A relatively moderate-sized carbon tax could raise $1.25 trillion over the next decade, a huge chunk of the money needed to bring the federal budget deficit under control. And the idea is getting a closer look now that the election is over and the “fiscal cliff” is looming.
Because it would tax fossil fuel use, the carbon tax pleases economists who want to encourage investment and discourage consumption. Climate activists hope it would reduce greenhouse-gas emissions by penalizing the use of coal, oil and natural gas. And for lawmakers opposed to any change in tax rates or deep cuts in spending, the carbon tax could be a lifeline.
“In the general scheme of things, taxes discourage whatever you’re taxing,” said William Pizer, associate professor of economic and environmental policy at Duke University. “If something is discouraged, it might as well be something bad like pollution instead of employment and savings.”
Pizer said that a $20-a-ton tax on carbon dioxide would raise gasoline prices by about 20 cents per gallon and boost electric bills slightly. It could be most efficiently collected “upstream,” at coal mines, oil and gas wells, or terminals for oil tankers arriving at U.S. shores.
Yes, it is. But as long as the U.S. ranks 25th in math, and one party has a clear anti-intellectual bias, it ain’t gonna happen.
Hey, I have better idea….STOP AND CUT SPENDING!!!
Does fake science = PRO-intellectual?
A relatively moderate-sized carbon tax could raise $1.25 trillion
Hmmm. Must be a different definition of “moderate-sized” than what I’m familiar with. Guess Trillion is the new million.
Uh, so will this make all our manufactured goods we produce in Wisconsin more expensive in relation to other countries?
I’m not sure why the Al Gore crowd thinks it a great idea to make our economy less competitive with these energy taxes while China then pollutes the earth much more as those manufacturing processes move overseas.
Maybe our new secretary of business can look into these concepts and explain them to Barry.
Stop spending, cut entitlements, stop Congress’ pay, stop Obama from golfing and Moochelle from taking 100 people on vacation to Spain, lower taxes, lower the corporate tax so business comes BACK to America, ditch the unions that do nothing but put businesses OUT of business, i.e., steel factories, airlines, etc., get out of the bases in Europe and NATO, and end our involvement with the UN (1 TRILLION a year in dues and costs).
Personally, I enjoy carbon on many levels.
My plants like it.
It tastes great in my beverage.
Of yeah, that thing about me being a carbon based life form.
Leave it to government to tax one’s very existence, regardless of income.
Talk about discriminating against the poor.
Why do liberals want to tax the poor?
The amount raised won’t even be 1/2 of the amount of the debt limit increase request the Democrats are asking for. It is just a little bit over 1/2 what the Federal government borrowed 15 months ago.
The tax will hurt the poor the hardest and so we will have to increase government welfare to help those people out. Other people will lose their jobs and businesses will go bankrupt. Everything will cost more.
But idiots like jim spice thinks this is a great idea.
I hope the State doesn’t raise the gas tax another form of carbon tax for big government spender.
It truly is only the left wing who classifies people by party, gender, race, income…
Makes demonizing them sooo much easier when trying to divide a once great country. Good job of not replying with a a good argument to counter the post, Herr Jim.
You guys also do a great job of being petulant asses on camera during debates….
Ah, liberals…the constant struggle to tax and spend one’s way to prosperity,. Problem is: they never have realize that it doesn’t work.
TerryN—You guys also do a great job of being petulant asses on camera during debates…
And you do a great job everyday in your own life!
A carbon tax requires convincing Republicans. Good luck! They’re enamored with petroleum!
YET, it appears that conservative economists (a survey from 2007, mind you) especially FAVORED carbon taxes.
Even Arthur Laffer himself (Reagan’s economic advisor!) wrote an op-ed in the New York Times calling for a carbon tax.
Questions—How high to set the tax? How to assist poorer Americans to offset the impact of the tax on their lives?
So, are these economists from the right side of the political fence “wrong” when it comes to their support of a carbon tax?
You supporting alleged conservative economists calling for subsidy of the rich…now I’ve seen everything.
Yes these economists are wrong.
As PJ O’Rourke opined…Giving money and power to government is like giving whiskey and car keys to teenage boys.
