Carbon Taxes and Carbon Pricing Are Not Solutions to the Climate Crisis

Yves here. There is yet another reason why carbon taxes and pricing are not good ways to combat climate change. Economist Martin Weitzman developed a framework for how to deal with externalities like pollution. Andrew Haldane’s summary:

In making these choices [between taxation and prohibition], economists have often drawn on Martin Weitzman’s classic public goods framework from the early 1970s.13 Under this framework, the optimal amount of pollution control is found by equating the marginal social benefits of pollution-control and the marginal private costs of this control. With no uncertainty about either costs or benefits, a policymaker would be indifferent between taxation and restrictions when striking this cost/benefit balance.

In the real world, there is considerable uncertainty about both costs and benefits. Weitzman’s framework tells us how to choose between pollution-control instruments in this setting. If the marginal social benefits foregone of the wrong choice are large, relative to the private costs incurred, then quantitative restrictions are optimal. Why? Because fixing quantities to achieve pollution control, while letting prices vary, does not have large private costs. When the
marginal social benefit curve is steeper than the marginal private cost curve, restrictions dominate.

The results flip when the marginal cost/benefit trade-offs are reversed. If the private costs of the wrong choice are high, relative to the social benefits foregone, fixing these costs through taxation is likely to deliver the better welfare outcome. When the marginal social benefit curve is flatter than the marginal private cost curve, taxation dominates. So the choice of taxation versus prohibition in controlling pollution is ultimately an empirical issue.

Needless to say, with more and more scientists calling climate change an emergency, limits and prohibitions are the proper tools.

By Richard Murphy, a chartered accountant and a political economist. He has been described by the Guardian newspaper as an “anti-poverty campaigner and tax expert”. He is Professor of Practice in International Political Economy at City University, London and Director of Tax Research UK. He is a non-executive director of Cambridge Econometrics. He is a member of the Progressive Economy Forum. Originally published at Tax Research UK

I have for some time resisted writing about why I found the issues of carbon pricing and carbon taxation so difficult. I think the time to address those issues has arrived.

At its core the reason why I dislike both those notions is that they miss the point of the climate crisis. What they presuppose is that we can price our way out of an emissions crisis that we now know threatens the future of life on earth. And the simple fact is that we can’t do that. There is no way we can be priced out of this issue. We can only solve the emissions crisis by stopping emissions. And taxing them won’t do that, any more than taxing tobacco has ever stopped smoking. Other measures – like bans – have been needed to make progress on that goal. That is even more the case for carbon. 

As importantly, the essence is that what both carbon tax and carbon price arguments suggest is that business can carry on supplying products emitting carbon as before, but that those products will simply suffer a price differential when compared to lower or non-carbon emitting products and what we are then supposed to rely on is the price mechanism of the market to alter consumer demand. I suggest that logic is wrong.

First, this assumes that none of the responsibility for the climate crisis rest on the manufacturers of the products that have get us into this mess. That’s definitely wrong. They are primarily to blame. They have known for decades what they have been doing with regard to carbon emissions, and have carried on doing it regardless. And we can be quite sure that they will carry on doing so into the future if they can pass the blame to us as consumers who, they will say, clearly indicate we still want their polluting and life-threatening products if we still buy them after carbon taxes are added. What this ignores is the fact that much of that demand will be driven by an absence of alternatives, which business will have no incentive to promote if there are carbon taxes, and that consumer behaviour is anyway heavily influenced by supplier behaviour through advertising and other market-distorting activities. 

Second, this assumption presumes that we, as consumers, know as much about the products that we buy as those who sell them do. It is presumed, therefore, by the proponents of carbon taxes and carbon trading that we can make rational, informed decisions on this issue after tax is added to a price.  That, though, is clearly absurd. The makers of products known massively more about the carbon impact of what they are doing than a consumer might ever do. The asymmetries between the two are enormous. In that case to presume that the consumer can make an informed choice on such an issue, even after a tax is added, is just wrong.

And third, there is no market for carbon. There has never been. It’s a fictional creation that pretends that something is being done when that is not true. No one wants to buy or sell carbon. It’s an externality that cannot be priced. That’s partly because no one wants it. That essential quality of a market – a willing buyer – does not exist.  But it’s also because you cannot price something that we know has to be unavailable to any market. A market presumes that there will be demand. The reality is that we have to eliminate that demand to ensure there can be life on earth.

The ideas behind both carbon taxes and carbon pricing are, then, wrong. But carbon tax is also wrong in practice. First, that’s because there is no one who denies that these would be regressive, because all consumption taxes are and this would have to be a consumption tax. Second, that’s because this would mean that any carbon tax would have to be matched by redistribution through other tax and benefits mechanisms, largely neutering its impact and making the whole thing a folly. And third, if the goal of the carbon tax was to create a fund for redistribution beyond international boundaries so that carbon emissions in developing countries can tackle their energy issues that oil not going to happen a) because politically that is nigh on impossible to achieve with tax and b) there will little or be no tax to redistribute for the reasons already noted. Tax is an amazing thing, but there are some tasks it cannot achieve and this is one of them.

In summary then (and this could, and maybe will, become a much longer piece) carbon taxes, like tobacco taxes, will not kill demand for the ‘bad’ product that forms their tax base. 

Carbon taxes also shift the whole blame for carbon consumption from the manufacturers, who willfully create the carbon outputs, to consumers, who are offered few or no alternatives to polluting products.

In addition, carbon taxes, by shifting the blame to consumers, put no responsibility for innovation or change on manufacturers. The result is that they will still sell polluting products, knowing they will still be bought.

And consumers will, because of the differences in information available to them compared to manufacturers, have no choice but go along with this.

Whilst, alongside this, carbon trading is just a charade or sham because there is no such thing as a carbon market at the literal end of the day. What there is, instead, is a need to eliminate the carbon and that will be the last thing carbon traders will want whilst they can make a living from its perpetuation, at cost to us all.

Of all the ways to tackle climate change these ideas are, then, just about the worst way to go. The primary fault is that they perpetuate the status quo by maintaining the market’s right to pollute, neatly hidden behind a convenient claim that we will have paid the supposed price for doing so. Little could be worse for our futures than that. 

Carbon taxes and carbon pricing are not the way to tackle climate change.

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  1. JE

    What this suggests is what we’ve known for a while, that without dramatic change in our way of life as a species and more-so in developed societies, we’re hosed. Is there the political and cultural will to mandate an end to fossil fueled personal and commercial vehicles? This will necessitate an end to freedom of travel as we know it in the US at least due to dearth of public transport options and the inability of the Earth to provide electric vehicle replacements. How to proceed?

    1. JE

      …and mandating changes to transport is just one area of change. How about a mandate to halt animal husbandry for meat? Rules on procreation? All are needed, and all will be exceedingly difficult to enact. I don’t see it happening. War is going to happen first and I hope there are enough pieces left for us to wake up and do the above afterwards.

      1. lyman alpha blob

        About those rules on procreation –

        Not a tax expert but I don’t believe that there is a limit on how many tax deductions you can take for dependent children in the US. In other words, the more kids you have, the less you pay in taxes, which in our time is a rather perverse incentive.

        What we really need is for a majority of the population to voluntarily commit to having one or zero children over the next several decades. I don’t think the government could ever enforce a mandatory limit on the number of offspring, but the least they could do, the very least which wouldn’t necessary even slow population growth, is cut off tax deductions for anything over three children per couple. I’m choosing three, as the replacement figure to keep population stable is 2.3 or so children per couple. I would think that would be a palatable option for most people to at least get us headed in the right direction.

        100% in agreement with the article – taxing and trading carbon will not benefit anyone except for carbon traders.

          1. Mr Broken Record

            Perhaps, but they still should not have more than 1 or 2. I think there should be harsh tax penalties (possibly even criminal) for having more than 2. Perhaps I’m wrong, but it is a discussion that needs to be had (and soon), but I won’t hold my breath.

      2. drumlin woodchuckles

        Growing piles of evidence suggest that livestock-on-range-and-pasture systems capture more carbon than they emit. “Banning animal husbandry” should be limited to the grain-fed confinement animal husbandry which emits more carbon than it captures.

          1. drumlin woodchuckles

            Well! . . . I’m glad you asked . .


            Farmer Gabe Brown in North Dakota is claiming accelerated soil-carbon buildup in his soils ever since introducing tight-packed fast-moving herdlets of cattle to his operation. Here is a bunch of his videos.





            I would offer more but I have to run and catch the bus.
            But these are a good first few to start with.

          2. drumlin woodchuckles

            God D*mn a computer.

            3 of my sources never came across. I gotta go. I’ll be back with those 3 other sources when I can.

