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> You are free to disagree, but what is the purpose of the disagreement here? Because in the case of a carbon tax, the government isn't taking assets that are

> You are free to disagree, but what is the purpose of the disagreement here? Because in the case of a carbon tax, the government isn't taking assets that are rightfully yours; they're taking assets that rightfully belong to the public. Let's say that I bulldoze your house in order to expand the size of my factory. The factory might generate lots of additional revenue, but that revenue would not be rightfully mine. Now let's say that instead, I dump refuse from my factory into a river that runs through both of our properties. The refuse flows downstream and ruins your drinking water. I would argue that again, the revenue from my factory is not rightfully mine. That's still pretty obvious. But now let's say that instead of polluting the river, I pollute the air with greenhouse gases. Long-term, this is also going to be detrimental to your property, such as by increasing the likelihood of extreme weather. And so some portion of the revenue I generate by releasing greenhouse gasses does not actually belong to me. The government should take that revenue, both to allow the free market to correct for those social costs, and to compensate those affected.

ItsMonkk 4y ago
A carbon tax is correcting the negative externality of using the carbon. So you are paying for the harm that you are doing to society. In that same exact way, a land value tax is correcting the capture of the positive externality that is coming from your neighbors for your particular location because of your monopoly over it.
SllX 4y ago
Ah, that’s a misunderstanding. Taxes are a cost from a business accounting perspective. Costs are not borne by the business but paid for by their customers in a manner which is usually obscured to them. A “carbon” tax would effectively be a tax on all goods and services that use energy (all of them). Now my understanding (when I’ve raised this cost of governance issue with advocates prior anyway) of a lot of carbon tax proposals is that the taxes paid would be remitted back to taxpayers or citizens in some way in a kind of Robin Hood-like manner rather than actually used to cover the cost of government, but this doesn’t actually accomplish anything and I disagree with that kind of scheme on prudential grounds (inappropriate use of tax authority). In any case it would be cash seized from someone who earned it first. A power plant doesn’t emit hydro-carbons needlessly, it emits them as a function of a customer downstream paying for it: to power your refrigerator or to pay for the manufacture of the phone you purchased. Whether you are levying the tax against the business operating the plant, the customer at the point of sale or any and all of the intermediaries, what you are effectively doing is raising business costs no matter how you phrase it or rhetorically justify it. This informs the final product and service price, so if costs go up including taxes, you should also expect prices to go up.
- Wowfunhappy 4y ago
  > A “carbon” tax would effectively be a tax on all goods and services that use energy (all of them). Unless one company could find a way to produce goods with less energy than their competitors, or obtain its energy from cleaner sources, perhaps by investing in solar power. This would of course incentivize competitors to do the same. Yes, it would cause prices to go up, but those prices would reflect the actual cost of the good. As you noted, you could offset the price increases by redistributing the tax revenue to the public. This redistribution doesn't make the tax pointless: you're giving a discount to individuals who make greener choices. People who pollute more (whether directly or indirectly via the products they buy) will pay more of the tax but not receive more back. (This reasoning can apply to a LVT as well, but I prefer the carbon example because I think it's more clear-cut. Clearly, no one person owns the air. People do own land, so I'm more conflicted.)
  - SllX 4y ago
    > Unless one company could find a way to produce goods with less energy than their competitors, or obtain its energy from cleaner sources, perhaps by investing in solar power. Sure. Let’s take that solar power investment: under your proposed regime, the cost of the supplies and materials and electronics of the R&D employees would be bear a carbon tax. The electricity to power the lightning and electronics would beat a carbon tax. Any transport they use will bear a carbon tax. The food they eat will bear a carbon tax. The mines the materials for the panels will bear a carbon tax. The transport of the materials will bear a carbon tax. The equipment for extraction will bear a carbon tax. The factories which produce the panels will bear a carbon tax. The intermediaries that ship and handle the panels will bear a carbon tax. The infrastructure to connect it to the grid will bear a carbon tax. And I’m sure I’m leaving out several thousand items, but that’s probably why the serious proposals say to just do it at the plants and refineries, I.e. increase the cost of energy directly. Taxes are not a cost in the way supplies and materials are and a carbon tax doesn’t make the “cost of the good” more real, just higher. They are a fiat cost, hence the need to tie to something real: the cost of governance. Consumers do not accept lightly increases in their cost of living, as you can see in the present moment with the current price of fuel in the US and the likely parties to suffer in upcoming elections.

