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>a carbon tax high enough to make your flight cast 8% more Where would this money go? Who would allocate it? Would it be allocated effectively, efficiently? As

>a carbon tax high enough to make your flight cast 8% more Where would this money go? Who would allocate it? Would it be allocated effectively, efficiently? As effective as road tax dollars, or as effective as lottery tax dollars? Would it just go to make more factories for Tesla? More eco-warehouses for Amazon? For the bureaucrat-in-charge's cousins? Where does it go and how does it get there?

ItsMonkk 4y ago
The Canadian system mostly simply gives it back out evenly to all. That choice is a just one. > Alberta, Ontario, Manitoba, Saskatchewan, Yukon and Nunavat use the federal carbon tax system, the Federal Fuel Charge, which started in 2019. Of these, all but Nunavat have a carbon fee and dividend scheme in place that redistributes tax revenue to the public. [0] Since carbon use is skewed heavily to those that use the most, this means that the median user of carbon is actually given a tax credit each year. [0]: https://en.wikipedia.org/wiki/Carbon_fee_and_dividend#Implementation https://en.wikipedia.org/wiki/Carbon_fee_and_dividend#Implem...
- vasco 4y ago
  It also means the current generation of normal people have no incentive to put pressure on the large industries of their country, the more they use the more money they get and the more messed up they leave it for the next generation.
  - gruez 4y ago
    Okay but at an individual level you're still incentivized to reduce your own emissions. Every $1 of carbon tax you pay is $1 out of your wallet, but you're only getting $1/(39 million) back through the carbon rebate.
  - theptip 4y ago
    “Normal people” don’t have to put pressure for this to work. Every point along the supply chain absorbs the price signal and will find cheaper (ie less CO2-producing) options where possible, raising the price a little. Where not possible the price goes up by the full CO2 tax amount. (In other words if it’s still the cheapest option to just pay the extra tax, like jet fuel, then the price just goes up.) The consumer might hypothetically not get any different choices, but still see a CO2 tax cause all deliveries to use electric trucks, for example. Consumers “putting pressure on companies” is a terrible way to fix this problem because few consumers have a clear picture of the current landscape of CO2 intensity and possible best fixes across the whole economy. But if you just price the externality in, then the market constraint-solves the problem for you. (To be clear I don’t think markets are perfect, they are just much better than human coordinators at solving this class of problem.)
    - vasco 4y ago
      Taxing carbon is fine, that isn't the problem, the problem is giving that money to the current generation in the form of payouts. Why should a random citizen get paid more just because in their country there's heavily polluting industries? It makes no sense.
      - kilotaras 4y ago
        > Why should a random citizen get paid more just because in their country there's heavily polluting industries? It makes no sense. I'm not following. Random citizen also pays more in tax.
      - yellowapple 4y ago
        > Why should a random citizen get paid more just because in their country there's heavily polluting industries? Because everyone - including that random citizen - experiences harm from said heavy pollution. That's my air being contaminated, my water being poisoned, my planet being wrecked; by what rationale would I somehow not be justified in demanding compensation for that harm?
      - imtringued 4y ago
        Giving everyone a single vote in democracy makes no sense, we should just air drop paper pamphlets all across the country and let anyone who collects them vote once for each pamphlet. If they fall on privately owned land, the owner of the land gets all of the pamphlets.
      - theptip 4y ago
        Ah I see, so is your concern that we aren’t putting that revenue to work on explicitly decarbonizing projects to invest in the future? Or is it more that you think there is a perverse incentive where residents might prefer e.g. a cement factory to move to their country because it will result in more CO2 rebate?
- s1artibartfast 4y ago
  But that does absolutely nothing to help the atmosphere.
  - NumberWangMan 4y ago
    This is a common misunderstanding, I think. But it actually still works. What matters is that the tax makes fossil fuels expensive relative to other energy sources. To take the extreme examples to make it clear: if you go 100 off fossil fuels, you pay no tax but get the dividend, so you win. On the other hand, if you were to for whatever reason choose the maximally carbon-intensive lifestyle you could, you'd pay way more in tax than the average dividend. In other words, the tax you pay varies with your carbon emissions, while the dividend is constant (or rather, depends only on the total emissions of everyone). You still have a very strong incentive to reduce emissions, as it would reduce your living costs substatially but reduce your dividend by only a fraction of a penny (I.e. the change in total tax collected divided by the population).