    2. Ian Ollmann

      I feel we need to do something more drastic than carbon taxes. Reading another article on the subject pondering what EV features were necessary for mass adoption, the author found that EVs already met these criteria for 20% of respondents, yet market penetration is maybe an order of magnitude lower. The problem is therefore not on the demand side, but rather on supply. It costs too much to make EVs and all things being equal big auto would rather make ICE SUVs.

      As long as that is the case, the only way to make converts out of the auto industry is to take the ICE option off the table. Ban new ICE vehicles, including natural gas from sale. Completely. You are now all EV makers if you want to stay in business. Welcome aboard!

      At this point, I predict the switchover will take merely 20 years. In about 10 we can ban ICEs from the public roads if that isn’t fast enough.

  2. Grant

    I agree entirely with the article. Information is obviously missing from markets, but the notion that you can reduce these heterogeneous impacts to a single metric like a market value is extremely unrealistic. We don’t fully understand the direct and indirect impacts of carbon, and asking individual consumers to take all of this into account when they buy products assumes that the information is available for them to make informed decisions (they also have to rely on interests that created the externalities to pass on accurate information), and it assumes that even if the information was available that the average person could make sense of it. For it to work, part of the information needed is what other consumers are doing, how else would you know if your consumption is sustainable unless you know how much of a resource is being consumed overall and how much pollutants are being generated overall?

    There is also the problem that global warming is one part of an even larger crisis. Yes, we don’t and can’t price carbon, but we also don’t price the ecological impacts of throwing all of the harmful chemicals into ecosystems that humanity has done since the industrial revolution. We don’t price soil erosion, the species extinction rate being thousands of times the natural rate, we do need price the negative environmental impacts associated with plastic pollution and deforestation. Thinking that we could price these things is absurd and even if we could, it would require massive changes anyway as the price of everything would massively increase.

    We would also have to take into account class issues too, as things like carbon offsets have set off violent conflicts over land. If we pay people for services that the environment does, like trees and soils sequestering carbon, who owns those things and who gets to then benefit from the things the environment does for us gratis? No small matter, and those pushing for markets to solve this problem have no good response.

    We have reached the limits to growth in throughput and pollution generation, and we need a new economic system and different institutions to deal with what is coming for us.

    1. Nigel Goddard

      The Worldwatch Institute was warning of these interlinked crises over 30 years ago when I started reading their “State of the World” reports, at about age 30. Since then there has been action to try to address these issues, but woefully inadequate in comparison to the economically-driven developments which make them worse. There do seem to be a growing number of people who are saying “Enough is enough, action now”, but we had that 30 years ago as well. Despite these movements, we are still nowhere near tipping point for social/economic systemic change. It’s an open question whether we’ll get to a positive tipping point before the earth systems get to their positive-feedback tipping points, and before the consequences of what we’ve already done drive us to conflict and war.

  3. RickV

    Carbon taxes and carbon pricing solutions are possible when tied to the cost of carbon sequestration. Several promising methods of carbon sequestration are under development. Each has a cost. When the amount of tax for carbon emission by, say, a transportation method such as airplane equals the cost of sequestering an equal amount of carbon the market has set the price to offset the carbon produced given current technology.

    1. Grant

      I don’t agree. We have to determine what the sustainable levels of pollution generation and resource consumption are, which would establish the appropriate size of the human economy, which is the subsystem of the environment that we draw resources from and use as a sink for wastes. Given the size of the environmental crisis, that requires some pretty comprehensive planning outside of markets and it requires either more public ownership of resources and the commons, or direct social control. But, explain to me anyway how you price something when you don’t fully know the impact anyway? We don’t at all understand the complex direct and indirect impact carbon emissions has on the environment, ecosystems or our environment. One of Barry Commoner’s laws of ecology was that everything is connected to everything else. Carbon emissions obviously has a major impact on ocean acidification, which in turn threatens coral reefs, and also threatens phytoplankton. Phytoplankton produces a good portion of the planet’s oxygen. How do you price that, and why would you? What does your or my opinion of what something is worth have to do with that? Either we collectively consume and produce pollution in a way that is sustainable or we don’t. If you ask someone with no background in science to make decisions on using carbon or consuming product with carbon embodied in them, does it not require a consumer to have a pretty strong background in the science of the matter? Doesn’t it require a person to know what others are consuming? Are there not obvious informational issues, and is some information not tacit, which cannot be realistically passed on through markets?

      Then there is the fact that carbon emissions are just one part of a larger crisis. Do you think that markets are a good means of addressing a species extinction rate that is thousands of times the natural rate? If so, what exactly (from an ecological perspective) would it mean that one species is worth twice as much as another? How exactly do you price the thousands of chemicals that industrial society has produced since the industrial revolution? Those chemicals have been thrown into ecosystems, they are reeking havoc.

      If you read the socialist calculation debate, all of this was discussed. Hayek’s big argument in that debate was that a planning authority would struggle to plan an economy, that replacing the decentralized market system with a planned economy would require such massive amounts of calculations for the planning authority that a fully socialized and planned economy would be realistically impossible. That, of course, has been debated and there have been huge advancements in informational and computer technology since that time. But, it at least places a realistic limit on how much could be planned. But, if there are realistic limits to state economic planning, how are there not much more informational challenges for individual consumers and producers? A state can hire a bunch of scientists, they can use lots of data and modern technology to plan the economy, at least to an extent, and they have a lot of accumulated knowledge of the subject. Is the average American not far more limited in that regard? Are there not far more realistic informational limitations for individuals? So, what can realistically be accomplished if we do contingency valuation surveys, or use something like travel cost methods? Even in regards to cap and trade programs, there has been a massive over-issuance of permits and offsets too, and there has been issues too with things like the REDD program in regards to fraudulent projects.

      This site has done an amazing job of analyzing the large problems with neoclassical economics. With MMT, it has discussed the problematic way that neoclassical economists think of money creation, what banks do, etc. The way that neoclassical economists though deal with environmental issues is just as off and problematic, and just as divorced from reality. In regards to class, if the human economy is too large relative to the ecosystem it draws resources from and uses as a sink for wastes, who consumes less and who pollutes less? Who makes this decision? Given how inequitable our society is and given how corrupt the government is, it is hard to think this all turns out well, but it certainly won’t if we rely on the stuff they tend to teach within orthodox environmental economics.

      1. RickV

        That is the beauty of market pricing. It will take all the complications you correctly identify and meld them into the price equation, that when properly described, will drive the solution. Once carbon dioxide and methane levels begin dropping society can move on to other problems.

        1. Yves Smith Post author

          Help me. You utterly ignored the Weitzman point at the top of the post.

          1. You cannot price things correctly. This is delusional. It is impossible in a system this complex. Read John Kay on Obliquity, for starters.

          2. When you are uncertain, and the social costs of being wrong are higher than the private gain (and destroying the planet is the highest social cost imaginable), the approach is prohibition, not taxes. Taxes are UTTERLY the wrong way to go when the stakes are this high.

          1. Grant


            The “beauty” is an illusion. These things cannot be priced, and even if they could be, it doesn’t make logical sense to think that they would actually mean a damn thing. As I asked above, we have thrown thousands of pollutants into ecosystems since the industrial revolution. Do we price every one of them? Is that the silly idea? Cause they have heterogenous impacts in ecosystems, so you couldn’t just price them with some uniform price if the price is supposed to reflect actual real world impacts. If so, and if this is all what neoclassical economists want to make it, that we as individual consumers will decide how much of a particular pollutant we want in a way not different than buying a pair of shoes, am I to think about thousands of pollutants at once every time I buy something? All of those pollutants are embodied in the products I buy. If you price two different ecosystems, are you saying that they then have an exchange value? Tell an ecologist or a biologist that one ecosystem is “worth” twice as much as another. I bet he or she wouldn’t know how to make sense of that. If there is no real perfect substitution for something, does it make sense to then use exchange values? You cannot replace water with anything, so what is the exchange value of water when there is obviously no perfect substitute? When I look at what economists say about global warming, they look absurd. The gap between the physical science and neoclassical economics is massive. Frank Ackerman’s work is devastating on that point. Fact is, the school of economics that the neoclassical economists have ignored more than others on this matter is ecological economics, and it is far more based in the real world and far more in line with the science of the matter. It recognizes the limits to growth as well as the limits to markets. Since we cannot price everything, as Joan Martinez Alier said “there are no ecologically correct prices”, we have to design an economic system that relies on markets a lot less. No easy matter, but no choice. The ecological economists have been trying to do that for about a century now, and some of them are also incorporating things like money creation and the financial part of the economy into the analysis.

