What to do after I-1631 failure?

You may have heard some economist last week mention the concept of “internalizing an externality.” The most obvious example of such wisdom (from society’s vantage point) is internalizing the cost of air pollution from our vehicles or the stack gases from power plants. That’s what Initiative 1631 was designed to accomplish: establish an opportunity to force our industries to internalize the polluting cost of carbon by paying a $15 fee per ton for its use. But then, that opportunity was rejected.

The rejection can be credited in large part to the carbon providers themselves. They want the cost of greenhouse gas emissions to remain external to their business model — rather, to let society continue to suffer the cost alone. They lobbied the voters, via political ads on TV and fliers in the mail to reject the fee; they encouraged a no-vote by pointing out that I-1631 would increase the price of gasoline (by 10 cents/gallon) and electricity (an additional penny per kW-hour) and thereby shift that cost to the American consumer. (True enough.)

So we have avoided that cost it seems and will travel down the old path a while longer. The climate change predictions may become more convincing, hurricanes may be more devastating, and more places like Paradise, California, may go up in smoke. But we, if lucky, will continue to dodge the cost of the carbon-based pollution that we’re causing.

I have a suggestion for what can be done with our savings: We’re told that most families will likely save $100 per year—at least $40 on gasoline and $60 on our electricity bill. Perhaps we should pass that money on to some young person. After all, they are more likely to need it.

— Ward Carson

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