tag:blogger.com,1999:blog-17232051.post5340258259573748397..comments2024-03-18T22:32:52.802-04:00Comments on Noahpinion: Carbon taxes won't work. Here's what will.Noah Smithhttp://www.blogger.com/profile/09093917601641588575noreply@blogger.comBlogger45125tag:blogger.com,1999:blog-17232051.post-72150266059774571212012-09-04T03:48:09.988-04:002012-09-04T03:48:09.988-04:00Yes. We should forget about taxing carbon and dive...Yes. We should forget about taxing carbon and dive in head first into making non-carbon energy sources the number one priority. Haven't we learned our lesson? Too bad for the oil, gas, and coal companies. They have enough to retire themselves and a few of their generations. The alternatives are way overdue. Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-15223617742690976652012-07-20T15:00:45.074-04:002012-07-20T15:00:45.074-04:00The calculation will show that reduction in enviro...<i>The calculation will show that reduction in environmental damage relative to the taxes collected is pretty small.</i><br /><br />Pretty much!!Noah Smithhttps://www.blogger.com/profile/09093917601641588575noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-14216978075344757842012-07-20T14:47:37.853-04:002012-07-20T14:47:37.853-04:00Noah - great post, these things needed to be said....Noah - great post, these things needed to be said.<br /><br />Here's a simple exercise: take plausible estimates of the amount of gasoline an average person consumes, the own price elasticity of demand, and the marginal damage per gallon of gas consumed. Then do a back of the envelope calculation of amount of extra taxes a person pays if a carbon tax is imposed, and the expected reduction in environmental damage. The calculation will show that reduction in environmental damage relative to the taxes collected is pretty small. And that, in a nutshell, is why people don't like carbon taxes. Sure one can say 'but the carbon taxes can be offset by reductions in tax X, Y or Z' - yes, in aggregate one can make a carbon tax revenue neutral, but it's hard to do it on a person by person basis.<br /><br />Having said all of that, in Vancouver the combination of carbon taxes + high gasoline prices + good public transit means that the demand for cars is so low that new condos are being built with far fewer parking spaces that condo units - and other buildings have half-empty parking garages.Frances Woolleyhttps://www.blogger.com/profile/04289318268301647625noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-40347409550785944882012-06-23T03:40:50.430-04:002012-06-23T03:40:50.430-04:00As the main argument is between the people who wan...As the main argument is between the people who want to do nothing, and the people who want to do something, it seems a waste of time to haver about the perfect thing to do.<br /><br />The important thing is to make a start - doing nothing, as is advocated, is the worse policy of all. There is an old political adage that a bad policy can be quickly changed. So do both - put the carbon tax revenue into R&D, or pass a reveneue-neutral carbon tax, and subsidise R&D from other taxes.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-76840851474577372292012-06-19T03:07:07.186-04:002012-06-19T03:07:07.186-04:00Actually, if you read my post again, you'll se...Actually, if you read my post again, you'll see that I'm saying that the chance of just such a catastrophe is exactly <i>why</i> carbon taxes won't work.Noah Smithhttps://www.blogger.com/profile/09093917601641588575noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-91156475535781605952012-06-19T00:45:09.107-04:002012-06-19T00:45:09.107-04:00False dichotomies everywhere. If you spout this br...False dichotomies everywhere. If you spout this breakthrough technology/ R&D, bright green stuff at least sight the Breakthrough Institute, whom you almost certainly got most of your talking points from. Your viewpoint seems to grossly underestimate the percentage chance that the global carbon cycle reaches a tipping point that leads to uncontrolled increases in atmospheric CO2. It seems fairly probable that reaching the 500-550 ppm level will lead to irreversible territory for the climate system, barring Geo-egineering. IMO, a hard cap to prevent attaining 500-550ppm, unparalleled R&D investment in renewables and nuclear, as well as local mitigation is about the only policy option that will *maybe* produce a politically manageable situation come 2100-2200. No idea why you chose to frame the issue like it's a big secret that carbon taxes aren't politically feasible and we need to subsidize low-carbon tech as part of any real climate policy.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-45058806292639059092012-06-18T00:46:31.951-04:002012-06-18T00:46:31.951-04:00Agreed -- this was an awful post.