          2. RickV

            With all due respect, I prefer a free market solution. Obliquity notwithstanding. That is the beauty of a free market established price, it distills complex information into a single result both from the supplier and purchaser standpoint. Incentivizing carbon sequestration technologies is one part of the potential solution to climate change. This approach avoids an authoritarian solution, although inaction may force one upon us eventually.

            1. Grant

              It doesn’t really matter what you prefer unless you can show that what you want is actually possible. It isn’t. Reality cannot be bent to match your textbook, or Terry Anderson’s free market environmentalism book. None of us want to have to deal with this environmental crisis, but some of us want to be based in reality, while others want us to pretend that the unrealistic assumptions needed for the models you prefer to work can be realized, and they can’t. Because what you want is not at all possible, us trying to use markets to deal with a crisis caused by markets WILL lead to an authoritarian situation, even worse than the one today. I would prefer to be realistic now and to build up institutions and a system that can deal with this issue in an equitable and democratic way. We have a little bit of time where we can start to build this. Let’s not waste it on fantasies that will not work and will likely speed the crisis up.

              The question still remains. If the human economy is too large relative to the ecosystem we draw resources from and use as a sink for wastes, then who consumes less? Who pollutes less? Who decides this? What mechanisms can they use to enforce things? Pretending, in a society as inequitable and a political system as corrupt as ours, and with the scale of the crisis what it is, that a market solution (assuming it could work) would not be authoritarian is unrealistic too. Look at the violent conflicts over land in places like Brazil because of trying to monetize carbon sequestration. Look at the distributional problems of using markets in regards to the poor and working people. In order for us to use markets to address this crisis in an equitable way, we would have to do a wide range of things that radically depart from anything resembling a free market.

              1. RickV

                From above: “I would prefer to be realistic now and to build up institutions and a system that can deal with this issue in an equitable and democratic way.” In our divided system, how is this possible? I doubt a democracy can exist without free markets. Yes, a market driven solution may become authoritarian, but what system other than free markets can deal with this emergency in ‘an equitable and democratic way’? At least for now, the approach of using the environmental crisis to overthrow capitalism will turn off a majority of the American electorate.

                1. Grant

                  RickV, Swedish social democracy would be a not too radical way to democratically plan an economy. Swedish social democracy at its height employed a form of national economic planning that also relied on solidaristic wage bargaining. It discussed in the mid 1970’s moving towards a fully worker owned and managed economy. Something like that would be an obvious example. But, you have to stop using the term free market. Economists define that in very particular ways, and it is entirely unrealistic to think what they define as a free market could ever realistically address the environmental crisis. Even if you could come up with a convincing argument that we could price environmental impacts (which you cannot, no one can), the distributional/class conflicts would require us to violate most free market principles. Market socialists used markets, but more than anything for accounting purposes, to transfer information throughout the economy and to allow firms to estimate things like efficiency. So, markets might be used to an extent, but in a radically different context. We will not deal with the environmental crisis with anything close to what economists define as free markets. We will have a planned economy, because of the massive scale of the environmental crisis, the fact that we have reached the limits of growth in throughput and pollution generation and because of the fact that most of these impacts are not priced and cannot be priced. As Pigou said long ago however, not every planned economy is a socialist or democratically planned economy. So, the question will not be whether or not we will employ more comprehensive economic planning (if we have even a small chance to deal with the crisis, that is a given). The question will be whether or not it will be democratic or not. What you are calling for cannot realistically work at all, and so it guarantees that we will see someone like Bolsonaro being the norm. Think what you want, but if this is what you are pushing for, if you ask me, you might as well be a supporter of his, because if we did what you are calling for it would result in someone like him taking power and we would not be grounded in reality enough to ditch unrealistic notions of free markets in the time we have to mitigate the crisis.

                  Like I said, think what you want, but I will do all I can to fight against the types of things you are pushing for.

                  1. RickV

                    Sweden, in the 1970s and now for that matter, is a very uncomplicated and homogenous society. It doesn’t compare to the U.S. or the world.

                    Since I cannot come up with a convincing argument I will give up trying.

                    I don’t know how the U.S. and world can get from where it is today to the planned economy you envision, except through war.

    2. Grumpy Engineer

      @RickV: I don’t think carbon sequestration will ever happen.

      Even if we did somehow come up with a technology that could be used to extract CO2 from the exhaust stream of a gas- or coal-fired power station, that CO2 would have to be shipped to a suitable site for sequestration. You can’t just pump it into any random hole in the ground. It has to be under a deep and impermeable rock layer that will never permit a Lake Nyos-style CO2 blowout.

      And how would the CO2 be shipped to the sequestration site? Via high-pressure pipeline. Now if you’ve been following the news, you’ll see people freaking out about petroleum pipelines because of the risk of leaks and groundwater pollution. And you’ll see people freaking about natural gas pipelines because of the risk of leaks and explosions. Imagine how people would react to the prospect of a pipeline being filled with an invisible ground-hugging asphyxiant.

      Politically, it’ll never happen. At least not at a large enough scale to make a difference.

      1. Ian Ollmann

        And if you study thermodynamics, you’ll find that a chunk of the energy gained from combustion is from entropy. There aren’t a lot of solutions to that. It just makes sequestered combustion a lot less energetically profitable to have to stuff the genie back in the bottle. Once you go down that road, burning stuff just doesn’t seem like a good idea anymore. Too expensive.

      2. RickV

        Society has bigger problems then CO2 pipeline leaks, but they should be minimized. I suggest you investigate CO2 sequestration technologies. Maybe start with FCEL stock.

        1. Grumpy Engineer

          Um, FCEL’s carbonate fuel cells require natural gas (or bio-gas) as a fuel source to produce power, per They’ll produce CO2 emissions just like a combined-cycle gas turbine facility will. And notably, at slightly lower efficiencies. [60% vs. a modern CCGT’s 64%.]

          And their picture describing the SureSource carbon capture technology is downright deceptive. It seems to imply that the fuel cells will magically increase the output of a coal-fired station by 80% while capturing all of the CO2. The presence of the natural gas pipeline that feeds the fuel cells was somehow omitted. As was the CO2 compressor and high-pressure pipeline necessary to transport the CO2 to the seqestration site.

          Is there even one real site where this CO2 capture-and-sequestration technology is actually operating? I’ll be darned if I can find one. This looks like “vaporware” to me.

          1. RickV

            Per the MarketWatch link below, the FCEL aim is to capture 90% of carbon dioxide omissions (no mention of exclusion for gas emissions). Also, there is an existing first generation facility at the Southern Company Barry power plant, and a second generation facility is planned for an unnamed Exon Mobile operating site. In addition, again per the MarketWatch article, additional projects are planned at the Tulare BioMAT project in California, the Bolthouse Farms power project for Cambell Soup Co., and the CMEEC U.S. Navy Base fuel cell plant in Connecticut. Seems like a bit more than “vaporware” to me. This is not a recommendation to purchase this stock, just an example of promising carbon sequestration project out there.


            1. Grumpy Engineer

              I researched a little further, and finally found reference to the single 25 MW project at Barry Power. Given that the Barry Power station can run at 2761 MW, this was clearly only a pilot project. They never expanded it. And until the Exxon announcement, nobody else ever bought one, which is why FCEL laid off a third of its workforce back in April:

              Right now I’d give this technology a big fat “maybe”. And even if we could capture all the CO2 from the power station (100X as much), would the sequestration site (located 12 miiles away) even accept that high a flow rate? For years on end? I’m deeply skeptical.

      3. drumlin woodchuckles

        Plants scrub carbon dioxide out of the air in order to combine it with water to make energy-storing sugars with. There’s your carbon-scrubbing.

        Properly managed, plants can inject carbon-based sugar-root-juice into the soil they grow in, feeding soil microbiota. Some of that microbiota dies in place, leaving its carbon rich bodies stored there in and under the soil. Some of that microbiota decays the sugar root-juice for energy and the byproduct glomalin, which is a precursor to stable humus. There’s your carbon sequestration.

        So, the simple but not easy thing to do is to lower carbon-gas emissions and raise carbon-gas green plant recapture until the two lines cross and maybe even get plants to suck down more carbon than what we release.

        1. Grumpy Engineer

          Carbon capture via bio/geoengineering? Perhaps. But I fear the scale required is much too large to make it viable. Currently mother nature only absorbs about 50% of our CO2 emissions:

          To solve our woes this way, we’d have to double the earth’s natural CO2 absorption capability. That would mean herculean soil management efforts everywhere. Messing with nature that much scares me. What if we overshoot?

          1. drumlin woodchuckles

            If we overshoot? We can always resume bio-destructive carbon-oxidising agriculture methods on enough of the re-biocarbonized farmland to debiocarbonize it all over again.

