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Old 09-24-2019, 06:45 PM
Delayed Reflex is offline
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Why is a broad-based carbon tax with dividend so politically difficult?


I've always wondered why a broad-based carbon tax with 100% of the proceeds refunded to the populace is not a more common approach for attempting to address climate change. It seems like as long as you agree that climate change is a problem that needs to be addressed, you should be supportive of such a scheme. IMO, the simplest and most fair way would be to simply divide the revenue generated from such a tax and write a cheque to every adult in the country for the same amount. To ease the transition and allow people to be able to make meaningful changes to improve their carbon footprint, this tax could start lower but would have to ramp up to pretty significant levels in order to achieve the desired change across the population that it is being applied - ideally, globally.

Perhaps some people on the political left would be concerned that this could lead to situations where poor people struggle to maintain their current lifestyles - but the entire point of this is that they would be incentivized to shift to a lower carbon footprint lifestyle, not maintain a wasteful one. Poor people have lower carbon footprints than rich people, unsurprisingly, so such a scheme would still ultimately result in some net transfer of wealth from richer people to poorer people. But more importantly, the incentives would be there for everyone to reduce their carbon footprint, regardless of socio-economic class.

I am not sure what reasonable objections might exist on the political right - carbon taxes are one of the easiest ways to incentivize market-based solutions and are even supported by many large fossil fuel companies. Which is why it is bizarre to me that, for example, the Canadian Conservative party wants to go to a soft cap style system instead of sticking with a carbon tax.

The biggest challenge I see is it being a coordination problem between countries - if all countries applied this evenly, there would be no issue with companies being incentivized to leave to another country with lower carbon tax. I can see it being pretty tempting for developing countries to ask for lenience and allow for them to not have to have the taxes in order to allow them to catch up - but a lot of developing countries are also the ones that will be the worst affected by climate change, so it is really in their best interests to have a high carbon tax to ensure that all the first world countries maintain their carbon taxes at a high level as well. If developing countries had high carbon taxes, there would be zero excuse for any developed countries to not have them as well.

Is the issue that the general population simply doesn't take climate change seriously enough to want to accept anything that could negatively affect them in the short term? There are certainly a few deniers left, but it seems like people across the political spectrum in most countries now acknowledge that climate change is a problem that needs to be addressed. Perhaps, globally, we are only at a point where people are willing to talk the talk but not walk the walk.
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Old 09-24-2019, 07:31 PM
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Because so many of the people who oppose a carbon tax are idiots who can't do math.

No, literally. I just saw a Facebook post from a friend that claimed gas went from $1.37/l to $0.97/l in one day after Alberta "cancelled the carbon tax".

First off, if gas prices dropped by 39 cents a liter anywhere in Canada, that would have made national news. Secondly, there's no way in hell a carbon tax made up about 25% of the pump price for a liter of gas. It was more on the order of 6-7 cents per liter. But to the people posting this meme, it made sense. Because they can't do math.
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Old 09-25-2019, 01:03 AM
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https://fortune.com/2018/09/10/baker...-climate-plan/

James Baker and George Shultz have in fact proposed a carbon dividend policy. Given their stature within the Republican party it suggests that something along those lines is at least feasible.

Why is it still politically difficult? There is a large segment of the Republican party which flatly denies the reality of climate change and they would be opposed to literally any policy to tackle the issue.
The left is also lukewarm on carbon dividend because they would prefer to use that money to pay for other green policies. Also it is a somewhat strange policy: what is the purpose of taxing carbon
if you are giving all the money back ? (The answer is that you are changing the relative price of carbon but that is not an easy concept to explain. Kevin Drum, who is one of the smartest commentators around, had a post on the carbon tax some time back which seemed to miss the point)
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Old 09-25-2019, 03:59 AM
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I don't think anyone who is already opposed to any tax, especially those designed to curb pollution, will be swayed by a dividend which they will try to paint as more government intervention. They're opposed to taxes because they're taxes.

Our deficit is so high, we should use the tax for general revenue. That's not an easy decision, but much easier than if there were a large chunk of people who could be swayed by the argument that you will get some of the tax back. People aren't swayed by the argument that government-funded health care will be cheaper overall either, and that is positive-sum rather than zero-sum.
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Old 09-25-2019, 07:49 AM
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Originally Posted by Delayed Reflex View Post
Why is a broad-based carbon tax with dividend so politically difficult?
The main reason is it contains the word “tax”.

Other reasons are that carbon taxes impact rural residents more than urban residents, and proportional to their income, the poor more than the middle class or upper class. You’re proposing a refund which would theoretically provide relief for the poor from that cost impact, at least for the low-polluting poor. However, when is that refund going to be provided? If someone is living paycheque to paycheque, an increased cost that occurs now isn’t going to be relieved by a future payment to recompense that cost.
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Old 09-25-2019, 07:55 AM
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I'm not completely convinced on what the best way is to put a price tag on carbon dioxide emissions. My personal preference is for cap-and-trade, but I could be persuaded otherwise on that.

I am, however, completely convinced that we need to put a price tag on carbon dioxide emissions somehow. Put this, or any other reasonable price scheme, up for a vote, and I'll support it.
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Old 09-25-2019, 08:22 AM
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Originally Posted by Delayed Reflex View Post
I've always wondered why a broad-based carbon tax with 100% of the proceeds refunded to the populace is not a more common approach for attempting to address climate change.
Trust, as in few people trust the government enough to introduce a tax-neutral solution.

About ten years ago in Canada, Stephane Dion, an ardent environmentalist and Quebec federalist, surprised himself by winning the leadership of the Liberal Party. He ran on a Green Shift platform, which would result in significant cuts in income tax and a hefty carbon tax, together being revenue neutral. Mr. Dion was not exactly charismatic. His Conservative opponent depicted him as a clueless professor type. Nobody knew what impact the Green Shift would have on them; some people would pay more taxes, and some less, but everyone thought they would pay more taxes. Spoiler: Dion lost, big time.

Canada has greater trust in its government than the United States does.

Changing the tax system (something basic to governments everywhere) used to spark rebellions, and while that happens far less often in democracies, it still sparks anger. Of course the tax system changes every year, but these are usually incremental changes, with advertising exaggerating who would be better off. Obamacare had an impact on taxes (it had to) which, of course, reduced its appeal.

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It seems like as long as you agree that climate change is a problem that needs to be addressed, you should be supportive of such a scheme. IMO, the simplest and most fair way would be to simply divide the revenue generated from such a tax and write a cheque to every adult in the country for the same amount.
That's what Canada did in the last tax season. People got a small amount and it's very difficult to measure the impact on higher gas taxes (since gas prices vary so much). The scheme was implemented only in non-cooperative provinces, such as mine (the largest). I don't know how it worked in provinces that cooperated.

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Is the issue that the general population simply doesn't take climate change seriously enough to want to accept anything that could negatively affect them in the short term?
Probably.

Of all the species on Earth, humans are the least likely to suffer direct impacts of climate change. We have technology and adaptability. We already practically cover the Earth, which very few other species do. We can deal with flooding, higher crop prices, heat waves, and so forth. Lots of people who believe in anthropogenic climate change think a 2 degree increase in average temperatures are nothing serious.