    - Clubber 4y ago
      So the 9.1% inflation we just experienced did more for the environment than an 8% carbon tax? Am I understanding this correctly? Did the emission of carbon actually go down because of inflation?
      - NumberWangMan 4y ago
        I think, to the degree that inflation is driven by rising gas prices, yes, it'll have a pretty substantial effect on reducing emissions. But my understanding is that inflation is also driven by things like federal reserve policy, stimulus bills, and supply issues due to the pandemic. Even then, if people are just consuming less and doing less fossil-fuel intensive stuff due to feeling squeezed economically, that'll reduce emissions. So it's kinda complicated. In the short term, it really depends on so many factors that I couldn't tell you, though I bet someone well versed in this sort of thing might be able to give a rough answer. But also consider: in the long term, higher gas prices due to supply shortages encourage companies to drill for and produce more oil -- because they are getting the profits. But higher gas prices due to a carbon tax have the opposite effect -- the buyer is paying more, but that's because the producer is paying the tax, and passing on some or most of that cost to the buyer. They aren't making more profit, but less -- reducing their incentive to pull more oil out of the ground. So that's something powerful that a carbon tax does that inflation doesn't. And inflation is (ideally) a temporary thing, and variable. A carbon tax is intended to be permanent (and ideally, slowly and steadily increasing), something predictable and inevitable that people can plan around. You'll act differently if you think gas is going to go back down by 20% than if you think it's going to stay at the higher prices forever, or keep getting more and more expensive over time. My understanding is that even the possibility of a future carbon tax has caused some companies to start reducing their fossil fuel dependency, because if a tax happens, they'll be in a better place than if they did business as usual.
Gigachad 4y ago
Bring it in to general government income and reduce other taxes by the amount it took in. Can set it up so the average person is unaffected. The eco conscious consumer ends up richer. And the over consumers end up poorer.
- imtringued 4y ago
  No that would just make poor people poorer and rich people richer because you are increasing taxes on the poor while decreasing taxes on the rich.
  - Gigachad 4y ago
    Why? I haven't even written out a full proposal so you can't know that. It's quite easy to think of some schemes which work the other way. The rich are the largest consumers of useless crap.
tzs 4y ago
The most economically sound way to do it is a revenue neutral tax. All of the tax collected is given back to the general public, with each person getting an equal share. That means that if things you buy use cause an average amount of carbon emissions you break even. The price increases you see due to the tax are balanced out by your share of the revenue. If your things are responsible for a less than average amount of emissions, you come out ahead. If your things are responsible for an above average amount, you pay more net.
- LorenPechtel 4y ago
  No. You make it revenue neutral by using the money to reduce other taxes (and make the 0% bracket wider) rather than introducing a distribution system. Why make it more complex than it needs to be? I'd like to see most forms of pollution handled this way--take the vast majority of pollution laws and throw them in the dumpster. Instead, make a list of pollutants and set a tax per ton (or other suitable unit) for emitting them. This tax is assessed at the point of creation (mining is considered a form of creation) and is rebated upon verified destruction (in many cases you'll "destroy" A to make B--you pay the tax on B but get back the tax on A) or long term sequestration. (Thus you can do things like grow trees and chuck the wood in an old salt mine and recoup the carbon tax even though you never emitted carbon.) There ceases to be any issue of what is feasible and no issue of company A emitting a lot more than B because what B does is easier to control emissions. You don't get situations like what happened to my former employer--kept being hounded by the EPA because their record on reducing emissions had been so good and then they stopped. Duh, they stopped because they had done everything viable at that point--effectively we had the EPA on our case for doing too good a job!
  - deleted 4y ago
    [deleted]
  - ncmncm 4y ago
    That would hand over most of the money to the people responsible for the pollution. Giving to everyone equally would invest a very large number of voters in continuing and expanding the program. Devoting 10% to carbon emissions reduction tech would fund a never-before-seen flowering of development. Eliminating subsidies for carbon miners would be helpful.
summerlight 4y ago
For a short term, you can use it to reduce government debts? Reducing it to the pre-covid level is going to take several decades, so let's not worry about where the money goes.

