© Dave Lauridsen for The Nature Conservancy

We Applaud Proposed Conservative Case for Addressing Climate Change

Mark Tercek is the president and CEO of the Nature Conservancy and author of Nature’s Fortune. Follow Mark on Twitter: @MarkTercek.

We should all welcome the carbon dividend proposal announced by the Climate Leadership Council today. This distinguished group of former Republican economic officials and corporate leaders, led by three Treasury Secretaries serving President Reagan and both Bushes, offers a simple plan to address the threat of global warming while making the size of government smaller. Americans will easily grasp their approach and I believe most will support it.

The plan has four pillars: tax the carbon in fossil fuels at $40 per ton of carbon dioxide for the emissions they will produce; rebate all of the revenue to American households in quarterly dividend payments; repeal federal regulations that will no longer be needed because carbon prices produce greater and more efficient investments in emissions reductions; and assure that the program does not damage U.S. trade by adjusting its impact on exports and imports that are energy intensive.

It is often said these days that in their hearts many Republicans in Congress know that we need to act on the global warming threat, but they are imprisoned in their anti-climate position by fierce partisan politics and the threat of interest group money supporting their primary opponents. Well, this is the day for the prison break. And as our Republican friends come out, I hope that Democrats and environmentalists will happily welcome them to a new, bipartisan conversation on this carbon dividend proposal.

One way we can put out the welcome mat is by reexamining our insistence on implementation of the Clean Power Plan as the Climate Leadership Council suggests. A gradually increasing price on carbon dioxide emissions starting at $40 a ton will do more to reduce emissions from the electric power sector, and do it sooner, than the Clean Power Plan. And it is a tax that reaches across the entire economy, so we won’t have to wait for new rules on oil refineries, paper mills and steel plants.

The second thing we can do is agree to send all of the revenue back to the American people as dividends rather than keeping it here in Washington and spending it on special interest nostrums, many of which we have supported in the past. Climate change legislation was defeated in 2010 mostly because the American people saw Congress using it as a way to make government much bigger by doling out subsidies and favors to those who had the best lobbyists. Let’s not make that mistake, again. Let’s just send all of this revenue back to the American people without any haircut for Washington-designed programs.

I don’t mean to suggest that there shouldn’t be any discussion about the details. For instance, low-income households spend much more of their budgets on energy than the more well-to-do. To make sure that the combined carbon tax and dividend does in fact have an equal impact on all Americans, perhaps the dividends should tilt a bit toward lower income families. We might also want to think about keeping the automobile fuel efficiency standards that President Obama created because they will for the next few years do more to reduce emissions in the transportation sector than a carbon tax. And by the way, the fuel efficiency standards also save Americans money in lower fuel costs.

In other ways, members of the Climate Leadership Council have done much to identify the impact of global warming on our economy and the most vulnerable economic sectors in each region of the nation through reports such as Risky Business. With this proposal today they have given us a simple, efficient and effective way to address those risks. It is an invitation drawn from principles that Republicans have long endorsed and should not be ignored by current officeholders who know they need to step up. I hope that it is an invitation that will also be welcomed by my colleagues in the environmental community as it draws on a principle we have long supported. A price on carbon is the most efficient policy to stop the threat of global warming.

If you believe in the work we’re doing, please lend a hand.


  1. I really enjoyed your article today. It is conversations like this that need to happen more so that everyone realizes how climate change will is effecting all ideologies. I am submitting this article to be posted the the large Facebook Page “Join The Coffee Party Movement” to be posted on the 10th at 10pm ET. I hope this will help get your article some exposure. I will also share it on my own personal Facebook page and retweet it as well. Thank you for all you are doing.

    1. Keep up the grassroots Marianne! It is what will save our humanity and precious earth.

  2. Finally! Sincerely, Teddy Roosevelt

  3. I think you are jumping the gun here. The devil is in the details. What does it mean to say “adjusting its impact on exports and imports that are energy intensive.” We need to remove subsidies for dirty energy, and continue to support research. I would not rush to remove laws assuring environmental and climate protections. Where is the data to show that their particular plan can work, that it works in another major developed country? I think this is a Trojan Horse and I am pretty surprised that you so trusting.

    1. I agree with you on that I believe it as a trojan horse as well because the Republicans are not going to do anything unless they can make money on it and put it in their pocket because they evidently do not give a damn about the American citizen or the environment of the United States or that of around the world!!!