UR MOM! :P :P :...<i>Agreed -- this was an awful post.</i><br /><br />UR MOM! :P :P :P<br /><br /><i>it's posts such as yours which make this difficult</i><br /><br />Nope. It's UR MOM<br /><br />OK, /taunting<br /><br /><i>And any law can be revoked in the future. Why is this an argument against carbon taxes specifically? High-skilled immigration reform also can't pass the House. Is that an effective argument against it?</i><br /><br />Actually, glad you asked. <a href="http://noahpinionblog.blogspot.com/2012/06/carbon-taxes-wont-work-heres-what-will.html" rel="nofollow">Here is a post</a> where I explain why carbon taxes are much more vulnerable to this problem, since total carbon levels, rather than the rate of emissions, are what counts. Check it out.<br /><br /><i>the US has the worst energy usage numbers of any rich country</i><br /><br />So what? The climate doesn't care who's rich and who's poor. If China kills the planet to get rich, it might be fair, but we're just as dead.<br /><br /><i>The best solution to the tragedy of the commons is not to let the animals eat all of the grass.</i><br /><br />That is a line that sounds smart, but upon closer examination is utterly vacuous.<br /><br /><i>#6 is just frustratingly wrong-headed logic.</i><br /><br />Oh, wow, I see your point!<br /><br /><i>If we lowered taxes on working and traded for taxes on carbon, would you be more of a fan?</i><br /><br />Hey, I am all for carbon taxes! I never said they're a bad thing! I just said they won't put any dent at all in global warming. Big difference.Noah Smithhttps://www.blogger.com/profile/09093917601641588575noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-50439549951495399472012-06-17T13:06:43.980-04:002012-06-17T13:06:43.980-04:00Agreed -- this was an awful post.
#1 & #5 are...Agreed -- this was an awful post.<br /><br />#1 & #5 are not reasons why carbon taxes are a bad idea. In any case, it's posts such as yours which make this difficult... And any law can be revoked in the future. Why is this an argument against carbon taxes specifically? High-skilled immigration reform also can't pass the House. Is that an effective argument against it?<br />#2 the US has the worst energy usage numbers of any rich country. The best solution to the tragedy of the commons is not to let the animals eat all of the grass. <br />#6 is just frustratingly wrong-headed logic. <br /><br />If we lowered taxes on working and traded for taxes on carbon, would you be more of a fan? After all, this would encourage production in all businesses at the same time it would dissuade carbon-intensive businesses.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-45543217546898463002012-06-11T22:37:34.422-04:002012-06-11T22:37:34.422-04:00You really should forgo from using the term, "...You really should forgo from using the term, "global warming" and instead use "climate change."<br /><br />Why? Well, because as the Earth is warming in some places, it is cooling in others. This is what republicans latch onto as "evidence" against climate change.<br /><br />So really, the climate is changing, not just warming. It's just changing more than it should--that is, ways that are dangerous. For many reasons. So not only is it technically incorrect, but it's also dangerous and feeds into climate-denier claims.Atleecshttps://www.blogger.com/profile/00872363645960751435noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-23605347411106399012012-06-08T18:53:25.869-04:002012-06-08T18:53:25.869-04:00On international coordination, you've got it a...On international coordination, you've got it ass-backwards. A carbon tax in the US with WTO-sanctioned border tax adjustments would continually nudge all our trading partners to enact their own carbon taxes or pay the equivalent to the U.S. treasury on every item we import from them. Far, far more effective than a 40 year fight in the UN over who gets to burn the most dirt. (That's Kyoto.)<br /><br />James Handley<br />Carbon Tax Center (www.carbontax.org)<br />Washington, DCJames Handleyhttp://www.carbontax.orgnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-43363921207780162462012-06-08T03:56:58.245-04:002012-06-08T03:56:58.245-04:00Rather than just R&D, the gov't should be ...Rather than just R&D, the gov't should be spending some amount of money in directly installing solar panels for power to gov't buildings. For instance, covering current parking lots with solar panels. Part of this process should also include publicizing the real costs of the installation, and maintenance, as well as the actual amount of delivered electricity.