Furthermore, climate change is almost invisible. Temperature varies by day (more than 2 degrees); to see the average temperature increase, you need to look at a chart. Your memory is not sufficient. Hurricanes and floods happen every year, and that's rising, but unless you're looking at numbers on a chart the increase in numbers is not very visible. There's less snow (where I live, anyway), but unless you look at a chart that's hardly noticeable. There's much less snow in the Arctic, but the population there is very small, so not very visible to many people. (For instance, the capital of Nunavut, one of Canada's three Arctic territories, skyrocketed... to just over 8,000 people. My neighborhood has more people than that. I think the entire territory has only one MP, so there can't be much political representation either.)

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There are certainly a few deniers left
More than a few. The green movement has done such a terrible job trying to educate people on climate change that vast numbers of people (especially in the US) think it's fake. A higher number than a few decades ago, so they're going backwards. And no, I don't think saying "oil companies and Republicans lied to people" is a sufficient explanation for this. Environmentalists don't think like other people, so they don't know how to convince other people. Instead of paying the same green advertisers, they should pay the most skillful advertisers instead. The advertisers don't have to believe the message, they just need to get results.

Like everything else, climate has become partisan. Before it used to be just Republicans (and similar parties and interests elsewhere) telling whoppers about climate change. Now there's a "study" saying 51% of greenhouse gas emissions are caused by raising cattle, which is at least double what I've seen in any previous study. A significant change in diet is more "basic" than a significant change in taxes, so of course there will be resistance.

Governments have done a bad job in promoting solutions. Due to weaknesses in the green movement, people don't like nuclear power. (While that's not renewable, it's far superior than coal-fired plants.)

Governments and green movements have also done a poor job of managing rational fears.

Some decades back, biofuel became quite popular in Brazil, and biofuel-only users were on the rise... and then they ran out of biofuel. They have some now, but pretty much nobody in Brazil uses only biofuel. They always use a mixture of biofuel and nonrenewable fuel because nobody trusts the biofuel supply anymore.

Electric vehicles have less range, and recharge stations aren't plentiful either. There's a legitimate fear of getting stranded. Governments should be helping gas stations install recharging stations (as gas stations must be common, to prevent gas-powered vehicles from being stranded). There may have been such initiatives, but I've not heard of them. Instead, I just hear "their ranges are getting longer" and "you don't need that much range".
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Old 09-25-2019, 12:05 PM
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A few reasons it's difficult:

1. People deeply distrust the government about taxes. I would bet that it's difficult to get even half of the populace to understand the concept of a "revenue neutral tax".
2. A revenue neutral carbon tax looks a lot like income redistribution, which many people are opposed to.
3. Fossil fuel producers make large donations to politicians.
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Old 09-25-2019, 12:35 PM
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To me, a carbon tax would be an excellent example of libertarian economics at its best! Instead of government coercion, prices are adjusted to reflect otherwise unafforded (i.e. "external") costs. This was discussed at some length in a recent thread. One of the Board's libertarians argued strenuously against this libertarian solution, beginning with

Quote:
Carbon taxes are dying as a policy prescription, because governments that implement them keep getting kicked out of office.

Carbon taxes also aren't working very well. Energy demand is highly inelastic, and it takes a long time to replace fossil fuels. In the meantime, we're just taxing people.
I posted my own views in yet another thread.
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Originally Posted by septimus View Post
I think we should debate optimal policies and hope for leadership to pursue them, rather than limit ourselves to what some might consider "politically feasible." If only "feasible" policies were on the table, women wouldn't have gotten the right to vote, the Civil Rights Act of 1964 would never have passed, and gay marriage would still be outlawed.

On top of which, I'm still taken aback by the apparent belief that using revenues from a new tax to reduce the trillion-dollar deficit would be another example of liberal over-reach! Let me ask those delighted with the huge deficits of Dubya and Trump: If a trillion-dollar deficit in a time of prosperity is good, would you like a 2 trillion dollar deficit even better?

Of course I would not support a carbon tax in isolation with no other tax code changes. A carbon tax is very regressive; this would have to be compensated by less regression elsewhere. I've already mentioned my proposal: Reduction in payroll taxes at the lower income levels.

But changes should be evaluated on their own merits. If deficits are really so wonderful than, sure, pair the $300B carbon tax with $800B in more tax cuts and pump the deficit to 1.5 trillion. If we'd rather reduce the deficit then, couple the $300B carbon tax and $300B SocSec rebate with a $300B income tax hike to reduce the deficit. But don't pretend that one change necessitates an unrelated change. Changes should be evaluated on their own individual merits.

Finally, for those who think I must be a Stalinist to mention the possibility of reversing the tax cuts for the super-rich, recall that Andrew Carnegie became "the richest man in the world" in 1901 when he sold out to J.P. Morgan's U.S. Steel Corp. and was suddenly worth $300 million. Those were 1901 dollars of course, but using a standard C.P.I. adjustment that's still less than $8 billion in 2019 dollars. Google to see what Jeff Bezos is worth today. The Walton or Koch families are worth far more today than the Vanderbilt or Astor families were ever worth, even with the C.P.I. adjustment. The persecution of America's billionaires that those on the right-wing fret about so much today is ... exaggerated.

Last edited by septimus; 09-25-2019 at 12:39 PM.
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Old 09-25-2019, 01:08 PM
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Of course I would not support a carbon tax in isolation with no other tax code changes. A carbon tax is very regressive; this would have to be compensated by less regression elsewhere. I've already mentioned my proposal: Reduction in payroll taxes at the lower income levels.

But changes should be evaluated on their own merits. If deficits are really so wonderful than, sure, pair the $300B carbon tax with $800B in more tax cuts and pump the deficit to 1.5 trillion. If we'd rather reduce the deficit then, couple the $300B carbon tax and $300B SocSec rebate with a $300B income tax hike to reduce the deficit. But don't pretend that one change necessitates an unrelated change. Changes should be evaluated on their own individual merits.

Finally, for those who think I must be a Stalinist to mention the possibility of reversing the tax cuts for the super-rich..
I think this points up an issue with a carbon tax.

In addition to Kimera757's very cogent point about marketing, those who propose a carbon tax are subject to the temptation to say "while we're at it, let's fix the rest of the system" and then it is harder to debate the carbon tax on its own merits. Witness the Green New Deal, which was supposed to be a proposal to address climate change and turned out to be intended to rewrite the US economy (cite).

"Let's use a carbon tax to address AGW and we will give it all back in rebates" is one thing. "Let's use a carbon tax to address AGW and get more money from billionaires and reduce the deficit and increase spending on solar subsidies and reduce income inequity and..." is quite another.

Regards,
Shodan
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Old 09-25-2019, 01:11 PM
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Canada implemented its Carbon tax as its own policy. 90% of the revenue is returned through income tax rebates (the remaining 10% goes towards green initiatives). That's hasn't stopped the right wing in Canada from screaming bloody murder about it being a huge tax grab.
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Old 09-25-2019, 01:27 PM
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To me, a carbon tax would be an excellent example of libertarian economics at its best! Instead of government coercion, prices are adjusted to reflect otherwise unafforded (i.e. "external") costs. This was discussed at some length in a recent thread.
I managed to delete the link to that previous thread.
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Old 09-25-2019, 02:01 PM
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I don't think anyone who is already opposed to any tax, especially those designed to curb pollution, will be swayed by a dividend which they will try to paint as more government intervention. They're opposed to taxes because they're taxes.

