The Atmosphere is Common Property – Carbon Polluters Owe Us All

September 22, 2015 – There are no geopolitical boundaries when it comes to the atmosphere. The molecules of air I exhale right now at some point may find their way to China and back again. When you look at atmosphere this way then you can begin to see why carbon emitters need to pay for the pollution they create because they impact us all.

A carbon payment from each emitter is therefore justifiable. The money raised would go into a global fund with proceeds distributed to all citizens equally annually. Such a tax-dividend system would begin to compensate all impacted by carbon pollution.

Interestingly this is how Switzerland has structured its carbon tax regime. Emitters pay a tax into a fund which is distributed to Swiss citizens annually in the form of a dividend.

So how could this be made to work globally?

Any polluter, let’s say a utility burning coal to create energy, would pay a fixed rate for carbon emitted by the ton. That rate could be initially set at $30 U.S. Over time the rate would increase incrementally. In 10 years the carbon polluter could see those payments rise to $50 or more per ton. The incentive to the polluter is obvious. Reduce emissions and save on paying the tax.

The money collected would go into a collective pool that initially might be limited to a single jurisdiction. But over time as other countries joined in the pool would be expanded and the pot of money collected would then be distributed equitably to all citizens in those countries. The money could help defray the costs borne by consumers as societies made the necessary investments to convert to low carbon economies.

Some governments might want the money to serve other purposes such as defraying the cost of new infrastructure to mitigate against extreme weather or rising sea levels. In such cases citizens could defer their dividend in return for receiving a tax credit when the money was specified for such projects.

It would seem that with a common sky the ultimate democratic way of dealing with polluting it would be to recognize the atmosphere as a common asset. A similar scheme could be applied to the ocean.

Of that we will write another time.

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