies for the proposal? Maybe state DOTs starved for funding start to push more taxes? - Need some kind of motivation for Republicans. E.g., allow controversial energy development, but attach that to a carbon tax - if you don't give Republicans something, force action - clear upfront section that details "These are the political realities we face in the country right now: (1) prevalence of climate deniers (2) no tax increase pledges (3) electoral difficulties for republicans talking about climate." (4) ETC. Unless a proposal addresses these political realities, it is unrealistic. There is no shortage of good wonky policy ideas. - the proposal relies on escalators. Republicans never tie any taxes to inflation or anything that would raise them. How do you make them want to do this? - CCL's proposal also includes a gradual increase. How do they justify it? do they? do you set yourself apart if you don't? very interesting and well-reasoned proposal. I like the idea of focusing on reducing carbon in the transportation sector and tying it to shortfalls in infrastructure funding. You could make a little more clear how exactly you plan for the revenues to be used to plug shortfalls in transportation budgets, and how it would break down between the state and federal level. Other Thoughts/Questions: 1. If you are going to “unify” these taxes, wouldn’t it be much more efficient (and politically easy) to impose 1 tax as high upstream as possible, as opposed to three taxes at different points in the chain? 2. Under an oil tax, what becomes of existing federal tax incentives for production of oil and natural gas ($4 billion/yr)?

Yiliang Zhu

Jul 17, 2014
11:18

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The idea of pooling oil-related tax from upper, middle, and lower streams is excellent! It's intriguing whether and/or how to share upper stream (dirtier oil) tax revenue across states if relevant policy is implemented at the state level. It also would be interesting to illustrate the distribution of the revenue beyond funding for the transportation infrastructure. A tax credit for R&D of efficient and cleaner energy?

Dave Finnigan

Jul 18, 2014
05:49

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Charles and colleagues - I happily have voted for this proposal. It is so logical. Another logical proposal is the one I have posted in another category that is complementary, and certainly not in any way competitive. I would really appreciate your comments and a vote. It is Climate Change is Elementary in the Youth Action category and it can be found at: https://www.climatecolab.org/web/guest/plans/-/plans/contestId/1300901/planId/1307405 Thanks in advance for your suggestions to make it work for every school and every vendor. After we have a carbon Fee we still need a way to rapidly make the transition to renewables, and I believe that our GreenActionCard can greatly accelerate the inevitable changes. Thanks Dave Finnigan

Climate Colab

Aug 5, 2014
08:22

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1. A novel, pragmatic way to get at this. Has benefit of differently situated regions to take different actions, and starts small with individual state action (a more realistic place in my view). But these are also detriments in terms of obtaining meaningful change in the near term. Again short of details of benefits because hard to assess how so many actors will respond and when. Building off existing fuel taxes and highway trust fund troubles is intriguing. 2. The few Republicans who are willing to stick their necks out for a gas tax increase (and thus violate "the pledge") are hardly helped by heaping a climate action explanation on top. In general, fuel taxes are hard to do. The Grover Norquist pledge, on top of climate change, would be a tough sell. This proposal also leaves out power generation sector, which is a bigger emitter than transportation. 3. Thinking about a gasoline tax - a) people who want higher infrastructure spending could be pinned on gasoline tax, b) would attract D’s who want to raise price of carbon, and others who like infrastructure. Maybe don’t talk about carbon at all but raise gas tax (still within the bounds of the contest). Other: 4. This is an interesting perspective, though overall its potential to address climate change is difficult to evaluate. The proposal seems to suggest that tax revenues will continue to be used to fund highways and other fossil fuel subsidies. Further, its unclear whether the proposed accelerating escalator design will provide the right signals to guide consumer decisions (e.g. the gas tax holiday seems counterproductive in driving appropriate consumption decisions). The focus is limited to carbon emissions associated with oil. However, the notion of revisiting existing energy taxes to transition a discussion into a potential carbon price is thoughtful. 5. A very thorough proposal, well-researched. I particularly like how well this group sets out an actual roadmap for implementation, a mix of policy moves but also engagement with the public on the issues. I have two concerns. One, the focus on oil throughout the proposal is odd to me. What about coal or natural gas? I know the authors are focusing a lot on the transportation sector, where oil is the major player, but coal (and nat. gas) in the electricity sector is a big deal as well. I think a sectoral approach certainly has merits (i.e. start somewhere, then go from there), but I'd like the authors to justify this further. Two, pushing the tax farther upstream the oil production supply chain won't really change anything. If the markets are functioning well, the tax upstream will simply find its way downstream to the end-use consumer eventually as every player passes the tax further down the supply chain. The authors should justify this move further.