Our deficit is so high, we should use the tax for general revenue. That's not an easy decision, but much easier than if there were a large chunk of people who could be swayed by the argument that you will get some of the tax back. People aren't swayed by the argument that government-funded health care will be cheaper overall either, and that is positive-sum rather than zero-sum.
I feel like your first paragraph doesn't really jibe with your second paragraph. I think if you used carbon taxes as general revenue, you would DEFINITELY get more opposition from the "anti-tax" people compared to if you refunded it all - if it's otherwise, then it comes down to people not understanding how the tax and refunds work. If it's general revenue, then governments will be incentivized to hike or cut the tax to manage their budget in the way they want, which is NOT how you should be setting your carbon tax rates - they should be set to achieve the target emissions reductions, and refunding all the proceeds from the tax will ensure that politicians are not swayed to fiddle with the tax rate for other reasons.

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Originally Posted by Wrenching Spanners View Post
The main reason is it contains the word “tax”.

Other reasons are that carbon taxes impact rural residents more than urban residents, and proportional to their income, the poor more than the middle class or upper class. You’re proposing a refund which would theoretically provide relief for the poor from that cost impact, at least for the low-polluting poor. However, when is that refund going to be provided? If someone is living paycheque to paycheque, an increased cost that occurs now isn’t going to be relieved by a future payment to recompense that cost.
This is actually a good point, and seems like a legitimate issue with respect to the management of such a program. More frequent disbursement of funds (eg. monthly) could help with this, but it likely would be difficult to balance taxes collected with dividends issued on a monthly basis. Ultimately, this could result in disproportionate impact to poor people, but if the tax is raised slowly it should allow people to adapt, as poor people adapt to things like sales tax increases. I am not sure how hard the poor were hit when the GST was implemented in Canada.

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Originally Posted by Kimera757 View Post
Trust, as in few people trust the government enough to introduce a tax-neutral solution.

About ten years ago in Canada, Stephane Dion, an ardent environmentalist and Quebec federalist, surprised himself by winning the leadership of the Liberal Party. He ran on a Green Shift platform, which would result in significant cuts in income tax and a hefty carbon tax, together being revenue neutral. Mr. Dion was not exactly charismatic. His Conservative opponent depicted him as a clueless professor type. Nobody knew what impact the Green Shift would have on them; some people would pay more taxes, and some less, but everyone thought they would pay more taxes. Spoiler: Dion lost, big time.

Canada has greater trust in its government than the United States does.

Changing the tax system (something basic to governments everywhere) used to spark rebellions, and while that happens far less often in democracies, it still sparks anger. Of course the tax system changes every year, but these are usually incremental changes, with advertising exaggerating who would be better off. Obamacare had an impact on taxes (it had to) which, of course, reduced its appeal.



That's what Canada did in the last tax season. People got a small amount and it's very difficult to measure the impact on higher gas taxes (since gas prices vary so much). The scheme was implemented only in non-cooperative provinces, such as mine (the largest). I don't know how it worked in provinces that cooperated.



Probably.

Of all the species on Earth, humans are the least likely to suffer direct impacts of climate change. We have technology and adaptability. We already practically cover the Earth, which very few other species do. We can deal with flooding, higher crop prices, heat waves, and so forth. Lots of people who believe in anthropogenic climate change think a 2 degree increase in average temperatures are nothing serious.

Furthermore, climate change is almost invisible. Temperature varies by day (more than 2 degrees); to see the average temperature increase, you need to look at a chart. Your memory is not sufficient. Hurricanes and floods happen every year, and that's rising, but unless you're looking at numbers on a chart the increase in numbers is not very visible. There's less snow (where I live, anyway), but unless you look at a chart that's hardly noticeable. There's much less snow in the Arctic, but the population there is very small, so not very visible to many people. (For instance, the capital of Nunavut, one of Canada's three Arctic territories, skyrocketed... to just over 8,000 people. My neighborhood has more people than that. I think the entire territory has only one MP, so there can't be much political representation either.)



More than a few. The green movement has done such a terrible job trying to educate people on climate change that vast numbers of people (especially in the US) think it's fake. A higher number than a few decades ago, so they're going backwards. And no, I don't think saying "oil companies and Republicans lied to people" is a sufficient explanation for this. Environmentalists don't think like other people, so they don't know how to convince other people. Instead of paying the same green advertisers, they should pay the most skillful advertisers instead. The advertisers don't have to believe the message, they just need to get results.

Like everything else, climate has become partisan. Before it used to be just Republicans (and similar parties and interests elsewhere) telling whoppers about climate change. Now there's a "study" saying 51% of greenhouse gas emissions are caused by raising cattle, which is at least double what I've seen in any previous study. A significant change in diet is more "basic" than a significant change in taxes, so of course there will be resistance.

Governments have done a bad job in promoting solutions. Due to weaknesses in the green movement, people don't like nuclear power. (While that's not renewable, it's far superior than coal-fired plants.)

Governments and green movements have also done a poor job of managing rational fears.

Some decades back, biofuel became quite popular in Brazil, and biofuel-only users were on the rise... and then they ran out of biofuel. They have some now, but pretty much nobody in Brazil uses only biofuel. They always use a mixture of biofuel and nonrenewable fuel because nobody trusts the biofuel supply anymore.

Electric vehicles have less range, and recharge stations aren't plentiful either. There's a legitimate fear of getting stranded. Governments should be helping gas stations install recharging stations (as gas stations must be common, to prevent gas-powered vehicles from being stranded). There may have been such initiatives, but I've not heard of them. Instead, I just hear "their ranges are getting longer" and "you don't need that much range".
Good post, and I think the issue of trust is certainly a big one, and is a real shame. The slow onset of the visibility of the impacts of climate change are also a big factor in why people in general likely aren't internalizing the seriousness of the issue. With regards to many of the other comments on other things like eating meat, biofuels, electric vehicles, etc. - that's why I'm such a big fan of broad based carbon taxes, because then the government and people don't have to make the right decisions on these things by themselves. With appropriate taxes, these things will naturally sort themselves out - people want to keep eating their steak? Go nuts, you'll just have less money to spend on flying around the world now. Electric recharge stations not plentiful enough? Electric cars will easily become more economical for city driving with high gas prices, and with a critical mass of people using electric cars in the city, companies will start to see a market for more chargers, etc.

Quote:
Originally Posted by iamthewalrus(:3= View Post
A few reasons it's difficult:

1. People deeply distrust the government about taxes. I would bet that it's difficult to get even half of the populace to understand the concept of a "revenue neutral tax".
2. A revenue neutral carbon tax looks a lot like income redistribution, which many people are opposed to.
3. Fossil fuel producers make large donations to politicians.
1. Yeah it seems to be a common thread in this discussion, and it's quite unfortunate
2. That could be said about any sort of tax - are those same people opposed to taxes on cigarettes?
3. Sure, but many fossil fuel producers have also come out in favour of carbon taxes - of course, mainly because it provides more cost certainty compared to cap and trade, but also because many of them (at least publicly) acknowledge that climate change is a real issue to be addressed.