What is this carbon tax going to pay for besides direct payments to Obama’s rich buddies at Solyndra?
I have an idea…let the poor and middle class keep their earnings.
The sources I cited are not “alleged” conservative economists…their track records speak for themselves. Laffer, for example, is a staunch fiscal conservative and libertarian. He in particular is all about the free market. I am citing these individuals to offer evidence that there is support for the carbon tax by the hard right.
Even members of the Cato Institute and Mitt Romney’s senior economic advisor support the carbon tax!
Economics isn’t left or right, greencarman. It simply is. Additionally, your links provide no economic support for a carbon tax. They make no economic argument for such tax, rather they make an argument that we want less carbon, something very different. No economic argument is made because there is none to make. Implicit, but unwritten in their arguments, is that we would pay an economic price for imposing such a tax.
“Questions—How high to set the tax?”
“How to assist poorer Americans to offset the impact of the tax on their lives?”
Don’t implement it in the first place, duh.
“No economic argument is made because there is none to make.”
Breaking new ground here BBB?
I would love to here you dissertation on property rights and Pigou?
The arguments to be made aren’t economic, fu, and none will be presented.
An argument can at least be made for taxing petroleum, in that importing it from Saudi Arabia, etc., is essentially funding people who are intensely hostile toward Western concepts of freedom.
But before you do that, you’d want to maximize domestic production, and also maximize imports from non-hostile countries (such as that large one that’s just north of us).
To tax natural gas and coal you’d have to (1) accept that global warming is largely anthropogenic, and (2) global warming is more harmful than beneficial, and (3) reducing CO2 emissions from the USA would have a significant effect on atmospheric CO2 even without similar taxes in India, China, etc.
To get fiscal conservatives on board for a carbon tax you’d not only have to convince them of the three points above, but also present this tax as revenue-neutral. That is, you’d have to reduce some other tax to compensate.
Finally, since a carbon tax would make just about everything produced in the USA more expensive (food, manufactured goods, anything transported over long distances) you’d have to charge a carbon-based tarriff on imported goods in order to avoid worsening the USA’s already dismal balance-of-trade deficit.
Which might just start a trade war, possibly resulting in a world-wide depression. Other than that, perhaps it’s a good idea?
Good to see you haven’t lost your sense of humor BBB:)
Whatever are these boys thinking?
The American Enterprise Institute is the venue for the Nov. 13 event on the economics of carbon taxes, which AEI is hosting with two other think tanks, the Brookings Institution and Resources for the Future, and the International Monetary Fund.
BVBigBro—“Economics isn’t left or right, greencarman. It simply is.”
Then why do some on the right jump down the throat of Paul Krugman or those who are Keynesians? No, ideology matters when it comes to economics. It most certainly is a “right” or “left” bloodsport.
BVBigBro—“They make no economic argument for such tax, rather they make an argument that we want less carbon, something very different.”
Come again? From fu’s source…Carbon tax advocates call it a simpler, more efficient way to address greenhouse gas emissions than cap-and-trade proposals that collapsed on Capitol Hill in 2010. Some backers also see a source of revenues to battle the deficit. Other ideas include using the tax revenue to enable reductions in other tax rates or aid energy consumers who would face higher prices.
Moreover, from the source I provided…Laffer recommends a carbon tax with revenue used to cut income taxes, a swap which he argues would create jobs, improve economic output and reduce pollution.
So, BBB, please tell us HOW and WHY these statements are NOT “economic arguments”.
Albigensian—Your arguments in #19 rest entirely on assumptions and pure speculation. That is, you presume those situations to be the actual results of a carbon tax.
“To get fiscal conservatives on board for a carbon tax you’d not only have to convince them of the three points above, but also present this tax as revenue-neutral. That is, you’d have to reduce some other tax to compensate.”
And if you read the links more carefully it would appear that, IF your assumptions are true, those economists who are enamored with “trickle down” are on board with the carbon tax!
