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Carbon taxes change the profit math for companies, which affects their decisions, that's the biggest change. They have to be high enough to change the decision

Carbon taxes change the profit math for companies, which affects their decisions, that's the biggest change. They have to be high enough to change the decision though.

jaggederest 8y ago
US$120 / ton of pure carbon, or about $32/ton CO2 should be about right. Ramp it up over 6 years, front loaded a bit, starting with $30/ton C, increasing $15/ton carbon per year. If that were done in a largely revenue neutral way on a worldwide scale, we could turn carbon emission around in a hurry. I'd actually advocate for putting aside some of the money to reward people actively removing airborne carbon dioxide down to the 290ppm threshold, not just holding at 400ppm.
- Gibbon1 8y ago
  I think a CO2 tax should be applied to capital equipment at the time of sale for best effect.
  - jaggederest 8y ago
    That creates some disincentives towards efficiency, and operation of equipment is often a much larger carbon source than initial manufacture. I think in practice it would work like a VAT, which is well understood and creates a reasonably level playing field.
    - Gibbon1 8y ago
      What I mean is instead of slapping a carbon tax on gasoline you slap it on the car. So if a car is slated to emit 60 tons of CO2 during it's expected life you compute a excise tax based on 60 tons.
      - jaggederest 8y ago
        Right, but that's too broad. Some people will drive a car for a million miles, some people will drive it for ten thousand. It's better to tax the embodied carbon of manufacture and delivery of the car separately from the carbon emitted by the fuel, for example. Fuels, in particular, are easy to determine the carbon weight - just add it up!
        Gibbon1 8y ago
        The problem with imposing a tax on fuel is your punish people for decisions they made before you changed the policy tax regime. Where taxing new equipment doesn't. The former tends to result in a lot of political blowback.
thaumasiotes 8y ago
> They have to be high enough to change the decision though. This is why I've stopped listening to people attempting to make externality-based policy arguments. If you believe that a carbon tax needs to be high enough to change companies' decisions, you're not actually making an externality argument. You've already decided that the world should change, and how it should change, and you're just trying to find some magic words that you think will get other people to agree with you. A real externality argument would try to determine the value of the externality, and set the tax to equal that value. It's not relevant at all whether that changes anyone's decision -- if there's no change, and you see just as much pollution as before, that's fine, because the cost of that pollution is now being accounted for correctly, and it's been decided that the pollution was better than the alternative.
- xg15 8y ago
  Seems like a weird argument in a thread about responsibility. Decided by whom? By the one party who is externalizing. Their may be able to offset the additional costs, however the ones that bear the consequences of the action in the first place (e.g. the ones who suffer from pollution or climate change) might not. Yet they still wouldn't have a say in the matter.
- afterburner 8y ago
  Are you saying the jury is somehow out on greenhouse gases? Because we definitely know it's affecting the planet. And we definitely know we need to cut back on carbon emissions. And we even know by how much. The externality is not hypothetical, we're living it, in real time, and so have a pretty damn good idea what we have to do to bring things to neutral. Anyone claiming otherwise simply would rather not lose their profits, or is being payed/brainwashed by those people.

Carbon taxes change the profit math for companies, which affects their decisions, that's the biggest change. They have to be high enough to change the decision though.

jaggederest 8y ago

US$120 / ton of pure carbon, or about $32/ton CO2 should be about right. Ramp it up over 6 years, front loaded a bit, starting with $30/ton C, increasing $15/ton carbon per year. If that were done in a largely revenue neutral way on a worldwide scale, we could turn carbon emission around in a hurry. I'd actually advocate for putting aside some of the money to reward people actively removing airborne carbon dioxide down to the 290ppm threshold, not just holding at 400ppm.

Gibbon1 8y ago
I think a CO2 tax should be applied to capital equipment at the time of sale for best effect.
- jaggederest 8y ago
  That creates some disincentives towards efficiency, and operation of equipment is often a much larger carbon source than initial manufacture. I think in practice it would work like a VAT, which is well understood and creates a reasonably level playing field.
  - Gibbon1 8y ago
    What I mean is instead of slapping a carbon tax on gasoline you slap it on the car. So if a car is slated to emit 60 tons of CO2 during it's expected life you compute a excise tax based on 60 tons.
    - jaggederest 8y ago
      Right, but that's too broad. Some people will drive a car for a million miles, some people will drive it for ten thousand. It's better to tax the embodied carbon of manufacture and delivery of the car separately from the carbon emitted by the fuel, for example. Fuels, in particular, are easy to determine the carbon weight - just add it up!
      - Gibbon1 8y ago
        The problem with imposing a tax on fuel is your punish people for decisions they made before you changed the policy tax regime. Where taxing new equipment doesn't. The former tends to result in a lot of political blowback.

thaumasiotes 8y ago

> They have to be high enough to change the decision though. This is why I've stopped listening to people attempting to make externality-based policy arguments. If you believe that a carbon tax needs to be high enough to change companies' decisions, you're not actually making an externality argument. You've already decided that the world should change, and how it should change, and you're just trying to find some magic words that you think will get other people to agree with you. A real externality argument would try to determine the value of the externality, and set the tax to equal that value. It's not relevant at all whether that changes anyone's decision -- if there's no change, and you see just as much pollution as before, that's fine, because the cost of that pollution is now being accounted for correctly, and it's been decided that the pollution was better than the alternative.

xg15 8y ago
Seems like a weird argument in a thread about responsibility. Decided by whom? By the one party who is externalizing. Their may be able to offset the additional costs, however the ones that bear the consequences of the action in the first place (e.g. the ones who suffer from pollution or climate change) might not. Yet they still wouldn't have a say in the matter.
afterburner 8y ago
Are you saying the jury is somehow out on greenhouse gases? Because we definitely know it's affecting the planet. And we definitely know we need to cut back on carbon emissions. And we even know by how much. The externality is not hypothetical, we're living it, in real time, and so have a pretty damn good idea what we have to do to bring things to neutral. Anyone claiming otherwise simply would rather not lose their profits, or is being payed/brainwashed by those people.