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Why Carbon Taxes Work

timharford.com

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Re: Why Carbon Taxes Work

#31

Post by occz »

throwaway599281 wrote: post #20

Another tax on the middle class, because they don't have enough of a fiscal burden already, in the goods they need, in paying gas when they drive to work (no, not everyone has a very green public transportation that gets them to work in an efficient fashion). Do these people even know the carbon footprint of manufacturing a solar panel or a wind mill for their "green" energy? I do agree that products should be manufa…

>Another tax on the middle class, because they don't have enough of a fiscal burden already, in the goods they need, in paying gas when they drive to work (no, not everyone has a very green public transportation that gets them to work in an efficient fashion).

So build it, then. You have lots of money available to construct it from your carbon tax, and even more money when you stop subsidizing the ridiculously expensive car-oriented infrastructure.

>Do these people even know the carbon footprint of manufacturing a solar panel or a wind mill for their "green' energy?

Total emissions from these technologies are significantly lower than fossil-powered energy generation.

Stop spreading disinformation, it's extremely frustrating. It's very obvious that you're doing it on purpose.

Re: Why Carbon Taxes Work

#32

Post by yunohn »

Vinnl wrote: post #21
yunohn wrote: post #10

Earlier quoted context omitted.

> If people need to get to work and heat their homes etc. then putting a tax on all of that will hit them hard while the rich will be relatively unaffected and can continue polluting. So much this. Here in NL, my heating bill is 70% tax and 30% gas charges (not exaggerating). The government claims to do this to encourage installation of better insulation and other energy saving measures - however, as a renter (like t…

To be fair, the policy was to raise gas taxes while lowering those on electricity in a way that it evens out for most people. Additionally, while I don't know the numbers of renters vs. buyers, I do know that the vast majority of renters in NL live in social housing, which means the government has some leverage there to get the housing corporations to lower gas use.

My electricity bill is less than 10x lower than my heating bill, with all taxes accounted for. Electronics are surprisingly efficient - radiator heating is definitely not.

> social housing, which means the government has some leverage

I’m not sure if you’ve seen social housing, or even the average rental in places like The Hague. They are definitely not maintained well - insulation or otherwise.

Whatever the gov “could” do, isn’t being done. Other than high taxes.

Re: Why Carbon Taxes Work

#33

Post by nabla9 »

kranke155 wrote: post #3

Carbon Taxes work because the market can't solve a problem it doesn't have a price for. Knowing the word "externality" is all you need to know. In the Adam Smith/Ayn Rand fantasy of money and the invisible hand, markets are a form of Artificial Intelligence. The fantasy is this AI can run the markets better than any centralized authority. Even if we assume that's true right now the AI has no price for carbon, can't t…

> In the Adam Smith/Ayn Rand fantasy of money and the invisible hand, markets are a form of Artificial Intelligence.

Don't equate Adam Smith and Ayn Rand.

Adam Smith was not a free market fundamentalist. Adam Smith has unnecessarily bad reputation because he is quoted very selectively. Adam Smith was aware of negative and positive externalities.

Re: Why Carbon Taxes Work

#34

Post by gefhfff »

throwaway599281 wrote: post #20

Another tax on the middle class, because they don't have enough of a fiscal burden already, in the goods they need, in paying gas when they drive to work (no, not everyone has a very green public transportation that gets them to work in an efficient fashion). Do these people even know the carbon footprint of manufacturing a solar panel or a wind mill for their "green" energy? I do agree that products should be manufa…

> Do these people even know the carbon footprint of manufacturing a solar panel or a wind mill for their "green" energy?

Yes, and it can't be ignored. A carbon tax is universal

I don't get your whining on the middle class. Everyone can strive for a climate friendly life style. This generates a demand on a big scale, thus also solutions.

A dividend would help people having not much money and still need to use carbon intensive products (until there are alternatives), because they have a small footprint anyways

Re: Why Carbon Taxes Work

#35

Post by xyzzy123 »

wcoenen wrote: post #18
lovemenot wrote: post #7

Global warming is a global problem. While carbon tax would be levied locally, creating incentives to just shift production to low or no tax locations. Just as harmonisation over Cororate Tax is finally emerging, similar cross-border agreements should be needed for a Carbon Tax.

Which is why mechanisms like carbon tariffs on imports are being designed. https://en.wikipedia.org/wiki/Carbon_Border_Adjustment_Mecha...

Do you think the natural game theoretic result might be "carbon havens"?

Areas that have the worst carbon enforcement / corruption (so issuing certificates to avoid tariffs etc without real action) would be more competitive than areas with effective enforcement so they will attract the most manufacturing.

I don't think importing from countries without a carbon price will be a problem (border taxes seem like they can work).

I suspect the problem will be that for countries that DO set a carbon price it is in everyone's interest within that country that the system not actually be effective.

