Sunday, November 18, 2018

My take - The Carbon Tax Is Dead, Long Live the Carbon Tax?

While I'm inventing traditions, how about a new one that a blog post riffing off another blog post should directly steal the headline?

So I'm riffing off of William's post regarding the lab experiment in Washington State, with a revenue-neutral carbon tax in 2016 failing (William appears to obliquely refer to this one), and now a revenue-generating carbon tax in 2018 also failing.

For the audience of climate bloggers and their readers, I'll put the most relevant-to-them point first rather than bury it like I usually do: scientists and engineers seem to treat scientific and engineering challenges as legitimate while political challenges are somehow illegitimate combinations of incompetence and corruption. As a once (and apparently, now again) small-pond politician, I'll just say the political challenges of climate change would be easy if you could provide perfect long term and short term localized forecasts, and provide a no-cost engineering solution to the problem. These are all human problems.

Political challenges are as mind-bendingly difficult. Neither William nor Tyler Cowen are announcing magic solutions that will win political contests, so maybe that's a recognition on their part that the challenge is real.

Not that I have a magic solution either. I think Churchill's sayings about democracy being the worst government type except for all the other types, and that Americans can be counted on to do the right thing after exhausting all other options, might apply to Washingtonians. Maybe third time's the charm for Washington State, and some impure compromise between the two prior initiatives can succeed.

And speaking of impurity, there's the fossil fuel companies. Yes, the public has moral agency and protecting democracy is ultimately up to them, but fossil fuel companies throwing sand in their eyes and buying out their representatives isn't helping. They more than deserve their share of blame, especially as they hypocritically claim to support a carbon tax and then do their best to stop one from happening.

I'll end with a only half-joking suggestion: "Tax Carbon, Not Trucks, Beer, or Harleys". Set up a carbon tax, and stop taxing cars, trucks, beer, and motorcycles. The government gets to keep the extra tax revenue after making up for the lost tax revenue from those other sources.


Everett F Sargent said...

A carbon tax is a must. But it needs to be VERY progressive and revenue neutral (meaning that the poor half get a tax refund from the rich half, which would really be a 1:99 split given ever growing income inequalities). I could really use the extra income as soon as we Dump Trump, if not sooner.

Russell Seitz said...

There is no accounting for tax, Everett. As tobacco is a renewable fuel, how can progressives sanction taxing it ?

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Unknown said...

Very O/T Brian, but just to say that I've written up your 2007 bet with David Evans, here:

David Evans has given his thoughts on how it's going. Would you like to respond and / or give your own views?

EliRabett said...

Brian will probably answer when he recovers from the holiday, but until then


Rabett Run, where your questions are answered before you ask them.

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Gingerbaker said...

Supposedly, there are 43,000 separate sects of Christianity. Double that number for proposed carbon taxes. Everybody has their own cafeteria version.

There have been quite a few variations enacted in the real world. Most have been outright failures. Not a single one can be said to have been properly proven to be effective. So says the NREL, which says there are only a very few properly done analyses, and those have shown no significant effect.

And why would we expect them to work? Almost all of them allow cost shifting onto consumers, who have zero influence on macro decisions involving renewable energy. Many are actually touted as the cat's meow because they give more money back to most consumers than they paid. So much for the ineluctable efficiency of so-called Pigouvian taxes.

Meanwhile, back at the ranch, there is absolutely no guarantee, and certainly no documentation that any carbon tax has ever resulted in the only thing that must be done if we are to solve AGW: build and deploy new renewable energy infrastructure. Not only has it never been documented - it's never even been looked at.

And another thing that has never even been looked at: Would any carbon tax be better at building and deploying new renewable energy infrastructure than would a simple and robust program of increasing renewable energy subsidies well beyond what they are currently? Just asking, because every single dime spent on a RE subsidy results in a dime's worth of new RE infrastructure being deployed.

Barton Paul Levenson said...

"Supposedly, there are 43,000 separate sects of Christianity"

BPL: I've also seen 2200, 3300, 30,000, and 33,000. The number just keeps on increasing. I've never seen any justification for the number.

But let's assume it's true. It's also true that 90% of Christians just belong to twelve or so of those "sects," all of which recognize the others as legitimate Christians. The two biggest, Catholicism and Eastern Orthodoxy, have intercommunion.

Brian Schmidt said...

Apologies for the delay, and I responded in a very predictable fashion to the climate bet blog post.

Hautbois said...

Many thanks Brian for your response at , and Eli for your pre-emptive one earlier.

I've added a couple of responses to David Evans' reply plus a chart that extends the trendline forward from 1987-2006. Which suggests Brian that, all things being equal, you're good for the 2nd and 3rd bet periods - even if we all lose in the scheme of things.

Phil Hays said...

Minor correction from Washington State.

The 2016 carbon tax was promised to be revenue-neutral, but was actually revenue negative.

Rebates and other tax cuts bundled with the carbon tax were significantly larger than the carbon tax.

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