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Opportunity and Costs: A potential bipartisan pathway for pricing carbon in 2025

There may be a political moment of opportunity for a bipartisan deal on a carbon price in 2025. The expiration of the Trump tax cuts and efforts to extend them could stoke concerns about budget deficits and the fiscal trajectory of key trust funds. Meanwhile, there is growing pressure from an increasing number of countries adding or considering the addition of a carbon border adjustment mechanism (or CBAM) to their existing carbon pricing schemes. But for any carbon pricing deal in the United States, climate would be a secondary motivator—at best—for a substantial number of potentially supportive legislators. For those legislators, what is the case for support? In this public forum, we will hear from two people who support a carbon price primarily from fiscal concerns. Their own journeys to support a carbon price have been informed by decades of experience in Washington and a deep concern for the fiscal health and geopolitical strength of the United States. If a 2025 deal is possible, many legislators will have to walk a similar path. This event will focus on their journeys, what they see as the political and fiscal constraints for any such deal, and what signs, if any, they may be looking for to indicate that such a deal is possible.