My fantasy: This diary gets picked up on Green Diary Rescue, and from there the ideas seep into wider discussion until someone in the Obama administration comes across the plan and brings it to the boss, who recognizes its simplicity and sheer brilliance, and uses it to save the economy and the planet. What will probably happen: if anyone ever reads this, it will get torn apart as another impractical liberal tax scheme. What I ask of you: consider the ideas based on the economics, not the practical politics of getting such a program passed.
(This diary, which could revolutionize the way we approach energy in America starts ... with ... a ... click ...)
Now that oil prices are hovering near a bottom not seen for years, a few voices have meekly raised the notion of raising federal taxes on gasoline. The economics of the idea are indisputable – higher gas prices result in lower consumption, and higher energy taxes can pay for sustainable energy investment. The environmental benefits of lower consumption are urgent – the fewer fossil fuels we burn, the less carbon we pump into the atmosphere to trap solar radiation and warm the planet. However, the politics of raising any taxes in America are suicidal – witness the second term of the first George Bush.
What is needed is a way to simultaneously ensure investment in sustainable energy and use price incentives to encourage people to burn less fossil fuel. Here is one way to do it: a green "un-tax," where you paid a surcharge every time you filled up the tank, but that surcharge went directly back to you in the form of alternative energy investments that you owned. While such a system would have been immensely complicated just a few years ago, today it can be implemented using technology that is already in place, using a simple device you probably already have in your wallet.
When you check out at your local supermarket, you are likely to hand the cashier two things without thinking about it: something to pay with, and an affinity card. The cashier swoops your affinity card and some central computer recognizes you, gives you discounts on some of your purchases, and perhaps gives you points toward future rewards. If you pay with a credit card, a different computer might also log credits you can use later for free flights or products. We can treat energy the same way.
An example: You put 10 gallons of gas in your tank. The surcharge – ouch – is $1 per gallon, or $10. You present your personal energy saver’s card when you pay, just like you now present your supermarket affinity card. A computer somewhere gives a $10 credit to your personal energy account. You grumble and drive away.
The real innovation of the un-tax is what happens to your $10. The money does evaporate into general government accounts. Instead, your energy surcharges are used to invest in new wind farms, solar thermal electric plants, and other sustainable energy facilities that are likely to make money in the long term. If you own your home, you could use your un-tax each year as a credit against the purchase of approved American-made renewable power sources for your property, thereby creating local jobs in industries such as solar panel installation. You could choose your specific un-tax investments from a menu of options available on the web, or you could leave the choice in the hands of a blue-ribbon panel tasked to create a diversified mutual fund of renewable energy projects. You could track your portfolio, and even trade, sell, or bequeath your assets after a period of time. Since your account would increase every time you purchased fossil fuels, you would soon have thousands of dollars invested in sustainable energy production.
Your investments would begin paying you back in the not-too-distant future. Suppose your un-tax for a year were $1000, all of which you invested in a windmill. Suppose the blades on that windmill started turning right away, and that your share of the energy produced was $100 per year. The blades would keep on turning, and the next year you would get another $100. And the next year. And the next. Results will vary, since alternative energy plants break even at different rates, but ten years is a rough average of when your un-tax will have paid you back. After that, you still own your share of the windmill, so you keep earning money as long as the wind keeps blowing.
Some people will want to pocket their payments every month, while many will want to offset their home energy bills and still others will want to reinvest. The same web site that makes it possible to allocate your investments will make it simple to allocate your returns. Each American would become the owner of their own energy infrastructure, responsible for their own investment decisions. The role of the un-tax would simply be to make sure that everyone takes part.
Fossil fuel use, meanwhile, would begin to wither away. As we saw during the most recent oil spike, consumers and businesses seek to reduce their consumption of pricey energy as soon as they have to start paying more. With an up-front surcharge on every gallon of gas, and the same system in place for fossil fuels burned by the central utilities, Americans would abandon carbon as quickly as alternatives became available. As we weaned ourselves from oil and coal, the un-tax would slowly fade away. All that would remain would be the clean energy facilities that the un-tax built, 300,000,000 energy owners enjoying the fruits of their investments, and a nation that powered itself from its own sunshine, wind, and water.
All it would take is a view toward the future and a supermarket swipe card. Do we dare?