A carbon tax doesn’t seem to be in the cards. Maybe a clean-up tax would fare better.
Production and combustion of fossil fuels imposes enormous costs on society, which the industry doesn’t pay for. I want to talk about some options for using the tax system to change that. One option, a tax on carbon dioxide emissions, gets the most attention but seems politically impossible. The closest we’ve ever come to a …CONTINUE READING
CLEE report proposes banking and exchange strategies for CEQA mitigation
When Caltrans and other state and local agencies build or approve projects that increase car traffic, state law requires them to mitigate those impacts. A new report from CLEE proposes development of state and regional programs that would allow these agencies to mitigate by investing in offsite bike lanes, bus-only lanes, transit passes, and other …CONTINUE READING
How would the Manchin-Schumer deal on permitting impact the environment?
To get Manchin’s vote for the $379 billion in environmental spending in the IRA bill, Schumer and other congressional leaders had to agree to support Manchin’s efforts to speed up the permit system. At this point, all we have is a one-page list of permitting changes that would form the basis of a new bill. …CONTINUE READING
The new law is a Big Deal. Or more precisely, a REALLY Big Deal.
IRA, the Inflation Reduction Act, is clearly the biggest climate legislation ever passed in the United States. The law will provide $379 billion in subsidies to clean energy in the form of direct payments and tax credits. Subsidies aren’t the ideal way to cut emissions, because it’s impossible to target them to the precise behavioral …CONTINUE READING
A short video explainer of why passage of the IRA bill is such a big deal.
We all have something to celebrate with the House passage of the IRA on Friday. Getting it passed required some difficult compromises, but the bill represents a major step forward. Because of the Mar-a-Lago search, it hasn’t gotten nearly as much attention as it deserves. If you don’t have time for a lot of details, …CONTINUE READING
Why subsidies for clean energy generally are preconditions for other climate policies
The Inflation Reduction Act would be, if enacted, the biggest piece of climate legislation that the U.S. Congress has ever passed. As such, it’s gotten a fair amount of coverage attempting to put it into context for the broader scope of climate policy in the U.S. and globally – in particular, this article in Slate …CONTINUE READING
There’s an embarrassing economic blunder in how OIRA’s jurisdiction is defined.
The Biden Administration is considering changes to how OIRA, the “regulatory czar,” operates. There’s one simple fix the Administration should make. OIRA core function is cost-benefit analysis But the rules establishing OIRA’s jurisdiction contain an error that should make an economist blush: using nominal rather than real (inflation-adjusted) dollars. This means that OIRA is now …CONTINUE READING
In climate policy, delay is deadly.
There are a lot of complaints about the very real flaws in the Inflation Reduction Act, tied with arguments that we should wait until we can do something better. In climate policy, however, waiting is dangerous. We’ve already delayed far too long. Further delay means having to cut emission much more rapidly to make up …CONTINUE READING
New book highlights the weaknesses of carbon pricing in addressing climate policy
I have a new post up at JOTWELL reviewing a recent book from Danny Cullenward at the climate think-tank Carbon Plan, and Professor David Victor of UC San Diego. Their book, Making Climate Policy Work, is a terrific overview of the political and administrative weaknesses of carbon pricing as a tool for climate policy. Please …CONTINUE READING
Senate passes biggest climate legislation ever.
In June, the Supreme Court trimmed EPA’s power to regulate greenhouse gases. The Court used the “Major Question Doctrine,” which says that issues of “vast political and economic significance” must be decided by Congress. Senate Democrats gave their response on Sunday: the Major Money Doctrine. They passed the Inflation Reduction Act (IRA), which provides over …CONTINUE READING