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I agree that externalities should be priced in - but I wonder if in practice Governments would end up footing the bill via subsidies. For example, look at what

I agree that externalities should be priced in - but I wonder if in practice Governments would end up footing the bill via subsidies. For example, look at what happened in France with the fuel tax rise which lead to the “gilets jaunes” protests. If people need to get to work and heat their homes etc. then putting a tax on all of that will hit them hard while the rich will be relatively unaffected and can continue polluting. A simple flat tax on CO2 emissions, while far easier to implement, would be regressive compared to one that scaled with your personal emissions or something. Such a regressive tax, levied on basic things like energy, fuel etc. that are fundamental to normal life seems incredibly likely to trigger political unrest as we saw in France.

yunohn 5y ago
> If people need to get to work and heat their homes etc. then putting a tax on all of that will hit them hard while the rich will be relatively unaffected and can continue polluting. So much this. Here in NL, my heating bill is 70% tax and 30% gas charges (not exaggerating). The government claims to do this to encourage installation of better insulation and other energy saving measures - however, as a renter (like the vast majority of NL is), I can’t do anything about this and just pay the exorbitant heating bill (1). I have no option but to use gas, and even if I move to a (rare) neighborhood with city heating, they’ll charge me the same amount (2). (1) https://www.dutchnews.nl/news/2021/09/as-gas-bills-rise-more-households-fall-victim-to-energy-poverty/ https://www.dutchnews.nl/news/2021/09/as-gas-bills-rise-more... (2) https://www.dutchnews.nl/news/2021/11/homes-with-district-heating-systems-may-still-be-hit-by-higher-gas-bills/ https://www.dutchnews.nl/news/2021/11/homes-with-district-he...
- Vinnl 5y ago
  To be fair, the policy was to raise gas taxes while lowering those on electricity in a way that it evens out for most people. Additionally, while I don't know the numbers of renters vs. buyers, I do know that the vast majority of renters in NL live in social housing, which means the government has some leverage there to get the housing corporations to lower gas use.
  - yunohn 5y ago
    My electricity bill is less than 10x lower than my heating bill, with all taxes accounted for. Electronics are surprisingly efficient - radiator heating is definitely not. > social housing, which means the government has some leverage I’m not sure if you’ve seen social housing, or even the average rental in places like The Hague. They are definitely not maintained well - insulation or otherwise. Whatever the gov “could” do, isn’t being done. Other than high taxes.
- RobinL 5y ago
  Most renters still have the option to turn down the thermostat though, so whilst the ability to respond to incentives may be dampened, they should still have an effect. Admittedly, there are some rentals with bills included. But if gas was very expensive, few landlords would offer it.
  - yunohn 5y ago
    > Most renters still have the option to turn down the thermostat though I can’t tell if this is serious? You’re saying that the gov policy’s effect should be the common man freezing during winter? I don’t know anyone who runs their heating for shits and giggles. > Admittedly, there are some rentals with bills included I’ve seen very few (<10%) of rentals that come with utilities included. It wouldn’t make sense either, I’d rather pay for my usage. Not the upper limit of usage that the landlord is accounting for while determining rent.
    - RobinL 5y ago