Quote:
Originally Posted by septimus View Post
To me, a carbon tax would be an excellent example of libertarian economics at its best! Instead of government coercion, prices are adjusted to reflect otherwise unafforded (i.e. "external") costs. This was discussed at some length in a recent thread. One of the Board's libertarians argued strenuously against this libertarian solution, beginning with



I posted my own views in yet another thread.
So because it is a libertarian solution, it is a bad thing? I'm not quite sure what you are getting at - but if you are suggesting that we shouldn't have a carbon tax unless it comes part and parcel with social justice, I'm going to have to disagree with you. If a revenue neutral carbon tax is on the table, you better take it and run, and try to work towards a "less regressive" tax after it's already enacted. Otherwise, you are partly to blame for the inaction that is occurring on climate change. You say that "change should be evaluated on its own merits" - which I agree with, but somehow come to a completely different conclusion to you about whether the tax should be refunded. A revenue-neutral carbon tax IS the one that is solely for its own merits - it's only objective is to achieve a reduction in carbon emissions. If that results in some poor people suffering, so be it if that is what is necessary to achieve the required reduction in emissions. Poor people will be suffering far more in the future if action isn't taken.

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Originally Posted by Shodan View Post
I think this points up an issue with a carbon tax.

In addition to Kimera757's very cogent point about marketing, those who propose a carbon tax are subject to the temptation to say "while we're at it, let's fix the rest of the system" and then it is harder to debate the carbon tax on its own merits. Witness the Green New Deal, which was supposed to be a proposal to address climate change and turned out to be intended to rewrite the US economy (cite).

"Let's use a carbon tax to address AGW and we will give it all back in rebates" is one thing. "Let's use a carbon tax to address AGW and get more money from billionaires and reduce the deficit and increase spending on solar subsidies and reduce income inequity and..." is quite another.

Regards,
Shodan
Yes, which is why I feel like a lot of left-wing people simply aren't as serious about addressing climate change as they claim they are. The amount of suffering that poor people could experience if we have >2degC warming could be tremendous - and yet people are willing to take that risk so that you can push for a deal that is slightly better for poor people now, despite that drastically lowering the likelihood of the deal occurring? An inability to compromise leaves us where we are now - complete inaction, and thus continuing on our trajectory towards higher warming.
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Old 09-25-2019, 02:01 PM
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My coworker adamantly believes certain things about the carbon tax:

1) It is not revenue neutral. Don't kid yourself, it's just a cash grab by the government.
2) It will cost her a lot of money, even though she has a very efficient house and drives a car with reasonable mileage. Showing her the carbon tax line on utility bills and doing the math to show she's wrong has no impact.
3) It won't change people's behaviour. Energy usage is apparently 100% inelastic in demand.

She steadfastly believes that it will cost some families so much money that it will put them in serious financial difficulty, but that these same families won't do anything whatsoever to decrease their carbon tax exposure. I'm reasonably confident that she won't be voting for the Liberals in the upcoming election.
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Old 09-25-2019, 04:05 PM
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2. That could be said about any sort of tax - are those same people opposed to taxes on cigarettes?
Sure, but it's a much more apt description of revenue neutral taxes, which are literally redistributive.

And think about how they redistribute, too: Largely from poorer rural people to relatively richer urbanites.
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Old 09-26-2019, 09:52 AM
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So the solution the OP is proposing is that the tax that is paid for by consumers, be refunded back to consumers? Am I understanding that correctly? Seem like the primary beneficiary of that type of scheme is the employees hired by the government to administrate the collection and refunding of the tax.
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Old 09-26-2019, 10:52 AM
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If we are going to go to the trouble of implementing and collecting a carbon tax, let's spend that money on research and development of carbon neutral and carbon negative technologies, and not use it to offset income tax.

And don't implement your carbon tax as a sales tax on consumers, rather do it as an excise tax on industry. Excise taxes aren't 100% translatable into price increases.
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Old 09-26-2019, 12:25 PM
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So the solution the OP is proposing is that the tax that is paid for by consumers, be refunded back to consumers? Am I understanding that correctly? Seem like the primary beneficiary of that type of scheme is the employees hired by the government to administrate the collection and refunding of the tax.
The idea is that you collect a carbon tax but redistribute it in some way (either per capita or via income tax reductions or whatever) to fix the problem that carbon has externalized costs without increasing the total tax burden.

On average, the government won't have more money to do whatever, but people will be incentivized to use less carbon-polluting things.

It's a great idea! But the specifics of how the redistribution is done are difficult.
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Old 09-26-2019, 12:56 PM
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Tragedy of the Commons.

If one nations doesnt do it, it gains a edge over all the nations that do.
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Old 09-26-2019, 01:00 PM
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Originally Posted by iamthewalrus(:3= View Post
The idea is that you collect a carbon tax but redistribute it in some way (either per capita or via income tax reductions or whatever) to fix the problem that carbon has externalized costs without increasing the total tax burden.

On average, the government won't have more money to do whatever, but people will be incentivized to use less carbon-polluting things.

It's a great idea! But the specifics of how the redistribution is done are difficult.
The specifics of how to do the redistribution are key.

The idea of imposing a tax on carbon, and then giving the proceeds back so it is revenue-neutral from the point of view of the government, doesn't make a lot of sense if you give the proceeds of the tax to those who used the carbon. Raise your electric bill by $100 a month and cut a check to you for $100 every month, doesn't do much to discourage me using electricity. It also doesn't work, because somehow you have to pay for the administration of collecting the tax and sending it back.

As said above, the temptation is to use this to redistribute income. This can be done in ways that offend everyone - tax everyone on their electricity/gasoline/energy in general, then send it back in income tax rebates, so people who don't pay income tax get nothing or less and people who pay income tax get more. Or send checks back to everyone, regardless of their energy use, which disproportionately benefits a different group.

Or just treat it as general revenue to the government and spend it on subsidies for non-GHG emitting technologies, or anything else the government wants. Which means it isn't revenue-neutral any more, and is just another sales tax.

Taxing industries instead of consumers makes it a regressive sales tax - which subjects government to the temptation of sending rebates just to poor people, so it is income redistribution again.

As I said, it is hard to get the government to do just one thing. Because "if we can get people to sit still for a tax increase, there are all kinds of worthy causes that should be funded!"

A new source of revenue, which the government agrees not to spend. It could happen, but I am not sanguine.

It doesn't mean the carbon tax is necessarily a bad idea, in and of itself, but there are reasons why it hasn't happened already.

Regards,
Shodan
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Old 09-26-2019, 01:57 PM
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Even if you tax the industries, the increased cost will eventually make its way to the consumer.
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Old 09-26-2019, 02:03 PM
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I think the general point is to replicate something like the cigarette tax. The tax is supposed to be high enough that people will seek alternatives. I'm not sure what alternative you can use if you live in a rural area with no public transit, with electric vehicles not yet being cheap or popular enough. It would work great where I live (a big city, where few of my friends own cars).

Directly taxing the taxpayer, or taxing the oil producer, would have the same result; a higher cost, unless the taxpayer can choose another option.

