Michael Freeman is concerned that putting a fee on fossil fuels would “harm the poor disproportionately” (letter Oct. 11). Initially, I had that concern also.
But last year, the non-partisan Regional Economic Models Inc. examined the proposal by Citizens’ Climate Lobby to return all fees from fossil fuels to American households in equal shares. REMI found that in this scenario, two-thirds of households would actually come out ahead. This is because the wealthy have a larger carbon footprint (they tend to buy more goods, take more plane trips, etc.).
After 10 years of a slowly rising carbon fee and dividend, average annual incomes would rise by more than $500 per person. By putting more money in the pockets of people, this policy would stimulate job-creating investments.
Burdensome government regulations could go away, since market forces alone would encourage any form of low-carbon energy production, including solar and wind energy, natural gas, nuclear energy and geothermal energy.
But what is the most important dividend of this policy? After 20 years, U.S. CO2 emissions would be cut to half of their 1990 levels. That’s something that would benefit all of us, both rich and poor.
Don Gaede, Fresno