Yes, that George Shultz, President Ronald Reagan’s Secretary of State. But not everyone who served with Reagan was a Reaganite. Reagan’s VP, G.H.W. Bush, famously campaigned on a platform of “Read my lips: No New Taxes.” Not two years later he raised taxes in a 1990 budget deal that torpedoed the economy and sank his presidency.
Yesterday, in an interview puff piece penned by two associates, Shultz, a distinguished fellow at Stanford University’s Hoover Institution, called for a ‘revenue-neutral’ carbon tax. This is unsurprising. As the article reminds us, in 2010, Shulz, partnering with Tom Steyer, a Democrat, “led the successful campaign to defeat Proposition 23, a California ballot initiative to suspend the state’s ambitious law to curb greenhouse gases.”
Nothing in the article indicates that Shultz thinks a carbon tax should replace California’s cap-and-trade regime established by AB 32. Nor is there any hint that Shultz would condition the enactment of carbon taxes on repeal of the EPA’s court-awarded power to regulate greenhouse gases via the Clean Air Act.
This pattern is becoming boringly familiar.
As noted here, earlier this week, former Rep. Bob Inglis (R-S.C.) launched a new institute with Rockefeller Family Fund backing to promote carbon taxes as a ‘Republican idea.’ Inglis said nothing to suggest that he views carbon taxes as an alternative to EPA’s greenhouse gas regulations, or that one of his objectives is to rein in the agency and return control over climate policy to the people’s representatives.
Kevin Hassett, economic policy director of the American Enterprise Institute (AEI), a conservative think tank, took heat this week for hosting a secret meeting on carbon taxes titled “Price Carbon Campaign/Lame Duck Initiative.” The agenda looks and smells like, well, what it is: the outline for a strategy session to build the PR/legislative campaign to enact carbon taxes. Participants included such ‘progressive,’ pro-Kyoto organizations as Union of Concerned Scientists, Public Citizen, and Climate Action Network.
Hassett issued the following statement in response to media inquiries:
In recent years, AEI has been accused of being both in the pocket of energy companies and organizing to advocate a carbon tax. Neither is true. AEI has been, and will continue to be, an intellectually curious place, where products aren’t influenced by interested parties, and ideas from all are welcome in seeking solutions for difficult public policy problems.
That doesn’t cut it. Such self-congratulatory platitudes tell us nothing about where Hassett stands on carbon taxes. If he is opposed to carbon taxes, he should say so. If he supports some kind of ‘grand bargain’ in which carbon taxes replace the EPA’s greenhouse gas regulatory agenda, he should say so. But I doubt that he will advocate such a swap, because the moment he does, the ‘progressives’ — the EPA’s amen chorus – will pick up their marbles and go home. Until Hassett clarifies his position, people will assume the worst, and reasonably so.
Even if Hassett’s objective is to get the EPA out of the GHG regulation biz, the timing of the AEI carbon tax pow-pow could not have been worse. With the unemployment rate still exceeding 8%, now is not the time to call for a massive new tax on energy. Nor is this the time for GOP influentials to launch a carbon tax campaign when the choice facing the electorate in November is largely a choice between a Democratic Party that is anti-energy and pro-tax and a Republican Party that is pro-energy and anti-tax.
But there has always been a wing of the GOP — the “establishment,” “Country Club,” or “Rockefeller” Republicans — who care more about controlling the party than about advancing liberty or even about winning elections. AEI’s Ken Green (a colleague of Hassett’s) hits the nail on the head. In a story on Shultz’s endorsement of carbon taxes, Green told Climatewire:
“There seems to be an eruption of conservatives — very moderate-seeming conservatives, non-tea party, old country club-style conservatives — who are suddenly enamored of carbon tax,” said Kenneth Green, a resident scholar at the American Enterprise Institute.
“I think this is mostly vanity and egotism on the part of these people who are coming forward, to try and reassert the Republican establishment over the tea party revolution,” he added. “I wouldn’t be surprised if we have more of these guys weigh in.”
Update: 5:45 pm, July 13, 2012
BTW, in 2007 Green co-authored a paper with Hassett and AEI’s Steven Hayward (Climate Change: Caps vs. Taxes) arguing that carbon taxes would be better than cap-and-trade, which would be better than an EPA-run system. Today in AEI’s online journal, The American, Ken explains why he “no longer believe[s] that such a tax (or, for that matter, other eco-taxes) can be implemented in the sort of ideal, economically beneficent way that people favoring either individual liberty, free markets, or limited government might sanction.” He concludes: “Even in flush economic times, carbon taxes would be bad policy. When economies are already laboring under too much spending, and are at diminishing-return levels of taxation, implementing a carbon tax would be a mistake.”
Well, Dr. Hassett, what do you think?