I'd like to kick us off.
I'm going to serve as moderator and timekeeper for the session.
Thank you very much for coming for this really important
topic.
As I think many of us are aware, MIT has made, as a community,
a number of statements to the effect that if we're going
to take climate change on and take it on seriously,
carbon pricing is a really important, necessary--
not sufficient, but necessary--
part of the equation.
I'll read this from a press release that
was put out when MIT joined this global Carbon Pricing
Leadership Coalition last year.
From Maria Zuber, if you ask MIT economists and policy experts
what we should do about climate change,
chances are they will tell you, "Put a price
on carbon emissions."
Along with increased funding for clean energy research
and development, carbon pricing is
one of the most effective things that we
can do to speed up the transition to a zero carbon
economy.
In terms of what we're aiming to do with this session here,
try to keep several big points in mind.
One, that there is this consensus that's developed
about the big picture.
It's a kind of a rare, hopeful, bright spot
of bipartisan coming together, in many respects.
But there is plenty to be done, as well,
and that the details still to be worked out really matter.
And there is, I think, healthy debate that
needs to happen that hopefully we, as the MIT community,
and our surrounding community can really engage with.
And so with that charge in mind, I'm
really happy to introduce our panel to you.
We have two legislators who are really
leading the charge on this in Massachusetts, Jen Benson,
Representative Jen Benson.
And from Senator Michael Barrett's office, Sam Anderson.
We have two folks representing the MIT academic community,
Chris Knittel and Emil Dimantchev.
And Cindy Luppi representing the grand coalition
that's been taking shape that brings together business,
civic, and all these other different organizations that
are really trying to make this happen.
We're going to start off with a series of opening remarks.
Chris, take it away, please.
Great, so first, thanks for coming.
I've been tasked to give the academic groundwork for why
we need a carbon tax from an economist's perspective.
So I'll most likely be very boring,
and then I'll hand it off to the more exciting speakers.
But the first point--
I want to make three quick points.
The first is that you can't efficiently
reduce greenhouse gas emissions without a price on carbon.
Economists have actually known this for 150 years,
with the work of Pigou in the late 1800s.
That is the most efficient way to reduce something
is to raise its price.
It works for every other product.
It works for products that we buy.
And it also works for pollution.
We as academic economists spend a lot of time
estimating how much more costly policies that we rely on
are compared to carbon taxes.
So I could certainly speak to those numbers.
My own work, for example, suggests
that reducing carbon through ethanol mandates
or renewable fuel standard is three to five times more costly
than a carbon tax would be.
Other work on fuel economy standards
suggests that fuel economy standards
are as much as 10 times more costly as a price on carbon.
So there's a long academic literature
suggesting the efficiency of a price on carbon
relative to these other policies.
The second point I wanted to make
is that the most efficient price on carbon
is the social cost of carbon, what's called
the social cost of carbon.
And then that is how much damage does
one extra ton of CO2 or any other greenhouse gas
do to the entire globe.
And that's a tough number to come up with.
And we might get into that later.
But we do have numbers.
So for the past three or four years,
the federal government has had a social cost
of carbon on the books that they use
for a cost-benefit analysis of any environmental regulation.
And that number is roughly $40 a ton.
OK, so you put a ton of CO2 in the atmosphere,
and that causes about $40 of discounted damage
to the globe over the life of that ton of CO2.
The last point I want to make is that a carbon tax can work.
So we can point to a number of carbon taxes or carbon prices
that exist.
I think the most popular one that we often point
to is the one in British Columbia, which
has existed since 2008, and started at $10,
and is now at $30 a ton.
All the analyses that have done on British Columbia
suggest that it's reduced CO2 emissions.
It also hasn't put a damper on the economy.
And the most striking feature of that carbon tax
is that over 50% of British Columbians support it.
And trying to find over 50% of it of anyone to support any tax
is going to be very difficult.
So not only has it worked, but consumers have embraced it.
And most likely they've embraced it
because it's a revenue neutral carbon
tax that collects the revenues and then sends it
back to the population after the year's end.
So we need it.
We can measure how high it should be.
And we have a good experience and actual evidence
that it works.
Great.
Hi.
Well, thanks for coming.
It's great to see so many people interested on this beautiful
day talking about this issue.
So I first learned about this issue, the concept of a carbon
pricing, down the river at another school,
and became really interested in this.
So Massachusetts, I've been in the legislature since 2009.
Massachusetts has been pretty aggressive in addressing
climate change as much as we can and as much as we've
been able to get political support for.
We're part of Regional Greenhouse Gas
Initiative, which is a cap and trade system.
We passed a Global Warming Solutions Act in 2008.
And so we had pretty aggressive timetables on that.
We have great incentive structure for renewable energy.
So there's a lot of things we have done.
