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It is kind of ironic how market economies and planned economies both succumb to the economic calculation problem. The people who used it to antagonize planned e
by imtringued 4y ago
It is kind of ironic how market economies and planned economies both succumb to the economic calculation problem. The people who used it to antagonize planned economies only had price discovery and supply and demand in mind. They didn't consider that money and prices will never capture all real economic variables like pollution. There is no "objective" level of pollution tax, it is purely subjective and since we don't have two earths between which people can migrate to choose the planet with the optimal carbon tax, you are going to have to rely on governments to just guess the right amount of tax and there is no way around it.
- lend000 4y agoMy point is actually that it can be done more or less objectively in the most relevant cases, especially where the atmosphere is concerned. Tax the polluting activity and use the taxes to exactly offset the pollution. If it can't be undone, or there wasn't any of that type of pollution in the atmosphere to start with, then it shouldn't be taxed--it should be banned. Sure, there's subjectivity in how we define which things are considered harmful enough to address as an externality or outlaw in the first place, but greenhouse gases, for example, are pretty cut and dry, and either way, it's a huge improvement over the current system (don't address externalities directly, create new big political programs that sort of address symptoms once they become big problems).