Commentary

With political gridlock stalling just about every legislative initiative in Washington, can any climate bill win bipartisan support?

One already has. In December, Senators Maria Cantwell (D-WA) and Susan Collins (R-ME) unveiled the CLEAR (Carbon Limits and Energy for America’s Renewal) Act, a bill that could break the U.S. energy policy impasse.

The bill has won a favorable reception across a broad swath of the nation’s political spectrum, from Friends of the Earth to the American Enterprise Institute, and from former U.S. Labor Secretary Robert Reich to Alaska’s Republican Senator Lisa Murkowski.

CLEAR makes a clean break from the legislative sausage-making that gave us the Waxman-Markey bill in the House last year and the Kerry-Lieberman bill that is seeking to overcome legislative arteriosclerosis in the Senate by implanting stents to boost nuclear power and turn the United States into “the Saudi Arabia of clean coal.”

Senators Cantwell and Collins realized that there is an alternative to the politics of special-interest giveaways. To win backing on both sides of the aisle, they embraced a common-sense approach to reducing carbon emissions founded on three pillars. First, their proposal is household-friendly: it protects family incomes from the effects of higher energy prices that will come with a cap on carbon pollution. Second, it treats all carbon the same, regardless of whether it comes from coal, oil, or natural gas. Third, it slams the door shut on financial speculators wanting to profit from a new, multi-billion dollar carbon market.

CLEAR auctions 100 percent of the carbon permits, instead of carving out giveaways for the coal-fired electricity industry and other special interests. It returns 75 percent of the auction revenue directly to the public as equal per person dividends: in every state, the majority of households receive more money in dividends than they pay in higher energy costs. The other 25 percent of revenue is devoted to investments in energy efficiency, clean energy, climate change mitigation and adaptation, and assistance for regions and sectors hurt by the transition from the fossil-fueled economy.

Only fossil fuel producers and importers can buy permits. There’s no role for Wall Street or other would-be market manipulators. No “offsets” are allowed: polluters cannot circumvent the carbon cap by paying someone else ostensibly to clean up after them.

Senators Cantwell and Collins have opened a path to a bipartisan climate compromise, based on a household-friendly policy that puts money from the sale of carbon permits straight back into the pockets of the American people. The result is a bill that stands a real chance of becoming the law of the land – and the air – even in our current political climate.

By James K. Boyce, Professor of Economics, University of Massachusetts Amherst