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Gary
Yohe, the John E. Andrus Professor
of Economics, suggests that the government place a growing tax on the cost
of carbon during a hearing March 30 in Washington D.C. |
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| Posted 04.17.06 |
Economics Professor Testifies Before U.S. Senate
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When Gary Yohe, the John E. Andrus Professor of
Economics, received a call from Senator Joseph R. Biden's office to testify
before the U.S. Senate Committee on Foreign Relations in Washington, D.C.,
he didn't hesitate. In fact, he hurried.
Yohe, who was the sole expert, recommended by both the Environmental Defense
Fund and Pew Center on Global Climate Change to Senator Biden's office, had
only a few days in which to prepare his brief testimony on "The Hidden
(Climate Change) Costs of Oil."
In a five-minute prepared opening statement, Yohe called attention to the
sources of economic cost attributed to climate change and suggested that
government respond by placing a permanent and growing tax on the cost of
carbon. The point of such a tax (or any policy that would add the climate
cost of carbon to the price of oil) is to hedge against, or reduce the
likelihood, of the extreme consequences of global warming.
"We don't have to go overboard," Yohe explained, but "adopting a
risk-management (hedging) approach to minimize the cost of future policy
adjustments would be appropriate and economical over the long run.”
Yohe says he believes Senators Biden and Richard G. Lugar seemed to agree
with his testimony.
"We were there for almost two-and-one-half hours and the two senior members
of the Foreign Relations Committee were fully engaged and almost thinking
out loud with us,” says Yohe. “The staffers were incredulous that they spent
so much time with us."
According to Yohe, Senator Biden said that people might get used to paying a
persistent tax on petroleum. Biden was
particularly interested, though, in how such a charge might be factored into
the investment decisions of American businesses as they frame the energy
infrastructure for the next half-century.
Senator Lugar, on the other hand, was specifically interested on how best to
implement an
effective climate insurance policy.
"I had a short amount of time to get in front of two people who essentially
could take my research and make a difference," says Yohe. "After generating
pages of points that I wanted to raised, I picked out what I thought was the
most important information and tried to tell a
simple, but interesting story."
To read the full transcript of Yohe’s testimony, please refer to the
following link:
http://foreign.senate.gov/hearings/2006/hrg060330a.html.
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| By Laura Perillo,
associate director of Media Relations |
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