      > I don’t know anyone who runs their heating for shits and giggles. Heating isn't a binary thing - we want people to minimise their use of gas within reason. Most people I know could turn their heating down a couple of degrees and put on a warmer jumper, some thermal underwear, or sit with a hot water bottle whilst at their desk if working from home. I've managed to save >30% of my households gas usage in this way. Yes, there are people on the poverty line who already use their heating at a minimal level. And at risk elderly people. This problem is best solved with subsidies to these specific groups, rather than gas that is too cheap for everyone relative to its environmental impacts. This view (that a sizable portion of people can reasonably turn down their heat) is substantiated by UK government research, see e.g. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/251785/what_people_want_from_their_heating_controls_qualitative_study.pdf https://assets.publishing.service.gov.uk/government/uploads/... For instance, there are lots of people heating rooms they don't even use, and heating their whole house overnight.
      - yunohn 5y ago
- surrehuet 5y ago
  If your gas bill is increased then your ability to spend money on rent decreases. Wouldn't this in turn decrease demand for energy ineffective apartments giving an incentive for landlords to take energy saving measures?
  - yunohn 5y ago
    That only works in a balanced supply-demand market. Housing is an essential requirement, and is severely under serving demand in NL. https://www.iamexpat.nl/housing/real-estate-news/urgent-call-big-cities-government-tackle-dutch-housing-crisis https://www.iamexpat.nl/housing/real-estate-news/urgent-call...
gefhfff 5y ago
The solution here is a payout of (most of) the taxes equally for every citizen and also use some of it for special groups (exceptions) that can't deal with even that (realistically). This is called a dividend: https://en.m.wikipedia.org/wiki/Carbon_fee_and_dividend https://en.m.wikipedia.org/wiki/Carbon_fee_and_dividend
- kspacewalk2 5y ago
  Yep, Canada does this. Carbon tax revenues are returned as rebates. If you "do the right thing" and reduce your fossil fuel usage, you get back more than you paid in taxes. Canada's tax is far too minuscule to make a big difference, but the design itself is very good.
nabla9 5y ago
Price of gas in France this week EUR 1.650/l ($7.018/gallon)
elurg 5y ago
Is it even possible to make a CO2 tax that is not regressive? The purpose of a CO2 tax is reduce emissions and a lot of emissions are not caused by luxury products and services but simple stuff like growing food or driving to work. Increasing the price of fuel to the point where people switch to biking to work would be very successful from a climate standpoint but extremely unpopular.
- yunohn 5y ago
  > emissions are not caused by luxury products I think this is patently false; but even more generally, wealthier people and “developed” countries are the biggest polluters. (https://www.theguardian.com/environment/2020/sep/21/worlds-richest-1-cause-double-co2-emissions-of-poorest-50-says-oxfam https://www.theguardian.com/environment/2020/sep/21/worlds-r...)
- pydry 5y ago
  Superyacht fuel efficiency is measured in gallons per mile. Private jets use ridiculous amounts of fuel. The middle class will drive while the poor take the bus. It's not as regressive as you'd think. This can also be offset with tax rebates for those on lower incomes. Politically the problem is that the wealthy will use every lobbying, legal and propaganda tool to shift the burden off their backs.
  - kspacewalk2 5y ago
    >while the poor take the bus. Except in most of America, where the poor have to drive as well, and spend a much higher percentage of their income on cars. Evidently most don't mind or are even supportive, because it supposedly buys them freedom (From what? Disposable income?).
    - schnitzelstoat 5y ago
      In many poorer areas bus services aren't reliable - and that can cost you your job.
roenxi 5y ago
> For example, look at what happened in France with the fuel tax rise which lead to the “gilets jaunes” protests. I think people actually underestimate the effect of a carbon tax. The tax has to be extreme enough that it changes behaviour in the real wold, and something like 70-80% of energy comes from fossil fuels. If people aren't near to rioting because their lifestyle is being forced to change then the tax isn't doing anything. It isn't going to look like cheerful.
- yunohn 5y ago
  I understand your viewpoint, but if you tax the common man such that they are unable to travel to work in the only car they can afford - the world will stop functioning. I often wonder why the elites don’t understand what their mistreatment of the proletariat will lead to…
