ThePanelist.com - Without a Carbon Tax, Markets Can't Solve Carbon Emissions

Without a Carbon Tax, Markets Can't Solve Carbon Emissions

Written by David Neubert

Monday, 26 November 2007

I'm starting to know what New York Times blogger, James Kanter means when he says that real solutions for carbon reduction are far off in the future. A carbon tax remains the most simple solution and, priced right, would allow business and consumers to decide whether carbon sequestration, reduced consumption or alternative energy sources make the most sense and in what situations. The market is a fantastic allocator of capital. The market is not so good at providing for the common good of the environment or recognizing economic externalities.

The only oil producer I know of with a serious carbon sequestration program is the Norwegian Statoil (STO -$32.50), which I own.

Disclosure: I own STO. I do not do any personal carbon sequestration. Fall Colors in The Berkshires

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written by Dan , November 28, 2007

You're right that a carbon tax is the most simple solution. It's also the most equitable solution and the one most likely to result in GHG emissions reductions. So why assume real solutions are far off in the future. With a new Congress and president in 2009 and a year before then to fairly compare a revenue neutral carbon tax to cap-and-trade, carbon taxes should be near the top of the agenda in about 14 months. To see a comparison of carbon taxes to cap-and-trade, take a look at our Carbon Tax Center website (www.carbontax.org).

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written by Adam Waitt , December 02, 2007

As an opponent to all forms of taxation, including Pigovian taxes, I would have to disagree. Putting aside the supposed environmental benefits, a carbon tax would be used as a precedent for further taxation of activities that the state deems negative or detrimental; sending us further down the road towards ridding the individual of their personal liberty.

In addition, it would no doubt significantly increase costs in numerous industries which will equate to higher prices across the board for consumers. Unbeknownst to most consumers, taxes already account for an average of $0.42 per gallon (which is more then the oil companies make in profit). It would also be discriminatory to lower income households because the tax would be naturally regressive and take up a much greater portion of their income.

One of the biggest problems with our philosophy in this country today is that our first impulse on how to fix a problem is to tax it, without considering all of the ramifications. In a true free market (one that enforces decisive property right arbitration) those who are concerned about carbon emissions would form private consumer education groups which would report the environmental friendliness of companies and energy sources. They would also be able to file class action lawsuits against the most egregious of offenders because of the unnecessary pollution of their personal property (their land and the air above it).

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