Experts Lay Out Their Case Against Carbon Pricing

Yves here. This article takes a look at how little progress is being made against climate/carbon emission targets and recommends more aggressive government action. Presumably the book it’s summarizing, Making Climate Policy Work. However, it sets up a straw man by equating carbon pricing with cap and trade and carbon offsets. We’ve called out those approaches starting with the early days of this website, in 2007, as gimmicks that enrich intermediaries, are rife with fraud, fail to change behavior, but mislead some do-gooders into thinking they’ve accomplished something.

A carbon tax is not a new idea. Al Gore pumped for it in 1992. Illustrious economists, including Fed chairmen, two former Treasury secretaries, and Brookings recommended one in 2019. The Financial Times called for “a clear and predictable price for carbon” in 2007 as a crucial step in combatting climate change, without saying how it could be achieved. Tyler Cowen (!!!) advocated a carbon tax and has also explained why regulations would likely still be necessary. From a 2014 post:

One problem with a Pigouvian tax is you may fail to meet the threshold of a desired outcome, given that the market response to the tax is uncertain. For instance if the government put on a stiff carbon tax there is a chance dirty coal use simply might continue, albeit at higher prices, and thus no problem would be solved. A very very high tax could ensure a movement away from dirty coal but then perhaps the tax is much higher than it needs to be and that too will bring significant distortions.

In that case, it can in principle make sense to supplement the Pigouvian tax with some kind of “best practices” standard or quantity regulation on the side of emissions.

Now here’s the catch. Let’s say you have been arguing that the transition to green energy can be a smooth and certain glide. In that case you should want the tax only (admittedly you still might favor direct regulation as a substitute, given the absence of a tax).

Let’s say you wring your hands about the ability of the market to find a good substitute for the dirtier fossil fuels. You’re really not sure whether that can be done or not at a reasonable price.

In that case there is the uncertainty and you might favor the Pigouvian tax plus the regulation. Or if you are truly fearful about substitutability, and don’t assign high enough priority to emissions control and climate issues, you might want no tax and also no major regulations.

One odd mix of positions is “I’m very unsure how well and how smoothly this transition will go and I want only a Pigouvian tax.”

Another odd mix is “I’m sure this transition will be a smooth and easy glide, I want both Pigouvian taxes and lots of regulation.”

Now in addition to Cowen’s point that carbon taxes may still not be sufficient to deter bad behavior all by themselves (you can imagine rich people continuing to fly on private jets), there are other reasons to have reservations:

They are likely to be regressive. There are ways to offset that with income taxes, but those who pay very low income taxes will be net losers ex giving them explicit subsidies.

They would need to be implemented in a coordinated basis across major economies, including China, to be effective. Then again, we have that coordination problem no matter what policy is adopted. There would similarly be border cost adjustment issues whether our trade partners played ball or not.

And it appears “progressives” have become squeamish about advocating taxes. From Politico in 2018:

The story of the carbon tax’s fading appeal, even among groups that like it in principle, shows the difficulties of crafting a politically palatable solution to one of the world’s most urgent problems — including greenhouse gas levels that are on track to reach a record high this year.

“This aversion to taxes in the U.S. is high and should not be underestimated,” said Kalee Kreider, a former Gore adviser and longtime climate activist. “I have a lot of scars to show for that.”

“I fear that the idea of a carbon tax is turning out to be a heavier lift than people envision,” said RL Miller, founder of the advocacy group Climate Hawks Vote. “As it is right now, starting from scratch, there is no constituency for it. … And I think the climate movement needs to go through some rethinking.”

Ahem, doing anything that is even remotely adequate to the challenge is a heavy lift…

By Bruce Lieberman. Originally published at Yale Climate Connections

Lockdowns, working from home, and sharply curtailed travel during the pandemic shaved 7% from global greenhouse gas emissions in 2020, according to the United Nations. But as people get vaccinated, economies begin to recover, and global emissions revert to the pre-pandemic trajectory, the outlook is dim for cutting emissions enough to avoid serious climate change and its adverse impacts.

With the clock running and the world’s economies headed in the wrong direction, climate policy experts see an urgent need to quickly throw out approaches that do not work and accelerate the ones that do. In the months leading up to the 26th UN Climate Change Conference of the Parties in Glasgow running from November 1 to 12, 2021, Yale Climate Connections is looking at ideas put forward in a new book: “Making Climate Policy Work” and elsewhere.

Why a Course Change Is Needed

To keep average global temperatures from rising no more than 1.5 degrees Celsius from pre-industrial levels, net emissions by 2100 must decline by about 45% from 2010 levels by 2030 and reach net zero by about 2050, according to a new report by the UN. To limit warming to below 2 degrees Celsius, CO2 emissions must decrease by about 25% below 2010 levels by 2030 and reach net zero by about 2070.

Current pledges under the 2015 Paris Agreement “fall far short of what is required, demonstrating the need for Parties to further strengthen their mitigation commitments” to avoid catastrophic climate change in this century, the report stated. Even if parties to the agreement follow through with their latest plans to cut emissions, the globe will be on a path to cut greenhouse gas emissions only 0.5% below 2010 levels by the end of this decade.