ItsMonkk 4y ago

The Canadian system mostly simply gives it back out evenly to all. That choice is a just one. > Alberta, Ontario, Manitoba, Saskatchewan, Yukon and Nunavat use the federal carbon tax system, the Federal Fuel Charge, which started in 2019. Of these, all but Nunavat have a carbon fee and dividend scheme in place that redistributes tax revenue to the public. [0] Since carbon use is skewed heavily to those that use the most, this means that the median user of carbon is actually given a tax credit each year. [0]: https://en.wikipedia.org/wiki/Carbon_fee_and_dividend#Implementation https://en.wikipedia.org/wiki/Carbon_fee_and_dividend#Implem...

vasco 4y ago
It also means the current generation of normal people have no incentive to put pressure on the large industries of their country, the more they use the more money they get and the more messed up they leave it for the next generation.
- gruez 4y ago
  Okay but at an individual level you're still incentivized to reduce your own emissions. Every $1 of carbon tax you pay is $1 out of your wallet, but you're only getting $1/(39 million) back through the carbon rebate.
- theptip 4y ago
  “Normal people” don’t have to put pressure for this to work. Every point along the supply chain absorbs the price signal and will find cheaper (ie less CO2-producing) options where possible, raising the price a little. Where not possible the price goes up by the full CO2 tax amount. (In other words if it’s still the cheapest option to just pay the extra tax, like jet fuel, then the price just goes up.) The consumer might hypothetically not get any different choices, but still see a CO2 tax cause all deliveries to use electric trucks, for example. Consumers “putting pressure on companies” is a terrible way to fix this problem because few consumers have a clear picture of the current landscape of CO2 intensity and possible best fixes across the whole economy. But if you just price the externality in, then the market constraint-solves the problem for you. (To be clear I don’t think markets are perfect, they are just much better than human coordinators at solving this class of problem.)
  - vasco 4y ago
    Taxing carbon is fine, that isn't the problem, the problem is giving that money to the current generation in the form of payouts. Why should a random citizen get paid more just because in their country there's heavily polluting industries? It makes no sense.
    - kilotaras 4y ago
      > Why should a random citizen get paid more just because in their country there's heavily polluting industries? It makes no sense. I'm not following. Random citizen also pays more in tax.
    - yellowapple 4y ago
      > Why should a random citizen get paid more just because in their country there's heavily polluting industries? Because everyone - including that random citizen - experiences harm from said heavy pollution. That's my air being contaminated, my water being poisoned, my planet being wrecked; by what rationale would I somehow not be justified in demanding compensation for that harm?
    - imtringued 4y ago
      Giving everyone a single vote in democracy makes no sense, we should just air drop paper pamphlets all across the country and let anyone who collects them vote once for each pamphlet. If they fall on privately owned land, the owner of the land gets all of the pamphlets.
    - theptip 4y ago
      Ah I see, so is your concern that we aren’t putting that revenue to work on explicitly decarbonizing projects to invest in the future? Or is it more that you think there is a perverse incentive where residents might prefer e.g. a cement factory to move to their country because it will result in more CO2 rebate?
s1artibartfast 4y ago
But that does absolutely nothing to help the atmosphere.
- NumberWangMan 4y ago
  This is a common misunderstanding, I think. But it actually still works. What matters is that the tax makes fossil fuels expensive relative to other energy sources. To take the extreme examples to make it clear: if you go 100 off fossil fuels, you pay no tax but get the dividend, so you win. On the other hand, if you were to for whatever reason choose the maximally carbon-intensive lifestyle you could, you'd pay way more in tax than the average dividend. In other words, the tax you pay varies with your carbon emissions, while the dividend is constant (or rather, depends only on the total emissions of everyone). You still have a very strong incentive to reduce emissions, as it would reduce your living costs substatially but reduce your dividend by only a fraction of a penny (I.e. the change in total tax collected divided by the population).
  - Clubber 4y ago
    So the 9.1% inflation we just experienced did more for the environment than an 8% carbon tax? Am I understanding this correctly? Did the emission of carbon actually go down because of inflation?
    - NumberWangMan 4y ago
      I think, to the degree that inflation is driven by rising gas prices, yes, it'll have a pretty substantial effect on reducing emissions. But my understanding is that inflation is also driven by things like federal reserve policy, stimulus bills, and supply issues due to the pandemic. Even then, if people are just consuming less and doing less fossil-fuel intensive stuff due to feeling squeezed economically, that'll reduce emissions. So it's kinda complicated. In the short term, it really depends on so many factors that I couldn't tell you, though I bet someone well versed in this sort of thing might be able to give a rough answer. But also consider: in the long term, higher gas prices due to supply shortages encourage companies to drill for and produce more oil -- because they are getting the profits. But higher gas prices due to a carbon tax have the opposite effect -- the buyer is paying more, but that's because the producer is paying the tax, and passing on some or most of that cost to the buyer. They aren't making more profit, but less -- reducing their incentive to pull more oil out of the ground. So that's something powerful that a carbon tax does that inflation doesn't. And inflation is (ideally) a temporary thing, and variable. A carbon tax is intended to be permanent (and ideally, slowly and steadily increasing), something predictable and inevitable that people can plan around. You'll act differently if you think gas is going to go back down by 20% than if you think it's going to stay at the higher prices forever, or keep getting more and more expensive over time. My understanding is that even the possibility of a future carbon tax has caused some companies to start reducing their fossil fuel dependency, because if a tax happens, they'll be in a better place than if they did business as usual.