This wouldn't really work well with the attempt at tax neutrality. Suppose the government increased its revenue with a carbon tax amount of X. They reduced income tax by the same amount, X. But now the tax is working, and people reduce their oil and gas consumption. Now the government has less money. The cigarette tax doesn't pretend to be revenue neutral. It's specifically about getting people to stop using a product, and if people continue to do so, the government gets money. Said money might be earmarked specifically for fighting cigarette addiction. I really think a carbon tax needs to go down that route. Said money could be earmarked on researching solutions, or at least on subsidies for renewable energy generation.
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Old 09-26-2019, 02:54 PM
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Even if you tax the industries, the increased cost will eventually make its way to the consumer.
That's not true. Excise taxes don't increase prices by the amount of the excise tax. If industry could charge 5% more for their product, they would. Prices are designed to maximize income and take into account what the market will bear. The reason industry will do whatever they can to block an excise tax, even if it means that their product is instead hit with a higher sales tax rate is that they end up eating the excise tax. In many states, the alcohol excise tax, which is typically charged on gallons, so has no bearing on price or inflation, hasn't been raised in decades, but increased sales tax rates on alcohol have been enacted.
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Old 09-26-2019, 04:23 PM
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I've always wondered why a broad-based carbon tax with 100% of the proceeds refunded to the populace is not a more common approach for attempting to address climate change. It seems like as long as you agree that climate change is a problem that needs to be addressed, you should be supportive of such a scheme. IMO, the simplest and most fair way would be to simply divide the revenue generated from such a tax and write a cheque to every adult in the country for the same amount. To ease the transition and allow people to be able to make meaningful changes to improve their carbon footprint, this tax could start lower but would have to ramp up to pretty significant levels in order to achieve the desired change across the population that it is being applied - ideally, globally.
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Old 09-26-2019, 06:20 PM
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Sure, but it's a much more apt description of revenue neutral taxes, which are literally redistributive.

And think about how they redistribute, too: Largely from poorer rural people to relatively richer urbanites.
True, this is probably one thing that makes things particularly politically difficult. But if it is actually true that poor rural people would be paying more than rich urbanites under a carbon tax, doesn't that mean that they ARE the ones who should be making more significant lifestyle changes to lower their carbon footprint? Whether that involves moving to the city, switching to a more fuel-efficient vehicle, or raising the prices on whatever they sell. Some amount of pain is inevitable - but if done gradually people should be able to adapt to the new norm.


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The specifics of how to do the redistribution are key.

The idea of imposing a tax on carbon, and then giving the proceeds back so it is revenue-neutral from the point of view of the government, doesn't make a lot of sense if you give the proceeds of the tax to those who used the carbon. Raise your electric bill by $100 a month and cut a check to you for $100 every month, doesn't do much to discourage me using electricity. It also doesn't work, because somehow you have to pay for the administration of collecting the tax and sending it back.
Does everyone use the same amount of electricity? The whole idea is that you get your $100 cheque every month, but that amount you pay in taxes depends entirely on you - cut back your electricity usage, and you can be paying $80 per month while still collecting the $100. Pretty simple to me.

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As said above, the temptation is to use this to redistribute income. This can be done in ways that offend everyone - tax everyone on their electricity/gasoline/energy in general, then send it back in income tax rebates, so people who don't pay income tax get nothing or less and people who pay income tax get more. Or send checks back to everyone, regardless of their energy use, which disproportionately benefits a different group.
That's right, it disproportionately benefits people who don't have much carbon footprint, which is entirely the point! Which, incidentally, should be poor people on average, as the cite I linked to before shows that rich people have larger carbon footprints than poorer people. Will some poor rural people be disproportionately negatively affected? Quite possibly - and if it is the case, that is the very price signal that the tax is meant to communicate. Hopefully, your society's safety net will be able to help keep these people afloat and transition to lower-carbon lifestyles. Again, the tax should be introduced gradually to ease people into making these transitions.


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I think the general point is to replicate something like the cigarette tax. The tax is supposed to be high enough that people will seek alternatives. I'm not sure what alternative you can use if you live in a rural area with no public transit, with electric vehicles not yet being cheap or popular enough. It would work great where I live (a big city, where few of my friends own cars).
There's no one right answer, but it could involve them also moving to the city, raising prices on what they sell, etc. Perhaps a lower-carbon future means that only rich people will be able to afford to live in rural areas. And perhaps this helps explain the average person's resistance to wanting to move towards a low-carbon lifestyle - they don't want to change what they are doing. Understandable, for sure. But it's not necessarily a given - perhaps it will turn out that the market will support higher food prices and enable farmers and ranchers to live a lifestyle similar to what they are doing now, and carbon reductions will be made mainly by city dwellers who cover the costs of higher food prices by traveling less and using more efficient transportation. The elegance of the broad based tax/dividend scheme is that nobody has to try to figure out which outcome is more efficient - the market will help determine that.

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This wouldn't really work well with the attempt at tax neutrality. Suppose the government increased its revenue with a carbon tax amount of X. They reduced income tax by the same amount, X. But now the tax is working, and people reduce their oil and gas consumption. Now the government has less money. The cigarette tax doesn't pretend to be revenue neutral. It's specifically about getting people to stop using a product, and if people continue to do so, the government gets money. Said money might be earmarked specifically for fighting cigarette addiction. I really think a carbon tax needs to go down that route. Said money could be earmarked on researching solutions, or at least on subsidies for renewable energy generation.
This is why I'm in favour of just cutting a cheque to everyone - if carbon emissions go down, then the dividends go down, but it doesn't affect the government's bottom line in any way. As the dividends go down, people who may have been using the dividends to sustain a more carbon intensive lifestyle will continue to be pressured more to find ways to reduce their carbon footprint. I am definitely supportive of incentivizing new technology development and renewable technologies, but subsidies always have the potential issue of having to pick winners and losers (ie. you might sink a ton of money into cold fusion, and it turns out that we are never able to surmount the engineering challenges, in which case that money is wasted). Nevertheless, putting some of the tax towards subsidizing renewables and low carbon tech is likely a decent idea because if carbon emissions decline and tax revenues decline, that should suggest that we don't need to spend as much money on subsidizing renewables anymore. Still, with a straight tax-and-dividend model, with taxes appropriately high, renewables should have a significant competitive advantage over fossil-fuel based energy sources anyway, so a subsidy is not necessarily needed (I understand that R&D for new technology could still use some up-front infusion of capital that might still not be available under a pure tax-only-no-subsidies regime, so that should be considered).


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That's not true. Excise taxes don't increase prices by the amount of the excise tax. If industry could charge 5% more for their product, they would. Prices are designed to maximize income and take into account what the market will bear. The reason industry will do whatever they can to block an excise tax, even if it means that their product is instead hit with a higher sales tax rate is that they end up eating the excise tax. In many states, the alcohol excise tax, which is typically charged on gallons, so has no bearing on price or inflation, hasn't been raised in decades, but increased sales tax rates on alcohol have been enacted.
Sure, but at least some of the tax should cascade down to higher prices, especially since this should be applied on a very broad basis. If prices aren't changing, then how will people know what are the carbon-intensive things in their life? The whole point of this tax IS for the costs to be passed down to the consumer, so that they can adjust accordingly to lower-priced, and thus lower carbon footprint goods and services. Fuel SHOULD be expensive to entice people to carpool, use public transit, fly less, buy local, etc. Perhaps there are some really non-obvious things that have high carbon footprint that people would be just fine cutting out of their lives - if they knew about it. Otherwise, the idea is that the tax should cause everyone a bit of pain, which can be lessened by making choices to lower your carbon footprint.
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Old 09-26-2019, 06:25 PM
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Old 09-27-2019, 02:58 AM
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So because it is a libertarian solution, it is a bad thing? I'm not quite sure what you are getting at - but if you are suggesting that we shouldn't have a carbon tax unless it comes part and parcel with social justice, I'm going to have to disagree with you. If a revenue neutral carbon tax is on the table, you better take it and run, and try to work towards a "less regressive" tax after it's already enacted.
What???? I support a carbon tax BECAUSE it is a libertarian solution. What made you think otherwise? Do you think everyone who supports libertarian thought is a fanboi of Ron Paul and Alex Jones?