Plotting a New Course

Market-based schemes like cap-and-trade agreements and carbon offsets have largely failed to deliver on the promise that policy makers once saw in them, according to a new book by carbon policy experts Danny Cullenward, a Stanford Law School lecturer and policy director at CarbonPlan, and David G. Victor, co-director of the Deep Decarbonization Initiative and a professor at the University of California-San Diego. The authors analyze the reasons those “magic wand” approaches have failed and lay out a suggested course correction in their 2020 book, “Making Climate Policy Work.”

The book says the most effective way to cut emissions quickly enough to avoid climate disaster is for governments to adopt policies and regulations targeting specific sectors such as electricity generation. The authors recently summarizedthe ideas from the book in a wide-ranging, three-part interview with David Roberts of the clean energy newsletter Volts.

The biggest reason for the disappointing results of carbon pricing schemes like cap-and-trade, they argue, is that policy makers aggregated industries and jurisdictions. This made it easier for a wide variety of opponents to aggregate to fight the policies, resulting in a “lowest common denominator” system that fails to lower emissions as much as intended.

“By linking all the sectors together, in effect you are linking the politics together,” Victor told Roberts in the Volts interview. “And then the whole program becomes connected to the sea anchor of the least ambitious politics.”

The authors also see problems with carbon offsets, which allow polluters to pay someone else to take action that “offsets” their pollution, such as planting trees or rehabilitating forests. A major flaw: This approach makes it hard to ensure that what polluters are paying for is actually happening, or that the steps are really offsetting the pollution.

“Everyone imagines that there’s this vast army of people working on this problem, insuring that there’s a good outcome, but in practice you see understaffed regulators – very few people paying close attention to this who have no financial interests,” Cullenward said.

Victor told Volt that emissions will not be adequately reduced without “large-scale, systemic state intervention” and that this will “require a lot of government.”

“We can’t delude ourselves into thinking that you can wave a magic wand over this climate problem, with a market that doesn’t require a lot of detailed design and high-quality intervention. Having government back off is the opposite of what you need.”

In their book, Cullenward and Victor offer a strong argument for doubling down on a bigger role for government.

The Emissions Gap

Some kind of course correction is urgently needed. The UN’s Emissions Gap Report 2020, published in December, found that even with the 7% drop in global emissions in 2020 due to the pandemic, the world remains on track to see average temperatures exceed 3 degrees C (in excess of 5 degrees F) above preindustrial levels by 2100 – blowing past the 1.5 C and 2.0 C increases that climate scientists have warned should be upper limits of warming.

In 2019, global emissions totaled 59.1 billion tons of CO2 equivalent into the atmosphere – an all-time high. As post-COVID economies open back up this year and next, experts expect pent-up demand by consumers around the world to bring emissions roaring back.

The Emissions Gap Report targets consumer behavior and the shipping and aviation sectors, which account for 5% of global emissions. Shipping and aviation worldwide need to shift rapidly from fossil fuels, and aviation has advanced research into new lower-carbon fuels and increased fuel efficiency. But, the report says, projected increases in demand will make it harder for these sectors to quickly transition away from fossil fuels. The report places significant responsibility squarely on individual consumption. Two-thirds of global emissions are linked to private households, and the richest 1% of the world’s population is responsible for twice the emissions of the poorest 50%.

The Emissions Gap Report evaluates the gap between anticipated emissions and levels consistent with the Paris Agreement goals of limiting warming in the 21st century to below 2 degrees C, while shooting for a rise of no more than 1.5 degrees C.

Current commitments under the Paris Agreement would still leave annual global emissions far too high to limit warming to 2 degrees C, the Emissions Gap Report found. Under current commitments, annual global emissions are projected to reach a median estimate of 59 billion metric tons of CO2 equivalent in 2030 – 17 billion metric tons too high to keep average global temperatures within the 2 degree C threshold, and 32 billion metric tons too high to stay below an increase of 1.5 degrees. So even if the current Paris commitments are met, the level of global emissions projected for 2030 will be nearly identical to the 2019 level.

Numerous countries have pledged to achieve net zero carbon emissions by mid-century, or they have taken at least some initial steps toward that goal. France and the UK have gone as far as making the goal a legal requirement.

China, the world’s number one emitter, has said it plans to become carbon neutral by 2060, but it’s still relying heavily on coal-burning power plants to expand its economy. The United States, the second biggest emitter, has launched an aggressive agenda under the Biden Administration to cut emissions, largely by decarbonizing the nation’s electricity sector by 2035. President Joe Biden has said he wants the U.S. to become carbon neutral by 2050. But he faces a divided government, a struggling economy, and numerous other competing priorities.

Reductions Need to be 80% More Ambitious than Paris Agreement Pledges

The world needs government leaders in Glasgow to enact the course correction that experts are proposing. Overall reductions in emissions globally must be about 80% more ambitious than what member countries of the Paris Agreement have pledged, University of Washington statistician Adrian Raftery told the Washington Post. The conclusion came from a significant study published in February by a team Raftery led that said global emissions need to fall steadily by about 1.8% annually in order to even have a chance at staying below a 2 degree C rise in average temperatures this century.

Raftery’s study estimated the probability that the Paris Agreement’s biggest emitters can meet their current commitments. It assigned a 2% probability for the United States, and a 16% probability for China.

If current trends continue, there is only a 5% chance that global average temperatures can stay below a 2 degree increase this century, Raftery and his colleagues estimated. However, if all countries can actually meet their commitments under the Paris Agreement, the chance rises to 26%. If the United States alone fails to meet its commitment, that percentage falls to 18%.