ItsMonkk 4y ago

A carbon tax is correcting the negative externality of using the carbon. So you are paying for the harm that you are doing to society. In that same exact way, a land value tax is correcting the capture of the positive externality that is coming from your neighbors for your particular location because of your monopoly over it.

SllX 4y ago

Ah, that’s a misunderstanding. Taxes are a cost from a business accounting perspective. Costs are not borne by the business but paid for by their customers in a manner which is usually obscured to them. A “carbon” tax would effectively be a tax on all goods and services that use energy (all of them). Now my understanding (when I’ve raised this cost of governance issue with advocates prior anyway) of a lot of carbon tax proposals is that the taxes paid would be remitted back to taxpayers or citizens in some way in a kind of Robin Hood-like manner rather than actually used to cover the cost of government, but this doesn’t actually accomplish anything and I disagree with that kind of scheme on prudential grounds (inappropriate use of tax authority). In any case it would be cash seized from someone who earned it first. A power plant doesn’t emit hydro-carbons needlessly, it emits them as a function of a customer downstream paying for it: to power your refrigerator or to pay for the manufacture of the phone you purchased. Whether you are levying the tax against the business operating the plant, the customer at the point of sale or any and all of the intermediaries, what you are effectively doing is raising business costs no matter how you phrase it or rhetorically justify it. This informs the final product and service price, so if costs go up including taxes, you should also expect prices to go up.

Wowfunhappy 4y ago
> A “carbon” tax would effectively be a tax on all goods and services that use energy (all of them). Unless one company could find a way to produce goods with less energy than their competitors, or obtain its energy from cleaner sources, perhaps by investing in solar power. This would of course incentivize competitors to do the same. Yes, it would cause prices to go up, but those prices would reflect the actual cost of the good. As you noted, you could offset the price increases by redistributing the tax revenue to the public. This redistribution doesn't make the tax pointless: you're giving a discount to individuals who make greener choices. People who pollute more (whether directly or indirectly via the products they buy) will pay more of the tax but not receive more back. (This reasoning can apply to a LVT as well, but I prefer the carbon example because I think it's more clear-cut. Clearly, no one person owns the air. People do own land, so I'm more conflicted.)
- SllX 4y ago
  > Unless one company could find a way to produce goods with less energy than their competitors, or obtain its energy from cleaner sources, perhaps by investing in solar power. Sure. Let’s take that solar power investment: under your proposed regime, the cost of the supplies and materials and electronics of the R&D employees would be bear a carbon tax. The electricity to power the lightning and electronics would beat a carbon tax. Any transport they use will bear a carbon tax. The food they eat will bear a carbon tax. The mines the materials for the panels will bear a carbon tax. The transport of the materials will bear a carbon tax. The equipment for extraction will bear a carbon tax. The factories which produce the panels will bear a carbon tax. The intermediaries that ship and handle the panels will bear a carbon tax. The infrastructure to connect it to the grid will bear a carbon tax. And I’m sure I’m leaving out several thousand items, but that’s probably why the serious proposals say to just do it at the plants and refineries, I.e. increase the cost of energy directly. Taxes are not a cost in the way supplies and materials are and a carbon tax doesn’t make the “cost of the good” more real, just higher. They are a fiat cost, hence the need to tie to something real: the cost of governance. Consumers do not accept lightly increases in their cost of living, as you can see in the present moment with the current price of fuel in the US and the likely parties to suffer in upcoming elections.