And our initial goals we surpassed much more quickly
than we anticipated.
And so we're seeing that there is an appetite for smart energy
policy and interest in addressing climate
change in Massachusetts.
So what's the next step?
So I think we'll hear about my bill.
You'll hear about Senator Barrett's bill today.
And they differ slightly.
But I think conceptually they are addressing the same issues.
So in addition to the economic aspect
of using this market-driven system to drive down
carbon emissions and consumption of carbon-based fuels,
it also has a sort of a behavioral aspect to it.
And it's the two-pronged approach
of paying that additional price at the pump,
or wherever you may be.
But then also getting that rebate check back.
So you get two hits on somebody.
And so that reinforces the idea of if I pay less
at the pump via having a more energy-efficient vehicle,
or whatever it may be, I get to pocket more of that rebate.
So the actual human interaction with this
is interesting and very different
than a lot of the other ways we've
tried to address this issue.
So my bill is actually a revenue-positive bill.
And the reason I really wanted to go
that route is because I felt that there are aspects
to reigning in carbon-based emissions
that isn't only addressed through a revenue neutral bill.
And I really wanted to have an additional pot of resources
to drive back to other infrastructure
to enhance our ability to deal with this
on a more rapid basis.
So for example, sending money back
to cities and towns in order to make their buildings more
energy-efficient, to increase public transportation options,
especially in areas where there really isn't any option.
And so there were other aspects to living in a rural community
I felt we could leverage this resource, new resource,
to further enhance sort of the benefits of the program.
So the other aspect of my bill is that I really
have tried to make it as progressive as possible
and to hold the lower quintile income, quintiles of income
as harmless as possible.
So it really does change sort of the [? repriant ?] structure
based on family income status and that sort of thing.
Because one of the main reasons is many middle-class,
upper-middle-class families have already
invested in a lot of the options available to them.
For example, putting solar on your house.
Right
Whereas there are many people living in multi-unit dwellings
or in rural communities where they haven't had
the opportunity to invest in that.
And so this gives more money back to them
to help them spur on that investment, which
then enhances their income-to-cost ratio
in their homes.
So if they can drive down the cost of heating their home,
whether it's through a new heating system,
through, energy efficiency, then they're
pocketing more of that money and being
able to spend it into the economy in different ways.
So these are all points that are debatable.
I mean, now we have a couple of bills that have been filed,
one in the Senate one in the House where we do
have differences.
And we can debate those differences
and what makes sense.
But my goal in this was to find a way to,
if we're going to create this new program,
I want to maximize the benefit.
How can we maximize benefit by addressing those sectors that
haven't been able to really take advantage
of the energy and green energy solutions
that are out there right now.
And one other thing I'll just mention
is multi-unit dwellings.
Multi-unit dwellings have been a real issue because as a renter,
you're not able to take part in a lot of these programs.
We've also prioritized multi-unit dwellings
as one of the areas to address.
So I'm really trying to dig through where
in the environment, and where people are, to address carbon
emissions at every level.
So I will pass it down to Sam.
Hey, I'm Sam Anderson.
I am a legislative director to State Senator Mike Barrett.
I'm doing a little pinch-hitting here while he's out of town.
I don't have too much to say that Chris and Rep.
Benson didn't.
I will say that I've been involved
at the staff level in one way or another in carbon pricing
at the state level since 2012.
And thanks in no small part to some
of the people on this panel, we've come a really long way.
Support's growing.
Back then we had like a dozen co-sponsors, a pretty sleepy
hearing, and no real prospects.
And this session we have 80 co-sponsors
and a real groundswell of support
in the state legislature.
So from my perspective, I feel like every day is progress.
And I'm very happy to be involved in the effort
and in the issue.
So with that, I'll turn it over to the advocacy community.
Thank you.
So, hi everyone.
Thanks for coming.
So I actually don't come to this from the advocacy side.
No worries.
Just to clarify.
So I come to it more from the analyst side
having worked with lawmakers in a few different countries
on carbon pricing policies.
The first thing I'd like to do is
to recognize Representative Benson and Senator Barrett
and their staff for the leadership
that they're showing on this issue,
because as we heard quite compellingly, I think,
carbon pricing can be very effective.
So I'd like to make two points.
One is about the policy and one is about the politics of this.
So first I think it's important to recognize
that the effectiveness of the policy
will depend on how we use the revenues, going
much to represent a Benson's point.
This is because carbon pricing does not get us
all the way to decarbonization.
So as we try to reduce emissions significantly,
we run into obstacles that carbon pricing does not
actually solve.
Especially around energy efficiency
and around research and development
for clean energy technologies.
For instance, a study commissioned
by the Massachusetts Department of Energy Resources
found that a carbon tax similar to the ones that
have been proposed, those reduce emissions significantly.