  - gefhfff 5y ago
    Or they'll just move closer to work, or will implement Home Office, or will demand public transport (which can be combined with bicycles), or will drive electric (car, ebike, electric scooter/motor cycles) or will drive as groups instead of individuals, or a dividend will implemented making this scenario unlikely in the first place while still enabling carbon taxes.
    - yunohn 5y ago
      > they'll just move closer to work This is often way more expensive than paying for heating. > will implement Home Office This only works for well paying IT jobs. Not the working class that actually physically work at factories, stores, restaurants, hospitals, etc etc that are underpaid and hit the most by taxes. > will demand public transport Demands are cool and everything, but you can’t sit around jobless for 1-2 decades waiting for laws to pass and municipalities to build out the transport infrastructure. > will drive electric Very few cities have the infrastructure for this. Once that’s fixed, carbon taxation would work better. > drive as groups instead of individuals This already happens in Europe, but people are still wage slaves. It changes nothing.
chriswarbo 5y ago
We need to be wary of counter-productive moralising: > the rich will be relatively unaffected and can continue polluting If the tax revenue is spent on cleanup/offsetting/etc. then that doesn't matter. That's the point of the tax. In fact, if the tax is set slightly higher than the net cleanup cost, that (a) acts as a disincentive (rather than just 'cost of doing business'), and (b) we would want the rich to pollute even more, since they would be paying to clean up more than just their own mess. For comparison: I take care to avoid making a mess at home, since it would take me a lot of time and effort clean up. The rich can just throw money at cleaners. Now imagine that some Global Cleaners Union sets the price-per-hour of cleaning to cover 61 minutes of work; those extra minutes are aggregated and spent on charitable activities. In such a situation, we would want the rich to make more mess. > Such a regressive tax, levied on basic things like energy, fuel etc. that are fundamental to normal life seems incredibly likely to trigger political unrest as we saw in France. This is mentioned in the article: > In the UK, carbon dioxide emissions are less than six tonnes per person per year, plus two or three tonnes more to reflect the carbon footprint of imported goods. A £100/tonne tax that covered those emissions would raise the cost of living by just over £2 a day, and cover more than 5 per cent of UK tax revenue. That’s not nothing: the government would be wise to send everyone a monthly lump sum in compensation.
- lozenge 5y ago
  Note, offsets don't clean up. They are just reducing emissions in our future compared to some other hypothetical future. For example, giving out gas burning stoves to replace wood burning ones in a developing country can generate offsets. But who's to say we accurately forecast the chopped wood demand that was reduced by the program, and the gas demand that was increased by the program? Can we say 100% the recipients were not going to purchase these stoves themselves in their future? All incentives go to biasing the assumptions and printing as many offset certificates as possible. To actually clean up we would need Direct Air Capture. The cost is 100+x higher than the usual cost of carbon offsets, and supply is very limited. The DAC industry would need to grow to a similar size (in terms of tonnes of product produced) as our current fossil fuel industry. But the output product, such as carbonate rock, would be useless, unlike fossil fuels. Its only use would be how it removed carbon from the air. I don't see anybody paying for that. Source on the carbonate rock and scale of DAC industry: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0081648 https://journals.plos.org/plosone/article?id=10.1371/journal... Info on offsets accounting: https://www.climatechangenews.com/2020/12/11/10-myths-net-zero-targets-carbon-offsetting-busted/ https://www.climatechangenews.com/2020/12/11/10-myths-net-ze...

