A Carbon Tax to Combat Climate Change and Support Low-Income Households
Summary
Putting a price on carbon is fundamental to achieving U.S. climate goals for 2050. Many options for carbon price-setting exist, and in this policy brief we propose a tax-and-dividend approach that mitigates the challenging impacts that carbon policies have on poor and suburban/rural communities, particularly those in Middle America. Such a plan will be a net gain for low-income households, in contrast to other proposed climate change policies which will adversely affect the poor. Furthermore, it has been shown that even a modest carbon tax can have large benefits in terms of cost-effectiveness.
For that reason, we propose the following:
- Introduce a carbon tax-and-dividend plan as part of any federal climate policy.
- Use revenue to offset impacts on low-income households, taking into account enormousregional disparities.
- If political dynamics favor regulatory standards, consider coupling such standards with amodest carbon tax whose revenue can be used to offset their regressive effects.
Once upon a time, the President’s budget was a realistic proposal to Congress about what the federal government should spend money on. These days, it’s essentially just a declaration of everything the President would do if Congress didn’t matter at all.
For International Year of the Woman Farmer and International Women’s Month, we spoke to five women farmers in America about planting the next generation.
From California to New Jersey, wildfires are taking a toll—costing the United States up to $424 billion annually and displacing tens of thousands of people. Congress needs solutions.
FAS is launching the Center for Regulatory Ingenuity (CRI) to build a new, transpartisan vision of government that works – that has the capacity to achieve ambitious goals while adeptly responding to people’s basic needs.