Should We Have a Security Fee on Oil? A Left-Right Solution to Security, Economy, and Environment

Once again, oil prices are spiraling. Once again, it's out fault: we failed to take charge of our energy future. And once again, politicians on the right and left looked not to solutions, but to their base, to find the rigid ideologies they pretend to believe. They don't have the fortitude to lead.

We are paying the price now, but Libya is just the beginning. In short order -- maybe a month, maybe a decade -- the Saudi regime too will fall. When it goes, all bets are off on the price, access, and political and military consequences of dependence. We may only have just begun to experience the full cost.

It is up to the rest of us to lead. We need a right-left alliance to break our addiction. Now one is within reach.

Leaders in the national security community are calling for a "security fee" on oil imports, to add the cost of military security to every barrel of oil we import.

Meanwhile, conservative economists are calling for a revenue-neutral tax shift -- a cut in payroll taxes to drive job and income growth, paid for with a fee on fossil fuel emissions. They want to trade a tax on things we want, like income, for a tax on things we don't want, like pollution.

Finally, environmentalists are turning away from their expensive cap-and-trade approach to climate, and opening their minds to a better alternative, one that originated on the right: a price on carbon.

It doesn't take a political strategist to see how close these three groups are. But getting them to cross the finish line together takes real work, and political courage -- a source of power far rarer than oil.

Environmentalists like the security fee concept -- but they worry that imposing it only on imports will drive up demand for coal in the U.S., making pollution worse.

National security experts like the carbon tax concept -- but they worry that unless wisely applied, it could give a price advantage to foreign oil sources, making dependence worse.

And economists like both concepts -- but they want to make sure the funds we raise don't just get spent by government on politically-favored special interests. They want revenue-neutrality.

Alone, these three groups may as well hang out in their respective ivory towers. They won't see their policies pass in their narrow forms.

But put the three together, and you have a prescription for solution: a revenue-neutral price on fossil fuels, based on carbon content, adjusted to reflect security costs. That appeals to both parties' bases -- who are energized by security and the environment respectively -- without exploiting their baser instincts.

Of course, this is how 1200-page bills get started. Each interest group takes a simple idea, and tweaks it to deal with their special interest.

But energy, security, the economy, and environment are meta-interests, and they are inextricably bound together. A simple price on carbon can address all four, at once. No narrow special interests need to be bought, if we deal at this level with them all.

That will require leadership from the sensible right and left, and the courage to align with unlikely bedfellows. Otherwise, litmus tests from partisan true-believers will block every step toward solutions.

Why should the left and right put a price on carbon? Doesn't that force them to agree on whether climate change is real or not?

No -- carbon is a logical indicator of pollution content and environmental externalities, even if you don't believe in climate change. If you find high carbon emissions, you'll also find high nitrous oxides, sulfur dioxides, particulates, leveled mountains, polluted lakes, and challenged lungs.
But political gamesmanship could easily get in the way of a solution that would advance national security, economic prosperity, and environmental sustainability.

For example, it is now a matter of almost religious faith, on both the right and left, to believe that the precise effects of climate change are either a proven reality, or a proven fiction. According to the enforced ideologies of the day, many expect conservatives to take the position that climate change is pure fiction, foisted on us by big government liberals determined to replace capitalism with socialism.

Conversely, liberals are expected to argue that all climate skeptics are conservative ideologues determined to foist their anti-science agenda on the public no matter the environmental or social costs.

The simple truth is that science does not offer the certainty that either of these extremes insist upon. At the Republican Leadership Network, on whose board I sit, some of my colleagues have been called climate skeptics, and others have been called believers. But we all agree there is a genuine risk of human-caused climate disruption -- and it is neither conservative nor wise to roll the dice on a matter as great as the climate of the planet.

To reasonable-minded conservatives who don't subscribe to litmus tests of political correctness, the climate issue is not simply a political Trojan Horse by the left. There are aspects of that, certainly, as there are in all legitimate policy questions. But it would be dangerous for conservatives to simply disregard the very genuine concerns of most in the science community who have studied the matter deeply.

That doesn't mean we have to overreact and support cap-and-trade policies that would genuinely damage the economy. In fact, there are many sensible approaches that advance important conservative political objectives while reducing risk. With smart policies that harness the free market, we can cut taxes, advance national security, drive innovation, and create real non-subsidy jobs, at once.

Placing a price on carbon, to deal in a single stroke with the economic, security, and environmental risks of fossil fuel dependence, is perhaps the most powerful, effective, and important way to bring right and left together, and move forward.