Portland is ending its hottest summer ever and Gulf of Maine waters, among the world’s fastest-warming, are far above normal this year. The West Coast is on fire and named Atlantic storms are running through the alphabet.

Widening the lens, global warming and weirding are undermining survival of the world’s poorest and most vulnerable, as deserts expand, rising seas drown low lying coasts, and tropical diseases invade higher latitudes. Scientists recently forecast that global temperature in 2100 will be at least 4.7 degrees Fahrenheit above pre-industrial levels.

The Maine Climate Council is shaping a strategy to reduce Maine’s contribution to warming and adapt to inevitable adverse shocks. Such farsighted state strategies are critically needed. But since climate change’s causes are global, so must be the solution, and American leadership is crucial. With a climate denier in the White House, Americans face a stark presidential choice this November.

International climate initiatives have been long on green rhetoric but disastrously short on concerted action. As Nobel Prize economist William Nordhaus puts it, “The key agreements, the 1997 Kyoto Protocol and the 2015 Paris climate accord, have relied on voluntary arrangements, which induce free riding that undermine any agreement.”

The United States failed to ratify the Kyoto Protocol and, by Trump’s edict, is exiting Paris. We are the ultimate free riders. Yet the failure of past international initiatives makes it clear that decisive international action will not happen without American leadership. Other nations have little incentive to impose costly CO2 emission reductions on themselves while the US – the world’s second largest current emitter and by far the largest cumulative emitter – shirks.

The Citizens’ Climate Lobby (CCL) proposes a three part strategy to stimulate American energy efficiency and renewable energy innovations. First, a gradually rising fee – or tax – on carbon emissions. Second, carbon tax revenues returned to households as equal dividends, offsetting their higher cost of living. And third, border adjustments – i.e. import tariffs – to prevent exploitation of US producers and consumers by foreign nations that fail to impose a comparable carbon price.


There is a growing consensus among economists that international action should follow a similar approach. A common carbon emissions tax, backed by countervailing tariffs on “cheaters,” is not a panacea. But it is the most cost-effective, readily implemented — and probably most politically feasible – policy to get the ball rolling: inducing buy-in, harmonizing incentives, and leveling the competitive playing field.

More than 20 nations have already implemented carbon taxes. But with tax rates all over the map, businesses and consumers in different countries face vastly divergent costs and incentives. Crucially, there is no common enforcement mechanism to deter cheating by nations that don’t impose the carbon tax, though the European Union is designing a countervailing tariff as part of its European Green Deal.

Effective international action faces three big challenges where American leadership will be crucial:

  • First, setting a timetable for carbon tax increases, gradually strengthening economic incentives while minimizing near term dislocation.
  • Second, designing countervailing tariffs to encourage participation and discourage holdouts.
  • Third, allocating billions of dollars in carbon tax revenues collected by national governments.

These are deeply political choices, but there is a wealth of economic analysis to help design cost-effective policies.

Regarding allocation of revenues, I would advocate the CCL’s dividend proposal, described above, with an added commitment to global equity. Channeling sixty percent of US revenues to low and middle income American households would fully offset their higher living costs; and targeting forty percent to vulnerable groups in poorer countries would ease the plight of those suffering most from the ravages of global warming.

We can be proud that Maine is taking climate leadership, but prospects for the USA spearheading decisive global action hinge on this November’s election — another key reason to vote.

David Vail is a professor of economics emeritus, Bowdoin College, and Economics Policy Network, Citizens Climate Lobby 

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