Even under the best of circumstances, the Paris Agreement as it stands will fall far short of where we need to be. “The commitments are not enough,” Raftery told the Washington Post.

“Emissions Gap Report 2020” asserts that governments around the globe can reverse course and limit warming to 2 degrees C if they solidify their commitments to net zero emissions by mid-century and more jump on board. As of late February, 126 countries accounting for 51% of global greenhouse gas emissions had adopted, announced, or were considering net-zero goals.

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  1. George

    Using the carbon tax as a form of UBI (what Canada is doing) is a great policy. This is similar to Alaska’s oil dividend. Tax carbon at a high enough level and return the money to the residents. Win win all around.

    1. Grant

      Is it though? Okay, you tax carbon, but why do you tax carbon? You want people to consume less carbon. But, if you give them more money, they buy more goods and services with that money, which has carbon embodied in those goods and services. If we tax carbon to lessen consumption of carbon, it doesn’t make logical sense to give more money to buy goods and services that require carbon to be created. If you want to argue that a carbon tax along with a wide range of other things may work, fine, but I want to know what those other things are. A carbon tax and a rebate by itself doesn’t necessarily reduce net carbon emissions at all, which is the actual point of the carbon tax.

      It seems more logical to figure out what the aggregate level of carbon emissions should be and to have a publicly owned and/or controlled energy infrastructure that is part of a planning mechanism to manage not only carbon emissions, but also have some say in carbon sequestration, land uses that result in net impacts in carbon emissions, etc.

      The notion of pricing carbon, to me, is nuts. How do you price something that has so many side effects? Ocean acidification is a byproduct of carbon emissions. Is that included in the price? Coral reefs are going away, is that included in the price? If you price carbon, you also have to price the worst case scenarios, so you need to price an uninhabitable planet and the potential of more carbon leading to that. Can you actually price such a thing? I know Costanza has priced ecosystem services, but I find the idea to be a bit crazy. Don’t we say that when we price something that it has an exchange value? I don’t know how to wrap my head around how to exchange something that could lead to environmental collapse with a pair of shoes I want to buy. I also thought that for something to have exchange value it has to have a perfect substitute. What is a perfect substitute for water, or a species going extinct because of carbon emissions?

      There is also the issue of positive externalities. Look at the fraud associated with carbon offsets and things like the REDD program. Look at the violence that has resulted in. After all, if you price carbon sequestration, who owns the land those trees or soils are on will then benefit from that. Look at what capitalists are doing now with buying up properties as is, look at the increasing commodification of water and most everything else. Karl William Kapp long ago said that non-market impacts were really just a cost shifting exercise and were a reflection of power dynamics.

      I think we need to employ comprehensive economic planning, we need to increasingly think in physical units (how many tons, for example, of CO2e we must admit) and if we use markets it is to thereafter pass information around or to be used as a unit of account.

      1. BlakeFelix

        A lot of the carbon offset programs were/are poorly administered to the point of bordering on grift, so let’s ignore that. Don’t allow hopeful nonsense. Then, the reason taxing carbon with a UBI discourages emissions is that it makes lower carbon alternatives price competitive, and high carbon emitting low value activities unprofitable. And gives everyone a buffer to deal with whatever chaos ensues. Why would you want to tax anything more than pollution, really?
        That the exact price is complicated to the point of being unknowable is true, but it isn’t a good argument for making it zero in my opinion, because I think that the evidence shows that it is not zero. And it can be phased in and adjusted, there is no law that we can’t dial it in.

        1. Grant

          I am concerned about people relying on markets and monetization to deal with these issues. That is not to say that doing nothing is better than this, but it should be a very temporary phase while we transition to a more comprehensive form of planning. I always hear people talk about the environmental crisis, but then the discussion focuses entirely on carbon emissions. Carbon emissions are one part of a much larger crisis. Let’s just say that the tax on carbon is to increase over time, or carbon permits in a cap and trade program are reduced over time, making carbon emissions more expensive. Okay, what about the species extinction rate being thousands of times the natural rate? Are we going to commodify species too? The ocean being free of fish in decades at current rates? We gonna privatize the deep oceans and all of the commons? Do we monetize the tens of thousands of chemicals produced in the industrial economy that don’t occur in ecosystems, which we throw into ecosystems? Do we monetize soil in some way to deal with soil erosion? Deforestation is still a huge issue, so I guess we privatize all of the forests too. How about unsustainable farming practices that result in a dead zone in the gulf the size of Connecticut? There is a bigger one in the Baltic. How do we deal with the aggregate limits of growth in a decentralized market economy that is horribly inequitable and undemocratic? It seems that, if the answer to all of this is to rely on markets to do nothing short of magic that we are taking up the position of people like von Mises and Terry Anderson. It seems entirely unworkable. I realize the problems with economic planning, especially authoritarian planning, but I think the idea that we monetize everything is insane and cannot work, and I don’t understand why we would monetize carbon emissions and yet on the other hand recognize the limits of markets elsewhere. Even if carbon is made to be more expensive, do we not need to radically change how we produce and distribute things, how we get around, land use patterns and zoning, housing and the proximity of residential areas to commercial centers, how we grow food, the massive inequalities regarding resource consumption and pollution generation?