Exactly, fu and greencarman, None of your sources are making any economic arguments for a carbon tax. They are making arguments for reducing carbon emissions and increasing revenues, both entirely independent of the economic effects of the tax itself. There is no economic argument being made because they have all conceded that fossil fuels are the most effecient source of fuel. They are arguing in favor of an inefficiency. That is to say, an economic cost. Note Laffer’s: “A carbon tax that isn’t accompanied by a reduction in other taxes is a nonstarter.” The remainder of his claims of jobs and output increases are based on the idea of cutting other taxes, if you read your link. Additionally, the claims that these gains offset the losses from a carbon tax are purely speculative and in addition assume a precision in the effects of taxation levels that no one posseses.
Economics is the observation and description of how we produce and distribute things. Keynes did some nice work in this arena. Keynesianism and its’ advocates have taken those limited observations and proposed a theory of central planning based on them. Central planning is not economics. Central planning is also not unique to Keynesians. The moment you read the word “theory” attached to anything pertaining to economics it’s a safe bet you’re going to be pitched a central planning theory.
The idea of central planning is where we go wrong. Economists have made a lot of observation over the centuries and have left us a lot of different tools that can be used to analyze and address the various economic pitfalls we encounter. Central planning, and Keynesianism takes the brunt of the criticism because it is the theory we have been following for decades, inherently eliminates most of the tools and leaves us with few options to deal with all problems, least of all problems caused in part by the central planners themselves. Our current problems happen to be non-Keynesian in nature, and Keynesianism can neither describe them nor solve them.
“None of your sources are making any economic arguments for a carbon tax.”
Playing semantics, aren’t we, BVBigBro?
Is NOT cutting other taxes and increasing revenues “economic” in nature? That is, the carbon tax may lead to financial benefits.
Moreover, central planning is an ECONOMIC mechanism that applies to production, investment, and/or distribution. Are these terms NOT economic in nature?
“Additionally, the claims that these gains offset the losses from a carbon tax are purely speculative and in addition assume a precision in the effects of taxation levels that no one posseses.”
Economists live and breathe speculation, my friend. They are perverts when it comes to trends both short-term and long-term. They make assumptions based on the available evidence.
“Our current problems happen to be non-Keynesian in nature, and Keynesianism can neither describe them nor solve them.”
Says who? Therein lies the debate between supporters and detractors of Keynesian economics.
Cutting other taxes is not an argument for a carbon tax in any form. Increasing revenues is fiscal in nature. No, greencarman, they are not economic in nature. The economic realities exist independent of our attempts to control them.
We have a well established malinvestment event. We have a well established change in the preference for spending vs. savings. We have an enormous accumulated debt, both public and private. The evidence simply does not support a Keynesian analysis. There is no argument between supporters of and detractors of Keysianism in this case. The supporters have merely invoked irrationality on the part of market participants as the explanation for all contrary evidence. Irrationality isn’t an argument. It’s a faith-based approach; unprovable.
Caught with your hand in the cookie jar again BBB?
So can an economic argument only reveal efficiencies?
How can that be? You are making one that a carbon tax is inefficient:)
Aspirationally clever at best.
Economics is the observation and description of how we produce and distribute things.
Like the production and distribution of carbon?
Let me guess, market externalities don’t exist for you do they?
Our current problems happen to be non-Keynesian in nature, and Keynesianism can neither describe them nor solve them.
Personally, I would like to hear more about the nature of “Our current problems” and what you think might “solve” them:)
Drinking the Keynesian kool-aid again, fu? (Yawn) All sorts of externalities exist for me. They don’t require that I subscribe to central planning.
You and greencarman made an appeal to authority to advocate for a carbon tax. The authorities you chose were economists. The links you provided contain no economic arguments for a carbon tax, merely an assertation that carbon is bad. Very bad. The economic arguments contained in the links, to the extent they exist, argue against such a tax on its’ economic merits and go so far as to propose measures to counter the tax. Why, therefore, should I find the authority chosen convincing or even relevant?
Comment 24 outlines our problems. An actual recession will solve them. The solution is the same as it was five years ago: allow the recession to happen and take care of the temporarily unemployed. But why have an 18 month recession when we can have a 20 year Keynesian cesspool?
