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I recently found out about a new idea for speeding up the economy's transition away from fossil fuels, called cap and dividend. Basically the idea is that the government places an upstream cap on carbon dioxide by forcing first sellers* of fossil fuels to buy permits equal to the CO2 content of their fuels. Then checks are sent out each year (or month) to all legal citizens (or just adults) of the country based on the total value of the carbon permits purchased. The thing I really like about this idea is that it's progressive, meaning each individual gets the same amount no matter what. This is the first idea I've heard that has a decent chance of keeping the lower class above water (at least those who are able to find affordable housing within a distance to work that allows affordable transporation) while the economy is in transition. The average family of four might receive $1,200 to $6,000 per year, according to a study by MIT. The only potential problem I see with cap and dividend is that the inflation that is bound to occur with increasing energy costs affecting all sectors of the economy might overtake the rate at which dividends increase, possibly leading to economic collapse if energy alternatives are not available in large enough quantities (and they won't be). My hope is that people will continue to spend less money on frivolities and focus more on necessities and conservation, with green jobs replacing those that will be lost when people stop buying yachts and hot tubs and Hummers.

* I'm not sure if "first sellers" means prior to any processing or not, but it affects all the players downstream regardless.


At June 23, 2008 at 5:33 PM webuyitgreen said...

Hi Alex,

I would like to invite you to post a description of your blog along with a link on my site at . I think you will find our sites compatible and would love to have you occasionally share your perspective on our forum. Let me know if you would like further information.

Jay Kilby
Redmond, WA


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