A nonprofit publication of the Kentucky Center for Public Service Journalism

Teresa Werner: Fixing the hidden costs of climate change; every person wants a healthy environment

Our taxes cover disaster relief, our insurance and premiums reflect what the insurers must pay for natural disasters, and we all pay increased healthcare to treat respiratory and other diseases caused by air pollution. The reason why all citizens must pay these costs is the result of a “market failure.” A market failure occurs when the cost of an action is not borne by the party or product causing the issue. For example, when a company pollutes, the local community incurs the cost not the corporation until or unless a fix is put in place.

Climate change is another example. The National Oceanic and Atmospheric Administration (NOAA) recently reported that the U.S. faced a record-breaking number of natural disasters in 2020 causing $1 billion or more in damage. The writing is on the wall: 19 out of the last 20 years have been the warmest on record leading to more extreme natural disasters. The costs of climate change will only increase if not addressed.

Three ways to reduce carbon emissions that are leading to climate change are being discussed: regulations, incentives and correcting the market failure. While regulations and incentives can be helpful, both solutions leave out the most powerful tool the U.S. has to offer – the free market. The most effective way to drive true innovation for alternative energy sources, increase efficient energy reduction and make the U.S. a leader in the associated products and jobs that go with these innovations is to use the laws of supply and demand.

Economists overwhelmingly agree that to fix this market failure and reduce carbon emissions, a steadily rising carbon fee should be placed on fossil fuels at their source (coal mine, oil refinery, etc.) and the money collected from these fees divided equally and returned to every American as a carbon payout. This market mechanism, a price on carbon with a payout to every family, will not only reduce carbon emissions but with increased demand encourage the development of 21st century alternative energy sources. And a border adjustment levied on imports from nations not matching our commitment would ensure a level playing field for our companies.

Every person wants cleaner air, safer water, a healthier environment along with a robust economy for their community. While addressing climate change may seem overwhelming, there are simple actions everyone can take such as educating yourself and your family and letting your elected leaders know that you are concerned. Ask your congressional leaders, Senators McConnell and Paul in Kentucky and Senators Portman and Brown in Ohio, to work towards lasting bipartisan climate solutions in Congress that include carbon pricing. Using the free market as a foundational policy for reducing emissions will allow energy providers, businesses and households the opportunity to make their own decisions on the best technologies and solutions for them.

Learn more by reading this Niskanen Center tribute to George Shultz and his dedication to carbon pricing or spending time at the website.

Teresa Werner of Villa Hills, has been a telecommunications engineer for over 30 years and volunteer with Citizens’ Climate Education, a non-profit, non-partisan group that empowers individuals to educate others about effective solutions to climate change.

A graphic from the NOAA report:

NOAA’s recent report here.
• Climate Leadership Council’s Economists’ Statement on Carbon Dividends signed by over 3,500 economists
Energy Innovation and Carbon Dividend Act
Niskanen Center tribute to George Shultz

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  1. Dublin Galyean says:

    The American economists Ms. Werner refers to, who agree with a carbon fee as a strong step to dealing with our contribution to climate change, number over 3500 (https://clcouncil.org/economists-statement/). Now we can add The American Petroleum Institute, which is preparing to endorse a price on carbon emissions, to the list. (See Wall Street Journal:https://www.wsj.com/articles/oil-trade-group-considers-endorsing-carbon-pricing-11614640681.)

    As she says, it’s time for this “market failure” to be corrected. HR-763, The Energy Innovation and Carbon Dividend Act, is a strong step in that direction. Yes, tell Senators McConnell and Paul in Kentucky and Senators Portman and Brown in Ohio, and every other Senator and Representative you can to reach, to work towards what Ms. Werner rightly proclaims every person wants: “a healthy environment.”

  2. Dr. Glick says:

    This is a sham. A carbon tax on Americans would do more harm than good for the health and livelihoods of all Americans. On a per capita and per square mile basis, America puts out the least amount of green house gases than all other developed countries.
    The Paris Climate agreement is no more than wishful and frankly fake agreements by all countries. There is no substance, and no consequences for anyone who wants to deviate from their “pledges”. Literally read the pledges and agreements from all countries first hand, and you will see they are no more than wishful thinking and no more than words on paper. All countries actually do and actually commit to a fraction of what is in the agreements.
    Some of the agreements are even structured to say some countries will start on environmental protections a decade from now.
    People see the news and take it for face value without looking at a single detail. And they are all fooled.
    The average person has no idea how much other countries pollute the environment more than the US does. That’s why everything is made in China, India, southeast Asia, and parts of Africa. They have very few environmental regulations, and that’s why they can manufacture cheaper than the US could even imagine making goods and products for.
    People who are avid environmentalists and want to push for more green regulations and everything should start in the countries that still dump unfiltered coal dust into the air, and literally let sewage and manufacturing waste dump literally directly into rivers.
    Making the most environmentally regulated and environmentally clean country in the world (the US) more regulated and more clean does no good at all, if environmentalists turn a blind eye to all of the other countries polluting the world as a whole.
    All anymore environmental regulations in the US would do, is ship more manufacturing oversees, and in turn create more completely unregulated pollution for the world as a whole. People just need to think about that statement. It is logic.
    An honest and well calculated step should be made in that direction at other countries, not here domestically.

  3. Excellent post, Werner!

    I must disagree with Dr. Glick’s comments. According to the Environmental Performance Index (https://epi.yale.edu/epi-results/2020/component/epi) the US is a long distance from number 1:

    Denmark 82.5
    Luxembourg 82.3
    Switzerland 81.5
    United Kingdom 81.3
    France 80
    Austria 79.6
    Finland 78.9
    Sweden 78.7
    Norway 77.7
    Germany 77.2
    Netherlands 75.3
    Japan 75.1
    Australia 74.9
    Spain 74.3
    Belgium 73.3
    Ireland 72.8
    Iceland 72.3
    Slovenia 72
    New Zealand 71.3
    Canada 71
    Czech Republic 71
    Italy 71
    Malta 70.7
    United States of America 69.3
    Greece 69.1
    Slovakia 68.3
    Portugal 67
    South Korea 66.5
    Israel 65.8
    Estonia 65.3
    Cyprus 64.8
    Romania 64.7

    Many countries are far ahead of the US in terms of strong environmental policies; Germany, the UK and France, for example, all large countries. Even Italy, which has struggled for years to improve its environmental quality, is ahead of the US.

    Glick feels we should leave the US alone, and work on big polluters like China: “People who are avid environmentalists and want to push for more green regulations and everything should start in the countries that still dump unfiltered coal dust into the air, and literally let sewage and manufacturing waste dump literally directly into rivers.”

    Leaving aside the fact that the US DOES dump waste directly into our rivers, is he proposing that the US should start controlling the Chinese environmental quality? And how does this work?

    Perhaps we should get our own house in order first.

  4. Tony Potochnik says:

    The EICD has another critical component: the Border Adjustment. We will tax all imported goods according to our rates and the carbon content. We keep the money. The exporting country is motivated to fee their own products so the money stays in their country. The EU is starting such an adjustment. If our exports are not taxed, they will be upon entry to the EU.

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