For Immediate Release: August 2, 2012
WASHINGTON,
DC – Today,
Congressman Jim McDermott (D-WA) introduced “The Managed Carbon Price Act of
2012,” which proposes a rational and reasonable approach to both emissions
reductions and a way to help address America’s fiscal issues without hurting
the economic recovery. McDermott’s bill, an updated version of legislation he
introduced in 2009, incorporates suggestions from the energy industry,
environmental advocates, policy experts and economists.
“The American people care about the
deficit and they’re worried about climate change--and we can fix both without hurting the economy. My bill would
reduce carbon emissions, and it returns all the money to consumers and deficit
reduction. Businesses want this kind of predictability, consumers need to be
protected, and we need to step up and address our climate and fiscal issues,”
said Congressman McDermott, who is a senior member of the House Ways and Means
Committee – the U.S. House’s tax-writing committee. “What seems to have fallen by the wayside is concern over the climate
and how carbon emissions are playing a factor in the extreme weather conditions
we have been seeing. My colleagues are seeing this in their districts. Just
yesterday, the USDA said that half of the counties in the United States – 1,584
counties – had been deemed ‘natural disaster areas’ with 90% of those counties
listed due to drought conditions. We can’t keep ignoring these major
environmental issues, and this proposal addresses emissions reductions in an economically
responsible way.”
The Managed Carbon Price Act (MCP) is simple to administer and easy to
understand. It would place a price on
carbon emissions that would increase over time, which would in turn create a
market incentive to reduce emissions. Specifically, MCP imposes an emissions
reduction schedule that would reduce CO2 emissions by 80% of 2005
levels within 42 years of enactment. The proceeds from MCP would go into a
newly created Energy and Economic Security Trust Fund where 25% of the revenue
would go towards deficit reduction and 75% would go back to the public to
offset any price increases.
McDermott added, “Mitt Romney’s Economic
Advisor Greg Mankiw, Exxon-Mobil, the American Enterprise Institute and other
conservatives have backed this concept because they know we have to wean
ourselves off of carbon emitting energy sources, and do it in a way that
doesn’t hurt our economy and makes sense for businesses.”
MCP is unlike a traditional carbon tax because it creates a flexible price
system that provides emissions price certainty by accounting for volatility in
the energy markets, requires specific emissions reductions, and addresses any
increase in energy costs with dividend payments to the public. The MCP charges the Treasury Secretary with
setting the price per one-quarter ton of CO2 or CO2 equivalent. A recent report from the Brookings Institution
illustrated that if the starting price were set at $15 per ton, it would raise
an estimated $80 billion, rising to $170 billion in 2030 and $310 billion by
2050.
- To view the MCP fact sheet, click here.
- To view the MCP section-by-section, click here.
McDermott is introducing his carbon price bill to ensure that it is part of the
discussion when tax reform is addressed in the House. Similar proposals are in draft form in the
U.S. Senate.
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Follow McDermott on Twitter: @RepJimMcDermott.