A fight brewing beneath the surface over Republican support for a carbon tax is about to come to a head this week as Congress shifts its focus to tax reform and the climate policy gains traction inside the conservative ranks.
A host of conservative groups such as the Americans for Tax Reform, led by Grover Norquist, are trying to discourage the GOP from entertaining a carbon tax or placing a price on greenhouse gas emissions, an idea that a handful of libertarian and conservative groups support.
The carbon tax would apply an across-the-board per-ton fee on carbon dioxide emissions, which proponents hope would send the markets a signal to reduce fossil fuel use and encourage clean energy development. Many scientists blame the burning of fossil fuels, which increase carbon dioxide emissions, for raising the average temperature of the Earth with potentially disastrous consequences.
Norquist and others such as Americans for Prosperity are trying to label at least two groups as liberals "masquerading" as conservatives by actively supporting the idea of a carbon tax or carbon price as a legitimate middle ground to liberal policies such as tax credits and subsidies.
"A carbon tax is a long-term goal of the big government Left," Norquist said in a statement to the Washington Examiner. "The Left will do whatever it takes to achieve this goal. The use of marketing slogans/consultant-speak terms like 'carbon pricing' and 'dividend' and 'revenue neutrality' is just one tactic."
He points out that the official Democrat platform calls for a carbon tax, while the official Republican platform is "rightly" opposed to it. Even Hillary Clinton's recently revealed new book said that she is "fascinated" by the idea of a carbon tax, he said.
"No wonder her campaign chairman, John Podesta, opened the door to a carbon tax last summer," Norquist said. "If she was president, she'd be pushing a carbon tax right now and holding tax reform hostage."
The stakes rose last week when Sen. Lindsey Graham, R-S.C., endorsed a carbon tax at a Yale University climate change conference hosted by former Secretary of State John Kerry.
Opponents of a carbon tax said Graham's endorsement was evidence of the "liberal" conservative groups gaining a foothold in the Republican Party. One of the sources called Graham's endorsement a distraction that came during the U.N. General Assembly and when climate change was a top concern.
Graham said he is working with Democratic Sen. Sheldon Whitehouse of Rhode Island on crafting a carbon tax bill. "I'm a Republican. I believe that the greenhouse effect is real, that CO2 emissions generated by man is creating our greenhouse gas effect that traps heat, and the planet is warming," Graham said in a transcript of his pre-recorded message to the conference. "A price on carbon — that's the way to go in my view."
He wasn't alone. Sen. John McCain, R-Ariz., also voiced support for addressing climate change in a pre-recorded message.
The two organizations that have sparked the most ire from the conservative groups include the libertarian Niskanen Center and the conservative and free-market R Street Institute.
"The reality is … only a handful of organizations masquerading as a conservative organization" are pushing for a carbon tax, said Christine Harbin, vice president for external affairs at Americans for Prosperity.
"There is always the threat that carbon taxes will be part of the package," she said. That's why her group and others think the handful of conservative groups supporting a carbon tax are so detrimental, because they undermine what the majority of groups hold true — a carbon tax is "bad on policy and its bad on politics as well," Harbin said.
"On the policy side, this is a way to raise revenue for government under the guise of helping the environment, but it's actually quite dangerous," she said. "The Left will say they are going to get rid of [Environmental Protection Agency] regulations in exchange. But we know that in practice we should be skeptical."
A carbon tax is being raised frequently now "because comprehensive tax reform talks are happening," Harbin said. But a stand-alone bill "is not likely to happen and the administration has given no indication that they are going to include it" in their tax plan, she said.
Opposing the carbon tax is a main part of her group's focus in discussing policy with lawmakers. Other conservative groups such as the American Energy Alliance, which formed part of the Trump Energy Department transition team, also oppose a carbon tax.
But one of the groups called out for endorsing a carbon tax, while being conservative and free-market-oriented, said Norquist and the others have got it wrong.
"First, I want to say that we are huge supporters of both Grover and [Americans for Tax Reform]," said Eli Lehrer, president of the R Street Institute, in a statement to the Washington Examiner. "They are old friends and hope to work with them on common issues of concern."
Secondly, Lehrer clarified that "R Street is not for a carbon tax if it would make government bigger." Instead, what R Street has proposed is a "tax swap," in which "a carbon tax would be paired with cuts to other more economically damaging taxes, and where EPA's regulatory authority over greenhouse gases would be pre-empted and all energy subsidies eliminated."
"More often than not, the most significant objection to our carbon tax ideas is a lack of faith in Congress to keep taxes low and reduce bureaucracy," Lehrer said.
The lack of faith in Congress is a "concern we share" with Norquist, "but it's a political challenge, not a policy objection," Lehrer said. "There's nothing ‘lefty' about a plan that could literally shrink the size of government as the market seeks to reduce pollution and lower tax liability."
He noted that he would personally like to see a carbon tax used to scrap the corporate income tax completely.
Some groups say the carbon tax is something being pushed in secret, but "we haven't disguised anything, we've been open about our position for years and we're always happy to discuss it," Lehrer said. "I've personally spoken with Grover about carbon taxes, and we simply disagree. The idea that conservatives can't disagree on specific policy approaches while maintaining a positive relationship is silly."
Jerry Taylor, the president of the Niskanen Center, said the reason conservative groups are complaining more about a carbon tax is "probably due to the fact that they are more and more worried that we are gaining traction on the Hill in Republican offices."
He said that is one of the only areas where Norquist and others are accurate, "and they are right to be worried."
Taylor said his center has not been shy in its support of a carbon tax since the group was established in 2014. "In fact, Grover Norquist … joined the Niskanen board of advisers knowing where we stood on carbon taxation and remained on our board for several years," Taylor noted.
Norquist said he joined the Niskanen board "because they were a new and struggling group and I shared their views on the benefits of free trade."
"They knew I opposed their support for a carbon tax under any guise and for any reason. When they started making noise about the carbon tax I told them I wanted off the advisory board and they fully understood," Norquist said.
"There is a disagreement on the right on this issue," Taylor said. "And it's an honest disagreement. But I don't think it's very accurate to say that conservatives and libertarians are on one space on climate issues and anyone not in that space no longer has ideological ID rights."
Bob Inglis, a former GOP House member from South Carolina who serves on the R Street board, said Lehrer and Taylor are staunch supporters of free-market principles and "are no liberals."
Inglis is the founder and head of the RepublicEN group that conducts state-level outreach on a conservative climate change policy that involves a carbon tax that is revenue neutral.
He had a message for Norquist. "You said publicly, years ago, that the carbon tax, if revenue neutral, did not violate your pledge" of not raising federal taxes while cutting deductions, he said. "But then, apparently, somebody called you after you got those headlines, because the next day you walked it back."
"What's that about Grover?" Inglis asked. "Are you a fearless conservative, or did courage fail you for some reason? Was it a donor that called?"
Norquist said Inglis "lobbied me to support such a tax. Never. Repeat, never. He is mad I said no."
Norquist said his group "has never supported a tax increase, ever. A carbon tax is a job killer and the highest priority of the Left — it would morph into a [value-added tax] and we would become Europe."
Inglis said a carbon tax would be used to eliminate the need for new subsidies for wind and solar, as the Norquist pledge for lawmakers called for, while providing impetus for companies to pick the most cost-effective and commercial energy technologies.
"It's an incredible opportunity to show the power of free enterprise," Inglis said.