          Beyond that, there was a really important book by Saral Sarkar about ecosocialism versus eco capitalism and he pointed out a clear problem with making non carbon forms of energy relatively cheaper, and the problem is that we haven’t figured out how to produce renewable energy with renewable energy, and the production of solar panels has very damaging environmental impacts too. Keep in mind, again, we have a full blown environmental crisis as is far beyond carbon emissions.

          We need to deal with the size of the human economy relative to the ecosystems we draw resources from and use as a sink for wastes and we need to get real about the limits to monetization at the same time. That alone requires pretty comprehensive economic planning a. A tax on carbon would be at most a pretty brief transition period where we start to figure out how to plan in regards to physical units. If people want to disagree with this, explain to me how a Terry Anderson style market based solution would work.

          1. BlakeFelix

            I don’t think that a Carbon tax will solve all that, but I think that it’s a good way of addressing carbon emissions. Taxing other pollutants and externalities is a good idea as well. Even wildlife, I have to pay(not much) to get a deer hunting license, if people are harvesting too many fish then tax/fine them until they stop. Money and markets aren’t magic that solves all problems with no oversight, but it’s hard to avoid them and get anything big done. They tend to concentrate power, so a UBI to redistribute some of that seems like a good idea. The economy is very complex, but prices are great in that they can roll complexity into a single number that people can evaluate easily. Making that number better reflect externalities won’t solve the whole problem, but it’s an elegant solution for as far as it goes. Now, getting it passed and administered is over my head, beats me what Washington is going to do.

            1. James Simpson

              You’re using capitalist tools to solve a problem that capitalist tools are causing. It’s never going to reduce our energy use to the level needed to even begin to mitigate the climate crises. For that, we need socialism. But, as the example of Ecuador has shown, people prefer to vote for a bright, shiny toy instead of what they actually need to survive.

              1. Darius

                Nevertheless, if you don’t tax carbon, society is subsidizing fossil fuels. We might as well be giving people vouchers that they can use only on gasoline or Buick Electras.

            2. Grant

              Using markets to deal with these non-market impacts isn’t workable. Markets would likely still be needed, but after a planning mechanism figures this out and deals with this stuff. Markets, within a more confined context, could be used to pass information in the economy and to be used as a unit of account. There are clear limits to monetization, so saying that markets aren’t perfect but we need to use them to solve this problem, again, show how such a thing could ever work given the scale of these non market impacts, informational challenges that would confront individual consumers and producers, and the limits to growth. Realize, again, that using markets in this way in regards to negative externalities is supposed to increase the prices of things to discourage particular behaviors. Given the scale of these impacts, how much would everything then cost relative to wages? Many things we now take for granted would need to go away (flying for example), and the things that are now affordable (like the computers we use to communicate here) would be far, far more expensive. The internationalization of supply chains would be drastically impacted, cause a lot of environmental damage is done by just shipping stuff to supply chains in multiple countries. Even if this was workable, if you accurately priced these things that in turn would require radical changes.

              1. BlakeFelix

                Well, I’d start by dropping a $200-800 dollar a ton tax on carbon emissions, redistributing it as a UBI, and see where that goes. It would raise gas about $1-4 dollars a gallon, putting us more like Europe, and paying everyone around $3,500 to 16k a year, man woman and child. So you come out worse if you emit more than 18 tons of fossil fuels a year. Tax it at the source, so it’s easy to track, maybe tariff imports to put them on an even or advantageous(for us) footing. I’m not sure it would fix everything, but it would eliminate poverty and put an anchor around the neck of fossil fuels. And that’s enough for one day, I think!

      2. drumlin woodchuckles

        James Hansen tried thinking through as best he could the problem of ” give them a dividend and they’ll just buy more fossil carbon anyway.”

        As I understand it, his solution is to FeeTax the fossil carbon at the first-point-of-sale mine mouth/ well head/ etc. Make the would-be first seller of the raw-as-extracted coal, gas or oil pay a FeeTax to the FeeTax Dividend Authority. Then grant them total permission to turn right around and add the price of the FeeTax onto the price of the fossil carbon they wish to sell. ( If they choose not to do so, Hansen might well end up desiring laws which would FORCE them to do so). The point is that every downstream 2nd, 3rd, etc. user/ rebuyer/rerebuyer/etc. would add that same price onto the price of whatever they sell. The fossil carbon would add its expense to every good or service it was involved in all the way down the line.

        All the collected FeeTaxes would be divided up into exactly equal dividend amounts and payed out to every legal resident of the US. Hansen’s theory or fond hope is that things done or produced withOUT fossil carbon would cost LESS than things produced or down WITH fossil carbon. People would spend their dividends on goods or services made withOUT fossil carbon because they would be cheaper by exactly the missing-price of the not-paid-because-not-involved carbon FeeTax.

        Hansen’s endgame theory is that the fossil carbon FeeTax will be kept rising to inconvenient, then to uncomfortable, then to torturous, then to outright exterminatory levels. The fossil carbon industry will be FeeTax exterminated to death. Non-fossil will be all that will end up being permitted to live.

        1. cnchal

          > The point is that every downstream 2nd, 3rd, etc. user/ rebuyer/rerebuyer/etc. would add that same price onto the price of whatever they sell.

          That isn’t how it works. At every sales stage the price isn’t added but multiplied. It would be a middleman’s dream of money for nothing, which is the way it is now.