Gigachad 4y ago

Bring it in to general government income and reduce other taxes by the amount it took in. Can set it up so the average person is unaffected. The eco conscious consumer ends up richer. And the over consumers end up poorer.

imtringued 4y ago
No that would just make poor people poorer and rich people richer because you are increasing taxes on the poor while decreasing taxes on the rich.
- Gigachad 4y ago
  Why? I haven't even written out a full proposal so you can't know that. It's quite easy to think of some schemes which work the other way. The rich are the largest consumers of useless crap.

tzs 4y ago

The most economically sound way to do it is a revenue neutral tax. All of the tax collected is given back to the general public, with each person getting an equal share. That means that if things you buy use cause an average amount of carbon emissions you break even. The price increases you see due to the tax are balanced out by your share of the revenue. If your things are responsible for a less than average amount of emissions, you come out ahead. If your things are responsible for an above average amount, you pay more net.

LorenPechtel 4y ago
No. You make it revenue neutral by using the money to reduce other taxes (and make the 0% bracket wider) rather than introducing a distribution system. Why make it more complex than it needs to be? I'd like to see most forms of pollution handled this way--take the vast majority of pollution laws and throw them in the dumpster. Instead, make a list of pollutants and set a tax per ton (or other suitable unit) for emitting them. This tax is assessed at the point of creation (mining is considered a form of creation) and is rebated upon verified destruction (in many cases you'll "destroy" A to make B--you pay the tax on B but get back the tax on A) or long term sequestration. (Thus you can do things like grow trees and chuck the wood in an old salt mine and recoup the carbon tax even though you never emitted carbon.) There ceases to be any issue of what is feasible and no issue of company A emitting a lot more than B because what B does is easier to control emissions. You don't get situations like what happened to my former employer--kept being hounded by the EPA because their record on reducing emissions had been so good and then they stopped. Duh, they stopped because they had done everything viable at that point--effectively we had the EPA on our case for doing too good a job!
- deleted 4y ago
  [deleted]
- ncmncm 4y ago
  That would hand over most of the money to the people responsible for the pollution. Giving to everyone equally would invest a very large number of voters in continuing and expanding the program. Devoting 10% to carbon emissions reduction tech would fund a never-before-seen flowering of development. Eliminating subsidies for carbon miners would be helpful.

summerlight 4y ago

For a short term, you can use it to reduce government debts? Reducing it to the pre-covid level is going to take several decades, so let's not worry about where the money goes.