And where did I link such a tax to "social justice"??

What I DO believe is that a gasoline tax, in isolation, would make net taxation in the U.S.A. even more regressive than it already is. A serious carbon tax proposal would have to be designed NOT to steal further from the needy. OK? My proposal is very simple and easy to implement: Remit the first $X of each worker's annual SocSec tax. To avoid confused digressions into "revenue non-neutrality", I set $X to balance the carbon tax.

But since you bring up the term "revenue-neutral", perhaps we need a new thread to discuss why that very phrase has now become hate speech! Was Trump's trillion-dollar tax cut "revenue neutral"? Of course not! Increasing federal debt was a major purpose of that tax cut. Was the insane war in Iraq "revenue-neutral"? Are the lush defense contracts to Lockheed Martin and General Dynamics "revenue-neutral"?
... Yet if a rational thinker proposes a new tax to offset the trillions of debt ... that's condemned as not being "revenue-neutral"?? Give us a break.
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Old 09-27-2019, 10:46 AM
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The following comment appears to be directed at me:

What???? I support a carbon tax BECAUSE it is a libertarian solution. What made you think otherwise? Do you think everyone who supports libertarian thought is a fanboi of Ron Paul and Alex Jones?

And where did I link such a tax to "social justice"??

What I DO believe is that a gasoline tax, in isolation, would make net taxation in the U.S.A. even more regressive than it already is. A serious carbon tax proposal would have to be designed NOT to steal further from the needy. OK? My proposal is very simple and easy to implement: Remit the first $X of each worker's annual SocSec tax. To avoid confused digressions into "revenue non-neutrality", I set $X to balance the carbon tax.

But since you bring up the term "revenue-neutral", perhaps we need a new thread to discuss why that very phrase has now become hate speech! Was Trump's trillion-dollar tax cut "revenue neutral"? Of course not! Increasing federal debt was a major purpose of that tax cut. Was the insane war in Iraq "revenue-neutral"? Are the lush defense contracts to Lockheed Martin and General Dynamics "revenue-neutral"?
... Yet if a rational thinker proposes a new tax to offset the trillions of debt ... that's condemned as not being "revenue-neutral"?? Give us a break.
Apologies for misinterpreting your post as snark - it is just pretty rare for anyone on this board to refer to something as being libertarian with positive connotations.

You may be interested to read this paper about the expected impacts of different schemes (also summarized by Vox). A per-capita refund/dividend will actually result in a net reduction in tax burden for the poor (with significant improvement for the lowest quintile), but also has the most dampening effect on the GDP (~0.4%reduction per year per this paper), while payroll tax reductions primarily benefit the middle class but could potentially have a positive impact to GDP. Deficit reduction ends up being more regressive than either option.
  #29  
Old 09-27-2019, 06:39 PM
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I thought about who would be hurt by such a tax and thought of the Alaska Example.

Alaska, being a mostly frozen wasteland of low temperatures, little sunlight during parts of the year, and large distances between towns, is a place where you need a shit-ton of fossil fuels. For heating, for most of the industries based there, even to get around you frequently need to fly in small inefficient planes. So the carbon tax would cause all the residents of Alaska's costs to skyrocket, but they would not receive any more than any other USA adult when the refund is issued.

But then I realized that this tax incentivizes the residents of Alaska to move where it's warmer and they can live more efficiently, which is working as intended.

But then, what about people who make their careers specializing in oil extraction in low temperatures or fishing or whatever other industries are in Alaska. Since the price of fuel would increase, and since alternatives work poorly in such extreme conditions (batteries don't work as well, solar panels don't work as well either...though a quick Google search says that wind power works extremely well), some of them would be out of work.

But so what? Ultimately any change to the laws of the USA is going to hurt some industry. Individual companies rise and fall all the time without the government doing anything. Ultimately, adults who stay employed have broadly marketable skills.

The US should probably have free vocational training, where the training is specific to whatever skills are presently in demand (government doesn't pay for just any training, only the training that's cost effective and has a high success rate) anyways.

For the libertarian and conservatives among us, perhaps that training should be calibrated to make sure that the average recipient will statistically pay in more in extra taxes than the training cost.

Last edited by SamuelA; 09-27-2019 at 06:41 PM.
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Old 09-27-2019, 08:15 PM
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Don't refund to the populace. Instead, put directly in basic needs that poor people need, such as public health care and food security. This alleviates the problem of poverty.

One problem is that significant aspects of manufactured goods and even mechanized agriculture involve fossil fuels, such that a broad-based carbon tax will also lead to price increases for basic needs.
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Old 09-27-2019, 08:29 PM
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I've always wondered why a broad-based carbon tax with 100% of the proceeds refunded to the populace is not a more common approach for attempting to address climate change.
One can debate about why it's not more common, but it's certainly doable and it's been done:
One key component of the federal carbon tax is that it’s revenue-neutral, similar to the policy proposal from Citizens’ Climate Lobby. All the taxed money will be distributed back to the provinces from which they were generated. The provinces will in turn rebate about 90% the revenues back to individual taxpayers. The rebates are anticipated to exceed the increased energy costs for about 70% of Canadian households.
https://www.theguardian.com/environm...ans-more-money
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Old 09-27-2019, 08:45 PM
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Don't refund to the populace. Instead, put directly in basic needs that poor people need, such as public health care and food security. This alleviates the problem of poverty.

One problem is that significant aspects of manufactured goods and even mechanized agriculture involve fossil fuels, such that a broad-based carbon tax will also lead to price increases for basic needs.
I don't disagree but perfect is the enemy of the good.
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Old 09-27-2019, 08:58 PM
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I oppose it because big government has no damn business trying to social engineer our lives like this and it's likely to cost me a huge amount of money.

Government needs to stick to defending the country, locking up criminals, and patching potholes rather than vacuuming money out of some people's wallets and discharging it into other people's wallets.

I'd reckon most people on the right feel likewise.

Last edited by Mdcastle; 09-27-2019 at 09:00 PM.
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Old 09-27-2019, 09:16 PM
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Government needs to stick to defending the country,
Keeping the environment from becoming unlivable is defending the country.
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Old 09-27-2019, 09:55 PM
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I oppose it because big government has no damn business trying to social engineer our lives like this and it's likely to cost me a huge amount of money.

Government needs to stick to defending the country, locking up criminals, and patching potholes rather than vacuuming money out of some people's wallets and discharging it into other people's wallets..
So right now, the government has a lot to say. It requires appliances and automobiles to be a certain minimum level of efficiency. It banned the incandescent lightbulbs. There's an effort to fight phantom power draw. There's hundreds and hundreds of other laws and restrictions I don't know about.

The basic idea of the carbon tax is you apply it at the highest level possible. Probably right at the refinery level or the natural gas distribution level. Basically, the moment a fossil fuel is committed to a path where it will eventually be burned, you make that massive corporate entity actually write the checks. (they are obviously going to pass the cost on down the line)

This makes the tax fairly straightforward and cheap to administer. And in turn the refund is also pretty straightforward, given the same way tax refunds are.

