Low oil prices aren’t really so great for consumers or the economy when the full cost is taken into account [“Why oil prices are plunging, what it means for you,” Nation & World, Dec. 16]. Major insurers, the Pentagon, most major employers and even some oil companies agree that there will be immense costs to pumping more carbon into the atmosphere.
We have to find a way to make the price of oil reflect these actual costs, while at the same time protecting consumers embedded in a fossil-fuel economy. A carbon fee and dividend, which requires producers to pay the full cost of their product (the fee) while returning revenue directly to consumers (the dividend) could accomplish this.
Investors would have a clear, stable signal that carbon costs would only increase, while consumers would have a cushion against higher prices. Over time, this will drive a shift to cleaner energy sources.
As things stand now, the costs of greenhouse gas emissions are socialized, with the public sector left to pay for the damage. Fee and dividend, also known as a revenue-neutral carbon tax, can correct this market distortion and move us toward a cleaner future.
Our children and grandchildren will thank us.
Davis Oldham, Seattle