          For example, when I sell my product to a retailer the price is $X + $shipping cost = $Y

          The retailer charges 2 X $Y to the end customer using the shipping cost as a margin generator, when in my opinion it should be (2 X $X) + $shipping cost = final price.

          My opinion cuts no ice with retail.

          1. drumlin woodchuckles

            Multiplied? Well, that’s even better.

            The way to encourage conservation is to discourage use. The way to discourage use is through punitive pricing.

            If we actually get a Hansen FeeTax Dividend on all fossil carbon at first point of first sale, and every re-seller or user-reseller down the chain MULtiplies the price the way you predict , this could help shut down a lot of monetized consumption altogether, and drive a lot of people partway back to subsistence-in-place.

            It would be a new dawn of hyperintensive hard-labor gardening in suburbia.

            1. James Simpson

              Subsistence agriculture cannot feed 7.5 billion mouths. It was abandoned to enable more people to be born. They’re here. Now what?

          2. Foy

            “The retailer charges 2 X $Y to the end customer using the shipping cost as a margin generator, when in my opinion it should be (2 X $X) + $shipping cost = final price.”

            Interesting comment cnchal. But I think the reason maybe that the retailers don’t cut you ice is because the shipping cost is a Cost of Goods Sold. And they work out their gross margins on Cost of Goods Sold. And that is because with significant inventories that shipping cost will increase capital requirements and there should be a return on that investment. The investment is not just in the actual unit cost of the goods.

            Just going through this exercise myself working out gross margins and recommended retail prices for a friend’s small business in South Africa, because of their regional location the inwards shipping costs are significant. They make home made natural cosmetics so they have a lot of investment in raw materials and finished goods and shipping costs are a significant proportion of that, so gross margins should be calculated on the total cost of goods sold.

  2. cnchal

    > The book says the most effective way to cut emissions quickly enough to avoid climate disaster is for governments to adopt policies and regulations targeting specific sectors such as electricity generation.

    Joe just held a White House conference complaining we don’t have enough chips to power all the digital crapola we don’t need, and billions to trillions are going to be doled out to make ever moar power sucking devices.

    I see a chip embedded in every sheet of toilet paper so that we can be charged by the ass swipe. In Silly-con Valley that’s called innovation. Even moar innovative is to lard up cars with digital garbage so they can be scrapped after a couple of sensors fail two months after the warranty expires. Also note how none of that digital garbage in cars actually work when really needed. Collision avoidance, anti lock brakes, all of that stuff is useless in preventing multi car pileups.

    Also, we don’t have enough power sucking data centers to store all the ones and zeros generated by your self spying cell phone and because these centers use so much power they get a massive discount instead of being charged triple retail to discouirage their use.

    We are going in the wrong direction at an accelerating rate.

    1. Alex Cox

      Thanks for linking to those articles about “embodied energy” — they are very important. It’s convenient for the promoters of private electric vehicles to ignore the cost of manufacturing (and disposing of) the beasts.

      The obvious takeaway is that we should hang onto our old stuff for as long as possible, and if it’s necessary to upgrade, to upgrade to a “used” item.

      Regarding estimated length of life, the second article states that cars last ten years and phones/laptops/tablets only last two years. In my experience this is untrue. Cars and pickups are pretty well made and if treated properly can last several decades. My ZTE “smart phone” is five years old and still works; I bought all my computers second hand/refurbed and some of them are more than ten years old.

      Often older tech is better: think of cars without unnecessary chip-based bells and whistles, or Macs without the deadly “butterfly” keyboards. Consumers often feel obliged to upgrade because newer software isn’t compatible with older units. But older software is more than sufficient for most purposes, IME.

      How much value is lost as soon the new car/computer leaves the showroom? Twenty percent? Reuse, baby, reuse!

      1. Laura in So Cal

        Our newest vehicle is 10 years old and our oldest just turned 25. We anticipate keeping both these at least another 10 years. One issue though is that manufacturers may not support spare parts. We’ve had to resort to on-line junk yards for parts on older (but not old enough to be classic) vehicles.

        I’m still using a Dell laptop that is 8 years old. When I upgraded from Windows 7 to Windows 10, the software kept telling me that I “should” upgrade my hardware, but amazingly Windows 10 works just fine on my old laptop. My son needed a laptop for his “hybrid” schooling recently so he took his old Dell laptop of the same vintage, unloaded older software, loaded Windows 10, upgraded the RAM and the hard drive and for $150 had a working laptop for the next couple of years before college when I would anticipate getting him a new one.

        We consider “Repair” one for the “R”‘s associated with the environmental slogan. It is Reduce, Repair, Reuse, Recycle.

        I really enjoy Jerry-Lynn’s Right to Repair articles. It is a real moral value in my family to avoid being wasteful. My Dad is an artist with respect to it and my husband is the most creative person I know at this. He can fix almost anything.

        1. drumlin woodchuckles

          There may emerge a business of after-market fabricators making such replacement parts to order.

  3. john Steinbach

    No mention about how radical cuts in CO2 emissions will impact society globally. Yves is correct that a stiff carbon tax with rebates (mainly to low income) is the only practical response to the climate change dilemma. The social consequences of the discontinuity created as fossil fuels and other resources run out is seldom mentioned in these kinds of analyses. The assumption seems to be that a technological fix will allow some facsimile of BAU to continue.