            Plus, I think we will be able to avoid overshooting. We just keep measuring the ppm of atmospheric CO2 and if we see it is back down to whatever ppm level we would like it to be . . . either 300 or 280 or whatever we decide . . . . then we can ease off our further carbon soil-recapture and soil-sequestration and leave worldwide soil carbon levels where we have gotten them to be.

            For now, we should look at the one-in-a-million farmers who cares enough to manage soil this way . . . so few that I could think of every name if I knew who they were to begin with ( the only names I can think of are Gabe Brown and Garry Zimmer, but there must be at least 50 others just in America alone), and see what their rate-per-acre of CO2 re-suckdown and soil-sequestration is. And then calculate how much CO2 would be re-suckdowned if every acre of farmland in the world did the same.

  4. Ignacio

    Probably when Weitzman though of pollution he did not have in mind externalities such as climate change and the uncertainty it brings in both costs and benefits that by no means can be priced properly. Economists, please, out of the table.

  5. Ian Fellows

    I’ve read a few arguments for taxation based solutions, so thank you for providing an alternate viewpoint. That said, I’m having trouble following your argument. You seem to be making the argument that increased prices for carbon intensive goods will not reduce emissions because demand will be unaffected. Isn’t this contrary to the laws of supply and demand?

    For example, if we provide more generous subsidies for electric vehicles, more will be sold. Similarly if we raise the cost of gas vehicles (through either higher gasoline costs or a tax at sale), more electric vehicles will be sold, leading to lower emissions.

    It would be great if you could expand on why carbon trading is a sham. Of course there is no demand because the government hasn’t created the demand by pricing the social cost of carbon. Once the cost is in place carbon is a commodity, and anyone who can figure out how to reduce carbon can profit from it.

    While I generally prefer market based solutions, I am open to the idea of outright bans. I do worry about their application though. It seems like every time we (California) are in a drought, politicians race to put in place bans on watering golf courses and things. While that sounds good to voters, it massively miss-targets where water needs to be saved.

    1. Grumpy Engineer

      @Ian Fellows: Several years ago, I was convinced that “cap-and-trade” (or carbon trading) was the best way to reduce CO2 emissions. After all, it had worked pretty well for CO, SOx, and NOx emissions from power stations, so why couldn’t it work for CO2?

      After further reflection, I realized this: If a major CO2 emitter is unable to purchase the emissions permits they require for operation, they need a readily-available alternative that will permit them to continue operating without permits. Or at least much less permit. In the world of CO, SOx, and NOx emissions, those alternatives existed. Catalytic converters for internal combustion engines, and wet or electrostatic scrubbers for power stations or industrial facilities. If operators got tired of the expense and hassle of permits, they could install these various pollution control devices and cut their emissions by over 90% (!!). They’d be good to go.

      There are no such devices for CO2 emissions. Catalytic converters won’t touch CO2. Wet or electrostatic scrubbers won’t touch CO2. Right now, the only way most major CO2 emitters can significantly cut their emissions is to quit operating. This means that power stations would have to shut down (hello rolling blackouts). Or transport companies would have to stop shipping goods (hello empty shelves). Or steel, cement, and asphalt manufacturers would have to stop making product (hello raw material shortages).

      And when a power station calls their local congressman and says, “We got outbid in the last CO2 permit auction, and we’re going to have to shut down half of Atlanta until the next permit auction,” I can tell you exactly how long it’ll take for new permits to suddenly appear on the market. And because this will happen pretty much regardless of which major CO2 emitter makes the phone call, the entire thing ends up being a sham.

      Without readily-available alternatives, there is too much pressure to make sure there are “always enough” permits. And nothing changes.

      1. ptb

        the theory is you pair buyers and sellers of the credits… so a coal or gas plant owner would have to pair up with a certain amount of wind or solar, and the penalty for the former is paid by the subsidy for the latter.

        The real threat of blackouts on sunless/windless days or weeks would drive up the wholesale price of electricity enough that the coal/natgas would get paid for during those days, and be idled the rest of the time.

        Its not impossible, it’s just that you’d have to be a 5-year-old if you trusted the industry-regulatory ecosystem in the US to pull this off without hiding loopholes and gaming the system to the max line Enron. Or simply lobbying / threatening the public with blackouts until legislators relented and agreed to backstop potential losses, which would severely undermine the incentives, while also wasting tax $. Not worth it.

        The same effect can be had more reliably by permitting the generation technology you want to eliminate, such that it is only allowed to turn on when there is not enough sun or wind. The market still takes care of the rest (i.e. figures out how much wind/solar to build, with the constraint of minimizing carbon to whatever degree the policy specifies) but less convoluted and prone to profiteering at the expense of the public good.

        1. Grumpy Engineer

          I don’t think it works even in theory. The whole concept of cap-and-trade relies on there being a cap on total CO2 emissions, with emission permits being traded to help decide who will get to emit how much. And then the total cap is reduced slowly over time.

          But our major emitters cannot fully control how much CO2 they’ll need to emit. For example, suppose we have a major cold snap in January, and your local natural gas company burns through their allocated quota before the end of the month because everybody’s gas-fired furnaces are running more. To avoid cutting off their customers (and having them freeze to death), they would need to purchase permits from somebody else. But from whom? The local fuel oil company? Nope. They’ll be burning through their quota too quickly also, meeting the demand from oil-fired furnaces that are running more. From the local power company? Nope. They’ll be burning through their quota too quickly also, as they fired up their oldest (and normally mothballed) coal-fired station to meet all the demand from heat pumps running more. From the local asphalt company? Nope. They shut down for the winter anyway and didn’t buy permits for January.

          The problem with the cap is that certain events (like unusually cold weather) can result in all permit owners running through their quotas too quickly. There’s no trading to be done if everyone’s permits run out prematurely. The cap would have to be lifted. Period.

          And this is with honest players. Throw in some greedy players like you mentioned, and it’ll get even worse.

          1. Grumpy Engineer

            Also, the total cap idea works only when emitters can reliably reduce their emissions over time on something approaching a schedule. During the 70s and 80s (when CO, SOx, and NOx were the emphasis of cap-and-trade efforts), power station operators could install scrubbers or other pollution control equipment whenever they wanted. They didn’t have to buy new property, and there was essentially zero local opposition to the installation of emissions control equipment. Indeed, the locals would usually celebrate the installation of scrubbers at their local power station because it meant their air would be cleaner.

            But to reduce CO2 emissions, power companies might try to buy a big patch of land and install a bunch of wind turbines. I can tell you from experience that local opposition would be significant. Or they might try to build a nuclear power station to provide low-carbon power even in the middle of windless winter nights, but here, opponents would come in even from out-of-state and fight them every step of the way. Lawsuits would abound. Committing to a firm CO2 ramp-down schedule as part of a cap-and-trade scheme? I don’t see how.

          2. Jasonuke

            Weitzman’s work as quoted by Haldane actually implies that what’s needed with carbon is to have a cap rather than a tax.

            Richard Murphy is railing about the lack of a carbon market. But the whole point of a cap and trade system is to create such a market when none existed. The fact that there is a price on carbon doesn’t magically make carbon emissions go down – that’s the job of the cap. The carbon price simply helps decide who gets to emit the limited quota of carbon. Its job is to reduce the cost to society of keeping to the cap.

            You are basically saying that a cap (or to use Haldane’s word, a restriction) is impossible. If that is true, then we are screwed no matter what. It doesn’t make the idea of cap and trade bad.

  6. John Wright

    The author suggests, apparently, that there are viable alternatives for existing consumer CO2 producing demand.

    “What this ignores is the fact that much of that demand will be driven by an absence of alternatives, which business will have no incentive to promote if there are carbon taxes, and that consumer behaviour is anyway heavily influenced by supplier behaviour through advertising and other market-distorting activities.”

    What are examples of these alternatives?

    How can consumers be guided to them?

    Can these alternatives scale up in a short enough time frame to make a difference?

    Meanwhile we have Bloomberg pushing for an ever growing human population by suggesting there is a Global Fertility Crisis to worry about.

    Climate change may be a problem that has only a very painful solution/resolution.

    1. Ignacio

      I think that what the corollary is that carbon taxes won’t work if there is not a regulatory framework for manufacturers to promote alternatives which are more efficient and bans certain stuff. I don’t know the situation in the US but such framework already exists in the EU, although it can be argued it is not as restrictive as it should be. Carbon taxes can be used to promote the best alternatives via renew plans etc. but yet, there is the complete absence of incentives to make more durable and repairable stuff and more regulations are required. It can be concluded that carbon taxes by their own won’t make the trick, even remotely, in the absence of a proper and dynamic regulatory framework ensuring transfers to the most adequate activities as well as banning some others.