BVBigBro—You are suffering from confirmation bias. Indeed, why should you find the authority chosen convincing or even relevant? The sources provide a host of experts who have conservative or liberal credentials and provide evidence in favor of the ECONOMIC benefits of a carbon tax, while recognizing its potential ECONOMIC flaws. Fiscal policy is part of a comprehensive ECONOMIC agenda.
If the objective is the reduction of domestic carbon emissions, regardless of the rest of the world, then the policy is suspect from an ECONOMIC perspective. If the objective is to ease our transition to a low carbon future (which will occur when the rest of the world acts), then the tax may or may not be sound ECONOMIC policy.
Carbon dioxide is a pollutant and in ECONOMIC theory, pollution is considered a negative externality – a detriment on a group not directly involved in a transaction, which results in a market failure.
“...allow the recession to happen and take care of the temporarily unemployed.”
Simply letting the “chips fall where they may” by “allowing” a recession to occur is political suicide. Foolish thinking on your part…try explaining its “benefits” to the everyday American. And, what, your magic 8 ball says recessions last only 18 months if we follow your advice?
“carbon dioxide is a pollutant…” and “If the objective is the reduction of domestic carbon emissions” That, of course, was the entire point of your appeal to authority, greencarman. You wished to avoid a discussion of the merits of regulating carbon dioxide as it relates to global warming.
Let’s assume we don’t want to reduce carbon emissions, then it should be a simple exercise to produce an economic argument for doing so, i.e. justify and quantify the supposed detriment. None has been provided, of course, and none will be.
The country has a history, greencarman. Recessions have been getting longer and deeper since we decided we could centrally plan them. An 18 month recession is entirely reasonable for the event we experieinced. In addition, we don’t have a choice in the matter. We’ll get the correction in any case. Explaining it to everyday Americans would be a fairly simple thing. It would not, however, allow political credit to be distributed nor allow more power to be accumulated by government, which is the beauty seen in the Keynesian approch by politicians.
You wished to avoid a discussion of the merits of regulating carbon dioxide as it relates to global warming.
The post is about the economic aspects and political viability of a carbon tax being used to increase revenue as opposed to other avenues. It seems it is you who wants to make it a discussion about carbon use/global warming.
What is with the fixation on Keynes? I believe governments have been levying taxes and raising revenue for a bit longer than you have had to pillory Keynes.
No need to change the subject, fu. The first link provided by greencarman declared the purpose of a carbon tax as regulating greenhouse gases.
Try to follow along here BBB.
I have been responding to
“No economic argument is made because there is none to make.”
In challenging you, I thought surely you would see the absurdity of that pronouncement relative to the topic?
Apparently you did not because you doubled down on in #18 and provided some rambling gibberish covering the evils of central planning and your aversion to all things Keynes.
I’m guessing you discovered your previous overgeneralization by qualifying it in#22
There is no economic argument being made because they have all conceded that fossil fuels are the most effecient source of fuel. They are arguing in favor of an inefficiency. That is to say, an economic cost.
That last bit looks like an economic argument to me, how about you?
Personally, I am a proponent of user fees.
If you consider clean air a common good,which I do, diminishing it would seem to call for some sort of compensation to the collective.
A carbon tax would seem to be designed to accomplish that.
BVBigBro—“You wished to avoid a discussion of the merits of regulating carbon dioxide as it relates to global warming.”
No, my focus was to reject your notion that there is no economic arguments for a carbon tax, when the sources i provided run counter to your claim.
BVBigBro—“The first link provided by greencarman declared the purpose of a carbon tax as regulating greenhouse gases.’
Try again! From that source (online.wsj.com)...“A majority of the economists said a tax on fossil fuels would be the most economically sound way to encourage alternatives. A tax would raise the price of fossil fuels and make alternatives, which today often are more costly to produce, more competitive in the consumer market.”
So, the purpose of the tax is to develop wind and solar power.
An offshoot or result would be less American reliance on fossil fuels.
BVBigBro—“An 18 month recession is entirely reasonable for the event we experieinced.”
Are you a soothsayer?
BVBigBro—“In addition, we don’t have a choice in the matter. We’ll get the correction in any case.”
And “purely market forces” will magically make that happen, right?
BVBigBro—“Explaining it to everyday Americans would be a fairly simple thing.”
