The Wall Street Journal:

Too many Republicans these days have lost their economic bearings. Look no further than a GOP Senate bill that would enact a carbon tariff—i.e., a new tax. In the name of punishing China, the legislation would punish American consumers and businesses.

The Foreign Pollution Fee Act, sponsored by Louisiana’s Bill Cassidy and South Carolina’s Lindsey Graham, could well have been written by the Sierra Club and AFL-CIO. Among the carbon tariff’s biggest advocates is Donald Trump’s former trade adviser Robert Lighthizer, who favors tariffs in principle. So it’s worth deconstructing the misleading arguments that Mr. Cassidy and others are making for climate protectionism.

The bill would impose tariffs on 16 categories of goods produced in countries with higher CO2 emissions than the U.S. They include steel, aluminum, critical minerals, solar panels, wind turbines, crude oil, gasoline, petrochemicals, plastics, paper and lithium-ion batteries. Companies could lobby to have products added to the list, and you can bet they will.

Tariffs would be based on a foreign good’s relative “carbon intensity,” as calculated by a new National Laboratory Advisory Board on Global Pollution Challenges. The bill would expand the administrative state by creating a new bureaucracy with sweeping powers that would be hard for future Congresses to rein in.

U.S. production of most goods on the tariff list doesn’t come close to meeting domestic demand. Yet tariffs could be reduced only in limited circumstances—namely, for national security needs or if U.S. companies produce less than 5% of domestic demand. That means importing businesses won’t have an alternative to paying the tariffs, which would be filtered through supply chains and passed to consumers.

Though the U.S. is a net petroleum exporter, many refineries were built to process heavier foreign grades of crude and can’t easily switch to lighter shale blends. That means Americans would pay higher gasoline prices no matter how much domestic oil production increases.

Mr. Cassidy claims in a recent article in Foreign Affairs that “the fee is not a domestic carbon price,” by which he apparently means it isn’t imposed directly on U.S. companies and consumers. But he knows—or at least should know—that it will be absorbed by American businesses, workers and consumers, as all tariffs are.

The Louisiana Senator is also selling the bill with a misdirection worthy of Al Gore. He argues that “the Chinese Communist Party (CCP) and other foreign governments have ignored international norms and agreements regarding environmental protection and pollute the world without consequence,” and the bill would hold these “polluters” accountable.

In Foreign Affairs he conflates hazardous air pollutants such as sulfates with carbon emissions, as the climate lobby also does. As a physician, Mr. Cassidy knows the difference. Particulates harm public health. Carbon emissions are ubiquitous, and if he really thinks they’re dangerous pollutants he should be honest and try to eliminate his state’s oil industry.

Yet the bill defines “pollution” as “greenhouse gas emissions.” This is a gift to Democrats who have been trying to codify the Supreme Court’s misconceived Massachusetts v. EPA (2007) ruling that let the Environmental Protection Agency regulate greenhouse gases as pollutants. This is the Administration’s legal justification for its back-door ban on gas-powered cars.

A carbon border tax would almost certainly prompt retaliatory duties from foreign governments, as Mr. Trump’s steel and aluminum tariffs have done. These would also harm U.S. consumers. The bill also wouldn’t shield U.S. businesses from carbon tariffs that Europe might impose because the U.S hasn’t enacted a domestic carbon-pricing scheme.

The bill’s unstated purpose is to protect American businesses from foreign competition as they face rising energy costs at home owing to the government’s force-fed green-energy transition. Mr. Cassidy says China’s lax environmental standards have rendered U.S. manufacturers less globally competitive and destroyed American jobs.

He’s right that rising energy prices could discourage U.S. manufacturing investment and undercut Washington’s industrial policy. But layering a carbon tax on top of sundry green-energy subsidies would raise U.S. manufacturers’ costs and create a Rube Goldberg contraption of economic distortions.

The Senate’s leading wind producer, Democrat Sheldon Whitehouse, is praising the Cassidy-Graham bill, which he says “creates the negotiating space to try to come with a bipartisan agreement.” Senate Democrats last Congress introduced two carbon tariff bills, which have the added virtue for progressives of raising revenue they can spend.

Some of the GOP’s strongest supporters of free trade and markets have recently retired, and the party’s protectionist wing is on the rise. But the GOP won’t be worth a dime’s worth of economic difference from Democrats if it embraces an idea that expands the administrative state, raises taxes, and increases prices amid damaging inflation.