  7. Susan the Other

    RM is profoundly correct as usual. The planet has a way of regenerating ecosystems that have been trashed. It takes time. And the key ingredient is that there are no humans around to continuously screw it up. The thing we need to do is sequester humans. We need a new “market” mechanism to do that. We need currencies based on the health of the planet and the progress toward maintaining a healthy sustainable planet. We can’t do this with currencies based on money itself and the interest it can make by exploiting the environment for pure monetary profit to be reinvested for same profit and just externalizing those pesky costs. And so absurd to categorize life itself as an “externality” to the economic system. We are not outside the system. We should have been mobilizing to create viable alternative lifestyles – non carbon lifestyles – decades ago if our goal was to gradually shift over. That alternative is now gone. We are looking at abrupt change on two fronts – the devastations of a disrupted climate and the devastations of a useless lifestyle. Maybe there’s a synergy in this combination. We maybe just waited until the situation was ripe enough to see it and make the most critical decisions. You know “cost benefits”. But it doesn’t help that we are unable to say it like it is and continue to with mythological fantasies about “the market”. We probably need martial law at this point.

    1. Ian Ollmann Ph.D.

      So what are you saying here, it is time to start shooting people? I mean, this didn’t stop Trump on immigration, but I feel that shooting citizens might have ballot box implications. /s

      1. Susan the Other

        No. Not martial law to shoot people looting stores. Martial law to suspend civil law – aka finance and commerce and private investment. And institute government decisions and spending priorities. And implement them.

        1. Susan the Other

          Or maybe that happened in 2008 and we are almost to the point where we can implement an new economy.

          1. Ian Ollmann

            I don’t think it is necessary to burn the economy to the ground, and it would be much better if we didn’t burn anything at all. Too much CO2. It would be better to simply recognize that there are some things we can’t do anymore, and adjust the law so that they are not done. We simply banned CFCs for example. Now, I won’t pretend this is that easy to solve. However, I think we could go a long way by banning the sale of new ICE cars and trucks, switching to less carbon dense methods of making concrete and smelting iron, and taking commercial air travel to task.

            That is, we should not look at CO2 as an excuse to change everything else about the economy we don’t like. We will get enough trouble just stopping the things that need to be stopped to avoid global catastrophe.

            1. Darius

              Electric vehicles are a bandaid. This problem isn’t solvable if Americans’ addiction to cars and sprawl isn’t cured.

            2. Susan the Other

              I agree, Ian, that we can’t change everything about this out-of-control economy – not even in one country let alone other countries. But we can definitely change our mindset. We can stop thinking of ourselves as “outside” the living, breathing world… “Oh, were just homo economicus,” etc. We are not external to nature. We are nature. And the stone in my shoe is how we finesse this reality with money. Money is dis-attached from nature. It’s a way to “hedge” nature. But it is a total and complete illusion. Or delusion. And once we embrace your own reality – not to sound like a new age evangelist – we can accomplish everything WITH money. Such an irony.

  8. Maurice

    Thanks for this update on what to do with polluting goods.

    The reasoning is convincing: taxes do not work, whatever concrete system is used. So much for the political parties who advocate complicated systems that happen to be ineffective.

    As Yves suggests, it leaves the alternative to prohibit bad for the environment products.

    Each bad product will have to be fought over, as it was the case with tobacco.

    And apart from the so-called carbon market, we must expect a lot of smoke screens intended to stall the action!

  9. WestcoastDeplorable

    Since the promoters of the “global warming” er ah “climate change” keep pressing the “carbon tax” button, me thinks this is just another way for the 1% to gain more power by extracting $ from the masses. Meantime if you stop cherry-picking the data, you’ll find the Earth’s climate has been changing since day 1 (ask the dinosaurs), and there’s not a damn thing we Humans can do about it.
    We’re heading into a little Ice Age BTW, so some warming may be in order to maintain a balance…something the Earth knows how to do with no interference from we ants, er ah, Humans.

    1. drumlin woodchuckles

      If you are correct, especially about a little Ice Age coming, then you have some lucrative contrarian investment opportunities laid out for you.

      You could invest in coastal seaside land/bussiness/assets/ whatever when the mistaken masses are fleeing the coast. You could buy land for pennies an acre. Then you or your heirs could realize dollars or hundreds of dollars per acre of that land when the mistaken masses realize it was all a mistake, and a non-rising ocean will never cover the land they scared themselves into abandoning.

      I hope you choose to make that investment. If you are correct, you could lay the foundation for a huge dynastic family fortune.

  10. Stadist

    Fairly popular form for the carbon taxation among my home country’s intelligentsia is with the tax income returned to population in form of basic income. This is superficially fair, although I would rather see it fund just need based transfers/social security instead of basic income. However they are already building special privileges in EU for the important industries that are heavy CO2 polluters, considering the global competition and also there is a lot of discussion to impose carbon-based customs as trade barriers. EU pretends to be free market and free trade proponent but it’s awfully quick to impose trade sanctions when it’s own industries are threatened and even trade barriers.

    Still my worst fear is the neoliberals managing to overtake the carbon tax and climate change discussion as they have always been big fans of increases in consumption taxes with reductions in personal income and capital gains taxes. I’m not big fan of USA, but at least the widespread opposition to sales taxes and VATs seems healthier option than the complex VAT accounting rules that have been used for fairly large frauds recently in EU area. Even if carbon taxes are implemented and imposed, it’s still under political control how the tax income is used, unless the tax is built outside national EU budgets, and I think there have been discussions of carbon taxes being implemented on EU level to build up the EU budget and ‘fiscal’ union, which itself sounds bad idea as EU parliament is firmly controlled by right wing conservatives.

  11. ptb

    Good article.

    The tobacco analogy is appropriate.

    With carbon, our society is locked in enough, that in addition to not being able to stop in response to any affordably priced incentive, future individuals and future businesses also lack the ability to not start.

    Our national structure of low cost, maximal per-capita energy consumption for transportation, housing, chemicals, etc. will be altered.

    As this is inevitably a political question, funding it with a regressive tax is a guaranteed fail, obviously.

    Regardless of how funding would be done, politicians are right to fear talk of reforms with a thirteen digit price tag. Their corporate sponsors will have none of it, and thus the politicians themselves would be on the chopping block.

    But costs of $10^13 and up, are the magnitude of the situation. If one is honest in what it means to eliminate CO2 emissions as we believe is required, the entire world of energy, industry, agriculture, housing, and transport is going to be upended, and not just by replacing old with new, but by replacing more with less. That last part is the kicker. It is hard to believe that the “market” can make this kind of transformation.

  12. Tim Smyth

    Interestingly many in Canada view the election results two weeks ago as being an overwhelming endorsement of carbon taxes with over 65% of the Canadian voting public voting for parties in support of carbon taxes.

    1. eg

      In fairness to the Canadian electorate, it wasn’t like they were afforded a serious regulatory alternative in any of the Federal Party platforms — it was sort of carbon taxes vs climate denial courtesy of “the Oil Party” (Conservatives)

  13. john halasz

    I don’t have time to go into all the flaws, but this is a sloppy piece of work. It conflates cap-n-trade with tax a rebate, when only the former involves an artificially created new market. Tax and rebate just shifts the relative price in existing markets and the complaint that the full informational content of any item is not contained in a price for consumers, (when the effect of demand shifts would feed back to producers), amounts to a claim the relative prices have no effects. (The tobacco analogy is to the point, but no as claimed: that taxes didn’t eliminate tobacco use doesn’t mean that the didn’t reduce it). Further there is no exclusive alternative between taxes and regulation. and a tax, which actually would be a fee and dividend scheme for reasons of administrative simplicity, would require regulatory supplement, since, say, a fixed fee on NG wouldn’t account for how leaky different pipelines,etc. are which would need to be addressed through fines for reasons of both efficacy and equity, driving out the worst offenders first. Not to mention all the other GHGs not tied to carbon. There is no panacea for such a complex and multifaceted set of problems and the transformations required to meet the exigent challenges. It’s the overall mix of policies that matters. Anyone who thinks that a solely market-based solution would suffice is nuts, but a carbon tax shift, properly conceived and implemented in the mix of policies could make a useful contribution in what is still an overwhelmingly capitalist society.

  14. rfdawn

    The framing of a binary choice between taxation and prohibitions just seems wrong. In the case of tobacco both were useful but even together still not totally effective. There is no single silver-bullet solution and it is instead certain that, as with tobacco, the answer to the question “What is to be done?” will always be “more” and for climate “much more”. Discarding partial measures seems inadvisable.

    The present logjam is political and the political usefulness of carbon tax-and-dividend is probably its best argument. Resulting electoral support among the 90% of (relatively) low-carbon mopes who stand to gain from the top 10% high-carbon elites might drive the tax-rate high enough to do something useful. At this point, “might” is quite enough.

