Bob Inglis: A revenue-neutral tax swap

“What we’re after is a conservative definition of sustainability,” declares former-Congressman Bob Inglis, Republican from South Carolina.

And why not? After all, conservative and conservation have much in common, theoretically.

Inglis calls his proposal a revenue-neutral tax swap: Remove all energy subsidies, and attach all costs to energy products. He’s been touting the tax swap idea since his days in the House (2009 video) and, this past January, joined the Cures for Climate Confusion Town Hall event held at the University of Michigan (video).

From an interview with Inglis in the U Michigan conference publication, “Increasing Public Understanding of Climate Risks and Choices” (pdf):

Q: What have you taken from this conference so far?
A: One thing I have learned in this conference is to start with a point of agreement and then to move from there. For example, in trying to reach conservatives on the need to prepare a conservative solution on energy and climate, we should assume that they want to be a solution agent and that our shared philosophy can help to solve the challenge. And I think it can, since a key value for many different types of conservatives is accountability. If you just focus on that key value, everyone can contribute to the discussion.

A few notes:

  • Inglis’ proposal (~58:00 on the U Michigan video): Reduce payroll taxes. Shift the tax to CO2 at $15 per ton, rising to $100 per ton over 30 years. Make it a border-adjustable tax that is removed on export, imposed on import, so it wouldn’t decimate American manufacturing.
  • Some or many U.S. military activities are, in effect, subsidies to the petroleum industry; the Price-Anderson Act is, in effect, a subsidy to the nuclear industry.
  • This type of market-based approach wouldn’t, by itself, engender large-scale infrastructure projects such as intercity high-speed rail.
  • Interestingly, at the Climate Change Open Forum I joined last week, one self-identified “climate skeptic,” who was wearing a Cato Institute jacket, sketched out a proposal very similar to this one by Inglis.
  • (Update): Jerry Taylor summarizes the arguments against carbon taxes in a 2008 post at Cato@Liberty, quoting energy economist Stephen Smith: “Only if there are expected to be environmental gains can the use of environmental taxes be justified, and the case for ecotax reform must be made primarily on the basis of the environmental gains that would result.” Indeed. Social and environmental gains.

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