    Back in the early 70s, we used to say “Mother Earth bats last.” It’s the bottom of the 9th, the bases are loaded & She’s stepping up to the plate.

    1. drumlin woodchuckles

      The social consequences of hard defossilization won’t be as bad as the social consequences of turning Earth into Venusian Hell Planet Number Two.

  4. William Neil

    I was very attentive and active during 2019, the formal dawn of the Green New Deal resolution, and plans from different enviro policy groups were all on the table, like “Drawdowns’s” and the Victory Plan…Sunrise was all in…but the Democratic leadership in Congress was terrified. They could have used the blocked Select Standing Committee on the Green New Deal to be the policy forum where all the competing visions and plans were vetted, sorted and ranked…with no binding commitment to accept the outcomes because they still would have to have gone through the other committee’s turf to get to the floor for a vote.

    Instead, today, groups like the Climate Crisis Policy are attempting to pull together all the competing strands of enviro groups – there are thousands of groups and many strands of policy emphasis – to back a unified grand bill – before the political slicing and dicing in Congress takes place. A wise strategy, I believe, and I’ve been impressed with their leadership’s experience and savvy.

    Let’s not forget the string of climate impact findings from birds to insects to marine life and all the natural disasters from fires to hurricanes which built up the momentum in 2018-2019… and yet this all receded in the wake of Democracy’s tribulations with Trump and the events of Jan. 6th…

    To tie this together let’s remember Naomi Klein’s striking analysis that the Green New Deal is Neoliberalism’s and the Republican Right’s worst ideological nightmare, calling for a strong state with emergency powers as in WWII…Sanders’ numbers for his very interesting fleshing out of the Green New Deal cost and programs dwarf what Biden has put on the table, and Biden has lowered the temperature in terms of costs and ideological threats. Yet I don’t see how we resolve this decisively to correct the current course given the obstacles built up since Reagan at least: anti-gov, anti-tax, anti-regulatory.

    One would have thought that the findings and natural events of 2018-2019, Paradise burned to the ground – talk about Miltonian symbolism – might have served to be climate’s Pearl Harbor rallying point. Instead, you know where we are.

    I’ve had a hard time coming back to the level of my intensity from the spring of 2019, and the early success of AOC and Senator Markey in signing up colleagues.

    I just don’t know if our society is capable of the extraordinary changes required.

    1. drumlin woodchuckles

      If society is not capable of the extraordinary changes required, then society can just get ready for the Big Heat Future.

      If some parts of society decide to get ready for TNAT . . . . and other parts don’t or won’t, then some will survive and some will die. In that event, let people or localities prepare as best they can for whatever Big Heat Rising they think they can see coming, and let Darwin take the hindmost.

    2. drumlin woodchuckles

      Pearl Harbor was a shock to the American public because Pearl Harbor was unexpected and unexpectable..

      Fires in California are not a shock to anybody. Careful parsing of evidence may indicate that fires are bigger, last longer, start sooner, start later, whatever. But the burning of a Town called Paradise is not a public shocker of a Pearl Harbor event.

      To be a Pearl Harbor Nine Eleven type shocker, a weather event would have to be like this . . . . A category 9 Hurricane lovingly lingering right over Houston and leisurely moving to Dallas, staying Category 9 the whole time, and spawning hundreds of F9 tornados within itself the whole way. Along with hailstones the size of beachballs the whole time. It would have to kill a million or so people, maim another few million for life, and cleanly raze every single object sticking up above the ground all the way down to ground level. That would be a Pearl Harbor weather event.

      If we don’t get that, the public won’t be interested in anything the sincere Global Hard De-Warmers have to say.

  5. Matthew G. Saroff

    I think that there is some conflation of Cap and Trade and a carbon tax here.

    A carbon tax has some advantages over cap and trade:
    * It can be refundable as a UBI, which means that most people (the bottom 80% end up ahead) creating political support.
    * A carbon tax is simpler and far less subject to manipulation than cap and trade and offsets.
    * A carbon tax can be applied in cross border situations much like a VAT, where taxes which are levied are rebated upon export and assessed on imports, meaning that it applies carbon pricing to countries with massive trade deficits, like the US.
    * A carbon tax is harder to evade.

    Carbon pricing is not THE solution, but it is a PART of the solution, while cap and trade is largely another subsidy for the casino that is Wall Street.

    1. William Neil

      they should be pretty distinct. The Climate Crisis Policy group I’ve been following had the policy wonk from Food and Water Watch – Jim Walsh- with us for a Zoon Mtg on Saturday and he had an excellent slide program to disabuse laypeople of cap and trade, a carbon tax, offsets, and the “miracle” of hydrogen arriving easily or “in time.’ Oh yes: and any faith in carbon capture and storage proposals which keep proposing but don’t deliver. This isn’t the place to go into all the details about why the carbon tax isn’t such a good idea – I tried to get answers a couple of years ago from the advocates of Senator Chris Van Hollen’s tax and dividend – the most popular version of raising carbon prices, but it was never clear when the “dividends” (just the taxes paid for the new carbon prices) would be mailed back to the threshold income cut-off meant to protect the bottom 60% of the nation’s income level from shelling it out at the gas pump – or wherever via the price incorporations at Walmart…would that be quarterly twice a year…or just once, like the EIC? No matter, the poor still will be paying upfront now even if they eventually get it all back…it’s hard to see how that discourages carbon intensive uses nationwide…which is perhaps why firms like ExxonMobil can live with it…

      I’m sure others are better than me on this but it would seem to be a long slow way to put pressure on when we don’t have the time to do that…

      1. drumlin woodchuckles

        James Hansen’s plan has an easier way to divide the money. Just divide the money raised by the number of people in the US, and send equal-sized dividend checks to every inhabitant.