  15. Grebo

    Transition. We are more addicted to oil than we ever were to tobacco. The consequences of going cold turkey would be fatal to our civilisation. Any serious attempt at wholesale prohibition would turn the world into Mexico, then Somalia, then Carthage.

    There must be crash programs to develop sustainable alternatives for all the major uses of oil and only when they become available can oil be banned for each use. In the meantime, it seems to me, an escalating tax and dividend would be a net progressive way to discourage minor uses of oil and encourage alternatives.

    Regulation and subsidies in many areas will also be necessary and, of course, a complete transformation of our mentality and philosophy.

    Now you must excuse me, I have a bunker to finish.

    1. Paul Boisvert

      John H., rfdawn, Grebo:

      Excellent points. The author, and some commenters, conflate many issues.

      1. Carbon tax, starting modestly but increasing fast and steadily, rebated equally percapita, is a very good (not perfect) idea. Cap and trade is not a good idea (article gets that right.) Conflating the two is wholly illegitimate.

      2. This vitiates straw arguments that we can’t “perfectly” price carbon. So what, that’s not the point of the tax. It’s just an increasingly punitive “fine” to discourage carbon use, combined with the carrot of the rebate, to further reward those who choose to avoid some punishment, and make it progressive overall (rich generally use more carbon than poor), though not perfectly. For the modest number of lower-income exceptions to progressivity, many ameliorative solutions can be crafted–which we have to do anyway, as low income is a capitalist crime in the first place.

      2. The only incentive from the tax is price–intentionally. Thus, all discussion in article and comments about consumers not knowing all info is irrelevant. Author says capitalist markets are imperfect–of course. But they still function with a strong (not perfect) impetus from costs and price–ask any business owner whether she’d like to reduce her costs! Crucially, author presents no evidence for how inelastic demand for carbon would be under innovation of alternatives–the key. Cost (thus profit) incentives largely (not perfectly) drive innovation of alternatives in capitalist economies..

      3. The tobacco tax argument is a straw man. There are no real alternatives to nicotine addiction. Casual users can afford infrequent higher-taxed use, and heavy users have no remotely easy alternative, since they are addicts. While carbon is fairly addictive, France gets ~ 50% of energy from non-fossil sources–so they’re just as “addicted” to non-fossil fuels as to carbon. There are now alternatives galore to carbon use, continually growing moderately every day without a carbon tax. We need much faster growth of alternatives, which the tax will help (not perfectly, but substantially and increasingly) achieve.

      4. I’m all for regulation and frugality TOO, though not the (pre-)extermination of the brutes by “ruthless force” advocated (seriously?) by GM below. WWII-style command green economy, radical anti-consumer culture change, wonderful!–but how and when? Commenters say “we need those”, but offer no evidence how or if we can achieve them any more successfully than a carbon tax. Centrist Dem’s don’t want green command socialism, nor Luddite anti-materialism crashing their donor’s consumer profits–let alone Rep’s.

      In fact, the carbon tax is very achievable. There is substantial bipartisan support for HR 763, and it could easily pass with a reasonable 2020 election results. Author and many commenters suggest either/or, with the “or” largely not remotely politically feasible for a long time–but we need ALL/and more. Carbon tax is a great catalyst, a great start, and will set a precedent that will snowball, HELPING achieve the other (admirable) objectives. It is (duh) not the only necessary, nor the perfect solution. But those are straw men–it’s still a great idea. Please support it!

  16. GM

    This is actually a quite silly article.

    “Information”, “redistribution”, etc. Those are not the terms one should be thinking of.

    The core of the problem is that emissions have to go down by a percentage that can never be delivered through a price mechanism, because the demand for fossil fuels is very strongly inelastic.

    There are no viable substitutes for fossil fuels at the current scale of their use, in case it needs reminding (and, unfortunately, scientific illiteracy is rampant on both sides, so it does need constant reminding), and we are talking about energy here, not some trivial consumer item that one can go without (which is also something that needs constant reminding, because, again, most people on this planet should never have been let past the 7th grade or so yet our marvelous educational systems did nothing to stop them)

    The very physical existence of most of the planet’s population depends entirely on the continued use of fossil fuels at probably at least 20% of the current levels, and for much of the rest that could in principle be reduced there are extremely strong behavioral attachments to it that cannot be overcome by “price mechanisms”.

    But emissions have to go down by 95+% (which, BTW, does not even leave room for current emissions from making concrete and other non-fossil fuel burning sources alone).

    Clearly no market-based “solutions” could ever deliver that, and that should be obvious to everyone with two functioning neurons to rub together, and should have spared us all the decades of empty debates back and forth about it and the millions of pages of spilled ink.

    One we come back to reality and acknowledge that fact, we arrive at the actual measures that will have to be taken — drastic reduction of global population (by reducing birth rates to near zero) and of per capita consumption, implemented by ruthless brutal force (because it’s not going tot happen voluntarily).

    1. Ian Ollmann

      Emissions down by 95% is probably achievable in the long run. It does mean a wholesale change in steel and concrete manufacture chemistry so that they do not emit CO2, an end to fossil fuels based air travel, vegetarianism, lots of renewable energy production, etc. across the board. If you run one of the many internet carbon calculators, it is plenty obvious we can not get there by individual action alone. Just your food budget will exceed your allowance today, because all the people who make and transport your food are busy creating greenhouse gasses, eating up your budget for you! The key thing is that we can’t save and cut back our way to 95% CO2 savings. We have to wholesale change the chemistry behind how some things get done. You are not burning fuel to propel your car, but instead discharging batteries. The batteries are not charged off a methane power plant, but off of renewables. We can’t change the chemistry in the cow or pig, so we might have to do without the cow or pig. Boeing will need to get busy on alternative propulsion systems for commercial air travel or we do without that too and airports may need to be refactored to accommodate that system. Etc. etc. etc.

      All this can happen. There are off the shelf technologies for much of it. It is just a matter of time to make all the zero carbon items needed, and time to make the machinery to make the zero carbon items and so forth. This requires investment. That won’t happen until the ICE alternatives become economically infeasible or just illegal. Most notably, if we start shooting people (!) like you suggest, none of this will happen because we will collectively be too busing avoiding the sword to worry much about tomorrow and what we need to do.

      People will eventually come around. It is just a question if they will do it before or after the temperature rises enough that the Earth itself starts emptying its own reservoirs of greenhouse gasses, much of which is currently frozen at the poles and it becomes impossible to stop. The big problem is that our current crop of politicians and the electorate don’t believe that facts matter. Facts are facts. If you conduct policy that flies in the face of fact, it is not going to end well. The delusional and corrupt need to go.

      1. GM

        All this can happen. There are off the shelf technologies for much of it. It is just a matter of time to make all the zero carbon items needed, and time to make the machinery to make the zero carbon items and so forth

        Did you read what I posted?

        There are no such technologies, and there can be no such technologies, for reasons having to do with fundamental physical limitations.

        1. cnchal

          > Did you read what I posted?


          > . . . because, again, most people on this planet should never have been let past the 7th grade or so yet our marvelous educational systems did nothing to stop them)

          Who are you to judge?

          All these marching orders yet no commenter or the post’s author does even a hand wave to the colossal waste within the food production, distribution and consumption system. Half the calories produced, and I will point out that we turn oil into food, is wasted, thrown in the garbage, feeds no one. On top of that, with a diet concentrated on consuming sugars and carbohydrates it becomes a certainty that greater consumption of medical services to deal with what is essentially a poison delivery system disguised as food delivery will multiply the waste.

          I suppose trips to the doctor, as long as the vehicle is powered by natural gas generated electricity, is good, but if it’s powered by gasoline, bad.

          Also not mentioned by anyone, is the exponentially growing power consumption of what is euphemistically called ‘the new oil’, the collection, analyzing, retrieving and displaying of a continuously expanding data collection. Data centers now use something like 12% of all power consumed, and growing by leaps and bounds. All those zeros and ones have to go somewhere, and kept alive with electricity. Moar waste as far as I can tell.

          I suppose trips to work by the few employees that operate them, by natural gas generated electricity, is good, but if it’s powered by gasoline, bad.

          But yes, I am the evil one for clinging to my mint old ICE cars that run and handle great, and I dare say, are fun to drive, which I can maintain myself, and that don’t have sensors up the wazoo to fail in five or so years which sends the newest cars, all made with stupendous energy inputs by the way, to the scrap heap.

