In an Op-ed of the New York Times (8th February, 2017), the above proposition is put forth in a Paper to be released by the Climate Leadership Council. The Op-ed is jointly penned by Martin Feldstein, chairman of the Council of Economic Advisers under President Ronald Reagan, Gregory Mankiw, chairman under President George W. Bush, and Ted Halstead, founder and chief executive of the Climate Leadership Council.
Co-authors of the Paper include James A. Baker III, Treasury Secretary for President Ronald Reagan and Secretary of State for President George H. W. Bush; Henry M. Paulson Jr., Treasury Secretary for President George W. Bush; George P. Shultz, Treasury Secretary for President Richard Nixon and Secretary of State for Mr. Reagan; Thomas Stephenson, a partner at Sequoia Capital, a venture-capital firm; and Rob Walton, who recently completed 23 years as chairman of Walmart.
This heavyweight Paper presents a plan that buys into deep-seated Conservative pro-business, anti-regulation, pro-growth, pro-exports, and pro-jobs principles. It is based on four pillars -
"First, the federal government would impose a gradually increasing tax on carbon dioxide emissions. It might begin at $40 per ton and increase steadily. This tax would send a powerful signal to businesses and consumers to reduce their carbon footprints.
Second, the proceeds would be returned to the American people on an equal basis via quarterly dividend checks. With a carbon tax of $40 per ton, a family of four would receive about $2,000 in the first year. As the tax rate rose over time to further reduce emissions, so would the dividend payments.
Third, American companies exporting to countries without comparable carbon pricing would receive rebates on the carbon taxes they’ve paid on those products, while imports from such countries would face fees on the carbon content of their products. This would protect American competitiveness and punish free-riding by other nations, encouraging them to adopt their own carbon pricing.
Finally, regulations made unnecessary by the carbon tax would be eliminated, including an outright repeal of the Clean Power Plan."
The Op-ed suggests that this plan could meet America’s commitment under the Paris climate agreement, all by itself. Above all, it facilitates President Trump's move to free shackles on the oil and gas industries. It also contains broad-based elements that should appeal to Conservatives, libertarians, populists and environmentalists alike, thereby ensuring bi-partisan support.
Absent further details, an apparent fly in the ointment is that only exports to countries without comparable carbon pricing can benefit from the tax rebate. As not all oil and gas production is for export and not all exports are to such countries, a sizable proportion would have to bear the tax burden. If true, it is open to question whether such a plan would gain enough support from influential hard-nosed energy interests inside the GOP corridors of power.