Message from the founders of
The Partnership for Responsible Growth
Oct. 24, 2014
The three of us, having raised families and had active business and professional careers, came to the conclusion last spring that we wanted to focus the remainder of our professional lives on something truly significant, an issue that could make a real difference to our children and their future. Since in our business and professional careers we have all had considerable experience working for and with the federal government, we concluded that finding a way to help our nation deal more effectively with climate change was the ideal challenge. Not easy, but critically important and politically possible.
We were motivated by the United Nations Intergovernmental Panel on Climate Change report, released last summer, which concluded that "the world may have as little as 15 years to keep planetary warming to a tolerable level through an aggressive push to bring down greenhouse gas emissions."
We were also impressed by facts documented in the recent "Risky Business" report (commissioned by three former Democratic and Republican U.S Treasury Secretaries plus Michael Bloomberg and Tom Steyer) which summarized the economic risks of climate change in the United States. Excerpts include:
"Rising sea levels are a direct consequence of rising temperatures. As the oceans warm, they expand. This phenomenon is further exacerbated by land-ice melt, particularly the Antarctic and Greenland ice sheets. Scientists have recently found evidence of accelerating and perhaps unstoppable land ice melt in West Antarctica....If we continue on our current path, by 2050 between $66 billion and $106 billion worth of existing coastal property will likely be below sea level nationwide, with $238 billion to $507 billion worth of property below sea level by 2100."
The report continued: "By the end of the century, the average American will likely see 45 to 96 days per year over 95°F. Oregon, Washington, and Idaho could well have more days above 95°F each year than there are currently in Texas....Rising temperatures will reduce labor productivity, as some regions—especially the Southeast and Southwest—become too hot by mid-century for people to work outside during parts of the day....(I)f we continue on our current path, the average Midwesterner could.... by the middle of the next century, experience 20 full days in a typical year....during which it will be functionally impossible to be outdoors."
This is not the legacy any of us wish to bequeath to our children and grandchildren.
As the world's leading democracy and largest economy, the United States must lead the way in formulating a global solution. Unfortunately, because of gridlock and political dysfunction, we have to date failed to lead--and, as time runs out, the world is failing as well. While there is disagreement as to how best to proceed, there is an increasing recognition across the U.S. political spectrum that more can and must be done.
The U.S climate change effort is currently focused on using age-old authority granted the EPA under the Clean Air Act to require each of the 50 states to come up with its own separate plan for reducing greenhouse gas emissions from large power plants. It is far from settled law that the Clean Air Act can be used for this purpose. Best case, the proposed “clean power plant rule,” even if upheld by the courts, will lead to 15 to 20 years of complicated federal rulemaking, litigation and 50 inconsistent, significantly-incompatible state plans.
This approach deals with only the power generating sector of our economy and, even if it survives in the courts, will yield slow, unpredictable, and, very costly progress in reducing emissions compared with a uniform, economy wide, free market approach. It also risks not getting our country anywhere close to where it needs in reducing emissions by 2030 and it contains nothing that will incentivize other nations to cut their emissions as we cut ours.
Fortunately, there is a better way-- "carbon-funded tax-cuts." Revenue neutral upstream carbon emissions fees refunded in part to lower income consumers to offset higher energy costs and in part used to buy down the U.S. corporate tax rate to a lower, more internationally competitive level.
There is a broad consensus among climate experts, economists and industry leaders that the most effective and least expensive way to reduce carbon emissions is to “put a price on carbon,” i.e., make emitters pay a fee that adequately compensates for the currently un-priced external social costs of those emissions.
We recognize that only Congress can “price carbon”, and therefore we must be ready when a window of opportunity opens for Congress to again address climate change.
We think that opportunity will most likely occur during the first two years of the next President's term. This is when "big ideas" typically get the best reception. But whenever it comes, we must have laid the groundwork if we are to take advantage. We must be ready!
We also recognize that it is very difficult to build public support for an abstract “idea” or just an undefined concept, such as “pricing carbon.” To build consensus, one must advance a specific proposal or at least have a template for proposals - - that has substance and advantages appealing across the political spectrum to diverse interest groups.
That is why we have chosen “carbon-funded tax cuts” as the starting point for those who want to price carbon.
It would grow the economy, create jobs in the U.S., lower business taxes, reduce government regulation, make US companies more competitive in the global market-place, protect consumers from higher energy prices and, most important, not require any new government spending. It would suspend "command-and-control" government regulations to reduce emissions, replacing them with free-market incentives. Adding border adjustment tariffs would force foreign governments to reduce their emissions or lose free access to U.S. markets.
Even climate skeptics should support this approach. It's pro growth, reduces government and taxes and, as with buying fire insurance for your home, provides a least-cost insurance policy mitigating the potentially disastrous costs of climate change--just in case it happens to be real!
We have formed the Partnership for Responsible Growth, an IRS approved 501(c)(3) not for profit, tax-exempt, corporation, to promote our proposal and a parallel advocacy organization to lobby the Congress and the Executive Branch to adopt it, most likely as part of comprehensive corporate tax reform legislation. We plan to spend the next two years promoting our or a similar solution, believing "a window will open" in Congress by not later than 2017.
Frampton and Minnick began working full-time for the new organization immediately after Labor Day. Eacho, also now a Visiting Professor at Duke, contributes when available. We have temporarily "set up shop" in borrowed offices in Georgetown and plan adding paid staff and a permanent office closer to Capitol Hill as soon as resources permit.
Comparing notes and establishing working relationships with other organizations advocating action on climate change, especially those which favor finding a way to put a price on carbon, has been a key initial priority. We have made a lot of friends and generated a great deal of excitement among those similarly engaged. We have found, in particular, a number of potential partners in organizations that are generally identified as very conservative and market-oriented, but are concerned about climate change and see our proposal as being the best way to proceed.
Two major projects constitute a large part of our first year agenda.
(1) Working in cooperation with others, we intend to talk with the staffs and members of the next Congress who have direct responsibility for tax reform and climate control legislation. Leadership from both parties and all of the members of seven key committees of jurisdiction will be visited. Views on our proposal for carbon funded tax-cuts, and all other approaches to dealing with the climate change issue, will be solicited and recorded. Leaders will be identified and messages tested. The results will be shared with our funders, legislators and the policy staffs of both of the upcoming presidential campaigns.
(2) A parallel effort will be launched to see if major industry participants and climate change interest groups can be brought together to develop common points of agreement about how the Congress should approach pricing carbon.
We will also monitor international negotiations and interact regularly with the State Department, EPA and other federal agencies that are dealing with both international negotiations and domestic regulatory approaches impacting the climate change challenge.
We now have a Facebook page, we tweet @prgrowth, and have a sparkling new website: http://www.partnershipforresponsiblegrowth.org. Give us your feedback--and feel free to contribute!
Ours is stimulating and important work. We appreciate your interest and support.