Sure, I can hear it now. “Sir, you lost your job. How, I’ve no clue. There will be a recession for about 18 months. Perhaps you can find meaningful employment, or just get “free stuff” from the gummint”.
“If you consider clean air a common good…” If if if if if. Finally you begin to see the light, fu. In this case the concern is not clean air but greenhouse gases as stated in the links provided in comments 12, 14 and 20. Nothing economic is offered to support that assumption and nothing will be.
The economic argument is against the tax. The argument made in the links is to accept a worse economic outcome in order to achieve a reduction in greenhouse gases the outcome of which is unquantifiable and not presented. Why would an economist be a relevant authority? Their argument is not economic. It’s a perfectly acceptable argument, but it makes them no more authoritative than anyone else.
Read again, greencarman. The discussion in each of the links begins with the assumption that carbon needs to be regulated to reduce greenhouse gases.
Markets exist greencarman. They will do what they do regardless of what you and I wish.
It’s not real complicated guys. Lots of people have done economic analyses of various externalities on economic grounds and successfully advocated for them on economic grounds. That hasn’t been done here and won’t be done because it can’t. Because it can’t they, and you, want to assume the outcome, reduced greenhouse gases. Go back to the beginning and demonstrate and quantify the externality. The process doesn’t change because you can’t prove it.
BVBigPro—“In this case the concern is not clean air but greenhouse gases…”
Since you are playing a verbal shell game, I again offer that source (online.wsj.com) which you have yet to offer rebuttal evidence…“A majority of the economists said a tax on fossil fuels would be the most economically sound way to encourage alternatives. A tax would raise the price of fossil fuels and make alternatives, which today often are more costly to produce, more competitive in the consumer market.”
So, the purpose of the tax is to develop wind and solar power.
An offshoot or result would be less American reliance on fossil fuels.
BVBigPro—“Why would an economist be a relevant authority? Their argument is not economic.”
Why WOULDN’T an economist be a relevant authority regarding taxes and their potential impact? It is abundantly clear that these experts—despite your insistence to the contrary—have been asked by proponents and opponents of the carbon tax to offer its potential impact from an economic perspective. SOME economists may based their conclusions regarding the carbon tax in an effort to reduce greenhouse gases, while SOME economists offer advice on the carbon tax in an effort to increase energy source alternatives for consumers.
BVBigPro—“That hasn’t been done here and won’t be done because it can’t.”
Yes, in your mind, since your entire argument rests on the premise that climate science is unproven and therefore anything related to greenhouse gas emissions is bogus on its face. That is, what you are doing is simply null and voiding the carbon tax argument by ASSUMING greenhouse gas emissions is “junk science”. Climate science has yet to be proven nor disproven; of course, automatically dismissing this phenomenon based on an insistence it is false “strengthens” your position that the carbon tax is NOT economic in nature. Obviously, there are politicians and economists who DO consider the carbon tax to be viable from numerous angles, one of which is the reduction of greenhouse emissions. Ultimately, you fail to take into account that the carbon tax can reasonably be viewed from a different perspective, one that is not necessarily tied to climate science—the desire to have more choices be made available for people to consider when it comes to energy.
This tax is tied to climate science, greencarman. I haven’t insisted climate science is false. I’ve insisted they can’t and haven’t proven their case and thus won’t provide an economic analysis because they can’t.
The implication is loud and clear, BVBigBro, that you are at the very least not a fan of climate science. Otherwise, why would you insist that economists cannot legitimately assess a carbon tax from a global warming perspective and/or an alternative energy point of view.
YOUR own statement—> “carbon dioxide is a pollutant…” and “If the objective is the reduction of domestic carbon emissions” That, of course, was the entire point of your appeal to authority, greencarman. You wished to avoid a discussion of the merits of regulating carbon dioxide as it relates to global warming.
BVBigBro, the economists have been asked by scientists and politicians to assess the ramifications of the carbon tax. They have made a number of arguments based on data, trends, and facts. These experts contend that a carbon tax “shift” can improve the overall output of the economy even without considering climate benefits and thus represents a “no regrets” policy for conservatives who are not convinced of the danger of global warming.
Refute their position, rather than wipe it entirely away.