Washington (Platts)--9Jan2008
In a departure from its usual aversion to the raising of taxes, the US'
largest business-advocacy group said Tuesday that Congress should consider
instituting some sort of "carbon fee" to combat global warming and to raise
money to revamp deteriorating highways, bridges and other forms of
transportation infrastructure.
The US Chamber of Commerce proposed the approach in a report outlining
its policy priorities for 2008. The carbon-fee idea builds on a notion that
the chamber floated last summer, when an eight-lane bridge in Minneapolis,
Minnesota, collapsed into the Mississippi River.
Thomas Donohue, the chamber's president and CEO, said at the time that
Congress should consider raising money to repair the US' crumbling
transportation infrastructure by increasing the federal gasoline tax, which
has remained at the same 18.3 cents/gal level for 15 years. But President Bush
rejected the approach, saying Congress should "revisit the process by which
they spend gasoline [tax] money in the first place."
The chamber echoed Bush's view in its report Tuesday, saying Congress
needs to halt its "outrageous practice of diverting infrastructure funds to
other programs."
But it also resurrected the possibility of raising the federal gasoline
tax, possibly via some form of "carbon fee to address climate change." Funds
raised by the carbon fee would be "dedicated primarily to [rebuilding
transportation] infrastructure," the report said.
The chamber did not say in its report how the carbon fee would be
assessed, or on which industries it would be imposed. But Donohue, in a
briefing with reporters Tuesday, said the chamber would not support a carbon
tax unless it had an iron-clad guarantee that the proceeds would be used to
repair highways, bridges and other parts of the transportation system.
"We wouldn't support a carbon tax unless we had that security," Donohue
said. "I would be very reticent to do that unless I had some real strong
confidence that the money was going to be spent on infrastructure."
The chamber's willingness to consider a carbon tax could represent a new
wrinkle in the global-warming debate in Congress, where most lawmakers favor
the so-called "cap-and-trade" approach to curbing industrial greenhouse gas
emissions.
The cap-and-trade approach would allow power plants, oil refineries and
other facilities to buy and sell emissions allowances in a market overseen by
a government agency, while a carbon tax would simply charge industries or
consumers a fee for emitting or using carbon-laden fuels.
Donohue said Tuesday that a carbon tax would be easier to implement than
a cap-and-trade scheme, and that a simple tax could generate more money that
could be used to revamp the US transportation infrastructure.
Other energy-related aspects of the chamber's report call for increased
oil and natural gas drilling on federal lands, and in waters of the Outer
Continental Shelf.
Donohue also said that the chamber would work this year to derail various
energy-related initiatives that have been proposed by the
Democratic-controlled Congress, including efforts to rescind billions of
dollars in tax incentives for the oil and gas industry.
"We will oppose legislation that would damage our economy and drive jobs
out of our country," Donohue said.
--Brian Hansen, brian_hansen@platts.com
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