4 ms·

Broke: import tariffs motivated by short-termist trade war one-upmanship and bigotism. Woke: import tarrifs motivated by long-termist climate change reduction.

by ovi256 7y ago

Broke: import tariffs motivated by short-termist trade war one-upmanship and bigotism. Woke: import tarrifs motivated by long-termist climate change reduction. We swear they're not the same thing so they can't have similar effects! This time it will be different and those unenlightened non-Westerns will listen to our thought leadership!

wool_gather 7y ago
Are they the same thing? It seems to me they'd be targeting different products, so yes, different effect.
adrianN 7y ago
When the US puts import tariffs on foreign cars for being foreign, there is nothing the other party can do other than putting up their own tariffs in retaliation. If the US puts import tariffs on the embodied carbon emissions of foreign cars, the foreign party can join the carbon tax scheme to get around the tariffs. That seems like an important difference to me, but I'm not an economist. Better economists than me seem to also support a carbon tax or other forms of carbon pricing like cap&trade.
- mechagodzilla 7y ago
  Exactly - with a carbon tax, the importing country says "The carbon emissions embodied in this product are going to be taxed, we can collect the money or you can, it's up to you." Will that result in a general reduction in the consumption of carbon-intense goods? Of course! They're now more expensive, that's the whole point. With an import tariff on foreign goods (for, as you described, being foreign), it makes foreign goods more expensive (with nothing the other country can do about it), so it will lead to a reduction in the consumption of foreign-produced goods (whether or not that is a benefit to you as an American is probably heavily dependent on what you consume and what you produce).
  - ovi256 7y ago
    For the imported good buyer, there's a price increase. It does not matter to him who collects the tax that increased the price - an import tariff imposing government or an enlightened carbon-scheme participating foreign government. This will reduce demand like any other dead weight loss, and yes, depress economic activity, employement and thus wages. BTW, most countries already have carbon taxes on fossil fuels, they just don't bother calling them that. They call them fuel excise taxes. Around 60% of the price a consumer pays for fuel in the EU is fuel excise tax, in other words, a 150% tax. In the US, it's only about 20%. Here: https://en.wikipedia.org/wiki/Fuel_tax#China https://en.wikipedia.org/wiki/Fuel_tax#China What's your estimated impact of this already huge tax ? Think about the demand elasticity of fuel and energy products.
    - adrianN 7y ago
      If you read the literature about carbon taxes, virtually everybody recommends a scheme where the carbon tax is paid out again, so there is no effective price increase for the consumer if they have an average carbon consumption, but everybody still has an incentive to switch to less carbon intensive alternatives.
      - ovi256 7y ago
        Right, that would be different, but I feel that's the kind of detail that gets lost in translation when it becomes government policy. Given the average EU government greatly enjoys the already 100%+ tax on fuel they have, why would they bother with this complicated, not even revenue raising scheme ? They can just crank that 100% lever to 200% or whatever. Can any of the economists proposing this scheme ask for a guarantee of any kind that if they help push this scheme, details like this one won't get left out ? Of course not. They'll cheerlead it and then blame the government, forgetting their complicity.

by ovi256 7y ago

wool_gather 7y ago

Are they the same thing? It seems to me they'd be targeting different products, so yes, different effect.

adrianN 7y ago

When the US puts import tariffs on foreign cars for being foreign, there is nothing the other party can do other than putting up their own tariffs in retaliation. If the US puts import tariffs on the embodied carbon emissions of foreign cars, the foreign party can join the carbon tax scheme to get around the tariffs. That seems like an important difference to me, but I'm not an economist. Better economists than me seem to also support a carbon tax or other forms of carbon pricing like cap&trade.

mechagodzilla 7y ago
Exactly - with a carbon tax, the importing country says "The carbon emissions embodied in this product are going to be taxed, we can collect the money or you can, it's up to you." Will that result in a general reduction in the consumption of carbon-intense goods? Of course! They're now more expensive, that's the whole point. With an import tariff on foreign goods (for, as you described, being foreign), it makes foreign goods more expensive (with nothing the other country can do about it), so it will lead to a reduction in the consumption of foreign-produced goods (whether or not that is a benefit to you as an American is probably heavily dependent on what you consume and what you produce).
- ovi256 7y ago
  For the imported good buyer, there's a price increase. It does not matter to him who collects the tax that increased the price - an import tariff imposing government or an enlightened carbon-scheme participating foreign government. This will reduce demand like any other dead weight loss, and yes, depress economic activity, employement and thus wages. BTW, most countries already have carbon taxes on fossil fuels, they just don't bother calling them that. They call them fuel excise taxes. Around 60% of the price a consumer pays for fuel in the EU is fuel excise tax, in other words, a 150% tax. In the US, it's only about 20%. Here: https://en.wikipedia.org/wiki/Fuel_tax#China https://en.wikipedia.org/wiki/Fuel_tax#China What's your estimated impact of this already huge tax ? Think about the demand elasticity of fuel and energy products.
  - adrianN 7y ago
    If you read the literature about carbon taxes, virtually everybody recommends a scheme where the carbon tax is paid out again, so there is no effective price increase for the consumer if they have an average carbon consumption, but everybody still has an incentive to switch to less carbon intensive alternatives.
    - ovi256 7y ago
      Right, that would be different, but I feel that's the kind of detail that gets lost in translation when it becomes government policy. Given the average EU government greatly enjoys the already 100%+ tax on fuel they have, why would they bother with this complicated, not even revenue raising scheme ? They can just crank that 100% lever to 200% or whatever. Can any of the economists proposing this scheme ask for a guarantee of any kind that if they help push this scheme, details like this one won't get left out ? Of course not. They'll cheerlead it and then blame the government, forgetting their complicity.