    2. Laura Haule I agree!

      Example: How does this one work: “repeal federal regulations that will no longer be needed because carbon prices produce greater and more efficient investments in emissions reductions;”

      We need Federal oversight because polluters will find ways to circumvent the rules and get away with contaminating more of our precious waterways and aquifers.

      Don’t fall for their bait and switch. Get the details before you blindly follow their claims!

      Think for yourselves and do your homework!

      1. And just exactly how are “polluters” going to find ways to contaminate waterways and aquifers by emitting Carbon Dioxide into the air?

        Are Greens really that ignorant? Or, do you just make stuff up and ignore reality and facts.

        You are the one that needs to think. First you need to learn how to think critically.

  4. I could not agree more with this approach. History shows students of political history, particularly environmental politics, the use of hard-line regulations and punitive policies to mitigate anthropogenic disturbances are only marginally-successful, degrade public goodwill towards the implementing agencies, and are often subject to the whims of the political majority in power (as evidenced in contemporary US politics). The most effective policies have always, and will likely remain so, those facilitating innovation through economic incentives. TNC is the most pragmatic institution I’ve ever encountered in my academic and professional career in environmental science, and Mark Tercek’s political acumen should be exemplary for those hoping to navigate this volatile political climate and affect beneficial changes to how society approaches natural resource management.

  5. A carbon tax is a beautiful thing when the proceeds go back to citizens. Congress has shown itself to not be trusted where money is involved.

  6. Surely you jest. Let them pay to add to the problem while removing all restraints and then bribe the people to let them do it. Are you serious?

    1. The radical republican terrorist organization known as the GOP are not interested in helping the average citizen unless they can make a 500% return on your money to put in their pocket!!!

  7. Ensure that the carbon tax is sufficiently high to create incentive to reduce CO2. – not an end run around other carbon reduction efforts that are proposed.

  8. Long time Conservancy member. I guess my concern is that if we tax them in this fashion and then rebate that to consumers, that the companies will then just raise prices to cover the tax and the net result will be zero. I fail to see what will motivate the corporations to lower their carbon footprint. I do applaud, as a Progressive, the idea of removing the partisan bickering and finding common ground. If the plan could be designed in such a way that there was pressure to reduce carbon intensive fuels, I would fully support that narrative.

    1. I thought the same thing as I read the proposal. How can a rebate reduce carbon emissions? If consumers really feel the heat of more expensive coal, oil, and gas in their wallets, they’ll likely speak up and try to get their energy elsewhere – renewables. Consumer pressure is crucial and it seems to be missing from this proposal.

    2. Your thoughts mirror mine. Since fossil fuel companies and the industrial consumers of their products can simply pass the tax on to consumers, where is their incentive to reduce their carbon footprint? Consumers will be lucky to recover a fraction of the extra costs. Their only recourse will be to switch to renewable sources of energy, a solution that is out of reach for most people thus far. I regret that I just increased my monthly donation to The Nature Conservancy, if its leadership is this naïve.

    3. This is exactly the plan. Most people will not see this as a zero sum game and spend their rebates on gas. They will buy more fuel efficient cars (pump price is high) or energy sources that don’t have the carbon tax built into the price, so they can spend their rebates on other things. This will work.

    4. Hello Sarah,
      The net result is zero in average, but people who spend less carbon than average would make money, financed by the people who use more carbon than average. A great incentive to use fuel efficient cars or install solar panels.
      Electricity from renewables would become cheaper than electricity from gas fired plants.

  9. Great. Put the money back into consumers’ pockets so they’ll go out and buy more gas guzzlers.

  10. Mark from Goldman Sachs. The fix is in.

    1. Sigh. It looks that way, Hal. I’m changing my will this week to write out The Nature Conservancy. Now that our new Plutocracy is advocating selling off government land, we need true visionary leadership to save our national treasures from oil wells, fracking and exclusive clubs. Tercek’s Goldman crony at Treasury is a member of said Plutocracy. This missive from Tercek places him in bed with them and is the last straw for this former supporter.

  11. Hmm, won’t businesses just pass on the extra cost to the consumers and trigger further ‘creativity’ in emissions accounting?

  12. While I welcome the idea of bipartisan conversation, this article raises some questions in my mind. It mentions “making the size of government smaller”. I would be interested to know details of how the suggested quarterly dividend payments would be processed, without hiring more people. The plan seems workable on the face of it; I’m not sure I trust the government to return the dividends “without any haircut for Washington-designed programs”. I look forward to knowing discussions have been started, and to hearing more details.

