Is there a Republican solution to climate change? Looking at Capitol Hill, it’s hard to tell. Liberals have dominated discussion of environmental issues for so long that the odds of bipartisan legislation seem slim. After all, the GOP is seen as the party of business, not environmentalists. A new generation of conservatives are challenging this divide, however, arguing that there is a place for market-based carbon solutions that will help the environment without forcing businesses to swallow the full slate of socialist regulations included in the Green New Deal.
“Conservatives can care about the planet, they can care about mitigating the risks to communities and future generations, [but] they’re often alienated from the environmental movement which has been pushing them out slowly but surely over the last several generations,” says Alex Bozmoski, managing director of the Energy and Enterprise Initiative at RepublicEn. Bozmoski, whose work advocates energy policy that supports limited government and free enterprise, spoke on an event hosted by Climate-XChange.
Conservatives who support strong environmental policy increasingly find themselves without a political home. As a result, the left has had a “veritable monopoly” on policymaking. This makes climate change and carbon reduction difficult issues for conservatives who might agree that a problem exists but reject proposed solutions that increase the scope of government regulation.
“When you hear the problem, you automatically think about what the solution that’s coming next is. And if the solution is totally untenable to you, then its really easy to cope with that by just ignoring the problem,” he continued.
Instead, he and others are arguing that conservatives should take another look at carbon pricing, which would reduce emissions without increasing regulations.
“A carbon price is an integral step in fostering a transition to a carbon-free future,” says Nader Sobhani, a climate policy fellow at Niskanen Center whose work focuses on environmental tax reform and clean energy policy.
He explained that if one accepts that climate change is a real problem demanding government response, there are only a few options on the table.
“You can have a regulatory approach, where you have bureaucrats trying to manage the issue. You can have industrial policy whereby subsidies pick winners and losers and then there’s a carbon price.”
More than regulation, carbon pricing uses the power of free markets to encourage new solutions. Instead of demonizing the fossil fuel industry, it encourages companies and consumers to think in terms of costs and benefits of producing emissions. A carbon pricing scheme could also be paired with reductions of other environmental regulations, further reducing the negative economic impact of carbon reduction.
This is where carbon pricing opens up debate on other conservative issues, such as cutting taxes and reducing regulation. Not only could a carbon pricing program reduce the regulatory burden, it could also be made revenue neutral through the use of rebates or by cutting payroll and other taxes. There are advantages to this type of tax.
“One advantage of the rebate is it is very transparent where the money is going,” says Josiah Neeley, director of energy policy at the R Street Institute, who adds that this makes it clear that a revenue-neutral tax is not intended to fill government coffers.
However, a tax could also be used to reduce payroll taxes or other taxes that target the middle class and small businesses. This is yet another area where conservatives have ample room to debate the pros and cons of different regulatory solutions.
“If you’re more concerned with the macroeconomic impacts, that’s where you use the revenue from the carbon tax to reduce discretionary taxes such as the payroll tax, corporate income tax, those kinds of measures,” says Sobhani, who explains that economic studies have shown that these policies can boost GDP.
On the other hand, reducing those taxes does not address the concern that a carbon tax would be more burdensome for lower income people. Meanwhile, rebates may in fact help improve the wellbeing of these families.
In the end, these are the sorts of policy debates that conservative environmentalists wish America was having. Climate change has been a polarizing issue, meaning that Republican politicians are wary of touching it, but embracing the debate would help ensure that there are pro-market voices addressing it. This would shift environmental regulation in the political sphere where it can be debated, instead of leaving it in the hands of unelected bureaucrats.
In short, it’s a question about choice.
“All of climate policy is trade offs,” said Bozmoski. “This is what we elect legislators to broker.”
“One of the most effective ways to frame the issue is for this this country to be a global leader,” he continued. “We have to unleash the power of our free enterprise system”