Streetsblog New York City

The several dozen transportation industry groups that raised questions about where the upcoming Senate climate change bill would send proceeds from its new "linked fee" on carbon fuels can stop worrying -- because it looks like the legislation won't contain any new tax on motor fuels.

Sen. John Kerry (D-MA) (Photo: Getty)

As Sen. John Kerry (MA), the climate bill's chief Democratic author, told Reuters late yesterday:

"There is not even a linked fee. There's not a tax, there's nothing similar."

Pressed for clarification about the fee, Kerry then said, "certainly not the way it was described previously, nothing like that." The Massachusetts Democrat refused to elaborate.

Kerry was more direct in a response to the Houston Chronicle, stating: “The gas tax is 18.4 cents today, and it'll be that when this bill is passed.”  

His comments do not rule out the possibility of some charge on carbon-based fuels remaining in the bill, but they cast significant doubt on the scenario that Washington transportation watchers had feared most: extra fees that oil companies would pass on through higher costs at the pump, amounting to a de facto gas tax hike without guaranteed revenue for road and transit projects.

The oil and gas industry had responded favorably to the prospect of a predictable fee they could market as a response to climate change, effectively shifting any negative consumer response onto Congress rather than fuel producers. American Petroleum Institute President Jack Gerard predicted last month that a carbon charge would "soften the reaction" among his member firms to a national cap on greenhouse gases.

The challenge of addressing transportation emissions, which account for about one-third of the nation's total output, could end up pushing the release of the Senate climate bill beyond its original Monday deadline. Sen. Lindsey Graham (SC), the measure's sole GOP backer so far, told CongressDaily that Monday remains "the hope" but is not set in stone.

London Mayor Ken Livingstone is on a tear. Yesterday he announced a £500 million investment in new bicycling infrastructure. Today, he approved a plan to charge the drivers of SUVs, high powered sports cars and other large engine, high emission vehicles a £25 fee ($48.75!) to drive into Central London's congestion charging zone. Simultaneously, low emission vehicles will become exempt from paying the charge. In a press release, Livingstone said,

The CO2 charge will encourage people to switch to cleaner vehicles or public transport and ensure that those who choose to carry on driving the most polluting vehicles help pay for the environmental damage they cause. This is the "polluter pays" principle. At the same time, the 100 per cent discount we are introducing for the lowest CO2 emitting vehicles will give drivers in London an incentive to use the least polluting cars available.

BBC News has more:

The new charges come into force on 27 October this year.

Transport for London (TfL) estimates about 33,000 vehicles that will now fall into the £25 charge sector drive into London each day.

It predicts about two-thirds of these will no longer come into the charge zone once the new fee is introduced.

London's transport commissioner, Peter Hendy, said the new charges were likely to bring in £30m to £50m a year, with most of this money going on new cycling and walking initiatives...

...The National Alliance Against Tolls said: "This move is not based on logic but on the whipping up of prejudices against those who use these particular vehicles."

Photo: Bennet Summers / Flickr.

Barack Obama is a long-time cyclist (Photo: Chicago Tribune)

The current crop of Presidential candidates are busy debating the energy crisis, national security, climate change, health care, all of which potentially pose a serious threat to America's future. We can begin to address all of these issues simultaneously by transforming our cities into more sustainable communities and adopting the principles of complete streets. A modal shift away from the automobile toward more bicycle and pedestrian orientated streets will reduce our dependence on fossil fuels, slow the rise of C02 emissions and improve the overall health of Americans.

With the exception of John McCain, none of the Republican candidates seem to be interested in any of this. You may remember their colleague Patrick McHenry, Republican Congressman from North Carolina, who while debating a proposal for a $20/month tax break for bike commuters in the energy bill ridiculed bicycles as a "19th Century solution" to our current energy problems. The tax break was eliminated from a weakened version of the energy bill that was just passed by the Senate.