  13. Raising taxes on the electric power sector so they can charge more and pass the costs to consumers? And then you want to return to consumers an average based pittance of what they already paid? Seems like a Republican scheme to encourage CORPORATIONS to do whatever they want as the do now anyway.
    We need to move the profits from corporations to the people. It is the taxpayers who pay for the infrastructures that support the corporations. It is the taxpayers who actually end up with the misery and losses caused by energy mismanagement. The courts allow corporations to get away with not paying full cost of cleanups.
    What we really need is some decent human beings for a change in the rethuglican party. How do we do that?

  14. A nice initiative by those that don’t fully understand the anthropogenic forcings associated with climate change.
    In its current format, transfers control of greenhouse gases from scientists to politicians, as it would be up to Congress to pass any rate increase. Additionally, it wouldn’t cover the most potent GHGs like methane. Finally, there needs to be a unique management plan for the transportation industry, which likely would require a higher tax than the energy industry to truly curb emissions.

  15. A small step in light of the magnitude of the issue. The EU took a more aggressive stance and taxed gas and diesel fuel directly also correct? Made internal combustion a luxury and promoted alternatives heavily as part of Infrastructure upgrades. A percentage of tax revenue would add wind, wave, hydro etc generating capability or fund new partnership with manufacturers for automotive and renewables production. A “green New Deal” similar in scope to ww2 production mandates. In ten years we could be at 80% carbon free and industry get massive profits for retooling. We paid them then. We can pay them now. Those “monied interests” you speak of get 99 year maintenance and upgrade contracts and profit 200% as the last generations industries did. Its play money past thier bank roll anyway after all. Expanding the economy in a controlled specified manner for a benificent purpose also draws in more willing participants producing for themselves as well as the “National” good. Happy workers when they have a clear, honest, Integrous purpose. Ants dont mind if the hive is tidy.
    This place is a mess sir. Drastic ww2 new deal measures. We need the spiritual boost as well after 75 years of global hedgemony. PR worldwide wouldnt hurt either.
    #GreenNewDeal #FailedState #CarpeLux #VetsForBernie

  16. I like the concept, but agree about devil’s and details. I see no point in removing regulations, because for example, electric cars won’t break them so why should government subsidize dirtier options? We need to transition as fast as possible, so we should both tax and de subsidise fossil fuels.

  17. I am also sceptical of the carbon tax approach. I’m thinking companies will just pay it and pass it on to consumers. Where will emission capping rules come into this which sounds to me like a more effective appproach?

  18. How much money would $40/ton of carbon generate? And who would my monitor these facilities? Isn’t it more transparent to have a computer monitor the facility and an employee
    Of the government test the computer?
    Why are we gambling with the atmosphere for a few dollars? I like the idea you recognize a real problem
    But the solution doesn’t seem to fit this massive problem.

  19. And why would this substantially reduce emissions? It puts no pressure on the oil industry to stop producing oil we do not need. How significant is $40 a ton to them? Oil is an industry in decline that is fighting to stay in the game. This is probably another ploy to keep it relevant.

    1. Agreed.

  20. If companies pass on higher costs of fossil fuels, people will choose less-fossil-rich products. Where substituting is difficult, they will pay higher prices. Where substituting is practical, fossil products will be driven off the market.

  21. This is a bad idea and I for one am shocked at how easily and glibbly you suggest we should buy into it. I am now beginning to doubt The Nature Conservancy. Have you sold out?

  22. Use the carbon tax proceeds for smart grid, solar, wind, infrastructure. Giving freebie to citizens is just pandering. Be smart with tax proceeds!

  23. For those that have not been keeping up on such things, this is what Dr. James Hansen has been advocating for some years. It appears to be a sound idea because the market is always more efficient than regulation.

    This will mean that all regulations on Carbon Dioxide emissions can be eliminated and the Invisible Hand of the market will do most of the work of regulation. The only area where some regulation will continue to be necessary is with electric utilities. That is because they are regulated monopolies and the market is not as effective a force there.

    However, there would be no need for further increases in the Federal mileage standards for vehicles. The market would provide an incentive for the purchase of efficient vehicles.

