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Yes! This is a point I raise frequently. My go-to example is cigarette taxes being used to fund public schools. They should be used to cover costs (borne by the

Yes! This is a point I raise frequently. My go-to example is cigarette taxes being used to fund public schools. They should be used to cover costs (borne by the relevant government) of people smoking cigarettes! Otherwise, as has happened, school funding can be hurt by people smoking less, which is not a good situation to have created. The degree by which governments routinely violate the accounting principle of matching revenues to expenses is awful.

loeg 7y ago
I think you're describing the problem of earmarking funds at all. In general it's just a stupid posturing maneuver. Spending is fungible; it just replaces the amount contributed from the legal body's general fund. As needs change, general fund money can be spent as needed. Earmarked funds are stuck. A carbon tax on consumers (incl. businesses) is effective at producing good market behavior regardless of how the tax revenue is spent.
- vonmoltke 7y ago
  > A carbon tax on consumers (incl. businesses) is effective at producing good market behavior regardless of how the tax revenue is spent. In the example I reacted to, a government agency actively worked to inhibit that behavior in order to preserve its revenue. Your point would hold if governments didn't have the power to do things like this. > Earmarked funds are stuck. If the revenue is being raised to pay for damage caused by society, those funds should be stuck to that purpose and should rise and fall based on the level of damage being done.
  - loeg 7y ago
    > In the example I reacted to, a government agency actively worked to inhibit that behavior in order to preserve its revenue. Your point would hold if governments didn't have the power to do things like this. A governmental bad actor is basically orthogonal to the idea of a carbon tax. The government could equally try to increase sales of liquor and cigarettes for sin taxes, or go around murdering people for the estate taxes. The UK example is shameful but reflects on that government body rather than the specific tax on petrol.
    - thomasz 7y ago
      This is very likely an urban myth.
- aeorgnoieang 7y ago
  The problem isn't earmarking funds in general. Money has to be allocated somehow and it's good to do so explicitly. The problem is earmarking or allocating a variable set of revenue as funding for something unrelated, and in particular something unrelated that's otherwise valuable or important. And NOT earmarking or allocating 'sin taxes' to pay for the supposed costs of those sins, borne by the public in the form of the government, seems pretty stupid (to me) if it's actually necessary or desirable for the government to 'manage' those sins or those sin's consequences.
red75prime 7y ago
Ave, Government, morituri te financiert.

loeg 7y ago

I think you're describing the problem of earmarking funds at all. In general it's just a stupid posturing maneuver. Spending is fungible; it just replaces the amount contributed from the legal body's general fund. As needs change, general fund money can be spent as needed. Earmarked funds are stuck. A carbon tax on consumers (incl. businesses) is effective at producing good market behavior regardless of how the tax revenue is spent.

vonmoltke 7y ago
> A carbon tax on consumers (incl. businesses) is effective at producing good market behavior regardless of how the tax revenue is spent. In the example I reacted to, a government agency actively worked to inhibit that behavior in order to preserve its revenue. Your point would hold if governments didn't have the power to do things like this. > Earmarked funds are stuck. If the revenue is being raised to pay for damage caused by society, those funds should be stuck to that purpose and should rise and fall based on the level of damage being done.
- loeg 7y ago
  > In the example I reacted to, a government agency actively worked to inhibit that behavior in order to preserve its revenue. Your point would hold if governments didn't have the power to do things like this. A governmental bad actor is basically orthogonal to the idea of a carbon tax. The government could equally try to increase sales of liquor and cigarettes for sin taxes, or go around murdering people for the estate taxes. The UK example is shameful but reflects on that government body rather than the specific tax on petrol.
  - thomasz 7y ago
    This is very likely an urban myth.
aeorgnoieang 7y ago
The problem isn't earmarking funds in general. Money has to be allocated somehow and it's good to do so explicitly. The problem is earmarking or allocating a variable set of revenue as funding for something unrelated, and in particular something unrelated that's otherwise valuable or important. And NOT earmarking or allocating 'sin taxes' to pay for the supposed costs of those sins, borne by the public in the form of the government, seems pretty stupid (to me) if it's actually necessary or desirable for the government to 'manage' those sins or those sin's consequences.

red75prime 7y ago

Ave, Government, morituri te financiert.