<br /><br />Such actual numbers would help decision makers by publicizing results. For many businesses, a long term reliable customer is more important than a start up grant. <br /><br /><br />In another view, with the collapse of Greece and issues with the euro so current, why do you think that human-caused global warming is a bigger problem than excess government spending? The obvious ways to make carbon or gas taxes more politically viable would be to reduce overall taxes, which requires reduction in other gov't spending. <br /><br />Of course it's more fun to spend, especially Other People's Money (especially if they are intellectually or morally inferior!) (oh wait, we can't mention that, just internalize it) -- but are you serious about solving problems? There is a real, current problem with excess gov't spending. In the next 10 years, as more boomers retire and health costs continue to rise, the problems in the US and Europe are going to get worse.<br /><br />Will a military coup in Greece convince you that gov't spending reductions is more important? <br /><br />More nuclear fission has already been mentioned, but if the CO2 problem isn't bad enough to argue for more nukes, now, than it's not so bad.<br />Finally, other out of the box idea -- why not plant more trees? Especially in Haiti.Tom Greyhttps://www.blogger.com/profile/15046612425809449502noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-9010892653710003632012-06-07T17:55:38.104-04:002012-06-07T17:55:38.104-04:00The relationship between methane and CO2 is somewh...The relationship between methane and CO2 is somewhat misunderstood. Yes, Methane is a stronger greenhouse gas than CO2, but its residence time in the atmosphere is only about 10 years, after which it decomposes to CO2, and it is at much, much lower concentrations (parts-per-billion, not parts-per-million). So a continuous elevated methane level could have short-term impacts as bad as coal, but does not have near the long-term impact. Elevated methane levels could be largely reversed in a decade, but CO2 is forever (or at least the next 10,000 years).Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-85340223969979819052012-06-07T06:10:34.982-04:002012-06-07T06:10:34.982-04:00America emits 4x more carbon per head than Europe ...America emits 4x more carbon per head than Europe or China, and it was certainly not less effective than China in scuttling international coordination.<br />But America being what it is, one day it will probably decide that Global Warming is a cause worth fighting, and it will then ridicule what Europe could have achieved by then. Pigou taxes are not likely to happen soon, but they should not be ruled out in the long run.<br />Besides, Pigou taxes are not only tools for pricing externalities, they are also taxes, just like VAT or income tax. And one way or another, governments need to raise money.Zorbloghttps://www.blogger.com/profile/03175779746756984479noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-54195584037883862972012-06-07T03:07:05.143-04:002012-06-07T03:07:05.143-04:00Noah,
Generally, you have good insights, especial...Noah,<br /><br />Generally, you have good insights, especially because a carbon tax is too complex. <br /><br />We have many lessons to learn before we can administer something that complex and the public trust such is being done fairly<br /><br />KISS: keep it simple, stupid, ought to be Rule 1<br /><br />Second, research should be aimed at cheap remediation, not cheap alternative energy.<br /><br />Last, you make a big mistake to thing of suburbs in terms of only costs. People move to the suburbs to meet deed psychological needs having to do with the appearance of their environment. A carbon tax really threatens these psychological needsAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-49634678204202615632012-06-06T21:39:59.999-04:002012-06-06T21:39:59.999-04:00Noah,
I don’t think your politics argument is cog...Noah,<br /><br />I don’t think your politics argument is cogent because you’re looking at it statically. No carbon tax might be a political equilibrium right now but that’s not to say that can’t be changed. I mean hell, if you accept the status quo even when you disagree with it of course nothing will change!<br /><br />I’m not sure about this but couldn’t there be a justification for carbon tax independently on it’s impact on emissions on the basis of economic gains from replacing other taxes with an carbon tax (similar to the debate about consumption taxes)?DavidNhttp://twitter.com/#!/ThePoliEconnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-6360893950361013082012-06-06T15:45:34.369-04:002012-06-06T15:45:34.369-04:00"Via commenter Amy, here is a Daron Acemoglu ..."Via commenter Amy, here is a Daron Acemoglu working paper that basically says the same thing I'm saying in this post. Yay!"<br /><br />This seems disingenuous, since the paper finds, "(ii) optimal policy<br />involves both carbon taxes and research subsidies, so that excessive use of carbon taxes is avoided;"<br /><br />Seems much closer to Miles' view than yours. Also the paper makes a point to say that carbon taxes could work alone, but they just involve excessive distortions. One of the key insights that they discuss that is missing from your post is that the carbon tax speeds the transition from the old/dirty technology to the new/clean technology. You want to throw money at low carbon technologies, but see no reason to handicap high carbon technologies. An optimal policy does both.Charlie Clarkehttps://www.blogger.com/profile/02079017903923824877noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-59787081276227911952012-06-06T14:35:53.120-04:002012-06-06T14:35:53.120-04:00Noah,