yunohn 5y ago

> If people need to get to work and heat their homes etc. then putting a tax on all of that will hit them hard while the rich will be relatively unaffected and can continue polluting. So much this. Here in NL, my heating bill is 70% tax and 30% gas charges (not exaggerating). The government claims to do this to encourage installation of better insulation and other energy saving measures - however, as a renter (like the vast majority of NL is), I can’t do anything about this and just pay the exorbitant heating bill (1). I have no option but to use gas, and even if I move to a (rare) neighborhood with city heating, they’ll charge me the same amount (2). (1) https://www.dutchnews.nl/news/2021/09/as-gas-bills-rise-more-households-fall-victim-to-energy-poverty/ https://www.dutchnews.nl/news/2021/09/as-gas-bills-rise-more... (2) https://www.dutchnews.nl/news/2021/11/homes-with-district-heating-systems-may-still-be-hit-by-higher-gas-bills/ https://www.dutchnews.nl/news/2021/11/homes-with-district-he...

Vinnl 5y ago
To be fair, the policy was to raise gas taxes while lowering those on electricity in a way that it evens out for most people. Additionally, while I don't know the numbers of renters vs. buyers, I do know that the vast majority of renters in NL live in social housing, which means the government has some leverage there to get the housing corporations to lower gas use.
- yunohn 5y ago
  My electricity bill is less than 10x lower than my heating bill, with all taxes accounted for. Electronics are surprisingly efficient - radiator heating is definitely not. > social housing, which means the government has some leverage I’m not sure if you’ve seen social housing, or even the average rental in places like The Hague. They are definitely not maintained well - insulation or otherwise. Whatever the gov “could” do, isn’t being done. Other than high taxes.
RobinL 5y ago
Most renters still have the option to turn down the thermostat though, so whilst the ability to respond to incentives may be dampened, they should still have an effect. Admittedly, there are some rentals with bills included. But if gas was very expensive, few landlords would offer it.
- yunohn 5y ago
  > Most renters still have the option to turn down the thermostat though I can’t tell if this is serious? You’re saying that the gov policy’s effect should be the common man freezing during winter? I don’t know anyone who runs their heating for shits and giggles. > Admittedly, there are some rentals with bills included I’ve seen very few (<10%) of rentals that come with utilities included. It wouldn’t make sense either, I’d rather pay for my usage. Not the upper limit of usage that the landlord is accounting for while determining rent.
  - RobinL 5y ago
    > I don’t know anyone who runs their heating for shits and giggles. Heating isn't a binary thing - we want people to minimise their use of gas within reason. Most people I know could turn their heating down a couple of degrees and put on a warmer jumper, some thermal underwear, or sit with a hot water bottle whilst at their desk if working from home. I've managed to save >30% of my households gas usage in this way. Yes, there are people on the poverty line who already use their heating at a minimal level. And at risk elderly people. This problem is best solved with subsidies to these specific groups, rather than gas that is too cheap for everyone relative to its environmental impacts. This view (that a sizable portion of people can reasonably turn down their heat) is substantiated by UK government research, see e.g. https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/251785/what_people_want_from_their_heating_controls_qualitative_study.pdf https://assets.publishing.service.gov.uk/government/uploads/... For instance, there are lots of people heating rooms they don't even use, and heating their whole house overnight.
    - yunohn 5y ago
surrehuet 5y ago
If your gas bill is increased then your ability to spend money on rent decreases. Wouldn't this in turn decrease demand for energy ineffective apartments giving an incentive for landlords to take energy saving measures?
- yunohn 5y ago
  That only works in a balanced supply-demand market. Housing is an essential requirement, and is severely under serving demand in NL. https://www.iamexpat.nl/housing/real-estate-news/urgent-call-big-cities-government-tackle-dutch-housing-crisis https://www.iamexpat.nl/housing/real-estate-news/urgent-call...

gefhfff 5y ago

The solution here is a payout of (most of) the taxes equally for every citizen and also use some of it for special groups (exceptions) that can't deal with even that (realistically). This is called a dividend: https://en.m.wikipedia.org/wiki/Carbon_fee_and_dividend https://en.m.wikipedia.org/wiki/Carbon_fee_and_dividend

kspacewalk2 5y ago
Yep, Canada does this. Carbon tax revenues are returned as rebates. If you "do the right thing" and reduce your fossil fuel usage, you get back more than you paid in taxes. Canada's tax is far too minuscule to make a big difference, but the design itself is very good.

nabla9 5y ago

Price of gas in France this week EUR 1.650/l ($7.018/gallon)

elurg 5y ago

Is it even possible to make a CO2 tax that is not regressive? The purpose of a CO2 tax is reduce emissions and a lot of emissions are not caused by luxury products and services but simple stuff like growing food or driving to work. Increasing the price of fuel to the point where people switch to biking to work would be very successful from a climate standpoint but extremely unpopular.

yunohn 5y ago
> emissions are not caused by luxury products I think this is patently false; but even more generally, wealthier people and “developed” countries are the biggest polluters. (https://www.theguardian.com/environment/2020/sep/21/worlds-richest-1-cause-double-co2-emissions-of-poorest-50-says-oxfam https://www.theguardian.com/environment/2020/sep/21/worlds-r...)
pydry 5y ago
Superyacht fuel efficiency is measured in gallons per mile. Private jets use ridiculous amounts of fuel. The middle class will drive while the poor take the bus. It's not as regressive as you'd think. This can also be offset with tax rebates for those on lower incomes. Politically the problem is that the wealthy will use every lobbying, legal and propaganda tool to shift the burden off their backs.
- kspacewalk2 5y ago
  >while the poor take the bus. Except in most of America, where the poor have to drive as well, and spend a much higher percentage of their income on cars. Evidently most don't mind or are even supportive, because it supposedly buys them freedom (From what? Disposable income?).
  - schnitzelstoat 5y ago
    In many poorer areas bus services aren't reliable - and that can cost you your job.