But to reach the climate goals in the Massachusetts Global
Warming Solutions Act requires us to multiply those reductions
by about eight times.
So carbon pricing is necessary, but it's not sufficient.
So if we use the proceeds from the carbon price
we could help close that gap.
If we were to recycle them toward smart initiatives
on clean energy and energy efficiency, I think.
The second reason why it's really important
to think about this, I think, is that it
can be very helpful from a political strategy perspective.
And I think using some of the revenues to fund clean energy
can help politically by securing the support of, for example,
the clean energy industry, which has
been becoming increasingly influential
political constituency.
Moreover, if you look at public policy, sorry, public
perception polls, nationally they
show that people tend to favor carbon pricing much more--
both Democrats and Republicans-- much more
if the revenues are used for different renewable initiatives
than if they are used as rebates and refunds.
So again this is a national data.
So this brings me to my second major point about the politics.
And this is just from my experience
working with lawmakers on these kinds of policies,
is that yes carbon pricing is very cheap economically.
But it's extremely expensive politically.
So past experiences around the world
have shown that to pass such bills and such proposals
requires a lot of political capital.
And a lot of compromises have to be made in the policy design
to sort of secure the necessary support from the business
community.
So I guess a takeaway we can take
from this is the only way the current pricing can work
is incrementally.
So you start with a policy that is less than ideal,
and you amend it over time.
And I think that's important to recognize because it's
important not to make the perfect the enemy, excuse me,
it's important not to make the perfect the enemy of the good.
So another takeaway is that these kind of policies
to pass, they require a very significant, very unified
support from the environmental movement,
from environmental advocates.
So this is something we've learned from past initiatives
here in the United States, at the federal level
back in 2009 and 2010, as well as in Washington state
just this past November.
In both cases, the efforts and proposals
failed in part because of lack of sufficient support
from environmental advocates.
So hopefully we can take this as a cautionary tale.
So just to summarize we need to talk
about using some of the revenues for clean energy.
But even more importantly, we need a strong, unified movement
of advocates to embrace the pragmatic incrementalism
to make this happen.
Thanks.
OK, well, so you've heard perspectives from four people.
And here I am, I guess batting cleanup, or at least
standing between you and question-and-answer.
So I will do my best to be interesting here, and brief.
My name is Cindy Luppi and I'm the regional director
for Clean Water Action.
And I'm also the coalition coordinator
for the Mass Campaign for a Clean Energy Future.
That is the coalition that is uniting groups
across the state around the goal of getting a Massachusetts
state-level price on carbon in a fee-and-rebate policy
as a stepping stone in an act of momentum for national policy
reform.
So we're working in collaboration
with states across the country.
Over 18 states have some level of carbon pricing policy
that they're moving forward that's being considered
and in the state legislatures.
In Massachusetts, we have over 50 groups
from the environmental climate, faith, health,
civic, grassroots community, all leading this push.
So I want to stop and ask who here
is a member of or representing an environmental group
or one of these kinds of groups?
What group?
Citizens' Climate Lobby.
Citizens' Climate Lobby is a leading partner of this effort.
I teach a class on water and climate change,
and I have an NGO called Pure Home [? Morning. ?]
Beautiful.
You're not part of it yet, but.
We're in a growth mode, so we'll be talking to you.
I'm also [? for ?] MIT here on campus.
Awesome, and we should definitely
be talking to you, as well.
Anyone else?
We represent members from the Environmental League
of Massachusetts, the Sierra Club, Climate Exchange--
which is the group that was formed with a singular focus
to pass carbon pricing in Massachusetts and in other
locations--
faith communities, the League of Women Voters
is incredibly active, Physicians for Social Responsibility,
Health Care Without Harm.
Just really groups across the state
have united around this goal.
And what we've learned so far is that the political unity
is really important.
So we are embracing every bill that
looks at reasonable effective carbon pollution reductions
in an equitable way as worthy of support.
So both Rep.
Benson's bill and Senator Barrett's bill
are supported strongly and passionately
by coalition members.
We want to make sure that, I guess the lessons learned
from Washington State where there were divisions
in the movement that has slowed down the road to carbon pricing
there, that we don't repeat some of those dynamics
here in Massachusetts.
So I guess that leads us to the question of why Massachusetts.
With all of these states moving forward,
why are we so invested in Massachusetts,
other than the fact that we all live here?
One major factor is actually what several speakers
have already mentioned.
The Global Warming Solutions Act mandates
that we hit at least 80% pollution reductions carbon
pollution reductions, by mid-century.
Does anyone know where were estimated to be right now?
Have a general idea?
This is from a baseline of 1990 emissions.
There's different schools of thought on this.
But in general, we're in the 16%, 17% reduction area.