  17. lyle

    First all of climate change will not kill off all life since similar climates to the ones predicted have existed in the past! Second humans are very a very adaptable species living from tropical jungles and deserts to the arctic before modern technology. What may well happen is the end of human live as we know it in advanced societies This will mean between a decimation and a reduction to 1/100 of the current human population, which if we declare modern medicine illegal mother nature will take care of bringing back things like the black death that killed 1/3 of the population in a few years. (All this makes me glad to be 69 years old). If you take the Gia hypothesis at face value the earth will kill off the human virus that is infecting her. (Perhaps a 100 km metor will do to humans like it did to the dinosaurs.)
    Many of the proposed solutions sound like ideas Hitler and the Nazis, combined with Mao would endorse, (1 child policy, removal of defective populations as defined by those in power, done with the feeble minded in the US in the 1920s (Hitler got the idea of the final solution from the sterilization programs for the feeble minded in the US, but wanted a faster solution to kill off undesirables so thus the extermination camps) Many of the solutions mean the end of freedom and moving to a world of 1984 big brother, combined with solent green etc (see science fiction for examples of such scenarios)).

    So imho the worst that could happen is the end of life as we know it, which is also suggested as solutions to the problem i.e. the demise of human freedom , not then end of human life and definitely
    not the end of all life recall there are tube worms in the deep sea that live off hot water given off by undersea hot springs that don’t rely on photo synthesis. as well as other forms of life called extremeophiles ( a long way from animals in the tree of life but. life….)
    Any way with the apocolypic predictions perhaps ecclesiastics in the old testament has the right idea 8:15 “Then I commended mirth, because a man hath no better thing under the sun, than to eat, and to drink, and to be merry”
    Or first Corinthians 15:32b ” “Let us eat and drink, for tomorrow we die.”, Or etc. Perhaps if one wants to engage in eschatological and end of the world thoughts then climate change could bring on the second coming or similar events predicted in many religious.
    traditions, Of course the apocalypse has been predicted since at least 35 ce and it seems to me to be a belief than one gets when one feels that ones time is more important than the times before.

    In final summary the partial question is which world will end, I believe it might be human life as we know it which even the solutions proposed require, but not the end of all humans, nor the end of all life. (As a data point genetic studies suggest that after the eruption of Toba in Sumatra the human population fell to between 10 and 100 thousand.
    (putting on fire resistant suit)

  18. John

    A carbon tax is definitely better than nothing at all.

    We long passed the point where a carbon tax could be considered a serious solution to climate change. We need a Green New Deal or some form of a full-scale mobilization of the economy to tackle this challenge.

    NC constantly posts criticisms of carbon taxes but they do have some effect in reducing GHG emissions. It’s better than nothing, which is effectively what the status quo is.

    1. Ignacio

      Better than nothing is not enough. Even worse, it gives you a false sentiment that the thing is being tackled.

      1. Larry Gilman

        “Better than nothing is not enough” — true. Where outcomes are threshholded, as in life or death, inadequate incremental measures are perfectly futile: Jumping with half a parachute reduces your velocity on the way down, but you end up just as dead as your friend who jumps with no parachute at all.

  19. drumlin woodchuckles

    I agree with comments above which note that the article confuses cap-and-trade hustles with punitive fees on permission to sell coal, gas and oil to begin with. Those punitive fees would be added to the price of the coal, gas and oil in order to punish everyone who buys any of the coal, gas and oil, and keep the punishment moving downstream in proportion to the coal, gas and oil involved in any product or service.

    The thought is that things made or done without having to pay for coal, gas and oil to do or make those things . . . can be sold for a price not including the added price of paying for the punitive fee not passed along with the coal, gas and oil not bought for making or doing that good or service. Coal, gas and oil and all those things involving coal gas and oil will be tortured out of the market by making the fee the sellers of them must pay so torturously high that the fossil carbon industries are exterminated from the market. And non-fossil alternatives will be the only alternatives left. Bussinesses can either develop those alternatives or businesses can die, as they would deserve.

    But some would still try to impose bans . . . in the political and cultural system we have. Think a President Trump or President Trump 2.0 would sign such a legislated ban into law? Think an Army largely staffed by people from parts of the country which the “lets use force” crowd would want to send that Army into battle against . . . would go into battle against their friends, neighbors and family? Maybe the Army would turn its guns against the “lets use force” crowd.

    Someone thinks they will legally or administratively ban the ICEngine and the Car? Maybe the guns won’t come out. Maybe the “lets use force” crowd should try it and see. Run that little political science experiment and see what happens.

    I would suggest trying Full Metal Hansen first. Combined with Militant Belligerent Protectionism to make Greenism In One Country a national patriotic drive to protect America from its carbon dumping Trading Enemies and rebuild America’s own social survival carbon-neutral industries without our carbon-dumping Trading Enemies taking Carbon Shit after Carbon Shit on our efforts.

    1. vlade

      The UK government tried, and backed off, lifting the fuel duty every year since IIRC 2008.

      French government tried – result = gilets jaunes.

      I write it below. The sad fact is that fighting climate change will be regressive (even if you eliminated the rich carbon consumption entirely, say by eliminating the rich, it would still not be enough by far), and lead to a drop in quality-of-life for the current generation at least.

      Anyone who tries to pretend otherwise is not serious about fighting it.

      1. drumlin woodchuckles

        The French government meant to steal all the fuel tax and give zero anything back to the Yellow Vest payers of the fuel tax.

        Full Metal Hansen requires government getting ZERO of the carbon sale fee money , and ALL of it being dividended back to the legal residents at exactly the same amount per resident. This de-regressivizes the impact of the tax on the yellow-vest poorest to some extent during the ever-rising fee transition to full extermination of the fossil fuel industry.

        1. vlade

          So you take money from X, and give at least the same amount of money to them. So they now, hey, have more money to spend on all sorts of stuff that produces CO2.

          As I wrote elsewhee, at the very best it just creates persistent inflation. At the worst, it generates more CO2 than before.

          Combating the climate change IS regressive to our current life style. If we do not recognised it, we’re done for, because it will turn into violence sooner or later.

          What we can do is to accept lower living standards, and figure out how to maintain the basics (healthcare, education, housing… ), as opposed trying to maintain or even give say holidays in Minorca (a UK example) as they God given right, and an SUV on the driveway.

          1. drumlin woodchuckles

            Sorry, no.

            The punitive-level fee for permission to sell fossil carbon to begin with will be added right back into the price when the first seller first sells the fossil carbon.

            Every bit of money taken in by paying those “permission to first-sale” fossil carbon will be re-dividended in equal amounts to every legal inhabitant. Every good or service involving fossil carbon in its use will have its price raised by the amount of the passed-along-costs of the First Fee, which gets pro-ratedly passed along and re-passed along at every point of every sale-purchase.

            The less fossil carbon involved in making or doing something, the less it will have its price raised relative to things involving fossil carbon. The middles and poors would find their FeeTax Dividend going farther the less fossil-carbon-tainted their purchases are.

    2. Larry Gilman

      “Think a President Trump or President Trump 2.0 would sign such a legislated ban into law?” Of course not — just as they would never agree to taxes that “torture” fossil-fuel industries out of existence. Either a ban or a torturous tax can come into being only if we put the politics of radical change in place first: a different kind of President (and Congress, and a popular-movement politics to lean hard on them). Think a President Sanders would sign a legislated ban into law? I’m sure of it: banning fossil-fuel exports is an explicit component of Sanders’s Green New Deal ( ). Which balances its restrictiveness on corporate behavior with an all-points justice orientation for little people, which opens the door to the popular-movement support that might, in turn, force salvific legislative change. Nothing less or other will, that is certain.

  20. vlade

    Tax and cap and trade aren’t the same. Cap and trade doesn’t work because it’s way too open to lobbying for higher limits, exceptions etc. Same could apply to the tax, and in both cases it’s non-trivial to measure correctly carbon emitted/sequestered (which is a problem for any and all carbon measures).

    But the article instead makes strawman arguments.

    The fact that tobacco useage doesn’t change by taxing it has a number of reasons, which the author does not, in any way, attempts to compare to the carbon situation.

    For one, tax on tobacco affects tobacco consumption only. People can, and do, allocate more of their fixed budget to tobacco (there’s plenty of research on this).

    Carbon tax can work only if it increases price of just about everything. As a result, people have to consume less (their fixed budget got smaller in real terms).

    What is the point of the second point, i.e. that consumers we know less about the products? The point of a carbon tax is that more carbon extensive product will be more expensive. We don’t need to know more. We will consume less, less carbon gets out. End of story.

    Banning – cf prohibition and how well that worked. You can either blanket-ban (all carbon fuels – let’s see how that works…), or ban something. Unless the penalty on the ban is terminal, any ban fine is equivalent to voluntary tax and can (and will) be taken as cost-of-business (cf banks).

