2016 Election Night

The Paris Climate Agreement went into effect this week, and although the presidential campaign paid scant attention to climate change, there’s a relatively straightforward approach to the issue — one backed by most economists — that’s being offered to voters in Washington state. It’s a carbon tax, and if Initiative 732 passes, it will make Washington the first state to impose a tax on carbon emissions. The new carbon tax would start at $15 per metric ton of carbon dioxide in 2017, climb to $25 per ton in 2018 and then automatically rise 3.5 percent plus inflation every year after that until it reaches $100 per ton (as measured in 2016 dollars). Proponents estimate that the measure would boost the price of gas by about 25 cents per gallon and raise the price of electricity from coal-fired plants by about 2.5 cents per kilowatt-hour. The tax is intended to be “revenue neutral” by swapping it for reductions in other taxes, such as state sales tax and certain business taxes. Ironically, the the legislation would give an inadvertent tax break to Boeing for its sale of commercial aircraft, an important contributor to climate change. Recent polls show a tight vote. While economists generally favor a carbon tax, the devil is always in the details, and the details are what are being disputed. The measure is backed by more than 50 University of Washington climate scientists, climatologist and activist James Hansen, former Secretary of Energy Steven Chu and Leonardo DiCaprio, who say the law puts a necessary price on carbon emissions. But some environmental groups, including the Sierra Club, oppose the initiative, saying that doesn’t do enough to help low-income people who might be hurt by the tax, it doesn’t shift enough money to clean energy and that the tax swap could lead to a state budget deficit. Interests funding the opposition campaign include the fossil fuel and manufacturing industries and local utility Puget Sound Energy.