9. CLIMATE:

Carbon tax remains out of 'fiscal cliff' discussions

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After much ado about the carbon tax last summer in think tanks and policy shops around town, it finally made an appearance yesterday on Capitol Hill when a group of House Republicans reintroduced their nonbinding resolution opposing its enactment in any form -- including as a "fiscal cliff" revenue raiser.

Rep. David McKinley (R-W.Va.) introduced the measure with supporters including House Energy and Commerce Committee Chairman Fred Upton (R-Mich.) and Ed Whitfield (R-Ky.).

"A carbon tax would increase the cost of everything from driving a car to heating and cooling a home," said McKinley in a statement this morning, adding that "raising taxes on everyone from manufacturers to homeowners is not the way to improve our economy, and Congress should reject this idea."

The resolution was referred to the Ways and Means Committee, which has primary responsibility in the House for the revenue side of efforts to avoid mandatory across-the-board budget cuts that are set to take effect in six weeks.

The fiscal cliff has been discussed as a possible opening for enactment of a carbon tax, and Ways and Means Democrats Pete Stark (Calif.) and Jim McDermott (Wash.) each introduced legislation in the last Congress that might have served as a template for it. Stark lost his bid for re-election last year, but McDermott said he planned to reintroduce his bill this Congress to help inform the discussion on long-term tax reform.

"It stirred up more than a little bit of interest," he said yesterday. "The fact that it's being talked about means people are going to have to start thinking about it."

McDermott said he has not yet found Republican support for the bill, adding that he expected the business community and others to champion it before the GOP does.

"The interest has to come from the outside," he said.

Interest off Capitol Hill has grown steadily for years, and the conversation intensified last year, especially among scholars associated with center-right groups like the American Enterprise Institute and the R Street Institute.

But the transition to Congress has proved difficult, at least for now.

"I don't hear a lot of action from the Hill," said environmental economist Michael Greenstone in a telephone interview yesterday, adding that a carbon tax has a lot of proponents in "think tank land."

"We can find ways to tax more of the things we love, such as income, or alternatively, we can tax more of the things we hate, such as carbon," said Greenstone, who served as chairman of the Council of Economic Advisers for part of Obama's first term. But he acknowledged that the politics on the issue are tough, especially given the lack of consensus among lawmakers about whether the planet is warming and what is causing it.

R Street Institute's Deputy Director Ray Lehmann said the short-term stopgap bills that Congress has been considering during the past few months to avoid the fiscal cliff would not be the kinds of packages that could include a carbon tax anyway.

"It's the sort of thing that we would expect to get serious consideration if a long-term tax-reform package would come to fruition, but we seem at this point to be in the midst of a series of short-term deals," he said. "It's not even something we would want to advocate as part of a short-term deal because it requires some thought and debate, and that's not what you get in these types of negotiations."

Reporter Nick Juliano contributed.