And we need to get to 25% by 2020.
Beyond that there is no comprehensive plan
for how we'll get to steady pollution reductions
in 2030, 2040, or 2050.
So the Department of Energy Resources study that Emil
mentioned is a really good tool for us to see that we cannot
reach these goals without carbon pricing.
I think you heard that unequivocally
from all of the speakers.
So we know we have to make this happen here if we're
going to hit our mandates.
It looks like depending on the fee rate
we could get 5% to 10% pollution reductions in one
fell swoop from carbon pricing.
And there's no other single policy
in the entire toolbox that will get that deep a reduction.
So we really need to make this happen
if we're going to meet our mandates, not
our goals but our legal mandates.
So that's one very important reason
why we're all on this path together.
I think another piece that we haven't brought up yet today
is the nature of our economy.
Has anyone ever seen an oil rig anywhere
in the state, or a coal mine, or any kind of fossil fuel
extraction going on?
Anybody outward to lately?
You have?
Yeah.
Sure, yeah.
Wyoming?
No, no, in Massachusetts.
Wow, my whole next point is ruined.
OK.
In Massachusetts, we import all of the fossil fuels
that we burn.
So what that means is that the fee, that a carbon fee
would put on fossil fuel producers
all fall on out-of-state fossil fuel interests.
And I just want to take a second and ask our political players
here how important do you think that fact is,
in terms of policy viability?
I think with a certain sector that may be.
I think for the general public, though, I don't
know how important that is.
What we're seeing right now is that we
export approximately $20 billion of Massachusetts resources,
financial resources, to other economies
to purchase the fuels that we burn here.
That includes Pennsylvania, Louisiana, Texas, Saudi Arabia,
Colombia.
And these are economies that benefit from those energy
dollars.
So there is, as has been mentioned,
a real incentive if we can align this incentive
with capturing those dollars and investing them
in a local, homegrown, clean energy economy.
That is something that does incentivize the clean energy
and clean tech sector to join with us.
So we feel really fortunate to have both business leaders
and industry analysts supporting this policy in ways that
make strange bedfellows, sometimes,
but also make me feel really fortunate that we're
looking at a very pragmatic policy
that multiple sectors of our economy and our population
can embrace.
So there's a lot of hope in that.
They also tell us, many of these business interests,
that we just flat out need to level the playing
field between the out-of-state fossil fuel
resources and the in-state alternatives,
including increased efficiency, including increased solar,
renewables, storage technology.
So there's an innovation economy here
that has sparked, but has certainly not hit
its full potential.
And there's a lot of support for seeing how far we
can go in Massachusetts.
One of the colleagues of representatives here,
a new representative from Western Mass
has said he would like to see Massachusetts
become the Saudi Arabia of battery storage technology.
I think maybe MIT is the only place where
we could get a smile or a laugh from that statement.
So thank you for being intrigued by that.
But it is a solid point.
We want Massachusetts economy to keep growing
and we want it to be a clean tech future for all.
And we also want it to be an equitable future.
This is the last point I want to make.
Massachusetts has a really proud history of focusing on equity
and making sure that low-income and moderate-income families
don't get overburdened by environmental advances.
And I feel really proud to be in a state
where really responsible policymakers
like Representative Benson and Senator Barrett
have looked so carefully at these policies,
that they have very carefully tweaked the models
in the formulas, such that low and moderate income
families, folks who make 60% lower salaries, lowest
incomes in the state, will either come out
ahead or at least break even between the fees that they pay
and the rebates that they get.
So that's a large part of why the faith
community has joined with us.
Over 150 religious leaders across the state
have taken up carbon pricing as the next climate leadership
move that Massachusetts should make.
And these are people, faith leaders representing all.
It's the interfaith leadership team.
And it's the thought leaders in the faith community
in Massachusetts which help influence the rest
of the country, as well.
So we feel really fortunate about that.
Finally, Massachusetts is the land
of wanting to do things first and best.
We felt that way, I think, about health insurance reform,
although the outcome is questionable.
We felt that way about same-sex marriage.
We certainly feel that way about climate change.
So we would really like to see in our elected officials--
very fortunate--
to want us to see, make this next leadership move.
So we are all about momentum right now.
And we're hoping that each one of you can join in the effort.
We have sample letters here that you can take with you
and send to your legislators, and also to the governor,
who also is keeping an open mind about carbon pricing,
but has not embraced it yet.
He has not said no, but he's not embraced it either.
So we really need to raise our Massachusetts voice with all
of these elected officials.
So I guess we can end there and hand this back to you, Kirk.
Thanks, I'm actually mic'd up, so you all
can pass the mic around.
I'm going to call moderator and ask the first question, if it's
OK, before I open it up.