This is really efficient and elegant. The government won't have to require you buy an efficient car - your wallet will encourage this for you. It won't have to encourage you not to fly unnecessarily, the ticket prices will tell you this for you. It won't have to force you not to buy incandescent lightbulbs and live in an inefficient home - that power bill is how you know you should consider this.

Also it creates incentive for more innovation, there are likely all kinds of even more efficient products we haven't ever considered because fossil fuel energy is so cheap.

Also, in the short run, windmill driven power will suddenly be hugely cheaper than everything else. And battery electric cars will be a no-brainer.

Why do you think the carbon tax will cost you a huge amount of money? Do the other people's lives you are affecting with your pollution have no value?

Last edited by SamuelA; 09-27-2019 at 09:56 PM.
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Old 09-28-2019, 07:35 AM
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Don't refund to the populace. Instead, put directly in basic needs that poor people need, such as public health care and food security. This alleviates the problem of poverty.
This is two unrelated issues, and also a good way to lose the support of the middle class.
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Old 09-28-2019, 09:08 PM
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This is two unrelated issues, and also a good way to lose the support of the middle class.
Sorry, what are the two unrelated issues. And doesn't alleviation of poverty lead to the rise of a middle class? That's what happened globally.
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Old 09-28-2019, 09:26 PM
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So right now, the government has a lot to say. It requires appliances and automobiles to be a certain minimum level of efficiency. It banned the incandescent lightbulbs. There's an effort to fight phantom power draw. There's hundreds and hundreds of other laws and restrictions I don't know about.
You're assuming for some reason I think the government has any damn business telling me to use those horrible LED light bulbs or drive microscopic clown cars. I do not.

Quote:
This is really efficient and elegant. The government won't have to require you buy an efficient car - your wallet will encourage this for you. It won't have to encourage you not to fly unnecessarily, the ticket prices will tell you this for you. It won't have to force you not to buy incandescent lightbulbs and live in an inefficient home - that power bill is how you know you should consider this.
There's no distinction between passing a law saying I have to drive a microscopic clown car and making spacious, comfortable capable cars so expensive I have no choice but to "voluntarily" drive one. Or use those horrid 80-93 CRI, not very dimmable LED builbs instead of 100 CRI fully dimmable incandescents.


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Why do you think the carbon tax will cost you a huge amount of money? Do the other people's lives you are affecting with your pollution have no value?
Because I like living a modern, comfortable, all-American lifestyle, not a lifestyle like a caveman in the stone age that the environmentalists want me to live.
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Old 09-28-2019, 09:43 PM
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Because I like living a modern, comfortable, all-American lifestyle, not a lifestyle like a caveman in the stone age that the environmentalists want me to live.
This is an honest question: do you feel any responsibility to consume goods and services in a responsible manner?

For example, let us say that you knew that your purchase of gasoline from a particular station would have you funneling money directly to Osama bin Laden’s coffers. Or, you’re looking for a new gun for home defense, but the store giving you a great deal is also selling weapons to Mexican cartels.

Would you say that such purchases would not be harmful on their face, and that since you are just one of so many others buying those goods, you aren’t actually contributing to any problems in a measurable way?

Or would you find that it would be unethical to do business under those circumstances, regardless of how little your money means in the big picture, and seek alternatives?

Or maybe you just prefer not to think about it, so you will just do what you want because it serves your interest, and critics are just overthinking things?

Again, honest questions. I’d like to understand how you think about such scenarios.
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Old 09-28-2019, 09:59 PM
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You're assuming for some reason I think the government has any damn business telling me to use those horrible LED light bulbs or drive microscopic clown cars. I do not.

There's no distinction between passing a law saying I have to drive a microscopic clown car and making spacious, comfortable capable cars so expensive I have no choice but to "voluntarily" drive one. Or use those horrid 80-93 CRI, not very dimmable LED builbs instead of 100 CRI fully dimmable incandescents.


Because I like living a modern, comfortable, all-American lifestyle, not a lifestyle like a caveman in the stone age that the environmentalists want me to live.
You think 93 CRI is even perceptible? I suspect you couldn't tell in a "blind" A:B test. I don't personally notice a difference.

As for the dimming problem, they have a solution for that. Smart bulbs. Those dim better than incandescents ever did with the wall dimmer switches. (and no, you don't have to use a voice listening device like Alexa to control them, you can use a phone or wall mounted dimming control. Just pretty fucking convenient to say "Alexa, turn the lights to 20%" and it works immediately and reliably without having to get up)

What you are calling an "All American" lifestyle isn't a god given right. Only you and your immediate ancestors (boomer parents) are the only members of humanity to ever enjoy this lifestyle in significant numbers.

I assume you are talking about a 5000+ square foot cheaply build "mcmansion", with low efficiency central air conditioning that used ducts, with lots and lots of leaky windows and thin walls with fiberglass batting insulation that also leaks. And a couple of big pickup trucks and an SUV parked in front.

You know, an enormous fucking brick of metal that gets under 15 mpg that you use to commute 2 hours each day back and forth to work because you need a fuck-ton of land to even fit all those mcmansions so the city sprawls out 60 miles. And when you're commuting the only thing the truck is carrying is your overweight self and maybe a briefcase.

You seem to react rather emotionally to even the thought of anything less. I guess you'd rather be dead than live in a 2k square foot house or apartment, eh? One with ductless "european" style AC. In a higher density city where most of the transport is electric buses, electric bikes and scooters, and electric taxies. Like, uh, China is doing really rapidly.

Most of the world lives like this, including tons of first world countries. And those people seem pretty happy to me. You don't need "All American" inefficient things to have a happy life and it seems to have serious environmental consequences.

Last edited by SamuelA; 09-28-2019 at 10:03 PM.
  #41  
Old 09-28-2019, 10:05 PM
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There's no distinction between passing a law saying I have to drive a microscopic clown car and making spacious, comfortable capable cars so expensive I have no choice but to "voluntarily" drive one. Or use those horrid 80-93 CRI, not very dimmable LED builbs instead of 100 CRI fully dimmable incandescents.


Because I like living a modern, comfortable, all-American lifestyle, not a lifestyle like a caveman in the stone age that the environmentalists want me to live.
Ah, those stone age cavemen, with their LED light bulbs and their small cars.


It sounds to me that either you don't believe it makes all that big a difference what size car you drive or what kind of light bulbs you use, or you don't care,

If it's the former, you should welcome a carbon tax, provided it's fairly and accurately imposed. You still get the choice to do what you want; you just have to pay for its effects on the world, and if those effects are insignificant, so is the cost to you.

If it's the latter, I'm not sure what I can say to you outside the Pit.
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Old 09-29-2019, 03:12 AM
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The specifics of how to do the redistribution are key.

The idea of imposing a tax on carbon, and then giving the proceeds back so it is revenue-neutral from the point of view of the government, doesn't make a lot of sense if you give the proceeds of the tax to those who used the carbon. Raise your electric bill by $100 a month and cut a check to you for $100 every month, doesn't do much to discourage me using electricity. It also doesn't work, because somehow you have to pay for the administration of collecting the tax and sending it back.