  24. Tercek’s endorsement of this flawed and in my opinion, willfully ignorant, proposal is exactly why I withdrew my support from the Conservancy several years ago. While a carbon tax is a valid idea as part of a comprehensive climate change initiative, I am stunned at the thinly veiled political bias presented in this endorsement. “Make government smaller”? Since when does the Conservancy wade into the argument about the size of government? “We might want to think about keeping Obama’s fuel efficiency standards? ” Really? This endorsement does a great disservice to the public discourse on climate change, and a great dishonor to all of the present and past staff and supporters of the Nature Conservancy. I’m sad to see this organization become such a political pawn in a serious issue.

  25. You began as an organization to protect biodiversity. You end as a boy’s club sitting around the fireplaces on your billion dollar properties with your 1% masters. Has the organization accomplished what it set out to do? No, given the rapidity of extinction, even E.O. Wilson seems to believe that your vision failed. You have wanted more and more support from fewer and fewer, and with that you have the foxes funding the hen house. Your best have left you.

  26. There is no question that economic incentives are required to reduce fossil fuel production and consumption. However, it would be naive to trade away environmental protections until the efficacy of the approach was prove in practice, not on some white board. The deal should identify what protections would be rolled back when certain levels of reduction are reached and maintained

  27. Now that Pruitt has been confirmed as EPA director, anything that does not make a buck and roll back significant regulations will never work. The pendulum has swung to the opposite extreme, and our environment is in trouble. I agree that the concept of taxing CO2 emissions works on paper, but the tax will be passed on to consumers, as such things always have. If there are taxes, they need to go to sustainable methods of energy production, not just maintaining the status quo with regard to fossil fuels.

  28. I was about to contribute to the Nature Conservancy as part of my carbon offset payment but having read this I have changed my mind. It strikes me as either naive or cynical and makes me distrust this organization. Might want to keep fuel efficiency? What a disappointment!
    Why on earth, given the track record of these corporations, would we believe this is anything other than another scam?


  29. Mark, I cheer your support for the Carbon tax proposed by the Republican group, which includes our former chair, Hank Paulson. I have long supported this approach rather than the cap and trade approach that TNC supported for the USCap consortium. The carbon tax lets markets work directly and efficiently, where as the cap and trade made a derivative market that would either drive price instability or be ineffective. The proposal has to come from leaders with high Republican credentials so that the current Congress will actually listen. With tax reform a pending initiative, a carbon tax is a good starter to wrap reform around. I also support a simple approach to the revenue from it to avoid political battles; give it either direct to taxpayers as proposed, or as block grants to states, as EcoAmerica proposes. And don’t be afraid to call it a tax. A Pigou tax on consumption is much more digestible than the tax we already accept on hard-earned income. Thank you for your leadership, Mark.

  30. I like what this is is trying to do but I don’t understand the economics behind it. How do we know what proportion of their dividend people are going to spend on gas, air travel, etc? How do we know this will have a meaningful effect in bringing down carbon emissions?

  31. The group Citizens’ Climate Lobby has been advocating for a “revenue neutral carbon fee and dividend” plan for several years and has built relationships with Congress in that effort. Congressional offices are listening.
    CCL’s plan differs from the Climate Leadership plan in a few respects but the key pieces are congruent. So congressional offices have already been introduced to this idea. It has strong appeal to conservatives, as this group shows, and without bipartisan appeal, climate legislation simply will not happen.
    I hope those who have reacted negatively will look again at this plan’s potential.

  32. The “us vs. them” approach that many comments exhibit are the reason we are at a stalemate with climate talks. While I completely agree with many of your concerns, we are at the point now that it is compromise or concede to the environmental atrocities the new administration is preparing to enact. I see first-hand the hard work and dedication to the environment that TNC is known for and have no doubt that this is a thoughtful decision to move us forward in our fight to protect the lands and waters on which all life depend.

  33. I believe the government should play a role in protecting the environment. This protection is necessary for the survival of the planet, not just a cost/benefit issue. If the government can spend so much on arms, why not more on national parks and consumer education.

  34. I think a carbon tax/dividend approach has a better chance of making a real impact than an ideological stalemate. And I think it minimizes the opportunities for hidden loopholes. For the skeptics who have questioned the economics, think of the carbon tax as analogous to the key interest rates that the Federal Reserve sets to regulate the flow of money in the economy. It influences financial decision making throughout the economy without a tangle of rigid and conflicting government rules. The key will be to insulate the carbon tax rate setting from short-term politics and in agreeing on the data to be used in measuring its impact and guiding adjustment to the tax rate. If too many people use their dividend to buy gas guzzlers and continue to gas them up – despite the tax that has been “passed along” to them by oil companies, then the data will show too little carbon tax impact. The Carbon Tax rate setting folks will presumably raise the tax until it dies make a difference. That difference will be that folks start using their dividend on cheaper – less carbon intensive alternatives that give them more money left over for other things. Another analogy might be the cigarette tax, which has reduced smoking but doesn’t seem to have hurt tobacco companies. I think we should be encouraged that this debate is about ways to address the problem instead of about the existence of climate change. Assuming the other side is out to undermine your goals should not stop the discussion, it should lead to constructive design of the program so that it serves its purpose.

