Taxing Carbon in WA after I-732

Last Wednesday night I drank beer with Kyle Murphy, the new Executive Director of CarbonWA. CarbonWA is the environmental organization which wrote and lead the campaign for Initiatve 732 in the 2016 election – which lost by 18 points, 41% to 59%. We discussed that election, the national political moment, the prominent role Washington state has been playing in national politics by resisting the Trump administration, and the future of Carbon WA.

The results of the election were deeply disappointing to supporters of I-732. The initiative was a revenue-neutral carbon tax, designed to financially reward consumers and producers for making low-carbon choices and to mitigate financial impacts by reducing other taxes in equal measure and funding a tax-credit for low-income families. With Washington state having the most regressive tax code in the country this element of I-732 was very important to me. Efficient as a carbon tax is, all else being equal it falls most heavily on the poor.

The initiative was crafted to have bipartisan appeal by making our economy more environmentally sustainable without raising taxes overall. Instead it was attacked from both the left and the right, with prominent environmental, social, and labor organizations endorsing a no vote and winning support from few prominent Republicans or business organizations.

CarbonWA has downsized since the election. Murphy and remaining board-members are looking for the ways the organization can be most helpful in the coming years. It is possible that a carbon-tax initiative could be placed on the ballot in 2018, but relatively low Democratic turnout during mid-term elections could put such an effort at a structural disadvantage. We discussed smaller-scale actions the organization could take, with targeted ballot initiatives, state-level lobbying, or local organizing. The ballot initiatives that passed in 2016: raising the minimum wage, temporary limits on gun access for the mentally disturbed, protections for care-givers to the elderly, toothless opposition to the Citizens United ruling – all deal in a narrow way with a popular issue. 732 on the other hand was broad and sober in its attempt to remake the economy and focused mostly on the negatives – the negative effects of carbon pollution and taxation, while negating also tax revenue. In the future CarbonWA could try to identify a more narrowly defined but popular issue and to craft ballot language that would still make an impact on carbon pollution: a tax or ban on the coal- or oil-trains which frequently pass through our state, for instance, or a “clawback” of federal subsidies for fossil fuels.

oil train.PNG

Oil train near King County Airport

It is challenging to identify a politically popular climate-change measure that would have a significant impact on the problem, however. Burning fossil fuels for energy is deeply embedded in the way we have built our society – it affects nearly everything about how we go about our daily lives. The problem is with us, and scapegoating unpopular actors or obscure practices is simply going to delay the difficult transition that we will have to start making if we are going attempt to reduce climate disruption in a substantive way.

It is very likely that a carbon-tax will be on the ballot in 2020, either sponsored by CarbonWA or a coalition of environmental groups. That ballot measure should preserve the best parts of 732, the low-income tax credit and statewide sales tax reduction that reduce the regressivity of our tax code. However, it should abandon strict revenue neutrality – this failed to win many Republican votes and was unpopular among Democrats. It could front-load subsidies for energy retrofits and job-training and delay the imposition of the tax by several years. These could be paid for on credit by future positive tax revenues and would give those negatively affected by the change time to make changes to reduce their costs. Ideally such a measure could pass in a state where our legislature will have finally achieved an agreement to adequately fund education, taking the pressure of any potential tax to compensate for an unrelated budget hole.

In the early months of the Trump administration our state is taking on a higher profile role in progressive government than it has traditionally played by standing up for immigrants and refugees.  In fact, this role builds on recent Cascadian leadership in marijuana legalization and marriage equality, and is buttressed by our states’ economic strength in technology and international trade. I am hopeful that our state will rise to the challenge of leading the way in dealing with climate change in a serious and just approach.

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