Charles Zhu

Aug 16, 2014
06:38

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Thanks for the comments and judging panel. Some very helpful feedback. I'm responding with initial thoughts here to help frame the proposal. 1. A novel, pragmatic way to get at this. Has benefit of differently situated regions to take different actions, and starts small with individual state action (a more realistic place in my view). But these are also detriments in terms of obtaining meaningful change in the near term. Again short of details of benefits because hard to assess how so many actors will respond and when. Building off existing fuel taxes and highway trust fund troubles is intriguing. - With the world approaching 40 Gt, even a comprehensive price on U.S. carbon doesn't achieve "meaningful" change in the near term. As underachievers, we try to take step one – a carbon tax somewhere in the U.S. on something. The impacts may be negligible or hard to measure, but policy and political scalability matter far much more at this point in time than raw tonnage. 2. The few Republicans who are willing to stick their necks out for a gas tax increase (and thus violate 'the pledge') are hardly helped by heaping a climate action explanation on top. In general, fuel taxes are hard to do. The Grover Norquist pledge, on top of climate change, would be a tough sell. This proposal also leaves out power generation sector, which is a bigger emitter than transportation. - Good point. Added new section just getting rid of the "carbon tax" name. - To a larger point, if raising the gas tax is hard to do, then a carbon tax - of which a gas tax is actually a subset - is impossible. Transportation is actually the largest end-use emitter because power generation isn't an end use. - Added new section on how power generation is over-regulated relative to other sectors with both 111d and RGGI and WCI and AB32. Keeping those things around without double-regulating would be good. Heating fuels like gas and transportation is relatively under-regulated from a CO2 perspective. - Grover Norquist's influence is diminishing (thank god!). 3. Thinking about a gasoline tax - a) people who want higher infrastructure spending could be pinned on gasoline tax, b) would attract D’s who want to raise price of carbon, and others who like infrastructure. Maybe don’t talk about carbon at all but raise gas tax (still within the bounds of the contest). - Yes - that's why the gas tax is a nice starting point. Changed the branding of the "carbon tax" as well. - Re: D's who want to raise the price of carbon, I don't think raising the gas tax by too much in the short-term is viable. That's why I favor eliminating it in favor of an upstream tax. Other: 4. This is an interesting perspective, though overall its potential to address climate change is difficult to evaluate. The proposal seems to suggest that tax revenues will continue to be used to fund highways and other fossil fuel subsidies. Further, its unclear whether the proposed accelerating escalator design will provide the right signals to guide consumer decisions (e.g. the gas tax holiday seems counterproductive in driving appropriate consumption decisions). The focus is limited to carbon emissions associated with oil. However, the notion of revisiting existing energy taxes to transition a discussion into a potential carbon price is thoughtful. - See above re: policy scalability over raw tonnage at this point. Anything claiming to address climate change in a significant way in the short-term is just not politically viable. - Tax revenues will plug transportation finance as far as it is politically expedient. It will not fuel fossil fuel subsidies. - The gas tax holiday is counterproductive in the short-term for the sake of political viability, but the whole point of the escalator is that in the long-term, it sends a very clear price signal. - The focus is not limited to oil, which is just an example. Natural gas is also possible. I've added more explanation to clarify. 5. A very thorough proposal, well-researched. I particularly like how well this group sets out an actual roadmap for implementation, a mix of policy moves but also engagement with the public on the issues. I have two concerns. One, the focus on oil throughout the proposal is odd to me. What about coal or natural gas? I know the authors are focusing a lot on the transportation sector, where oil is the major player, but coal (and nat. gas) in the electricity sector is a big deal as well. I think a sectoral approach certainly has merits (i.e. start somewhere, then go from there), but I'd like the authors to justify this further. Two, pushing the tax farther upstream the oil production supply chain won't really change anything. If the markets are functioning well, the tax upstream will simply find its way downstream to the end-use consumer eventually as every player passes the tax further down the supply chain. The authors should justify this move further. - Revised to draw out that natural gas can be brought in. I don't mention coal because it's essentially on its way out and is only used for electric power, which is covered under many layers of regulation already. - Re: tax pass-through, while the gas tax is passed through almost entirely to consumers, as less as 50% of upstream taxes are passed to the consumer (http://www.clevelandfed.org/research/trends/2008/0208/04ecoact.cfm)

Climate Colab

Sep 3, 2014
12:21

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Overall, splitting a carbon price effort into different smaller efforts (e.g. gas tax debate) is more intriguing in some ways than the part of this proposal advocating for the unification of different taxes in one debate. This proposal suggests a potential context in which a carbon price might get inserted into the policymaking agenda. Still, hard to see how it will gain Republican support. If you are already having to vote for a tax increase, why not get the public benefits associated with climate mitigation as well as everything else? This makes it a bit hard to see the political road map for this proposal. If you're going to engage the fight, you could do it for the whole hog vs just a piece of bacon.

Lin Dong

Sep 5, 2014
02:42

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I am glad to vote this great proposal, hope more people can support it.

Osero Shadrack Tengeya

Sep 17, 2014
05:24

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Hi Charles and friends, kindly consider to vote for my proposal shown in the link below https://www.climatecolab.org/web/guest/plans/-/plans/contestId/1300206/planId/1002 Thanks in advance.

Anne-marie Soulsby

Sep 23, 2014
02:58

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Hi Charles, Please consider voting for my proposal, https://www.climatecolab.org/web/guest/plans/-/plans/contestId/1300801/planId/1309001 Good luck with your entry! Asante/Thank-you @conserveaction
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