  35. I’m glad that Nature Conservancy seems to embrace carbon tax as an efficient and most politically viable option to solve the urgent problem that we are all facing today: climate change. There has been a lot of studies done to support the likely effect of carbon tax on carbon emissions. Here are a few points I want to make to address some of the concerns raised by other readers:

    1) “Because the carbon tax raised will go back to consumers as dividends, the consumers will just spend the dividends on fossil fuel rich products and emit more carbon. So the impact of carbon tax is nil.” This argument is only valid if the consumer converts ALL dividends back to carbon equivalent, which is physically impossible – even carbon rich products have non-carbon components that need to be paid for. In addition, carbon tax will move consumers away from carbon rich products. So carbon tax & dividend will absolutely reduce carbon emissions.

    2) “Instead of dividends, the carbon tax should be given back to the poor because they’re most affected by climate change.” A per-capita, evenly distributed dividend will in fact be helping out the poor already. They consume less and pay less carbon tax but they end up getting the same amount of dividends as their richer peers. So they actually come out ahead. This *is* a progressive tax policy, benefiting the economically disadvantaged. In addition, it encourages “good” behavior – people get rewarded by shifting to less carbon intense products and behaviors.

    3) “This is just a Republican ploy to do away with environmental regulations.” We need to be careful about this blanket statement. I agree with Mark that the regulations need to be reviewed case-by-case. For example, the Clean Power Plan may no longer be necessary. The cost of renewables like Wind and Solar have already come down a lot. Coal is already on the way out. With a carbon tax set at a strategic level, it will gradually phase out oil and gas. One word on natural gas: a large part of the greenhouse gas emission from natural gas is methane. If methane is taxed – which I think we should – natural gas will become a lot less competitive too. The Clean Power Plan is not aggressive enough for us to meet the 2C goal from the energy sector anyway, so it may just as well be replaced by carbon tax which may get us to renewables faster and meet the 2C goal. Of course, this will need to be carefully evaluated to make sure that the carbon tax we set will make Clean Power Plan unnecessary. Looking beyond the energy sector, there’re other sectors that may need a bit of regulatory push to nudge it forward if the impact of carbon tax isn’t enough. For example, electrifying the residential and commercial heating, electrifying transportation, etc.

    4) “The dividends should go back to renewables and research instead.” I agree. However, that would make it much more challenging to pass the carbon tax in the current political climate. We are fighting an uphill battle here. We need to be practical. We need a climate solution now. A promising, workable, winnable climate solution, even if it’s not perfect. Carbon tax & dividend will not just be a step forward, it will be a giant leap forward.

    5) “There’s no point to regulate carbon if we don’t regulate other greenhouse gases”. Yes and no. Carbon is the biggest warming contributor right now among the greenhouse gases we release to the atmosphere. Regulating carbon will go a long way in stabilizing the climate. At some point, we will need to regulate methane, N2O, etc, to meet our 2C goal. A success in carbon tax policy and reduction of CO2 will pave the way to regulate other greenhouse gases.

    6) “It’s just talk. There’s no proof that carbon tax will reduce carbon emissions.” In fact, there is a successful test case for carbon tax and dividend. British Columbia. In 6 years, they reduced carbon emission by 16% with negligible impact in economy. They did it despite the inability to impose carbon tax on products made out-of-state. Of course, a country wide carbon tax policy in the US won’t face the same challenge of unbalanced carbon tax policies because US as a country can charge a border tax which will keep the competitiveness of US made products, in addition to incentivize exporting nations to adopt a similar carbon tax policy of their own.

    I’m glad that carbon tax is getting a robust debate in this forum. I applaud Nature Conservancy for supporting carbon tax & dividend which is an efficient, practical, and perhaps the only viable climate solution. Because of this, I have just decided to join Nature Conservancy as a member. Please keep up this good work of pushing forward pragmatic climate solutions on behalf of all of us.

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