For those of us who haven't gone through the experience
in any detail of moving state-level legislation
through, what does it look like to take something that's
got this kind of level of pretty strong support,
you know, over-the-top to the point where it actually
gets put into force?
How can we help with that?
Any thoughts?
Well, it's messy.
I can say that, as it is everywhere, I think.
But I'll start out by saying this is very
general to any legislation.
The government is set up to be very inefficient and slow.
I mean that's purposeful.
Because this session we've had 5,700 bills filed
and we don't want 5,700 new laws passed.
So it is difficult to get a law passed.
And so something this complex, and I
would say not well understood by many of my colleagues,
is very, very difficult to pass.
And so obviously there's a lot of hurdles.
The first hurdle is to get through committee, which
luckily Senator Barrett is the senate
chair of the appropriate committees,
so that should help us some.
But then it will move through a very slow process,
probably go to a secondary committee in each chamber,
before it ever sees the light of day.
And ultimately, there are a few people that really
need to be influenced on this.
And in order to get it down, the last hurdle.
So what I would say is I think speaking loudly, and educating
friends, colleagues, whomever about this,
always sending letters, making calls to your state legislators
is very important.
I encourage people to write letters to the editor or op
eds, because I think the greater public really needs
to understand this better.
Because really all they hear is tax.
They think it's a tax.
Which it is, I mean, frankly.
But the end result is not about beefing up the state coffers.
It's really about sending that money back
out to people, to businesses, to cities and towns,
in order to address this pressing issue.
And I think that ultimately with what
is happening in Washington right now, that maybe our best
ace in the hole, because clearly this administration not
only does not believe in science,
but also does not believe in funding the EPA
or supporting things like CAFE standards in California,
and that sort of thing.
So I think this gives us an opening
to say that if we want something done around climate change,
we have to be willing to address it ourselves.
We can't look to Washington to solve this problem.
I think that one of the political issues
is that people say, "Well, what does
it matter if Massachusetts-- what impact will that
have on global climate change to our little state?"
It probably won't have a huge impact
on global climate change.
But it will have a political impact on the United States.
And that I truly believe.
Somebody has to be first and we've
been very willing to do that in the past.
And I think that we should use that political capital
on this issue.
And we could also mention that there's probably
a lot of beautiful homes on the Cape
that could be under water in the next generation.
So perhaps, if nothing else, that will motivate people.
I'll just add to that.
I believe the bills that are proposed in Rhode Island
and Connecticut look to Massachusetts
to be the first one to jump.
And they have trigger language where
if Massachusetts puts something like this into play,
they're ready to go.
I don't think those are approved bills, but they're proposals.
And so that's the kind of thing that gets set up.
Any other comments on the big topic?
Yeah, I'll just make an observation
and buttress something that Rep.
Benson said.
On big ideas like this, what the legislature
is often looking for is consensus
before actual legislation takes shape.
As you said, it's an incremental process.
So on a huge idea, you really need something
to be a mainstream idea that everybody
is familiar with before moving forward.
And that's where I think the knowledge
gap with a lot of legislators is holding us back.
It's not a question of necessarily
the technical process of going through committee.
It's the process of having conversations
with as many legislators as possible
and convincing them that it's the consensus choice.
So that's just my observation.
Cindy?
I would say that's true, which gets us back
to the role of everyone who's sitting here in the room.
The more noise we make, the more we reach out
to our legislators and municipal officials and organizations
that we work with, the more it's sort
of a everything and the kitchen sink approach
to building momentum and building
a roar in support of this leadership
step for the climate.
And it's a really exciting process to be a part of.
I feel really fortunate to be in the spot that I am,
because I get to see the businesses that
are stepping forward and implementing
carbon pricing voluntarily within their business.
I get to see the churches that are moving forward and meeting
with their legislators as a body to influence them
in this direction.
I get to see legislators like these leaders really
step out before their colleagues and be change makers.
Both the senator and the representative
are in leadership positions, key leader leadership
positions in both bodies.
So they have their actions carry a lot of weight.
And honestly, I think this effort in Massachusetts,
although it is not easy, it's quite hard.
It requires each of us to be persistent.
But we are so fortunate to have the unique characteristics
that we have in this political playing field in Massachusetts,
that ultimately I'm feeling really confident
that if we're persistent we will get there.
So I again I'm just hoping that all of you
will be interested in getting involved.
Open it up to the floor for questions.
If you can come up and use one of mics.
Thanks.
So thank you so much for the presentation.
Question for Representative Benson.
If the tax passes, what would it mean in practical terms?
So for example, how much more would a gallon of gasoline
cost?
Thank you.
All right, so thank you for the question.
So my bill starts at $20 per ton of carbon emissions.
And goes up to $40.
And then after that, every other year,
there's basically a decision point
whether or not to increase it further, or if that's working.
