Rep. Chris Van Hollen of Maryland introduced a climate bill this week that received little notice, but the formula it provides for capping carbon offers a useful strategy for winning broad public support: Make polluters pay fees for carbon emissions and rebate the revenue to American families.
It is called the The Cap and Dividend Act of 2009, and it is an astonishingly simple piece of legislation – a mere 20 pages long.
The reason this little bill might end up punching above its weight is because it speaks loudly where the 648-page climate bill introduced the day before by Reps. Henry Waxman (D-Calif.) and Ed Markey (D-Mass.) remains silent: on the question of carbon credit auctions and allocations.
Van Hollen wants to auction 100% of the permits that companies will need in order to release carbon into the atmosphere – in other words, no free giveaways to polluters, despite their demands.
He also wants to return 100% of the auction revenues equally to every American resident with a social security number. That's the "dividend" in the bill's title – also sometimes referred to as "cash back" or "rebate."
His bill echoes President Obama's thoughts on cap and trade as well. The president wants a program that controls emissions, auctions 100% of the permits and returns most of the revenues to working families. Peter Orszag, the president's budget director, explained succinctly why a 100% auction is necessary:
To give away the permits instead would be "the largest corporate welfare program that has ever been enacted in the history of the United States."
SolveClimate had the luck to bump into New York Congressman Charles Rangel, chairman of the House Ways and Means Committee, as he arrived by train in Washington, D.C., on Monday, and he was gracious enough to answer a few questions about climate legislation as we walked along the platform.
It was the day before President Obama addressed the joint session of Congress, asking for a cap on carbon emissions. When we asked Rangel how his committee would respond to climate law, here's what he said:
Whether it's cap and trade or a carbon tax, we're there.
On the question of where the money from carbon revenues should go, he voiced concern about protecting consumers from rising energy prices that a cap on carbon would bring:
We've got to provide a cushion. No question about it.
Watch the video. It will make you feel like you're walking the platform at Union Station alongside the powerful Congressman as he pulls his own bag behind him. Unfortunately, we ran out of platform and the drive-by interview was over, but he gave us a peek into his intentions for influencing the shape and scope of climate law.
At issue is hundreds of billions of dollars of new revenues, so it should be no surprise that Rangel has his antenna up as chairman of Ways and Means -- that's why he said, "We're there." Since then, he has announced that his committee would be marking up a climate bill of its own before Memorial Day.
