Cap and Dividend bill introduced in U.S. Senate – a ray of hope regardless of its “political feasibility”

Mar 01, 2018 No Comments by

For those watching U.S. politics from afar, it may seem like the country is filled with climate deniers and oil drillers.  But there was a bright spot recently for those of us in the US who continue to work for climate stability and sanity.  U.S. Senator Chris Van Hollen (D-MD) re-released his “cap and dividend” bill Senate Bill 2352 , the “Healthy Climate and Family Security Act of 2018,” on January 29, 2018.

It is “re-released” because Senator Van Hollen has been promoting Cap & Dividend for several years, and this year he has a sponsor in the U.S. House of Representatives, Rep. Don Beyer (D-VA), who has released the House companion H.R.4889.  Beyer’s bill has an impressive 29 co-sponsors, which may be a record for a federal Cap and Dividend bill.  In keeping with much of the current national climate debate, all 29 co-sponsors are Democrats.

For readers new to Cap and Dividend, the concept is to set a “cap” on total emissions, sell permits representing the emissions under the cap to the emitting industries, and return the funds back to people as a “dividend.”  Cap and Dividend is similar to the Feasta proposal for Cap and Share. It is a way to set an economywide price on carbon (which is currently free to emit), and provide incentives for everyone to reduce emissions.  Industries are incentivized to reduce emissions so that they would not need to buy as many permits, and individuals can “come out ahead” at the end of the year if their dividend exceeds the amount spent on emitting activities.  The system is also simpler than the more complex Cap & Trade, where governments often overallocate permits for free to corporations, allow questionable “offsets” to substitute for permits, and spend the money on projects instead of giving it back to people.  Opponents call Cap & Trade a “tax,” and the attack sometimes sticks since the projects can be opaque to voters and may not benefit everyone (for example, California’s Cap and Trade system is investing billions of dollars in a high-speed rail system that is not expected to benefit the environment for decades).   By contrast, dividends can avoid that label because the money goes immediately back to people, providing the start of a universal basic income from a shared resource.  It is a form of carbon price that takes social justice seriously, and providing the money directly to people is similar to the “cash transfers” approach to international aid (for example, the group Give Directly).

The Van Hollen bill would set up a domestic version of CapGlobalCarbon, an approach advocated by FEASTA for a global carbon cap and dividend.  That program would be administered by a Global Climate Trust set up by civil society.  The Trust would solicit interest and endorsement from individuals, the private sector, and eventually governments.  Once it reached a certain threshold (but below the impossible universal consensus requirement of the UNFCCC), it could launch and use international norms and peer pressure to gain legitimacy over time.  It is a fanciful pipe dream of sorts, but given the state of politics in the USA, the Van Hollen bill is too.

Let’s address the “elephant” in the room, er, Capitol: political feasibility.  Unlike bills that are deemed “politically feasible” nowadays, the Van Hollen bill helps the 99 percent, not the 1 percent. It empowers “science,” not religious fundamentalists. It does not reinforce the strict father hierarchy of rich over poor, white men over everyone else, or humans over the rest of nature.  Even so, it could gain support from some conservatives, if:

–          They care about preserving a planet for future generations

–          They understand that the Biblical commandments to subdue nature have already been completed, and are no longer relevant to a world with 7 billion people and the level of our current technology

–          They understand, as many tech billionaires who support basic income do, that automation will be destroying millions of job in the next few years, and that basic income is necessary to preserve social cohesion and prevent societal chaos


–          They are interested in receiving a climate dividend for themselves or their families

That may not be enough to be deemed “realistic” or “politically feasible” in 2018, but in a time when hope can be in short supply, U.S. climate dividend advocates can at least point to leadership from Senator Van Hollen, Rep. Don Beyer, and his 29 co-sponsors for advancing climate dividends in the U.S.

Disclaimer: Feasta is a forum for exchanging ideas. By posting on its site Feasta agrees that the ideas expressed by authors are worthy of consideration. However, there is no one 'Feasta line'. The views of the article do not necessarily represent the views of all Feasta members.

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About the author

Mike Sandler is a FEASTA Trustee and climate change and sustainability professional with experience working for nonprofits and government. In 2001 Mike co-founded the Center for Climate Protection based in Sonoma County, California. Inspired by Peter Barnes and Richard Douthwaite, he has advocated for revenues from a price on carbon to be returned back to the public as a per capita dividend or share. He actively promotes CapGlobalCarbon and he has written on green monetary reform and basic income, some of which is archived on his author page on HuffPost.

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