Re: Why Carbon Taxes Work

#36

Post by dougweltman »

gefhfff wrote: post #24
lovemenot wrote: post #7

Global warming is a global problem. While carbon tax would be levied locally, creating incentives to just shift production to low or no tax locations. Just as harmonisation over Cororate Tax is finally emerging, similar cross-border agreements should be needed for a Carbon Tax.

As a country you also can enforce restrictions/taxes onto the whole supply chain, as a initial measure (can't be done by weak countries though). Of course, mid term everyone should push for global carbon pricing models Germany was the only country that seems to have understood this, given they were the only ones that advocated for it at COP.

> As a country you also can enforce restrictions/taxes onto the whole supply chain, as a initial measure…

Isn’t this an extremely hard problem, possibly unworkable, when trade is in assembled goods with complex, global supply chains?

Re: Why Carbon Taxes Work

#37

Post by dane-pgp »

roenxi wrote: post #13
kranke155 wrote: post #3

Carbon Taxes work because the market can't solve a problem it doesn't have a price for. Knowing the word "externality" is all you need to know. In the Adam Smith/Ayn Rand fantasy of money and the invisible hand, markets are a form of Artificial Intelligence. The fantasy is this AI can run the markets better than any centralized authority. Even if we assume that's true right now the AI has no price for carbon, can't t…

> The fantasy is this AI can run the markets better than any centralized authority. I agree with a literal reading of your comment, but will just point out that the wealthy countries all tend to be the ones that let the market do its thing though. We've got a lot of examples now of authoritarian vs free market (the Koreas, Germanys and China pre- and post- Deng Xiaoping leap to mind). People routinely do better when…

> Markets are really good at putting competent but unpopular people in charge which is a better strategy.

It's only a better strategy if your goal is to increase the wealth and power of the largest entities, i.e. corporations and the rich. If your goals include "popular" ideas like human rights and a non-polluted biosphere, then it can be better to make market participants share their power with elected politicians.

Re: Why Carbon Taxes Work

#38

Post by ajb »

dougweltman wrote: post #30

That a carbon tax is a source of information about the highest leverage areas we can change is a great framing. Unfortunately, the main barrier to implementing a carbon tax is how we treat imports, which is the key to getting the whole thing to work. Failing to solve this means importers deindustrialize in favor of countries with more lenient carbon pricing regimes. “Do I have to spell it out for you? Just implement…

Then you also need to tax the uncertainty...

Re: Why Carbon Taxes Work

#39

Post by chriswarbo »

schnitzelstoat wrote: post #5

I agree that externalities should be priced in - but I wonder if in practice Governments would end up footing the bill via subsidies. For example, look at what happened in France with the fuel tax rise which lead to the “gilets jaunes” protests. If people need to get to work and heat their homes etc. then putting a tax on all of that will hit them hard while the rich will be relatively unaffected and can continue pol…

We need to be wary of counter-productive moralising:

> the rich will be relatively unaffected and can continue polluting

If the tax revenue is spent on cleanup/offsetting/etc. then that doesn't matter. That's the point of the tax.

In fact, if the tax is set slightly higher than the net cleanup cost, that (a) acts as a disincentive (rather than just 'cost of doing business'), and (b) we would want the rich to pollute even more, since they would be paying to clean up more than just their own mess.

For comparison: I take care to avoid making a mess at home, since it would take me a lot of time and effort clean up. The rich can just throw money at cleaners. Now imagine that some Global Cleaners Union sets the price-per-hour of cleaning to cover 61 minutes of work; those extra minutes are aggregated and spent on charitable activities. In such a situation, we would want the rich to make more mess.

> Such a regressive tax, levied on basic things like energy, fuel etc. that are fundamental to normal life seems incredibly likely to trigger political unrest as we saw in France.

This is mentioned in the article:

> In the UK, carbon dioxide emissions are less than six tonnes per person per year, plus two or three tonnes more to reflect the carbon footprint of imported goods. A £100/tonne tax that covered those emissions would raise the cost of living by just over £2 a day, and cover more than 5 per cent of UK tax revenue. That’s not nothing: the government would be wise to send everyone a monthly lump sum in compensation.

Re: Why Carbon Taxes Work

#40

Post by tonyedgecombe »

yunohn wrote: post #22
roenxi wrote: post #17

Earlier quoted context omitted.

> For example, look at what happened in France with the fuel tax rise which lead to the “gilets jaunes” protests. I think people actually underestimate the effect of a carbon tax. The tax has to be extreme enough that it changes behaviour in the real wold, and something like 70-80% of energy comes from fossil fuels. If people aren't near to rioting because their lifestyle is being forced to change then the tax isn't…

I understand your viewpoint, but if you tax the common man such that they are unable to travel to work in the only car they can afford - the world will stop functioning. I often wonder why the elites don’t understand what their mistreatment of the proletariat will lead to…

On the other hand if you can't get the common man out of their polluting activities then you aren't going to solve the problem.
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