        Trying to means-test such a thing is just a way to keep a bunch of PMC busy-body blue-nosed people-judgers in power to picky-choosy who gets a check and who doesn’t, and to make everybody crawl and beg to satisfy the PMCs lust for sadistic power.

    2. Yves Smith Post author

      The cross-posted article conflated the two. I picked that apart in the intro.

      Cap and trade is a scam. Tons of market manipulation from the get go, before you get to the problem of verification of the supposed change in behavior.

      The cross-posted article bizarrely acted as if the failure of cap and trade said anything about carbon taxes, a completely different approach.

  6. a. wells

    The carbon tax is a general tax. Just like the SS taxes,the government will spend it on whatever it would do anyway. Mainly gas guzzling, CO2 emitting tanks, aircrafts and warships. It solves nothing.
    If one’s argument is that taxes influence behavior, here is an observation. People have to have electricity and the grid mixes it from all the sources – the % renewable offered by different companies is just a gimmick. People will drive the gas powered cars for the remainder of their useful life, and governments at any level can raise or add to the gasoline tax, which will fall heaviest on the poor.

    1. BlakeFelix

      Well, if all it does is shift tax avoidance behavior from hiding income to not polluting, that’s not nothing. And I think people have an unrealistic view of how much the rich consume vs the poor. The rich guy may drive a Tesla but his yacht burns 2 gallons to go a mile, and his jet burns your years fuel budget just going off to fetch his cats favorite breakfast.

    2. drumlin woodchuckles

      Hansen is aware of that danger, and he perhaps naively thinks that a totally separate FeeTax Dividend authority may be legislated into existence which would separately gather all the fossil carbon FeeTaxe and spend all the money on Dividends back to all of America’s legal residents.

    1. Jason

      That’s cap and trade at the individual person level. It is of course a massive-redistribution scheme. Why this would fly when other schemes have sunk under politics is not explained.

  7. Peter Dorman

    I’ll discuss this in first person mode, comparing these arguments to mine in my someday-it-will-be-published book on climate change.

    David Victor, coauthor of Making Climate Policy Work, is a hybrid of serious climate hawkishness, which I share, and cold political realism, which I think is too limited. (I’m not familiar with Danny Cullenward.) He takes existing politics as a constraint and then looks for policies that have a chance of seriously cutting carbon emissions that adhere to them. I prefer to look at what would be a sensible way to minimize the risk of a climate catastrophe at least cost to other goals, and then deducing the politics we would need to make it happen. The bottom line is that I am much more open to basing climate activism on radical, disruptive politics than Victor is.

    Anyway, it is perfectly obvious at this point that existing policies, like those of the EU and California, are simply inadequate. He says this and I agree. I think it is also beyond debate at this point that the global offset regime, including forest credits, is a sham. He is somewhat more open to trying to fix it than I am. When people talk about carbon trading, if they know the subject, what they’re referring to is the offset business. And once you reject offsets you also have to question the “net zero” stuff.

    On the other hand, the discussion around “market-based” policies is hopelessly confused. Carbon emissions overwhelmingly result from burning fossil fuels. Directly curtailing these emission by regulation and enforcement is not relying on the market; it’s controlling them directly through law. Trying to tweak the market for fossil fuels is what “market-based” should mean. Taxes are market-based. So are crash programs to build out renewable energy sources, since they rely on markets to transmit demand signals to the fossil fuel sector. (If there were some natural law that the amount of energy in use is fixed, then of course a program to increase renewables would directly reduce fossil fuels, but total energy use is, um, a market outcome.) In my book I give several reasons why I think direct control over emissions, through a comprehensive and no-offset permit system, is a better approach than taxes. Either would need to be supplemented with immense public programs to facilitate conservation and fuel-switching, but that’s different than relying on those programs to replace direct control over fossil fuel extraction.

    And I think the record shows that Victor has it backward about upstream versus downstream policy. In every system that has been enacted so far, regulation is downstream at the level of individual sectors. And each sector lobbies crazily for exemptions, offsets and rebates, winning to a greater or lesser extent. Politicians like this too, because they can trade off obscure technical giveaways to these lobbyists, which have huge consequences for actual emissions, in return for political support.

    The only hope is upstream control at the level where fossil fuels are introduced into the economy; that’s where they need to be interdicted. Yes, as Victor says, this will centralize business opposition, but it also has the potential to centralize the conflict on our side. A movement to overcome the lock that business currently has on policy could win that battle.

    Incidentally, the second reference is to a study of the likelihood of meeting Paris climate targets as a function of emissions reductions. In my book I took the current sort-of-consensus remaining carbon budget (for 2/3 chance of holding warming to 2º) and translated it into global annual reductions slightly above 3%, under the constraint that the ratio of annual emissions to remaining budget (number of years we could continue at the current level until the budget is exhausted) remains constant, which I take to be a measure of sustainability. (You don’t want to ever use up the whole budget.) I argue loosely that developed countries would need to have a much higher annual rate, more like 5%, for this to be remotely acceptable, politically and ethically, for the developing world. This puts us way above Raftery’s 1.8%.