I agree with some of the premises b...Noah, <br /> <br /> I agree with some of the premises but the underlying logic is a bit flawed, while a carbon tax would not solve all the problems it would give a boost to some solutions through a market pricing mechanism of carbon. Not only that but the idea that companies would just move factors to other countries in import them to get away from the carbon tax would be a problem for some companies, but the largest ones that a carbon tax would be aimed at (Energy Sector) this would not be plausible for several reasons 1)Transferring Power planets is not a short term possibility and given the large investment by the private sector those companies would not be able to take a massive loss on there balance sheets( I think you make a mistake of assuming that they could easily move to other countries)2) It would increase cost by such any extreme to distribute power extremely long distances that any savings by not having to pay the Carbon tax would be offset by an increase in waste through power lines. Another point, would be that while reducing CO2 is one of the purposes of a carbon tax it is by no means the only reason, there are large externalities that are not being paid for in the current pricing mechanism that a carbon tax would help address, such as acid rain and mercury and the negitive health effects of pollution. Now I agree that this is not a silver bullet by any stretch of the imagination but it would be part of a solution, and possible help finance both the private sector ( by making coal and oil more expensive this would create an incentive to research and develop alternative energies such as Solar, Wind, Geothermal, ect). The public sector would be able to finance these using the money gained from the carbon tax. So yes not a full solution, but there are other reasons to institute a carbon tax.David Maffohttps://www.facebook.com/david.maffo1noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-57385201037317551612012-06-06T14:20:56.941-04:002012-06-06T14:20:56.941-04:00Noah- I enjoyed your post (and your name), but it ...Noah- I enjoyed your post (and your name), but it disregards the most recent climate science, and I think it's a mistake to simply consider climate change a "long-term" problem that we can take our time solving. Consider the possibility that the situation is more dire than you realize. For example (an exaggerated example to make a point), what if there were a 20% probability that we could pass a tipping point in the next couple decades that would lead to runaway warming (via melting of permafrost or other means) and the collapse of the global economy? Would you still advocate for R&D spending only? Or more severe measures such as a high carbon tax or command and control? My point is that the "correct" policy depends very much on the extent and the timeframe of the damages.Noah Knoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-21047880044067836172012-06-06T13:51:01.504-04:002012-06-06T13:51:01.504-04:00The recent success of the Regional Greenhouse Gas ...The recent success of the Regional Greenhouse Gas Initiative (RGGI) seems to suggest that cap & trade may both reduce carbon emissions and add economic value.Tom M.noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-65373655881027103722012-06-06T12:01:33.051-04:002012-06-06T12:01:33.051-04:00The difference between a tax, an auction scheme fo...The difference between a tax, an auction scheme for permits, or cap and trade is primarily a difference in the underlying assumption about who owns the right to emit CO2. <br /><br />If we could produce unlimited power for about 10 cents per kilowatt hour then the whole world can live in comfort and plenty. If the incremental cost of power is a dollar a kilowatt hour then the global future is probably fairly grim. <br /><br />We need serious research into energy sources and efficiencies in use. For example, more efficient air conditioners could be a big deal. The research should not be limited to solar energy production.Absalonhttps://www.blogger.com/profile/09131268683451462949noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-5410376327779229272012-06-06T09:53:26.923-04:002012-06-06T09:53:26.923-04:003. Carbon taxes are undermined by free trade.