The Oregonian, however, has discovered that one candidate does understand the importance of this "old fashioned" form of transportation:

Portland's fervent bicycling community has discovered that Democrat Barack Obama is the only one of the Democratic presidential candidates who explicitly encourages bicycle transportation in his platform (and I didn't find much from the Republicans either, other than that Mike Huckabee rides his bike to the grocery store). Here's the relevant quote from Obama's energy platform:

As president, Barack Obama will re-evaluate the transportation funding process to ensure that smart growth considerations are taken into account. Obama will build upon his efforts in the Senate to ensure that more Metropolitan Planning Organizations create policies to incentivize greater bicycle and pedestrian usage of roads and sidewalks, and he will also re-commit federal resources to public mass transportation projects across the country. Building more livable and sustainable communities will not only reduce the amount of time individuals spent commuting, but will also have significant benefits to air quality, public health and reducing greenhouse gas emissions."

It's also worth noting that Chris Dodd is the only candidate with the guts to push for a carbon tax.

Assembly Member Richard Brodsky, archenemy of Mayor Bloomberg's congestion pricing plan, is urging the mayor to seek a carbon tax instead. So he said, following Monday's meeting of the Traffic Congestion Mitigation Commission, as reported by Streetsblog and confirmed by at least one other observer.

I wish Brodsky (pictured) had checked with me first. After all, if there's another New Yorker more obsessed with carbon taxing and congestion pricing than yours truly, I'll eat my bike helmet.

I co-founded the Carbon Tax Center last winter. Since then, I've spent hundreds of hours blogging, number-crunching and campaigning for the carbon tax cause. But my devotion actually began much earlier. Back when Barry Bonds was a svelte 180-pounder, before Dan Quayle wrote potatoe on a blackboard, I published a pro-carbon tax op-ed in the Washington Post (this was in 1989). And I've been banging the drum for congestion pricing in NYC for almost as long.

So I'd love to be able to say that a carbon tax is our ticket out of gridlocked streets. But it ain't so. When it comes to erasing New York's gridlock, a carbon tax would be about as effective as a mouse stomping on an elephant's toes.

But don't take my word for it. Go and input a carbon tax into the Balanced Transportation Analyzer ©, the spreadsheet model I'm creating for Ted Kheel's free-transit proposal. The results are underwhelming.

A carbon tax of $50/ton (of carbon dioxide) would cause a mere 8,000 auto trips a day into the Central Business District to disappear. That's just 1% of current traffic, and barely more than the increase in trips the MTA board just set in motion by raising bus and subway fares. And this is with a tax surpassing any carbon tax bill being considered in Congress.

By comparison, Mayor Bloomberg's proposed $8 daytime toll would eliminate an estimated 45,000 trips a day into the CBD. (The Kheel Plan, combining a $16 'round-the-clock cordon fee with free transit, would eliminate 250,000 daily CBD trips.)

A little math reveals why a carbon tax can't cure Gotham's gridlock: a tax of $50/ton of CO2 equates to 50 cents a gallon of gas, which is roughly the fuel burned on a typical round-trip drive into Midtown. Yet that same trip currently costs around $20 for gas, parking (where applicable) and tolls (ditto). Half-a-buck on top of twenty is way too little to make a big difference in travel choices. Moreover, part of drivers' response to higher gas prices from a carbon tax will be to trade up to more efficient cars without necessarily driving less. In contrast, an $8 cordon toll, or $16 for that matter, is real money, which CBD drivers can save only by reducing trips into the CBD.

Of course, Brodsky may just be feinting. He's a smart guy and may have deduced that his best shot at blocking congestion pricing is to sow confusion.

Or, Brodsky has decided that leading New Yorkers out of traffic hell isn't his concern. He'll attack the "right" to spew carbon without paying an emission fee, but he'll leave untrammeled the "right" to create traffic congestion without paying a congestion fee.

Ordinarily, anytime an elected official calls for taxing carbon, I'm thrilled. Not in this case. Even if Brodsky could deliver a statewide carbon tax tomorrow, New York would still be mired in motor vehicles. Just as a carbon tax is the antidote to too much carbon, charging a price to drive into Midtown is the antidote to too many cars.

Charles Komanoff will be discussing the Kheel Plan with Doug Henwood on WBAI-FM (99.5) this afternoon, beginning a few minutes after 5 p.m.

Congressional debate on climate change has revealed division among politicians on how to best regulate carbon emissions. From NPR's Marketplace, we get a report on the sharp difference between leading Democrats in both houses, Sen. Barbara Boxer (CA) and Rep. John Dingell (MI)

Boxer is quoted as preferring cap and trade, which seems to be most favored among politicians and big corporations as a way to leverage market forces to address climate change.

