The plan generates a renewable transition.

The economic benefit and transparency of the dividend also contribute to its political feasibility. Particularly in a country where there is hostility toward taxes, a revenue-neutral dividend can sustain support for a tax that will need to rise steadily for decades. If the dividend were very small, it would not make sense to focus on it as a meaningful step toward a basic income. However, a carbon tax adequate for keeping global temperature rises from exceeding 2 degrees Celsius will support a dividend equal to or exceeding Alaska’s Permanent Fund Dividend (US$2,072 in 2015, $1,022 in 2016). For example, the carbon fee and dividend proposal favored by Citizens’ Climate Lobby (CCL) starts at $15 per metric ton of CO2-equivalent emissions, assessed at the mine, well, or port of entry. It rises by $10 per year, or at whatever rate the Department of Energy determines will bring emissions to 10 percent of 1990 emissions by 2050. All revenue (minus a small administrative cost) is returned as dividends (full for adults and half for children under 18, with a maximum of 2 child dividends per household). A majority of households will benefit. If instituted in 2015, the annual dividend for a family of four would rise to $3,456 in 2025 and $4,752 in 2035, according to CCL. Other estimates suggest even higher dividends. Using the calculator at the Carbon Tax Center, I modelled a similar carbon tax and dividend, starting at $10 per ton, rising by $10 per year, with equal per capita dividends, and counting a household as 2.6 persons. In 2025, the individual dividend would be $1,557, and household dividend would be $5,721. In 2039, the last year available in the model, the dividends would be $3,289 and $8,551 respectively. In either estimate, the dividend is significant, and can be expected to have a positive effect on poverty and inequality. If Alaska’s Permanent Fund Dividend deserves to be regarded as a partial basic income, then so too should a carbon dividend over a significant number of years. A carbon tax is not on the immediate political agenda in the US, but there is growing support for it. Legislation has been introduced in the Congress. A bipartisan caucus is exploring climate policies. CCL has 418 active chapters around the world, with a concentration in the US regularly lobbying every member of Congress. And a group of prominent (mostly Republican) elder statesmen, the Climate Leadership Council, has proposed a tax and dividend package that could achieve the same ends as Obama’s Clean Power Plan. But even if the tax comes to pass, there are competing claims that would have to be addressed before most or all of the revenue could take the form of a dividend. Firstly, labour. Many unions will favor green investments over universal dividends. For those employed in such projects, the wages can be expected to greatly exceed the per capita dividend. Moreover, a transition to a green economy will displace many workers in traditional carbon-based industries such as coal mining, and the support of these workers for carbon pricing may depend on adequate support for their transition to alternative employment. Secondly, the urgency of green investment. For independent reasons, there may be a good case for green investment in order to speed the transition to a carbon-free economy. Thirdly, consistent with the Kyoto Treaty and the more recent Paris accord, it will be necessary to support transition in developing countries toward a carbon free economy – and there will be political pressure to use the proceeds of carbon pricing for this purpose.