As said above, the temptation is to use this to redistribute income. This can be done in ways that offend everyone - tax everyone on their electricity/gasoline/energy in general, then send it back in income tax rebates, so people who don't pay income tax get nothing or less and people who pay income tax get more. Or send checks back to everyone, regardless of their energy use, which disproportionately benefits a different group.
One or another aspect of this problem is why the idea isn't that popular.

Like you say and is obvious, the tax has to redistribute at least from people with relatively more carbon intensive lifestyles to those with relatively less carbon intensive lifestyles, even at a given income level, or else it's pointless. IOW in the simplest most honest form possible it is, as a rule, taking money from less densely populated places and paying it out to more densely populated places. Because under a strictly market pricing of energy the former tend to have higher carbon intensity (on the consumption side: further to travel on average, harder to do so other than by car, fewer walls of indoor heated spaces abut other people's indoor spaces etc; and on the production side too, fossil fuel extraction/production is a relatively bigger economic activity in less dense areas). It's no surprise that's a challenge in the urban v rural politics of a lot of countries.

Then as you also pointed out in a couple of posts, on the left side especially it's really difficult to propose any new tax, expend the political capital to drag it through the process, then 'waste' the potential to use it to redistribute income from higher to lower income groups even at a given level of carbon intensity, besides redistributing by carbon intensity. Or potential allies really prefer more fundamental collectivization of the economy (eg. 'Green New Deal') and the climate issue is actually in part a means to that end. A redistribution by carbon intensity just doesn't do what they actually want to do.

On the right side of things a lot of people have real skepticism about the future cost of climate change. In this regard I think it's useful to look beyond the set piece battle between 'deniers' and 'those who listen to science' and realize that 'consensus science's' estimate of the expected future cost of climate change in *temperate countries* as % of GDP is much lower than the estimate for the world as a whole. This has been illustrated in various releases by the US govt, even as some of them are trumpeted by the media as dire warnings about climate change. Like the one which (supposedly) embarrassed the current admin in the last year (similar to others going back across various admins). A relatively bad case non-carbon action scenario amounted to a big $ number annual cost to US econ by 2100, but a quite small % of what would be a much larger US real GDP by then if there's reasonable growth. Really bad expected outcomes are mainly in already hot areas (though a graphic in The Economist's 'Climate Issue' last week pointed that relatively *within* the US 'red states' would be hit harder). So paying a net cost in economic efficiency to reduce carbon intensity is *in part* a foreign aid project, or could reasonably be seen as one if the debate got sophisticated enough.

Then to the extent you are redistributing even just from more carbon intensive to less carbon intensive people/places/economic sectors, that doesn't magically become economically efficient just because it's 'revenue neutral'. The differential costs you are imposing, away from solutions the market would choose with no carbon tax, have to be less than the externality costs you're avoiding by cutting carbon emissions. That's not a no brainer for significant carbon taxes if you consider the globally disparate impact of not taking action, and seek to have the tax justify itself on a nation basis. It's really not just 'greed' of some chosen bogeyman like 'corporations'. A high carbon tax that results in adopting less efficient (not considering carbon externalities) ways of producing and using energy (or else they'd be the ways already adopted) is for a 'societal' benefit that might be disproportionately in other countries. It's no surprise that's a big political challenge in a world of separate national govt's.

Last edited by Corry El; 09-29-2019 at 03:16 AM.
  #43  
Old 09-29-2019, 09:24 AM
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You seem to react rather emotionally to even the thought of anything less. I guess you'd rather be dead than live in a 2k square foot house or apartment, eh? One with ductless "european" style AC. In a higher density city where most of the transport is electric buses, electric bikes and scooters, and electric taxies. Like, uh, China is doing really rapidly.
Yes, quite frankly. I'd rather be dead than have to put up with living in an apartment building instead of my house and have to ride a bus instead of owning an SUV.
  #44  
Old 09-29-2019, 11:40 AM
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I assume you are talking about a 5000+ square foot cheaply build "mcmansion", with low efficiency central air conditioning that used ducts, with lots and lots of leaky windows and thin walls with fiberglass batting insulation that also leaks. And a couple of big pickup trucks and an SUV parked in front.

You know, an enormous fucking brick of metal that gets under 15 mpg that you use to commute 2 hours each day back and forth to work because you need a fuck-ton of land to even fit all those mcmansions so the city sprawls out 60 miles. And when you're commuting the only thing the truck is carrying is your overweight self and maybe a briefcase.

You seem to react rather emotionally to even the thought of anything less. I guess you'd rather be dead than live in a 2k square foot house or apartment, eh? One with ductless "european" style AC. In a higher density city where most of the transport is electric buses, electric bikes and scooters, and electric taxies. Like, uh, China is doing really rapidly.

Most of the world lives like this, including tons of first world countries. And those people seem pretty happy to me. You don't need "All American" inefficient things to have a happy life and it seems to have serious environmental consequences.
You know I'm pro carbon tax but I've got to say your description of a environmentally friendly life sounds terrible. I've lived in modern apartments and it was terrible. I never want to share walls again. I hate public transportation and if I could afford it would never fly outside of a private plane. Buses and trains are terrible ways to get around. I've spent more then a decade living outside of the US and I firmly believe that the rural/suburban lifestyle is vastly preferable to what us common outside the US. I would be shocked if you convinced anyone to support a carbon tax based on converting people to that.

On the other hand I'm really excited about the Rivian R1T and R1S since they seem to solve most of the problems I have with electric vehicles and I'll hopefully be buying one in 2021. Instead of trying to force people into driving shitty electric death traps I get amazing reactions from my friends who work in oil and gas when I tell them about a truck that can do 0-60 in 3 seconds, tow 11,000 pounds and has a 400 mile range between charges. They don't really care that its electric but they do care that its better then their F150 in every way. In the same way getting someone to convert to an electric house from their dependance on natural gas is better done by showing them how awesome an induction stove is compared to even a top end gas range rather then telling them they have to cook on a shitty electric cook top to save the world.

As for the actual topic of the thread. The problem with the carbon tax is that people on the right see it as destroying their lifestyle and people on the left see if as a money grab to fix the ills of society. If it could be shown as a method to simply make costs that are already their concrete and allow the market to then act on the increased knowledge you could get people on the right to agree especially once you can show that they can still drive their truck and have a good life. People on the left need to be convinced that solving all of society's problems simultaneously isn't going to happen and they need to focus on important things. If solving wealth inequality is more important, fine but quit using climate change as you fig leaf to get the rest of us to accept it. If climate change is the most important thing then focus on that and pass a bare bones carbon tax and refund.
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Old 09-29-2019, 06:45 PM
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Sorry, what are the two unrelated issues.
Poverty and the environment are unrelated issues, politically.

The suggested carbon taxes are consumption taxes. People who use less carbon would pay less than people who use more carbon. There would be a lot more political support for spending any carbon tax money on environmental initiatives.
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Old 09-29-2019, 07:10 PM
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Poverty and the environment are unrelated issues, politically.

The suggested carbon taxes are consumption taxes. People who use less carbon would pay less than people who use more carbon. There would be a lot more political support for spending any carbon tax money on environmental initiatives.
As I explained in my first post, "One problem is that significant aspects of manufactured goods and even mechanized agriculture involve fossil fuels, such that a broad-based carbon tax will also lead to price increases for basic needs." Those are the same basic needs of the poor.
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