So that's the structure.
So that translates to about $0.18 per gallon of gas.
Now just to put that in perspective,
though, I will say that I was curious
looking at the US dollars of a gallon of gas in Europe.
Right now in the UK it's 5.77, I believe, for a gallon of gas.
It's in that 5.50 to 5.75 range in all the countries that I
looked at.
And we have to also understand that our gas prices are
artificially deflated by a lot of government intervention,
the federal government intervention
into the fossil fuel industry.
So we're kind of at a low point globally.
Could you dissect what happened in Washington State
this past year?
Like what went wrong and what we can learn from it?
And then also, too, is that rift re-incarnated
between the Barrett and Benson bills?
Aside from the fact that that was on the ballot versus this
is legislation.
If that's not kind of re-incarnated,
how have we avoided that?
So I think the Washington State experience
is a cautionary tale.
I think we're working really hard to make sure
that we're all supportive and happy
with each other's approaches.
I personally think that the tactical error
that the folks in Washington made
was to go to the ballot in the first place.
I don't think this is an issue that belongs on the ballot.
I think if you ask people, even in Massachusetts,
if they want their gas to be more expensive, they'll say no,
even if you tell them it will save the planet.
So that's my personal opinion.
I don't know if others here agree on that.
Someone say a little bit what the Washington situation
was, in case people don't know.
Anybody want to--
I don't have any first-hand knowledge.
So it was sort of your, from an academic perspective,
your optimal carbon tax in many ways.
It used the tax revenue to lower other taxes, corporate income
taxes, and then to increase the Earned Income Tax Credit
for low-income consumers.
So from an academic perspective, economists,
that's how we would use the revenue.
So we have good taxes and we have bad taxes.
Good taxes are taxing things that we want less of,
and bad taxes are taxing things that we
want more of, like labor, and sales taxes, and so on.
So any situation where we could replace bad taxes
with good taxes, the economists are always
going to be in favor of that.
But that's from the ivory tower.
I think the difficulty with the Washington State proposal
is that it was very cumbersome and nontransparent.
There were arguments over whether it was actually
revenue-neutral, whether it was going
to generate enough revenue to cover the tax breaks.
And then it was also going to replace
some environmental programs.
And that led to a number of environmental groups
being against the tax.
So that's the beauty of something
like Senator Barrett's bill, where it's perfectly just a tax
and dividend program, where all the money goes in
and then it goes out.
That transparency has a lot of benefits.
Representative Benson's bill pushes
that a little bit further and uses
some of the money for other potentially useful things.
So it's a nice mixture of the clean tax and dividend
program to using some of the money
to do other things that we would like,
and not at all close to the Washington State, very complex,
and I would just say nontransparent bill.
Plus the fact that if you let the population vote for a tax,
I think the typical answer is going to be no.
I also think we have to be really careful when
we are building political support for an initiative
to make sure that the voices at the table
are respected and heard, and that there's a good dialogue.
And they were two very different groups
of people who were convinced that they each had the best
model, and had talked to a lot of people within their circles.
And there was a real clear sort of dividing point.
So the public coalitions divided and split
in ways that were really unfortunate.
When everyone could embrace this push for climate leadership,
there was a clear division around the ways
to get there, strategy and policy framework.
And that's really hard to build a winning campaign on that kind
of a playing field.
It's just hard.
So in Massachusetts and in many other states,
we've learned from that experience
and are trying a different approach
to be a little bit more flexible about policies
to flag the benefits of the different models,
and to make sure that at the end of the day,
we respect each other.
We're talking to each other and not past each other.
And that we're keeping our eyes on the prize
and making sure that a next climate leadership steps moves,
moves so that we can meet our generational and legislative
mandates.
I have a question about the nature of the political costs.
I think it was you, Emil, who mentioned
that there was enormous political cost to introducing
a carbon tax.
I mean, what is the nature of the argument?
Is that primarily that private citizens
don't like the fact that they have to pay more for gas?
Or is it a jobs argument that the energy-intensive industries
in Massachusetts will move outside of the state?
Or where is this--
or is it just simple general resistance
to government regulation of any kind?
What is the nature of the resistance?
And if it is a jobs issue, I'm suggesting
there may be another argument that you
can bring on this, which is that in fact, it is true
that it is costly to firms in the short run
to get to have to pay a tax on carbon.
But dynamically if you look over the longer run,
that kind of price signal will set
in process innovation and improvements in efficiencies.
New technologies will appear, including perhaps battery
stores and other things, which in the longer run
will actually potentially make Massachusetts more competitive,
if other states and nations follow suit later on
and put on more stringent--
then you almost have like a first mover advantage on this.
But I'm just curious about what the nature
of the political resistance to this
is, what the main arguments are.
Thank you.
