An Incentive Based Solution to the Environmental Crisis

Monarch

When motivating people or companies to change I’ve always found the carrot to be more powerful than the stick.

Recent reports have given us 12 years to right the damage being done to the earth before these cycles become irreversible and much of our world ultimately uninhabitable.

As someone who’s been an advocate for the environment since the 1980’s when I first wrote to Brian Mulroney the current Prime Minister of Canada asking for a plan of action to begin on environmental protection, I have watched many ideas, programs and methods be implemented and sadly fail.

The problem with most, if not all, of these efforts were that they used a stick.

Carbon taxes, cap and trade, as well as other complex measurement regimes and corrupted exchanges did not offer a simple carrot to those who reduced their carbon footprint.

Apparently there are some who still don’t believe in the danger we face and that is why there’s so much political will fighting against taking action. And unfortunately if we remain locked in these political tug of wars for the next 12 years the outlook is bleak.

Most frustrating of all is seeing the great number of the cities, states, people and countries who are attempting to make change happen, but are continually blocked and sidelined by higher levels of government.

The secret to success is to find a carrot that will accomplish the goal of carbon reduction, that is positive in nature, one which both companies AND individuals can choose to opt in.

I humbly submit, for the further scrutiny of economists and tax experts, that a simple and straight forward regime of tax cuts for both companies and individuals who reduce their carbon footprint has the potential to become this carrot.

Just as differing tax rates apply to individuals and companies based on brackets of income or company size/type, carbon brackets could be created that reward those individuals and firms who create less carbon with lower tax rates.

Simple and standardized measurement methods based on total carbon utilized and emissions created certified on an annual basis along with personal and corporate tax returns and confirmed by professionals will place individuals and companies into their effective tax bracket based on carbon.

In this way, individuals and companies could make the determination on whether they feel it beneficial to invest in equipment, technology, electric cars or alternative energy sources should they see fit to earn these carbon reductions to the amount of taxes they pay.

Most importantly, individuals and companies can decide to participate in these programs or not, but those who don’t participate will not get the benefits of these available tax cuts.

One of the major complexities of implementing any plans with a stick like a Carbon Tax is when other countries don’t and your country’s economy can become less competitive and companies will not locate and invest there impacting jobs and overall output.

In Canada, the Carbon Tax plan currently being implemented is as flawed as the Paris Accord. It will almost certainly fail just as miserably, along with any government which insists on staying this course, unless a program is done in lock step with United States such as the carbon tax cuts being proposed in this case.

Another complexity are those countries emerging that are just reaching potential for peak development around the globe. Methods of encouraging participation in such programs may be tied to tariff rates for those who meet brackets of positive carbon reduction set for such purposes.

However, those who rail against this Carbon Tax plan without their own plan, have little hope to govern if they do not also put forward an alternative proposal that can work.

Some may say this is too simplistic an idea to solve such a complex problem, however I don’t see any alternate solutions being proposed which can accomplish significant reductions by giving both people and companies the collective power they need to decide the long term destiny for their families and our world.

Jeff Ashcroft

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