roenxi 5y ago

> For example, look at what happened in France with the fuel tax rise which lead to the “gilets jaunes” protests. I think people actually underestimate the effect of a carbon tax. The tax has to be extreme enough that it changes behaviour in the real wold, and something like 70-80% of energy comes from fossil fuels. If people aren't near to rioting because their lifestyle is being forced to change then the tax isn't doing anything. It isn't going to look like cheerful.

yunohn 5y ago
I understand your viewpoint, but if you tax the common man such that they are unable to travel to work in the only car they can afford - the world will stop functioning. I often wonder why the elites don’t understand what their mistreatment of the proletariat will lead to…
- gefhfff 5y ago
  Or they'll just move closer to work, or will implement Home Office, or will demand public transport (which can be combined with bicycles), or will drive electric (car, ebike, electric scooter/motor cycles) or will drive as groups instead of individuals, or a dividend will implemented making this scenario unlikely in the first place while still enabling carbon taxes.
  - yunohn 5y ago
    > they'll just move closer to work This is often way more expensive than paying for heating. > will implement Home Office This only works for well paying IT jobs. Not the working class that actually physically work at factories, stores, restaurants, hospitals, etc etc that are underpaid and hit the most by taxes. > will demand public transport Demands are cool and everything, but you can’t sit around jobless for 1-2 decades waiting for laws to pass and municipalities to build out the transport infrastructure. > will drive electric Very few cities have the infrastructure for this. Once that’s fixed, carbon taxation would work better. > drive as groups instead of individuals This already happens in Europe, but people are still wage slaves. It changes nothing.

chriswarbo 5y ago

We need to be wary of counter-productive moralising: > the rich will be relatively unaffected and can continue polluting If the tax revenue is spent on cleanup/offsetting/etc. then that doesn't matter. That's the point of the tax. In fact, if the tax is set slightly higher than the net cleanup cost, that (a) acts as a disincentive (rather than just 'cost of doing business'), and (b) we would want the rich to pollute even more, since they would be paying to clean up more than just their own mess. For comparison: I take care to avoid making a mess at home, since it would take me a lot of time and effort clean up. The rich can just throw money at cleaners. Now imagine that some Global Cleaners Union sets the price-per-hour of cleaning to cover 61 minutes of work; those extra minutes are aggregated and spent on charitable activities. In such a situation, we would want the rich to make more mess. > Such a regressive tax, levied on basic things like energy, fuel etc. that are fundamental to normal life seems incredibly likely to trigger political unrest as we saw in France. This is mentioned in the article: > In the UK, carbon dioxide emissions are less than six tonnes per person per year, plus two or three tonnes more to reflect the carbon footprint of imported goods. A £100/tonne tax that covered those emissions would raise the cost of living by just over £2 a day, and cover more than 5 per cent of UK tax revenue. That’s not nothing: the government would be wise to send everyone a monthly lump sum in compensation.

lozenge 5y ago
Note, offsets don't clean up. They are just reducing emissions in our future compared to some other hypothetical future. For example, giving out gas burning stoves to replace wood burning ones in a developing country can generate offsets. But who's to say we accurately forecast the chopped wood demand that was reduced by the program, and the gas demand that was increased by the program? Can we say 100% the recipients were not going to purchase these stoves themselves in their future? All incentives go to biasing the assumptions and printing as many offset certificates as possible. To actually clean up we would need Direct Air Capture. The cost is 100+x higher than the usual cost of carbon offsets, and supply is very limited. The DAC industry would need to grow to a similar size (in terms of tonnes of product produced) as our current fossil fuel industry. But the output product, such as carbonate rock, would be useless, unlike fossil fuels. Its only use would be how it removed carbon from the air. I don't see anybody paying for that. Source on the carbonate rock and scale of DAC industry: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0081648 https://journals.plos.org/plosone/article?id=10.1371/journal... Info on offsets accounting: https://www.climatechangenews.com/2020/12/11/10-myths-net-zero-targets-carbon-offsetting-busted/ https://www.climatechangenews.com/2020/12/11/10-myths-net-ze...