Yeah so thanks for the question.
So there are two things, I would say.
First is a carbon price makes costs very visible.
So the price of a gallon of gas increases.
And all the drivers in America see it
on printed and big digits.
So that's something that tends to be sort of politically more
difficult. And you know you can see it also
in public opinion polls.
If you ask Americans, "Do you support climate legislation?
A majority will say yes.
If you ask, "Do you support regulations on CO2?"
a vast majority will say yes.
But if you ask them, "Do you support a carbon tax?"
then it gets much more difficult.
And a lot fewer people support that.
The second element is that there are
few losers and many winners.
And the winners all benefit by a little bit,
but the losers lose a lot.
So this gets to your point about the short term costs.
And these businesses and constituencies
that have to bear those costs are
very powerful for one reason or another.
I'm sure that Sam and Representative
Benson can speak more to the on the ground
realities in Massachusetts, as well.
But those are the two main challenges.
So one way to get around it is to use the revenues to benefit
a very powerful political constituency, such as the Clean
Energy Industry, for example, which
might get around some of that.
Another way would be to, for instance,
frame it as less of a tax and more of an investment program.
For instance, saying that this is a green economy investment
program that, oh by the way, it's funded by a fee on carbon
or a tax on carbon.
But it's still very difficult.
Did you want to--
So I'll just say very briefly, actually
some of the largest employers, businesses in the state,
are supportive or at least open-minded to this,
so that's one thing.
When we created the Regional Greenhouse Gas Initiative
and the cap and trade system, we did not
see a major exodus of businesses out of the state.
The aspects of energy that are covered by that
are exempted from this, so you're not
double-hitting those areas.
And I think if you look at really small businesses,
they're probably the ones that are the most concerned
about this.
And having talked to some of them,
I think that there there's an interest
to invest in green energy and efficiency
within their businesses.
So hypothetically creating a zero or low-interest loan
program through this might be a great way
of addressing their concerns, for the really small
businesses, which helps them reinvest
more into their business and potentially hire
and everything else.
So I think the jobs argument is not
the biggest argument in this.
And clearly what we've seen in the solar industry
and the renewable industry in Massachusetts,
it's just blossomed.
And I think so many people are now employed in that sector,
they appreciate that.
I will say it's the idea of a tax.
I think there's just a lot of people who say, "Listen, you're
taxing us every which way."
We just voted down a gas tax in Massachusetts,
which the legislature passed and the people voted down
at the ballot.
Hypothetically if this were to pass that
could also happen to this.
I mean, you know realistic with the prospects of that.
So I think we have to really lay out the benefits of this.
And it's going to really depend on making
sure people understand and making
it as transparent as possible.
I think that's critical.
If people think this is just going
to the general fund to the state to fund God knows what,
they're not going to support it.
So ensuring that in this legislation,
it has to really be spelled out where the money is going,
how it can be used, how those rebates work.
I think both of our bills also take into account mitigating
some of the issues outside of 495,
like having to drive further.
We actually add a 30% increase to the rebate
for families outside of 495 that don't have access
to public transportation.
So we're trying to thwart as many of those arguments
as possible.
But it's going to overburden some and only benefit
a select few, or the state as a whole.
So we're working those.
But I think just the idea of another tax
is what is the biggest issue.
Everything else I think we can address very, very well.
So that's my- do you have--
Communications firm that's looked at this
has said that we should never say the word tax.
We should say fee.
Fee, fee, fee, fee, fee.
And rebate.
Start with rebate, don't say tax, for what it's worth.
So Rep.
Benson, I think you were just starting to get at this.
But a question I have, I'm really
interested in the actual mechanism
by which people would receive the rebate or the dividend
or whatever you call it, because I think that potentially
could be a place where you reduce the political burden.
And so for example, people getting their first rebate
check, you know call it a prebate
before they see the increase in energy costs.
And I'm just wondering if you can talk a bit
about have you thought about that,
and how can you design the actual--
can you avoid direct deposit so people actually
get something in the mail?
That kind of thing.
This is-- we have had this discussion.
You would not believe how much time
we have discussed this exact issue, because it is important
not only--
I mean, the prebate is an interesting-- also
from a business perspective.
If you look at cash flow issues and that sort of thing,
getting that sort of prebate is a great idea, because for them,
it's sort of thwarts some of that expenditure upfront
in order to get a rebate.
So we've had that discussion.
But also, how do you physically get this to people?
And we wanted to do a check, a physical check
to be mailed out.
And we keep discussing that because
of the sort of the behavioral aspect of that,
getting that money in your hand.
The problem is, though, it's expensive to do that.
And so there's how much overhead are we willing to add on
to this program?
And so that's the debate we've been having back and forth.
Do you want to--
And obviously cost is a concern.
