Future Tense

Even China Will Have a Carbon Tax Before We Do

A labourer walks at an industrial residue disposal plant in southwestern China's Chongqing municipality.
A labourer walks at an industrial residue disposal plant in southwestern China’s Chongqing municipality. Photo by Reuters

President Obama and his team have made it clear again and again that he’s not going to push for a carbon tax, yet the idea keeps popping back up. A Washington Post editorial called on the president to propose a carbon tax in his State of the Union address. The journal Nature suggested he trade approval of the Keystone pipeline for a carbon tax. Two weeks ago, a pair of Senators went ahead and introduced a carbon-tax bill.


The latest White House kibosh on the idea comes from Obama’s nominee for Treasury secretary, Jack Lew. According to The Hill, Lew put the administration’s stance in blunt terms in a written response to a question from Utah Republican Orrin Hatch. “The administration has not proposed a carbon tax, nor is it planning to do so,” Lew wrote.


That doesn’t necessarily close the door on a cap-and-trade scheme, which many environmental policy wonks regard as a second-best alternative. But in the weeks since he floated that idea in his State of the Union address, Obama has been quiet about this “bipartisan, market-based solution” as well.

In case you’re curious, here are the basics of the Senate carbon tax bill—technically, a “fee and dividend” scheme—that Obama won’t be fighting for:


  • Proposed by Democrat Barbara Boxer of California and Independent Bernie Sanders of Vermont
  • Would set a goal of cutting emissions 80 percent from 2005 levels by 2050
  • Would tax polluting companies $20 per ton of carbon emissions, a fee that would rise by 5.6 percent each year
  • Would refund 60 percent of the proceeds to the public, with the remainder going to clean-energy initiatives

And here’s the full text of the bill.

Even if Obama were willing to push for it, the bill would be unlikely to get past Congressional Republicans. But the fact that he isn’t virtually assures that even China will have a carbon tax before we do.