JoeStrout wrote:scareduck wrote:
Things I have never understood about the myriad carbon tax proposals:
1) They are mostly regressive, i.e. they hit the poor hardest.
Often true; there are ways to offset that, but maybe that's not the point. If we fail to curb our carbon emissions, the consequences will hit the poor hardest too (look at New Orleans for an example). Better a small amount of suffering now than a much larger amount of suffering later.
"Small"? But the point was to force people to change their habits! How can that happen without hitting them hard in the pocketbook? And if that doesn't happen by cutting a certain group out by virtue of income (and this will be a
very large group), how can we expect to effect the desired change?
2) Those that involve rebates to the poor to make up for this fact miss the point that this is also where most of the carbon ends up being consumed, thus failing to achieve the intended effect.
No. If we phase in, say, a gasoline tax, then the market will develop alternatives to gasoline, quite apart from any rebates. Bob Sixpack isn't going to choose to pay more per mile than he has to just because he's getting a $2000/year credit on his taxes.
This response is a non-sequitur. Bob Sixpack pays less because he doesn't have to under some income-tested carbon tax. And as I said, for this to work it has to apply to
everyone, not just those who can afford it. A carbon tax only applicable to the top 30% of society (say) won't help, nor will a 5% tax on the top 50-60%. As we're discovering now, even tripling the price of gasoline has made only very modest changes in consumption. Part of the process of a carbon tax will be discovering how much will make a difference; will it mean a 100% tax? A 200% tax? 300%?
Moreover, there's a strong argument to be made that getting carbon fuels out of the hands of the poor is exactly what needs to happen. Making them unaffordable for as many people as possible
should be the policy prescription that high carbon taxes emphasize.
3) Rebates also have the defect of being a hidden wealth transfer scheme, a fact that will eventually surface and require political consideration, possibly derailing (in the US, anyway) the whole thing.
Whether it's politically feasible is quite separate from whether it's the right thing to do. Taxing fuels in proportion to their net carbon emissions is absolutely the right thing to do, because it internalizes (and makes immediate rather than remote) their true costs
Which are what? The problem I have with this calculation is that so-called "externalized" costs are largely hypothetical and in any event difficult to prove.
and will help the market develop cleaner alternatives.
But carbon fuels are a necessary part of shipping windmill parts, building nuclear power plants, etc., making the end results more expensive. Discuss.
But it's probably not politically feasible in this country, which tends to act (en masse) like a bunch of spoiled children.
God forbid individuals should want things like cheap energy, clean water, etc. I must be in the wrong forum...
4) Those proposing rebates need to explain what will prevent the government from ultimately just spending the money, as with Social Security revenues.
I'm not sure what you mean here. Rebates would be immediate, not deferred, unlike Social Security. (More likely they'd be tax credits, so they'd be money the government simply never sees.)
Perhaps I'm not being clear about how Social Security works. Social Security revenues go into the general fund, and have since 1968. The Social Security Administration gets IOUs from the government, and gets to cash those in at some future date. My point is that when Social Security got started, part of the deal to get the money was that individuals would have accounts and the government wouldn't spend it along the way. Lyndon Johnson changed that... and if that can happen to the "third rail" of American politics, it will
certainly happen to something like a carbon tax, which to the government will look like a gasoline tax on steroids.
5) If the government spends carbon taxes, that makes state revenues dependent on that source. This means the government actually has a perverse disincentive to eliminate carbon-based fuel use. France had/has a similar problem in that they use cigarette taxes to (partially?) fund their national health care system.
That's a good point. You do want to take care to make sure incentives are all pointing in the right direction. A good solution would be for income from the carbon taxes to be spent only on alternative-energy research.
See above. It won't happen.
Trust me, the researchers and entrepreneurs doing that research are not going to worry about the loss of the research money that would result from success, since success would bring far greater profits than the research grants ever did.
I worry more about what the mischief the government will do with even more treasure.
On the other hand, I suspect there is a lot of the "watermelon" effect here, i.e. scratch a "green" and you will find an ill-disguised "red" underneath.
This is far too subtle; why don't you come right out and say that environmentalists are commies? Then you can hop in your pickup truck and go pal around with Rush Limbaugh (if he happens to be out of drug rehab at the moment).
I'm no friend of Limbaugh or the Bush administration for that matter; Limbaugh is a partisan apologist, and Bush II has been an unmitigated disaster for the country, espousing radical theories of presidential power that sneer at the roots of constitutional checks and balances. But that said, I also fear for any social engineering that starts with the words "we should", because they imply the primacy of government in society.
This is one reason, further, I am gravely concerned about whispers I hear around here that there may be a "Manhattan Project"-style WB7 engineering project. The major problem with this is that the very promise of proton-boron fusion is that it is supposed to be cheap, yet by throwing lots of money at the problem, it opens the door to the very things that have afflicted tokamak fusion, high cost and disappointing results. Big budgets beget big budgets, and soon the endgame of "cheap" is long forgotten. It gets back to the old engineering adage: fast, cheap, good, pick two. Private funding must never forget economics, which is one reason that the efforts at Tri-Alpha Energy may be more effective, even if they end up taking longer to get there.