    Carbon tax is regressive. Yes. But here we hit the core problem. Tackling climate change will be regressive. Unless someone will come with a miracle of carbon-free energy in the next 10-15 years (extremely unlikely IMO, for that to be commercially viable we’d have to have the basic ideas by now), tackling climate change will mean using less – SUBSTANTIALLY LESS – energy.

    Rich may lose their private jets, but that’s a drop in the ocean compared to EasyJet and Ryanair who serve the 90%.
    Rich may still have electric cars, when majority of the population will have to use public transport (when they will be lucky enough to live close to some good one).
    Rich may still be able to build carbon-netural mansions (using geothermal + solar + wind + some storage to be energy self-sufficient), when the majority of population may have to live in high-density small apartment cities (which are way more energy efficient).

    The only currently possible way of making substantial impact on climate change in the next 10-15 years means very substantial lifestyle changes and sacrifices. I challenge anyone to show how else, with currently known technologies (i.e. deployable so that it would actually make a difference in that timescale), we can start reducing carbon emissions and put the overall carbon content on the declinine while dealing with the consequences of what’s already there.

    Our golden age came, and gone. That’s how stuff works. If we’re very lucky, our society will adapt (at the moment it doesn’t look so TBH). If we’re just lucky, our species will survive and maybe learn, with new golden age sometimes down the history.

    The nature will take its course, and adjust the ecosystem one way or another. Believing that all can have a good life (defined as a good life say even ten years ago) and we can combat climate change at the same time is IMO just a fantasy.

    That is, actually, a problem I have with (some of) the left right now. The promise that everyone will be better off, which for most people means consume more, is incompatible with combating climate change. Because, ultimately, more stuff = more energy = more CO2. That’s how simple it is right now.

    Yes, we can make people’s lives better substantially (via services, like healthcare in the US). But at the same time, combating climate change will mean being worse off in other aspects.

    If Labour in the UK announced increase of fuel duty as a way to combat climate change, it would guarantee its election loss.

    1. Grebo

      It’s tax and dividend, so most people would have a net gain. Announcing it before you’re elected is probably not a good idea though, as you say.

      There are a number of groups working on fusion, which is the closest thing to a magic bullet. Amazingly, most of them are struggling for funding. And every time someone says “fusion is 30 years away and always will be” they cut the funding again, just to make sure.

      Pending that, energy use will have to be cut by 50% and the remaining 50% replaced by non-fossil sources. It won’t be easy to do and it will be harder to get people to do it, but not doing it will be harder still.

      1. vlade

        If most people have a net reccuring gain, then, at best, all we get is inflation, at worst the consumption will increase (which will mean CO2 production will increase).

        That’s really the TLDR point – the only workable solution is so substantially cut aggregate consumption. That will be regressive, and there’s really no way around it.

        1. drumlin woodchuckles

          Raising the Permission-Fee per ton of fossil carbon which must be paid to even sell any fossil carbon in the first place would lower aggregate demand for fossil carbon based goods and services when it was raised to punitive and then torturous levels.

          The whole point of the Hansen Fee-Tax is NOT to raise money for a two-faced deceitful government to spend. The dividend is in part re-assurance that the two-faced deceit-based government will not be able to get ANY of the money to use for ANY pet projects of ANY sort WHATsoEVer.

          And since the govenment will receive ZERO of that money, it need not be viewed as a long-term revenue raiser. It can be viewed as a long-term instrument of increasing torture.
          The point is to raise the Fee over time to levels which are so torturous as to torture the fossil carbon industry to death by price-based extermination.

      2. Larry Gilman

        Alas, fusion is not even potentially a magic bullet (however far away its market entry might be, which is, in plain fact, very far), as this former principle research physicist for the Princeton Plasma Physics Lab makes clear: The good news is, we’ve already got plenty of magic bullets and don’t need fusion: wind, photovoltaics, end-use efficiency, storage, electrification of energy services, all of them sliding inxorably down well-established learning curves to lower and lower cost. E.g., some unsubsidized wind is already making power at $0.01/kWh and wind is getting cheaper every year, as is PV, which is why they are now heavily dominating new generation globally. Centralized thermal plants relying on a novel hyper-high technology with unfavorable energetics — fusion — is never going to catch that rabbit. And we don’t need it to.

    2. Ignacio

      Your last phrase holds quite a lot of truth though for some may be hard to admit it. If anything, it demonstrates that any “market approach” to fight climate change is doomed because much of what is needed is unmarketable (if such word exists). Nothing that market incentives can help with. I have lately been present in a few meetings where national and European authorities and managers (involving utility managers, financiers, municipal/regional/state representatives, social sciencists etc) blah blah blahed about initiatives to tackle Cl.Ch. Although a lot is being done, a lot of sensible initiatives and good ideas are in place, and though the theme is taken seriously, really seriously, after each talk my feeling was always, OK but yet these are not going to save us from catastrophe. Talk on restrictions is –almost– completely lacking, the word “ban” is hardly ever heard, and there are always insurmountable barriers that IMO are simply arbitrary barriers that we impose to ourselves to keep some fantasies alive. Is kind of a Bizantine approach in which we talk a lot, endlessly discuss alternatives and at the end we have… dissapointing conclusions.

      For instance you mention that banning private jets or luxury yatchs is a drop in the ocean. It is but, have you considered the exemplary push that such a measure would have? It would then be much easier to impose other restrictions to us, the populace. It is precisely the way to start IMO.

      China, with all its caveats, its own limits and growth appetite, does bolder things than bizantine europeans.

      1. Ignacio

        Another exemplary measure, unpopular but easier than taxing gasoline, would be banning car motorbike and boat races. Or just let them proceed with renewable fueled vehicles as a way to promote improvements on these. The hell with 24h Le Mans, 500 miles Indianapolis, F1 etc…

        Measures like this show the roadmap.

      2. vlade

        Ok, let’s look at the private jets.

        What specifically do you want to ban?
        – private jets
        – charter flights (as in unscheduled flights)
        – commercial use only, or government etc. too?

        If you ban private jets, well, actually, most of them are now, technically charter companies owned and operated by someone.

        Normal airlines can also operate charter flights. A non-trivial number of airlines (most you never heard of) lives on providing charter flights to popular tourist destinations.

        Do you ban flights on occupancy rates then, preventing the rich to just charter a whole 747 for themselves? They just may take their hangers-on with them..

        Do you kill small aircrafts entirely? That hurts a number of small distant communities, where it would effectively delegate any emergency response to military.

        Etc. etc. You spend a lot of effort, with not entirely clear side-effect to create a signalling device that most of the people won’t even care.

        I like the idea of killing the races more TBH.

    3. Andrea Casalotti

      I would not give up on Cap-and-Trade.
      It is easily the most elegant and effective way to frame the issue:
      1. There is a yearly declining global carbon budget
      2. Permits are issued representing the CO2 that can be burned that year.
      3. Permits are either auctioned or (my preference) distributed to global citizens
      4. Trading of permits allows prices to give a clear signal of the returns for carbon sequestration policies

      van der Leyen has made clear that free allocations of the EU ETS are on their way out and a carbon border tax will be established.

      In other words, cap-and-trade sets limit and uses prices to optimise resource allocation

  21. Larry Gilman

    I may have missed something, but this forum appears to be stuck discussing two negative controls, taxes and bans. Although I strongly agree with the top-of-thread argument in favor of bans, additional tools are in hand for shaping carbon emissions at largest scale: E.g., public direct action to alter energy and other carbon-intensive systems. We can, for example, build large amounts of publicly-owned renewable generation and sell the power to ourselves at cost, simultaneously decarbonizing the electricity supply and lowering its price for consumers. (In the US, publicly-owned generation already constitutes 10% of the power supply: .) We can wholly decarbonize our electric supply by 2030 with tools already in hand: no technology breakthroughs are needed. By marrying decarbonized electricity to electrification of end-use in transport and space heating, we can significantly decarbonize our economy by 2050. The global picture is more complex, but unless we make such changes ourselves there is zero chance of producing them elsewhere by any blend of incentives, development aid, and enviable example.

    Especially with a Presidential election fast approaching, any discussion of how to radically mitigate greenhouse-gas emissions should delve into policy proposals actually on the table. Politics is a driver of the geophysical system — is poised to be a determinative one, whether through action or inaction — and must be engaged. Given the likely rapid approach of no-going-back climate thresholds, such engagement must be urgent, practical, nontheoretical. The Green New Deal proposed by Bernie Sanders, a plausible contender for the Democratic nomination, is the most thorough such proposal, and is before us in 40,000 words of detail: It comprises the publicly-owned generation I describe above.

    Submitted for your consideration, as Rod Serling might say: Only a program of fast positive action (featuring not only bans but massive publicly-owned construction) can alter our system on the single-decade timescale needed (per IPCC 1.5 deg report) to avoid climatic catastrophe.

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