carbon tax

It’s not optimal, but he says he’s serious about it at least

As you’ll recall, a few weeks ago Rep. John Dingell said in an interview that he plans to introduce a carbon tax bill, "to see how people really feel about this." He expressed doubt that the American people are willing to pay what it will cost. Reaction from progressives was swift and vicious. Everyone assumed […]

Very interesting

Here’s an interview with Gilbert Metcalf, a Tufts University economics professor who’s been circulating a carbon tax proposal (PDF) that’s revenue neutral — it uses the carbon tax revenue to reduce other taxes. It’s called the "Green Tax Swap." Good stuff. Here’s one good bit : SM: Rep. John Dingell said he plans to propose […]

The connection between congestion pricing and carbon taxes

I wrote this piece linking NYC Mayor Bloomberg's congestion pricing proposal with a carbon tax, in June. I shopped it around but none of the big papers took it. Now, NY Times columnist Tom Friedman -- perhaps the second-most visible supporter of carbon taxes (after Al Gore) -- has written a column backing the Bloomberg pricing plan. "Crunch time" for the plan may come as early as the next day or two. So it's time the piece saw the light of day.

Every so often there arises an environmental controversy that tests the capacity of Americans to face reality. One such case is emerging in New York City, where Mayor Michael R. Bloomberg has proposed a "congestion fee" on cars and trucks driving into Manhattan.

Backers from the mayor on down tout the fee as a cure-all: it will unsnarl traffic, relieve pollution and create a revenue stream to upgrade subways and buses, while also cutting global warming emissions.

These claims are a bit overstated. More probably there will be a single-digit increase in traffic speeds, a one percent drop in emissions citywide, and perhaps a $400 million revenue infusion for a transportation system whose annual costs top $30 billion.

But even though the immediate benefits of the congestion charge are relatively modest, the act of imposing such a charge is transformative in itself.

He proposes a carbon tax, assuming it will fail

Last Sunday, Rep. John Dingell appeared on the C-SPAN show Newsmakers for a 30-min. interview (transcript here; video accessible via the website), and caused an enormous ruckus with this: SWAIN: Mr. Chairman, I want to go back to your statement that the American people want action [on climate change]. Does that also correlate with the […]

He’s pro-carbon tax, anti-CAFE — which matters more?

Last week, Rep. John Dingell (D-Mich.), chair of the Energy & Commerce Committee, dropped this bomb (sub. rqd.): My own judgment is that we are going to have to adopt a cap-and-trade system and some form of carbon emission fee to achieve the reductions we need. Lest you missed it, “carbon emission fee” is clever […]

Picking apart an argument against carbon taxes

Yesterday's L.A. Times ran an odd op-ed calling carbon taxes an ineffectual antidote to global warming. Unlike other critiques that brand carbon taxes politically unpalatable, this one argued that they're simply not up to the job of cutting carbon emissions:

Carbon taxes -- taxes on energy sources that emit carbon dioxide (CO2) -- aren't a bad idea. But they only work in some situations. Specifically, they do not work in the transportation sector, the source of a whopping 40% of California's greenhouse gas emissions (and a third of U.S. emissions).

I've known Daniel Sperling, the author of the op-ed, for decades. As the long-time director of the Institute of Transportation Studies at UC Davis, Dan probably knows as much about automotive engineering as anyone in the world. What's more, he's conscientious, tireless, and concerned.

So why do I think he's wrong about carbon taxes? Actually, Dan is part right, but his message is wrong. Let me explain.

Dingell floats it; Boucher knocks it down

Hmm? What’s all this now? John Dingell is floating the possibility of a carbon tax? From CongressNow (sub. rqd.): Rep. Rick Boucher (D-Va.), who will play a key role in crafting the House version of comprehensive climate change legislation, on Wednesday night downplayed speculation that the House bill could include some form of a tax […]

What good carbon policy should — but often doesn’t — reward

Too much of the debate on carbon-control policy starts from flawed assumptions. Take those assumptions away, and one quickly realizes that we have a lot of pretty good options.

Let's parse the carbon policy argument, and think for a moment about how to best engender the most economically beneficial carbon reduction policy.

First, let's strike any false assumptions from our logic:

1. Let's not assume that it costs money to reduce carbon emissions until proven otherwise.
2. Let's not presume that any of us know what the answer is.

Take these away, and you can pretty quickly get a good model. Picture, if you will, a 2x2 matrix of all the world's policy options. On one axis we list things that reduce or increase carbon emissions. On the other, we list things that cause GDP to grow or shrink. The middle of the plot (0,0) is the status quo. No change in emissions, no change in the economy.

Clearly, we ought to preferentially deploy resources towards those options that win on both metrics. Equally clearly, we ought not to spend any time on options that lose on both metrics. And once we've picked up all the low-hanging fruit in that win/win box, we can start getting into really hard political debates about whether win/lose beats lose/win.

And yet ... and yet.

It’s all about raising the price of carbon

Robert Reich — Secretary of Labor under Clinton, economic policy professor/pundit — has a somewhat confused column up advocating for a "carbon auction." In particular, it’s not clear whether he’s talking about politics or policy, which is a confusion that generally plagues this discussion. He rejects a carbon tax because it will be politically unpopular. […]