So ...<i>3. Carbon taxes are undermined by free trade.</i><br /><br />So much the worse for free trade.<br /><br />Seriously, you could gather support for a carbon tax/tariff from unlikely sources if it was framed as an anti-import (anti-China) policy. This goes back to point 1. However, these might be people you wouldn't normally associate with but that is politics.<br /><br />For the sake of reduced carbon emissions you are willing for people to sacrifice things they care about (suburban life style, current income to finance research, economic growth). Is free trade sacrosanct?<br /><br /><i>Addendum: And you know what the U.S. can't tax? Cheap-carbon Chinese-made products replacing expensive-carbon U.S.-made products in global markets.)</i> <br />Which products are these? Comparing <a href="http://www.businessinsider.com/usa-manufactured-products-exports-america-2012-3#" rel="nofollow">top US manufactured exports</a> and <a href="http://www.industryweek.com/articles/china_poised_to_pass_u-s-_in_manufactured_goods_exports_11701.aspx" rel="nofollow">top China manufactured exports</a> the only overlap I see with possible high carbon footprint products is non-electronic machinery and chemicals but perhaps I'm missing something. Does the effect of a prospective carbon tax make the difference in sales as opposed to other costs and factors? This would need a detail study.Larry Headlundnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-2880343818438266512012-06-06T09:28:51.291-04:002012-06-06T09:28:51.291-04:00Well, why do you think they scuttled the agreement...Well, why do you think they scuttled the agreement? Clearly they viewed it as not in their interest. It's not like they had a brain-dead domestic political reason, like Christie getting a national reputation as a cost-cutting fiscal hero while NJ's GDP drops. Is reducing CO2 globally optimal? Then there is some set of tradeoffs that will make it locally optimal for China. <br /><br />How's is it a different problem vs building a Hudson crossing? It's something that benefits both sides, but if one side feels like it's paying an unfair price, or one that doesn't match the costs, it will opt out.<br /><br />BTW for your amusement, some pictures of pollution in Pittsburgh, and child miners in the US not so long ago... There came a point in the US's development when people decided to do something about it... do you think you proved that China will never want to do anything about it?<br /><br />http://www.theatlanticcities.com/arts-and-lifestyle/2012/06/what-pittsburgh-looked-when-it-decided-it-had-pollution-problem/2185/<br />http://www.retronaut.co/2012/04/u-s-child-miners-1900s/CurmudgeonlyTrollhttps://www.blogger.com/profile/02004282752334460717noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-82366428744186106282012-06-06T08:45:53.157-04:002012-06-06T08:45:53.157-04:00Do they serve Pegu Club cocktails at the Pigou Clu...Do they serve Pegu Club cocktails at the Pigou Club meetings?Larry Headlundnoreply@blogger.comtag:blogger.com,1999:blog-17232051.post-44340049771412797792012-06-06T06:32:12.882-04:002012-06-06T06:32:12.882-04:00Maybe it's because I live somewhere that's...Maybe it's because I live somewhere that's dark half the year and grey the rest, but I wonder if putting all your eggs in the solar basket is wise. <br /><br />If you want to look at what's physically possible by way of renewables, have a look at www.withouthotair.com , where David Mackay, a physicist at Cambridge, estimates thing like how much power would be generated if 5% of Britain was covered in solar panels. (It is slightly biased towards overcast windy islands with plenty of tides...)Lukehttps://www.blogger.com/profile/14014996272817759191noreply@blogger.comtag:blogger.com,1999:blog-17232051.post-54289596394641074092012-06-06T01:16:31.090-04:002012-06-06T01:16:31.090-04:00It's certainly more popular politically to go ...It's certainly more popular politically to go this way. See the <a href="http://environment.yale.edu/climate/files/Policy-Support-March-2012.pdf" rel="nofollow">Yale Climate Study</a> for details. Economists mostly seem to want policies that make the costs explicit and don't mention the solutions, where it is most easy to sell the public on policies that make the solutions explicit. I think doing something is more important than doing it in the way that would please economists the most, so I think someone should start campaigning on something like this:<br /><br />1. Create a CAFE for power companies, basically specifying that newly installed eletrical plants over each 5-year period must have some maximum lbs CO2 per kWh, and the target drops every 5 years until it reaches zero.<br /><br />2. Eliminate oil subsidies, use the money to "do whatever it takes" to get the country off oil. Or a "Manhattan project" to make oil unnecessary.<br /><br />This would provide a lot of public and private money for research, it will over time weaken the special interests that would oppose further action, and promising to spend money to make sure the next generation doesn't have to deal with rising gas prices will be a much easier sale than promising to make gas prices rise even further so that we'll really really hate our trips to the gas station and will want an alternative more badly.Eric Lhttps://www.blogger.com/profile/17688525347746547529noreply@blogger.com