But another piece of it that we continuously debate
is how often.
There's language I think we wrote
that says as often as possible.
So if you want to do it monthly or quarterly
and you can do it cost effectively,
we also think that would be a great idea.
But obviously the limitation is overhead.
But that's another piece of it, prebate and how often.
Another element of this that has been really carefully studied,
which I think is incredibly impressive
and again, I think it's a credit to Massachusetts,
is that people who are too poor to be in the tax
system, those people are estimated to be about 9%
of our population.
Their needs have also been really carefully considered,
looking at programs where they are in databases, like food
stamps and SNAP programs, fuel assistance programs,
so that the poorest of the poor also
are insured to the best of our ability,
that the people who can least afford to pay this fee
would make sure that the rebates would reach them.
I think that's another key part of the debate,
particularly with the faith community.
Hi, I wanted to follow up on something you mentioned before,
which was just educating other legislators
about this particular legislation.
So I'm wondering if--
my perception is that this is really a very urban-rural split
in terms of supporters and detractors,
in terms of people that are more reliant on vehicle
transportation-- if I'm wrong, please correct me--
but those that are more reliant on transportation, particularly
personal vehicles and those that have other options.
So I was wondering if, first of all,
if that is a major split then you're trying to overcome.
And second, if it really is educating other legislators
about what specifically in this proposal
are you expecting to have additional amendments
or other language?
Or could you potentially imagine during hearing
to actually change significantly to provide
additional assurances or benefits
for those other communities?
Thanks.
Sure.
So worked into the rebate structure is, as I mentioned,
a 30% additional--
so again, you get a 130% rebate if you live in an area
where you're dependent on cars.
So in a rural area, for example.
So that is worked into both of our bills, I believe.
Right.
And then I would say you have to realize
legislatures come from every walk of life, every background.
So I have colleagues who don't have smartphones
to very technologically savvy colleagues.
So there's a wide range of people
we have to explain this to.
And I don't think-- it's not a rural-urban split.
It's really more of a world view split, I would say.
And sort of a basic understanding and background
split.
So I think we have a big education
gap there in the statehouse, as we do in the public,
so I think it's very reflective.
What was your--
Oh, the amendment process.
Yes, so absolutely in committee, bills can be changed.
Bills can be put to get combined.
There's lots that can happen.
And then if it should reach the floor of the House and/or
the Senate, people can file amendments there, as well.
So it's going to be up to really the committee chairs
to watch that process and ensure the integrity of these bills
stay intact moving forward.
And that amendments are welcome to the bills
that would strengthen them or help them pass.
All right, we are out of time.
We got one last question, a short one here.
I want to thank you.
I'd like to thank the panel for an interesting meeting.
But I would like to address my question to Emil.
I was disappointed to hear you say that carbon tax by itself
was not going to solve our problem.
And I wonder if that's because you were concerned
about the political backlash that
might come from raising the tax to the point where it actually
would meet our goals?
So that's part of it.
That's one of the biggest reasons, yes,
but it's not the only reason.
Other reasons are that there are more market
failures than simply the lack of CO2 pricing.
So what I mean by that is even if there was a very, very
high CO2 price, you still wouldn't
be able to incentivize everybody to make their homes as energy
efficient as they could be.
Energy efficiency is one of those really hard things that
runs into other problems, like the fact that many of us
don't own homes, but we are actually tenants.
And so maybe we don't pay the utility bills,
so we don't have the incentive to reduce emissions.
And this is just one small example.
On the other side of it is innovation.
So simply having a high carbon price
doesn't mean that researchers here at MIT or elsewhere
will start to try to innovate and create
new technologies, because there are certain technologies
spillover.
There's a knowledge spillover, which
means that when you create new technology
you can't necessarily capture all the benefits,
just because it might be very cost-effective
because there's a carbon price.
So there's sort of a need for many additional policies
to take care of these things.
Thank you.
Please join me in thanking, appreciating our panelists.
For more infomation >> Dodge Avenger 2.0 SE Business Edition - Duration: 0:50. 
For more infomation >> Volvo XC60 2.4D FWD R-Design LEER/NAVI/CLIMA/CRUISECONTR./PDC/BLUETOOTH/18" - Duration: 0:55. 
For more infomation >> Nhận định trực tiếp trước trận đấu Đức vs Chile (Germany vs Chile)_Confederations Cup 2017 - Duration: 2:03. 
For more infomation >> 【海賊王惡搞配音劇場】海賊王#2 震驚！羅賓將再次離開路飛的草帽海賊團，原因竟然是。。。 - Duration: 2:52. 
For more infomation >> Dariusz Loga: Wzorce odrzucenia i ich wpływ na nasze życie cz. 8 - Duration: 10:41. 
No comments:
Post a Comment