Defense energy project aims to end energy inefficiency

>> delightful wednesday afternoon to you. nice to see you live from the bob bullets texas state museum in the capital city of texas, austin. we're here to play a little match game . not that match game . in order to create the 30 million jobs this country needs -- that was cute. in order to create the 30 million jobs this country needs we know we must match the problems we face with the money we have to the people that we have looking for work. if you marry them together guess what happens. you end up with a solution and a job. we will also have complete coverage of course of the rick santorum trifecta wins last night in colorado, missouri, minnesota to say the least a wrinkle in the gop presidential ball game .

>> i don't stand here to claim to be the conservative alternative to mitt romney . i stand here to be the conservative alternative to barack obama .

>> washington will never be reformed by those who have been compromised by the culture of washington . this is a clear choice. i'm the only person in this race republican or democrat who has never served a day of time in washington .

>> well, mr. romney, many more nights like last night and you will not have to worry about serving in washington . before you get too excited newt you were fourth in minnesota, third in colorado and not even on the ballot in missouri. our megapanel will be along in a second with full analysis but back now to energy independence and our match game . what are the greatest challenges no matter who is in the white house is america 's lack of energy independence and our gross energy inefficiency. so today we're excited to unveil the defense energy project. here in austin, texas two simple, powerful goals of this product. number one, create a jobs program that helps veterans returning from wars fought over foreign oil such that they can get work in america , creating clean energy and energy efficiency and independence. that's what it is. more on that later in the show. the second component of the defense energy project is this. expose the true cost of hydro carbons including the cost of the wars that we fight and the environmental toll in order to restore the necessary price integrity to our so-called free markets with the discussion of a plan called fee and dividend. in short, fossil fuel producing companies would pay a fee, which would be pooled into a national fund that would be that directly distributed, equally to each of us, 311 million americans. we would effectively be taxing energy waste and rewarding with a dividend energy efficiency . joining us now to learn more is an advocate of the program i just described and brian merchant who has been taking the lead on advocating a broader understanding of the breach in price integrity. explain your understanding, brian , of why the breach of price integrity and the real cost of our fuel sources is such a problem.

>> well, most americans have no idea how rigged the market is in favor of fossil fuels . it is no secret we dump tens of billions of dollars directly into the pockets of big oil every year in the form of subsidies, tax breaks , direct from our pockets to theirs. that is a small fraction of the cost. even though it amounts to billions of dollars and totaled as many as $500 billion over the last 50 years or so, the real costs are the indirect ones i know you've illuminated in your work, too. in other words, the u.s. military pays, i mean, the oil industry can't operate without the u.s. military providing security presence.

>> $7.3 trillion just for aircraft carriers in the persian gulf over the past couple decades.

>> right. that is not a cost a lot of people recognize that, of the american taxpayer footing the bill for but the oil company gets a huge deal. they get to use that as their own personal security detail . it's a huge cost for american taxpayers.

>> so, dr. hanson , as we come to better understand the free market can only function if there is actual integrity in the prices, actual integrity if we man up if you will and deal with the actual cost of the energy sources that we're choosing, how is it that the proposal that you have been discussing and are introducing effectively more broadly now to restore price integrity works, how do we fix this problem?

>> let me first say and i'm speaking as a private citizen not representing the government even though i'm a nasa employee. also, let me point out that there are other costs to fossil fuels . the human health damage from air and water pollution from fossil fuels is huge. it sits on hundreds of billions of dollars per year. and in addition, there is the cost of climate change , which is going to be borne mainly by our children and grandchildren. the climate is already beginning to change. the way we should deal with this is by putting a price on the fossil fuel emissions by collecting a flat fee on oil, gas, coal, at the source, the domestic port of entry. that money should then be distributed uniformly to legal residents of the country. i would give one share to each legal adult resident of the country and half a share to children up to two per family. if you did that, then more than 60% of the people would get more in their dividend than they'd pay in increased energy prices . those people who pay special attention trying to minimize their fossil fuel use, using clean energies, energy efficiency , they would do very well.

>> brian , if we were able to restore hydro carbon price integrity or move in that direction, is it even possible to anticipate the rate of adaptation and the effect it would have on the rate of transition to both more efficient fossil fuel use and alternative use?

>> it would be amazing. i mean, the advantages of the fossil fuel industry are enormous. they're enormous and, you know, politicians complain about a little tiny subsidy for a solar company. they're not seeing the whole picture. if there is even a modicum of price integrity restored to this scenario we would see american innovation unleashed. we would see clean tech solutions. we would see a whole new outpouring of funding into a new sector, you know. this would be a job creator. this would unleash american innovation. this would do kind of all of the things that need to happen in this sector so america can get a foot forward.

>> it would come from the coal companies, natural gas companies and oil companies . we know they are very effective with our government. is there anything in addition to the stick that you create for them with this tax that says listen, burn less, be more efficient or you're going to have to pay, is there any way to create the carrot for the 5% or 10% of our population that really will bear a disproportionate portion of this tax? is there a way to create an incentive for those that would, you see the rewards. we will get the dividends, 60% would get more money. we'd burn less energy. how do you mitigate the most acute political resistance from the biggest payor?

>> well, the incentive is for everybody. let me give a quantitative example to the question you had just asked. if we put a fee that we collected at a rate of $15 a ton of carbon monoxide the first year, and increasing $10 a ton each year, at the end of ten years, that would be $115 a ton and the amount collected would be close to $600 billion a year. if you distribute that among the legal residents it would be between $2,000 and $3,000 per legal resident . so a family with two or more children would get between $6,000 and $9,000. they would get it monthly. electronically to their bank account or if they don't have one to their debit card. this would reduce our fossil fuel dependence 30% in ten years. that's been run through economic models . and that reduction is equivalent to more than ten times the amount of oil that would be carried by the keystone xl pipeline. so we wouldn't need that pipeline. we would be using --

>> so, dr. hanson , i need you to repeat what you just said. because it was very significant. people like to think about the costs. i want you to repeat what you just said about the fuel savings and the comparative analysis of the fuel savings of a proposal like this relative to what we're currently debating.

>> it's huge.

>> what you just said was very significant.

>> the carbon tax center in washington has run this through economic models and finds that it would reduce our fuel use by 30% in ten years. that is ten times more than the keystone xl pipeline would carry and would make our industry more competitive. that's what we need to do. in order for the economy to work most efficiently, you need to have the true costs for the fuels that are being used. you don't want to subsidize them because all of those subsidies are coming out of the taxpayers' pockets.

>> yeah. dr. hanson , you have, again, your exertion of rational thought is remarkably admired and if i could send it through signal transfer into the brains of our policy makers i would magically do so. if nothing else it is an honor to be able to give you a louder voice. brian , the same is true, tremendous work with tree hugger and your reporting. we both know all of us this is a beginning of a conversation not an end. once you understand the breach of price integrity then you can begin the conversation about the most intelligent ways to restore that that is the most respectful to our incumbent business but at the same time gets us where we need to go. be sure to check out brian merchant's incredible blog right now at treehugger.com as well as dylan ratigan.com. look for more on this in the months to