Mark Silk: The Moral Inadequacy of Carbon Taxes

Imagine this:

Instead of backing a constitutional amendment to abolish slavery, President Lincoln proposes to tax ownership of human beings. “This will incentivize Southern landowners to shift to paid agricultural labor,” he tells Congress. “Freeing the slaves outright would undermine much of our reunited country’s economy.”

Or this:

After Pearl Harbor, FDR proposes to tax new automobiles, thereby incentivizing car companies to produce tanks and aircraft for the war effort. “Ordering Chrysler, Ford and General Motors to cease automobile production would be undemocratic,” he tells Congress. “And guaranteeing them a 10 percent profit, as some are suggesting, would add unnecessarily to the federal deficit.”

Ridiculous? Of course. But not much more ridiculous than proposing a tax on carbon as the solution to climate change.

This column is not unaware that the climate policy wonks and the big green organizations think taxing carbon is a great idea. Or that the Nobel Prize in economics just went to Yale’s William Nordhaus for making the case for it. Or that it has been enthusiastically embraced by the U.N. Intergovernmental Panel on Climate Climate, whose recent report gives us 12 years to get our act together.

So let’s stipulate that a (very high) tax on carbon would be the most economically efficient way to achieve the necessary reduction in the amount of greenhouse gases being pumped into the atmosphere. And if the sole determinant of climate policy were economic efficiency, everything would be cool.

But it’s not. Consider the politics.

In 2012, the Australian government put in place a cap-and-trade program (similar to a carbon tax) that significantly reduced greenhouse gas emissions by raising the price of carbon to $23 per metric ton. The following year, a new government bowed to public and industry pressure and did away with it.

In Washington State, where environmentalism is effectively the dominant religion, voters in the midterm elections soundly rejected a ballot measure that would have taxed oil refineries $15 per ton of carbon. In France, the yellow vest protests have forced the government to suspend a new fuel tax increase.

Yes, carbon taxes are in place in a number of places, but the rates are woefully inadequate to the task of keeping global warming under the new benchmark of 1.5 degrees Celsius above preindustrial levels. The fact of the matter is that in the real world, taxing carbon has done far less to curb greenhouse gas emissions than command-and-control policies such as mandatory mileage and fuel emissions standards.

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Source: Religion News Service