Climate Equity: What Is It? — Peter Dorman

The limitations of AOC-Harris become clearer when you consider what the centerpiece of any meaningful climate policy has to be: suppressing the use of fossil fuels, which will entail putting a steep price on them. (This can be done either with a permit system or taxes, quantity controls or price controls; permits are by far the better option.) We are talking hundreds of dollars per metric ton of carbon, which translates to several dollars per gallon of gas at the pump and similar added costs for heating, electricity and other energy uses and sources. Will this have a devastating effect on low income communities? Absolutely, and it will be nearly as unbearable for everyone below the top fifth or so. Fortunately, we also know the solution: rebate the carbon money back to the public, using the progressive formula of equal rebates to all households. This approach does the best possible job of protecting the living standards of the majority of the population, at the same time assuaging, as much as any program can, the fears that might make a stringent carbon policy politically unattainable.

This is not everything a carbon policy has to do, but it is the one part that is non-optional....

Econospeak

Climate Equity: What Is It?
Peter Dorman | Professor of Political Economy, The Evergreen State College