No Floridian would carry bags of fertilizer underarm and then dump their contents into Lake Okeechobee or other Florida waters, but that, effectively, is what we do. A flaw in our market economy virtually compels us to.
The same flaw is at the root of our climate crisis. A carbon fee and dividend program can fix this flaw and use the market to restore the Earth’s climate.
Here’s an illustration Floridians can relate to.
Every day, thousands of people go to Publix and choose between a $5 head of organically grown broccoli and a $3 head of conventionally grown broccoli. Although the organic broccoli is better for the planet and their health, most buy the $3 broccoli thinking it costs less.
But it doesn’t.
That’s because the conventional farmer, unlike the organic farmer, uses synthetic fertilizers that through nutrient run-off cause or worsen blue-green algae blooms and red tides.
Who pays to haul from our beaches the thousands of tons of dead fish that result from these algal blooms? Not the conventional farmer whose fertilizer contributes significantly to the problem. We do, through our taxes. This is a production cost of that broccoli that the farmer transfers to us.
When Floridians, ill from cyanobacteria, go to their doctors, who pays those medical bills? We do. When our restaurants and hotels go nearly empty because tourists avoid our polluted waters, who incurs these economic losses? We do.
No, Floridians don’t dump fertilizer directly into our waterways. But we do deny Peter, the organic farmer who farms sustainably and thus deserves our business, and pay Paul, the conventional farmer, to pollute on our behalf. That’s because we erroneously think his broccoli costs less than it does.
Price doesn’t necessarily reflect all costs. This is the market flaw long recognized by economists that compels us to buy the product that damages the waterways upon which our health and tourist economy depend.
How do we fix this?
Impose a tax on fertilizer commensurate with the costs. To protect his profit margin, the conventional farmer will raise the price of his broccoli accordingly. All production costs will then be evident in the purchase price, and competition between the organic and conventional farmer will be honest and fair, the way Americans expect it to be.
Consequently, Floridians will buy the suddenly comparably priced sustainable product, and through thousands of daily purchases quickly restore our waterways.
A carbon fee and dividend program would work the same way regarding our climate crisis.
Fossil fuels did not create Hurricane Irma, but they made her stronger and more destructive. Who paid for the $50 billion in damages? We did. This was a production cost the fossil fuel companies externalized onto us.
Fossil fuel pollution kills thousands of Americans and, according to the National Academy of Sciences, generates $120 billion in health care costs yearly. Again, externalized costs.
Who will pay the exorbitant costs of sea-level rise? Not fossil fuel companies. We will.
According to the International Monetary Fund, Americans incur approximately $650 billion in externalized fossil fuel costs yearly.
Nevertheless, every day, through billions of purchases, because we erroneously think fossil fuel energy costs less than renewable energy, we effectively pay fossil fuel companies to ruin climate conditions for our children and grandchildren.
How do we fix this? Make competition in the market fair by ensuring that the full costs of fossil fuels are transparent to the consumer. Impose a rising fee on carbon commensurate with its externalized costs.
When the price of fossil fuels rises to the price of clean, renewable energies such as solar and wind, the market will be the world’s most effective instrument of climate restoration.
Will the price of just about everything increase? Yes. It takes energy to grow, produce, and transport the goods we live on. How will Americans pay for these increased prices?
This is where the dividend comes in. The government does not keep the carbon fees it collects from fossil fuel companies. It distributes that money monthly to American households, equal full shares to every adult, equal half shares to every minor.
About 70% of families will end up with more money in their pockets, not less, and another 10% will break even.
Fix the flaw in the market economy by making polluters pay for the pollution they produce, and we will reduce carbon emissions 40% in 12 years, and 90% in 30 years, as well as save thousands of lives and create 2 million jobs within the first decade.
Four former Chairs of the Federal Reserve and thousands of American economists say that if we fix the flaw, the market becomes “the most cost-effective lever to reduce carbon emissions at the scale and the speed that is necessary.”
When it comes to climate change, Florida is the nation’s ground zero.
Florida’s senators and congress people, mostly Republicans who champion market solutions over regulatory policy, should be climate leaders. A carbon fee program, such as the Energy Innovation and Carbon Dividend Act, which has the most support in Congress, should be their go-to program.
Joseph Bonasia is Citizens’ Climate Lobby Legislative Liaison to Sen. Rick Scott’s office.
“The Invading Sea” is the opinion arm of the Florida Climate Reporting Network, a collaborative of news organizations across the state focusing on the threats posed by the warming climate.