"I think cap and trade makes the most sense. When we pass legislation to combat global warming, we will not be hurting this economy. We will be helping it."

Dingell, however, favors a carbon tax as a more direct, visible and predictable means of reducing carbon emissions. He says,

To be fair, the economic pain must be shared all the way down to the consumer. And he says the way to do that is to tax anything that produces too much CO2. "This is going to be tough. And it's gonna cost, and its gonna hurt. In my view, probably the only thing that will really work. In all honesty, I'm not convinced that if you don't change people's behavior, you're going to change the way they behave."

The Carbon Tax Center has a page that explains why it thinks a carbon tax is the way to go. CTC co-director and Streetsblog contributor Charles Komanoff recently published a piece in favor of a carbon tax over at Gristmill. On the other side of the issue is the US Climate Change Action
Partnership, a group of major corporations and environmental
organizations in favor of a cap and trade system. Environmental Defense chief scientist Bill Chameides, wrote a piece in Gristmill as well laying out the case for a cap and trade system.

The debate between Carbon Tax and Cap and Trade is an important one that could lead to new federal legislation by the end of the year.

(Editor's note: Why do I always want to write it, "Cap'n Trade?")

In his essay, "Valuing the Commons," Charles Komanoff discusses congestion pricing and carbon taxes and the difficulty in convincing people to pay for their negative externalities. Komanoff wrote it back in June and it’s on Grist this week:

What, then, is standing in the way of congestion fees and a national
carbon tax? The power of
an entrenched minority, for one thing. In New
York City, fewer than one in 20 working residents drives toll-free into
the intended congestion charging zone, but they know who they are and
are not shy about protecting their self-awarded entitlement to a
toll-free commute.

Conversely, the benefits of congestion pricing will be broadly
distributed but not life-changing. Indeed, judging from polls, many New
Yorkers don’t even realize they are potential beneficiaries.

"Losers cry louder than winners sing," wrote University of
Michigan professor Joel Slemrod in explaining the near-impossibility of
overhauling the U.S. tax code, and the same holds true for the
congestion fee and the carbon tax.

What is more, the benefits
from road fees or carbon taxes aren’t just diffuse; because they lie in
the future they are by necessity uncertain.

"There is nothing more difficult to take in hand," Machiavelli observed in The Prince,
"than to take the lead in the introduction of a new order of things …
the innovator has for enemies all those who have done well under the
old conditions, and lukewarm defenders in those who may do well under
the old conditions, and lukewarm defenders in those who may do well
under the new."

That is why enacting the Bloomberg congestion plan is so hard, and
so necessary. America’s civic polity is stuck in traffic, so to speak.
Getting it moving again will require us to imagine something other than
permanent stalemate and act upon that vision.

The Atlantic Monthly's Matthew Yglesias argues that high-density living is a key strategy to fight climate change. Yglesias takes issue with fellow Atlantic Online blogger Ross Douthat and author Joel Kotkin, who defend suburban sprawl -- what James Kunstler has famously called "the most destructive development pattern the world has ever seen, and perhaps the greatest misallocation of resources the world has ever known." Reporting on a recent talk by Kotkin, Douthat writes:

The notion that Americans are moving back to downtowns in large numbers is a myth, Kotkin announced; instead, they're moving ever outward, into new exurbs and rural areas. The traditional unipolar urban downtown isn't going to make a comeback: Young couples with families can't afford to live there, and aging Baby Boomers don't want to. The American city of the future will be more of an archipelago of suburbs than the kind of one-downtown organism bred by the Industrial Revolution: "We aren't creating more New Yorks and Chicagos; we're creating more Los Angeleses."

Yglesias counters:

There's the paradox. The urbanist proposal isn't "hey, jerks, why don't you all move to dense downtowns." Rather, the proposal is something like "why don't we impose carbon taxes so that things like driving long distances and heating or cooling large detached structures are priced in accordance with their social cost? Why don't we stop having the federal government heavily subsidize driving cars as the preferred mode of transportation? Why don't we have more areas that allow for high-density zoning, thus reducing the cost of urban housing?" It's not that we urbanists are unaware that many people live in low density areas because its cheaper, it's precisely that we are aware of this fact that makes us believe that the "traditional unipolar downtown" could make a comeback.

