The Carbon Tax Option

Given the tax reform effort currently under way in Congress this would seem an appropriate time to consider the usefulness of a carbon tax to increase Federal revenue even though no such proposal (happily) is in the current tax bill.

The first question, of course, is whether this perennial idea has any intrinsic merit. The answer is no.

The use of fiscal incentives for reducing pollution has considerable merit in general. Federal revenues are increased, other taxes which have adverse incentives can be reduced, pollution is decreased, and everyone is better off except the polluters. So win-win.

The problem with the oft-proposed carbon tax is that pollution would not be reduced because carbon dioxide CO2 is not a pollutant despite the endless propaganda by climate alarmists to the contrary. They claim that increased atmospheric levels of CO2 result in catastrophic increases in temperatures and that CO2 is thus a pollutant, albiet not the usual kind.

I and many other climate skeptics have argued that CO2 is not only not a pollutant but rather a vital component of Earth’s ecosystem, particularly for plants. It harms no one and helps plants, animals, and humans. Modest increases in global temperatures are good, not bad and the alleged catastrophic increases have no basis in science. So since CO2 is good, not bad, taxing human-caused emissions of it is bad, not good.

The Current Objective Should Be to Increase, Not Decrease Atmospheric CO2 Levels

If any change is needed in current atmospheric CO2 levels, the need is to modestly increase levels, not decrease them. Further, increased human-caused CO2 emissions mean more energy use, which results in more human productivity since humans generally use fossil fuel energy to increase their productivity and reduce their dependency on other less reliable and higher cost energy sources.

The only virtue of carbon taxes is that if carefully done they can be more efficient than administrative regulations. So if a government has unfortunately decided to impose reductions on CO2 emissions, it would be better to use a carbon tax. But by far the best solution is no carbon tax and no regulations for this purpose.

Given the magnitude of the climate scam, of course, rationality may not prevail, but is much to be desired.

via Carlin Economics and Science

November 3, 2017 at 01:13PM

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