  8. Susan the other

    A tax is like debt. It just makes the hole deeper and harder to dig out of. It’s a money-driven solution to keep the economy going… and money circulating. Not that taxing isn’t a good way to balance an economy. Just not this one. This economy is so out of whack no tax is gonna help. A carbon tax, if it works, will slow the entire economy down, but only slowly. How many years will it take to clean the atmosphere? Too many. Since nobody is particularly panicked about that prospect the only thing I can deduce is that it’s really not a big priority for anybody. If it were we’d all be begging the government to do something effective. So, where’s the truth? And if and when we can find it, then maybe some decisions can actually be made that make a difference. I mean, if this were a war and we operated this casually – doing nothing for 4 decades and then putzing around for another 8 decades, I really don’t think we’d win.

  9. chuck roast

    For at least 30 years academics, economists and various sorts of ‘experts’ have been producing this type of analysis to absolutely no effect. I could say that this endless derivative word mashing is extremely disheartening if I weren’t so extremely cynical. The political will was there in 1994 to do something really significant at Kyoto, but Bubba was too busy triangulating 1996 so it was all a bunch of hand waving. Mind-boggling that in 2021 some guy is writing that, “Yes, carbon taxing is more effective then carbon trading.” I think I’ll take a nap.

    But before I close my eyes let me point out that it was recently posited that the mining of Bitcoins, an asset class whose only two functions are speculation and blackmail, uses more energy than the country of Argentina. One would think that a politician somewhere in the world who actually cared about CO2 emissions would demand that this activity cease immediately. I’m listening closely…maybe I should turn up my ear aids.

    In my little state the concerned pols just passed a climate bill that ‘pledges’ the state to reduce future carbon emissions step-by-step to some impossibly low numbers. They might have passed accompanying legislation mandating heat-pumps in all new residential construction or roof-top solar panels or some other actual policy requirement to demonstrate their determination to do the right thing. Uh, no. Zzzzzzzzzzzzz…

  10. Jeremy Grimm

    Carbon taxes are not the same as cap & trade or carbon offset. I am not sure carbon taxes are the same thing as carbon pricing. I suppose carbon neutral is a carbon offset scheme. Add rebates, exemptions, regulate the cap & trade markets but all these schemes are Market based schemes for slowing and eventually halting CO2 emissions. The idea that we have some CO2 ‘budget’ based on Charney’s climate sensitivity coefficient and its refinements — as they are ground out from running multiple complex climate models and studies of paleoclimate — is ultimately Market based, crafted to the satisfy politics of these times. I believe the Market has demonstrate tepid ability to reduce CO2 emissions. Besides the Market seems unable to optimize further in the future than a month, at most a financial quarter and there is just too much sunk investment and untapped value to exploit.

    I believe it is past time to institute rationing fossil fuels and past time for a comprehensive policy for making radical changes to our way of life and basic beliefs. Our civilization cannot continue as it is. The hour grows late for deciding whether the transition will be a cushioned slowdown or a dramatic halt. The Market with and without the ‘right’ price for CO2 is driving Humankind like topsy toward a violent crash. I very much doubt anything will be done on a grand scale to avoid a violent crash. Maybe MIT’s SPARC fusion reactor will pull our chestnuts out of the fire or maybe some new program funded by the Biden’s jobs plan and developed by a new technology directorate that Biden’s jobs plan would incorporate into or around the National Science Foundation (NSF).

  11. Synoia

    Intelligence as we humans have it appears to me to be an evolutionary dead end.

    We humans have been astride this planet for under 100,000 years.

    The Dinosaurs existed for about 240 Million years, and if it was not for an asteroid strike, would still be going strong.

    There will probably be be life on earth for millions more years, Just not human life.

    Compare the destruction of our biosphere with that of the dinosaurs. The dinosaurs lived on what is on the surface of the planet. We humans used to live on what is on the surface of the planet, up to about 400 years ago, but now do not.

  12. Michael

    Numerous climate/economic models show that multiple actions are necessary to reign in GHG emissions, but that carbon prices are the single strongest action to reduce GHG emissions. If you haven’t explored action impacts with a climate model, take a look at En-ROADS at: Its a free to use, real time climate model updated regularly with data as climate science advances.

    A climate price and dividend bill has been submitted to Congress for every session in at least the past decade by Citizens Climate League, a group with about 15,000 members. The current bill is called Energy Innovation and Carbon Dividend Act. It has been analyzed by economists. It has several layers of detail. Basically, it puts a price of $15/ton of carbon emitted on companies and raises the price $10/ton every year. Funds collected are distributed on a per capita basis as a taxable dividend paid quarterly to everyone with a Social Security number, with half payments to children in a family setting. It is not regressive because low income people use less carbon that wealthy people (think riding the bus vs flying to conferences), and wealthy people pay a higher income tax on the per capita flat dividend they receive, so more of it gets returned to the Federal government. The dividend is economically ‘progressive’. The carbon price eventually gets high enough to create strong disincentives for fossil fuels. The planned steady rise in carbon prices gives companies time to adjust, if they choose to.

    Europe seems poised to implement a carbon border fee – probably in 2022. Bureaucrats are working the details. When/if that happens, the US will have no choice but to implement some type of carbon price.

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