Quite naturally, the combination of cars being invented, cars being massively subsidized, and governments being successfully lobbied by car companies to dismantle mass transit systems led to a massive shift in the direction of sprawl. But by that same token, if we step away from those policies to some extent we'll see a rebalancing in the direction of urbanism.

Quebec will become the first Canadian province to impose a carbon tax on energy producers. Bloomberg reports:

The provincial cabinet approved the tax in Quebec City yesterday, according to a statement on the Natural Resources Ministry Web site. Refiners including Valero Energy Corp.'s Ultramar unit and Royal Dutch Shell Plc's Canadian unit will start paying a tax of 0.8 cent a liter on gasoline and 0.9 cent on diesel on Oct. 1. Power producers such as state-owned Hydro- Quebec and gas companies will also be taxed.

"Everyone is talking about the environment; everyone wants to play their part," Natural Resources Minister Claude Bechard told reporters in Quebec City yesterday. "Well, the oil companies too have to play their part."

The province will direct proceeds from the tax to a "green fund" that will invest in commuter rail networks and other forms of mass transit.

Bechard said he expects that the companies will absorb the higher costs, though he "can't guarantee" that producers and refiners won't pass them on to consumers. The tax is based on the "polluter pays" principle. "That is not negotiable," the minister said.

Charles Komanoff of the Carbon Tax Center (and Streetsblog), while hailing the tax as a positive step, notes that it's extremely small, equating to little more than 1% of the tax level that CTC proposes the U.S. phase in over a ten-year period.

Photo: _EM/Flickr

The Independent reports that European CO2 emissions are rising not falling, casting doubt on the EU's touted Emissions Trading Scheme:

Europe's big polluters pumped more climate-changing gases into the atmosphere in 2006 than during the previous year, according to figures that show the EU's carbon trading system failing to deliver curbs. Critics said the data underlined the gap between the rhetoric of European leaders, who have promised to cut C02 emissions by one-fifth by 2020, and the reality of delivering reductions.

Yesterday's figures relate to the carbon produced in 22 nations by big industrial users that accounted for almost 93 per cent of emissions reported in 2005. The European Commission said that carbon output from these sources rose between 1-1.5 per cent in 2006 over the previous year. The statistics suggest the EU is still allocating too many carbon permits to enable the system to work properly.

Meanwhile, the Washington Post reports that an unlikely coalition is coming together in the US to support carbon taxes over emissions trading:

As lawmakers on Capitol Hill push for a cap-and-trade system to rein in the nation's greenhouse gas emissions, an unlikely alternative has emerged from an ideologically diverse group of economists and industry leaders: A carbon tax. A coalition of academics and polluters now argues that a simple tax on each ton of emissions would offer a more efficient and less bureaucratic way of curbing carbon dioxide buildup.

This same argument in favor of carbon taxes was recently put forward by Charles Komanoff of the Carbon Tax Center in a debate on Grist.org with "Dr. Bill" Chameides of Environmental Defense, who favors a cap and trade regime.

Streetsblog contributor Charles Komanoff, along with Daniel Rosenblum, today announce the foundation of their new organization, the Carbon Tax Center. The Center's mission is "to educate and inform policymakers, opinion leaders and the public, including grassroots organizations, about the benefits of and critical need for significant, rising and equitable taxes on carbon emissions from fossil fuels." My favorite part so far? The title of their e-newsletter, "An Inconvenient Tax." Check out their presentation above.

Why carbon taxes? Why a Carbon Tax Center?
Charging American businesses and individuals a price to emit carbon dioxide (CO2) is essential to reduce U.S. emissions quickly and steeply enough to prevent atmospheric concentrations of CO2 from reaching an irreversible tipping point. It's a basic economic principle that prices of goods and services should reflect ("internalize" as the economists say) all of the societal costs (such as pollution) that production of the goods or services imposes on society. Yet the prices of gasoline, electricity and other fossil fuels don't include many of these societal costs, particularly their impact on global warming. The necessary transformation of our fossil fuels-based energy system to reliance on energy efficiency, renewable energy and sustainable fuels simply won't happen without carbon taxes sending accurate and powerful price signals into every corner of the economy and every aspect of life.