FedEx CEO: Tax Carbon, Don’t Institute Cap-and-Trade

April 21, 2009

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FedEx Chief Executive Officer Fred Smith said he is in favor of a carbon tax, but that he does not agree with the Obama Administration’s proposal for a cap-and-trade system for carbon emissions.

Smith has been outspoken on energy issues, saying that ending our oil dependency will save money and fight terrorism.

He reiterated that notion April 20 at the Global Green Initiative’s “Transportation in Transformation” conference at the University of Memphis.

Half the U.S. military budget goes toward protecting the global oil trade, he said, adding that oil was “almost exclusively, but not totally” to blame for U.S. involvement in two wars in recent years, reports the Memphis Commercial Appeal. Smith, who is part of the Energy Security Leadership Council, a group of military and business leaders, said he sees energy independence as a national security issue.

On the topic of carbon emissions, Smith advocates a straight carbon tax.

“We would support, if the Congress in the United States wants to do it, a carbon tax,” he said, according to the Commercial Appeal.

“It’s straightforward. It’s clear. It’s directly related to the sin, which is the production of CO2, the burning of carbon,” he continued. “I agree very much with former vice president Al Gore, who said, ‘Tax carbon, which you don’t want to have, and reward work, which you do want to have.’ Tax carbon and reduce the payroll tax.”

Smith also commented on nuclear energy and offshore drilling, both of which he favors.

“Anybody who’s concerned with national security, our balance of payments, with our national economic security, should be a proponent of nuclear power,” he said.

As for domestic oil production, including the practice of off-shore drilling, he said, “We should be producing the maximum amount that we can in this country.”

FedEx has taken a leading role in reducing its own carbon footprint. FedEx has plans to cut aircraft emissions and increase vehicle fuel efficiency.

In an extended trial period using hybrid diesel trucks from Iveco, FedEx has achieved fuel savings of 26.5 percent.

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