This article originally provided by
The Charleston Gazette
March 30, 2008
What if W.Va. started thinking of climate change policies that would
be good for the state?
The conservative poet and thinker Peter Viereck came up with the
best working definition of reality that I've found so far. In a poem
called "Hex," he defined it thus:
"It's what, when you don't believe in it, won't go away."
It's becoming clearer that global climate change might fall into
The Powers That Be in West Virginia, and I'm not referring to the
elected ones, have a vested interest in denying or minimizing the
reality of it and limiting or delaying actions taken to counter it.
The coal that keeps the lights on produces a lot of CO2.
But as powerful as those interests are here, they don't control the
whole world or even the whole country. Sooner or later, we're
probably going to be looking at significant national legislation to
deal with climate change.
It's the reality thing.
Rather than wishing it away, places like West Virginia would be
better served if we started thinking and talking now about policy
options that would do the least harm to the state, its people and
its economy while also limiting the amount of overall damage caused
by climate change.
The damage done to the public and environment by carbon emissions is
a classical example of what economists call an externality-i.e. a
social cost that doesn't show up on the buyer's or seller's bottom
line. At their best, markets "tell the truth" about prices and
costs. But when costs get shifted to others or to the world as a
whole, this doesn't happen. It's a common form of market failure.
I know the idea that markets can sometimes fail is a shock for true
believers in the cult of the market god, but these things happen.
It's the reality thing again.
A likely scenario is that at some point, the United States will get
serious about dealing with it, either by imposing a carbon tax or by
a cap and trade system, which would limit greenhouse gas outputs and
allow companies to exchange carbon emission allowances. If these are
well designed, they can ease the impact of these changes on ordinary
people and the public.
If we go the cap and trade route, it's important that carbon
emission allowances be auctioned off by the federal government
rather than simply given away as windfall profits to corporations
and that the revenues generated by this be used responsibly. The
nonpartisan Congressional Budget Office (CBO) estimates that a cap
and trade system could generate $50 to $300 billion a year in
Robert Greenstein and other researchers at the Center on Budget and
Policy Priorities have done some groundbreaking research on how
these resources could be used to strengthen the economic well-being
of the country as a whole.
For starters, they recommend that 15 percent of the revenue from a
cap and trade auction should be dedicated to compensating energy
companies for losses under the new system. That figure is derived
from CBO estimates
The people who will be hit the hardest by rising energy costs,
however, are low-income Americans. If Congress eventually adopts a
policy to reduce greenhouse gas emissions by 15 percent, energy
costs for these families could rise by $750-$950 per year, including
home energy, gasoline and other kinds of consumption. But by setting
aside as little as 14 percent of the revenues generated by a good
climate change policy, these families could receive an energy rebate
along the lines of the popular Earned Income Tax Credit.
This would leave around 70 percent of cap and trade revenue for
other important purposes, including assisting communities and
workers in places like West Virginia affected by these changes.
Other potential uses include investing in research and development
of alternative energies, providing energy cost assistance to
middle-income families and offsetting rising energy costs to
federal, state and local budgets.
The old saw that we have to choose between economic well-being and
the environment is getting lamer and lamer. As you may have noticed,
both are taking a dive right now.
With luck and effort, we can have some of both - or a whole lot of
Wilson is director of the American Friends Service Committee WV
Economic Justice Project and publishes The Goat Rope, a daily public