GUEST EDITORIAL: New taxes put carbon reductions at risk

OLYMPIA - Everyone wants to help the environment, but blindly following trendy environmental fads can often do more harm than good. Eco-fads squander precious resources and waste the opportunity to adopt more beneficial strategies.

One of the most common errors made by environmental activists is to believe that only radical revolutions make an environmental difference. In fact, environmental improvement comes incrementally as we find ways to do more with less.

Many on the left believe that only a massive jump from inexpensive coal to expensive and intermittent solar power will help the environment. Such an approach, however, is simply unrealistic and misses the important opportunities we have to make progress on reducing carbon emissions in the near term.

Unfortunately, this all-or-nothing thinking appears to be guiding some of the thinking at the federal level.

The budget deficit poses a similar pitfall as for Congress and the administration as we continue to try and solve this country's debt crisis in the wake of the Supercommittee's failure. If our elected officials ignore new information about the effects of new energy taxes, they could hinder domestic energy production, do significant damage to our economy and ultimately deepen the deficit they seek to eliminate.

Just as important, they could miss opportunities to make important, incremental progress toward carbon reductions.

Some lawmakers support the revocation of common business tax deductions for natural gas companies (the "loopholes" we hear so much about) to raise tax revenue and reduce the federal deficit.

This could be counterproductive on several levels.

For example, a study done by a Louisiana State University professor of economics who specializes in energy issues found that targeted tax hikes for oil and natural gas companies -- who support 9.2 million American jobs -- would drastically impact both U.S. economic performance and government revenue.

Proposed energy tax hikes would cause the United States to lose $341 billion in economic output, 155,000 jobs and $68 billion in wages. This tax increase-driven downturn would so severely upset the nation's economy that the federal government would actually end up losing over $83 billion in long-term tax revenue.

At first glance, this strategy sounds reasonable. If we raise taxes, government revenue will increase. But the facts simply do not support the expected outcome.

This approach would not only put the federal treasury farther in arrears, it would hamper investment in domestic fuel resources (including clean burning natural gas) thereby increasing foreign energy imports and weakening our national energy security.

The additional result is that it could make it more difficult to reduce carbon emissions in the near term. Not only is a step from coal to natural gas a positive move, but natural gas is also used to back up intermittent sources of power, like wind energy. Such a combination makes wind more viable, reducing some of the downsides of that irregular source of energy.

While some will object, history shows it is the best approach. While California and others waited for electric vehicles to appear, hybrid vehicles bridged the gap for more than a decade, providing an opportunity to reduce carbon emissions while waiting for the technology that politicians promised but could not deliver. Without hybrids, we would have lost a decade of reductions. Without natural gas, we will lose time waiting for other renewables to emerge.

We have expressed our support for putting a price on carbon. But the taxes being proposed are more about raising revenue than a rational approach to cutting carbon emissions.

The test before Congress and the Obama Administration is clear. Will they have the political courage to accept this information and reject policies that make it difficult to take that important, interim step? Or will they do what, at least for some of them, might appease more of their constituents and supporters, even though it threatens to make our deficit problems worse and push off carbon emissions?

To be truly environmentally conscientious, we have to accept the facts as they are and do what is most effective. Our elected leaders must be ready to do the same.

Todd Myers is the environmental director at Washington Policy Center, a non-partisan independent policy research organization in Washington state. For more information visit washingtonpolicy.org.