A Conservative Case for a Carbon Tax in the United States of America

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A Conservative Case for a Carbon Tax in the United States of America1

By Georges Alexandre (Alex) Lenferna

University of Kansas Philosophy DepartmentNSF IGERT C-CHANGE Research Associate

Email:[email protected]

Thesis Statement: This paper argues that putting in place a carbon tax in the United States is a policy

which adheres to conservative principles, and will also help to promote more equitable economic growth

and can, relative to other climate legislation, tackle problems of social inequality, poverty and climate

change among other societal problems hence why it has also been appreciated by democrats.

This paper will attempt to provide a comprehensive argument in support of the carbon tax, but will not

neglect the shortcomings that such a policy might have. My aim is to provide an argument illustrating

why when starting from conservative principles a carbon tax is the most sound policy choice in response

to climate change. My first task will be to elucidate many of the potential benefits of a carbon tax, such

as job creation, efficiency promotion and environmental protection, and then respond to some of the

major objections that are voiced against it. While keeping in mind the potential shortcomings of a

carbon tax, the paper will continuously explore why a carbon tax is better than its three major

competing policies: environmental regulation of greenhouse gases (GHGs) through the EPA; government

subsidies for clean energy; and neither of the above.2 Although these are not necessarily mutually

exclusive policies, I aim to show why a carbon tax best adheres to conservative principles and why

conservatives should support it as the dominant policy instrument aimed at effectively leveraging the

economy towards a sustainable paradigm of growth. Following from that I will then go on to argue why

significant opposition to a carbon tax exists within the US and why much of the opposition is morally

suspect, after which I shall end with a discussion as to why it is of particular moral significance that the

US takes on such an action.

1Alternate title: A Republicans Guide to Shooting Yourself in the Foot with Climate Legislation

2I have not included cap-and-trade both, because there is great evidence to suggest a carbon tax works much

more effectively and, mostly, because on a national level it seems that a cap-and-trade bill is simply a political non-

starter, especially following the major failure of the Waxman-Markey Bill which attempted to introduce such

legislation. In the more poetic words of Jonathan Chait, no possible scenario, not even if John Boehner were

ordered to pass a cap-and-trade bill by a returning Jesus Christ, bearing legislative text, could result in Congresss

passing a cap-and-trade law (2013).

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The Political Context

For the sake of our children and our future, we must do more to combat climate

change...I urge this Congress to pursue a bipartisan, market-based solution to climate

change. But if Congress wont act soon to protect future generations, I will. I will direct

my Cabinet to come up with executive actions we can take, now and in the future, to

reduce pollution, prepare our communities for the consequences of climate change, and

speed the transition to more sustainable sources of energy Barack Obama (2013)

The above quote from President Barack Obamas State of the Union address lays down a challenge to

the US Congress, either they work together to come up with a market-based solution to climate

change3, or President Obama uses his executive powers in order to address climate change, which

involves expanding the powers of the Environmental Protection Agency to further regulate greenhouse

gases under the Clean Air Act. Following up on his challenge Obama is currently pursuing the option of

using the EPA to regulate greenhouse gas emissions (among other avenues4) because congress has so far

failed to rise to Obamas challenge and put in place a market-based solution to climate change. For both

conservatives and democrats alike, the continued inaction of congress should be seen as a mistake, for

as this paper will argue, the market-based option, if pursued in the form of a carbon tax5, is the most

effective way to bring about action on climate change in a form which is most beneficial (and least

detrimental) to the US (and the rest of the world), and which not only adheres to conservative

principles, but can also most efficiently bring a bring about a just transition to a more equitable,

environmentally-benign and labour intensive paradigm of growth.

3This paper agrees with the overwhelming scientific consensus that anthropogenic greenhouse gas emissions are

causing devastating climate change. This scientific consensus and the details thereof (which this is not the place to

get into) are outlined in detail in the Intergovernmental Panel on Climate Change Fourth Assessment Report (IPCC,

2013) among other places,3and while the supposed debate rages on in many circles within the United States, I

will take for granted, as the relevantly qualified global scientific community does, that consensus from those who

are relevantly qualified on matters related to climate change is virtually unanimous. The controversy, as far as I can

tell (being a former climate skeptic myself (Cf. Lenferna, 2011)) comes not from legitimate scientific concerns, but

from a malignant fossil fuel industry funded disinformation campaign (Cf. Conway & Oreskes, 2010). What does

remain uncertain is how far we will allow this crisis to grow and how devastating the effects thereof will be, not

that we are causing the problem, for that we know with virtual scientific certainty3.

4http://www.whitehouse.gov/sites/default/files/image/president27sclimateactionplan.pdf

5A carbon tax is somewhat of a misnomer, for even though much of our worries around anthropogenic climate

change revolve around our emissions of carbon dioxide, other greenhouse gasses are also important to consider.

Thus under many proposed carbon taxes other greenhouse gasses such as methane and nitrous oxide are

included and measured according to their carbon dioxide equivalency5, such that where carbon emissions are

taxed per ton of carbon other greenhouse gasses can be taxed according to their relative global warming

potential5. A carbon tax in the US would hopefully do likewise.

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The Economics of a Carbon Tax

A carbon tax is a Pigovian tax which works by putting a price on carbon dioxide emissions and/or

greenhouse gas equivalents. The aim is to internalize the costs that are now externalized by using the

atmosphere as a free sink within which to pump our pollution. The costs of such emissions are referred

to as the social cost of carbon6, referring to the fact that the costs of the emissions are not borne by the

companies themselves, but rather by society at large. Thus a carbon tax aims to make companies pay for

the costs that they are foisting upon society and which are not included in the way that we currently

determine the price of goods and operations. Far from this being a radical distortion of the free market

system as opponents of the tax often claim, such a tax corrects a distortion of our current system by

attempting to make companies pay for the full price of their production and processes. Indeed by doing

so a carbon tax adheres to a fundamental conservative and free market principle of ensuring that

companies pay for their full costs, and are not subsidized by society at large through foisting the costs of

their production upon society. As Brian Andrew (2008) points out, a perfect market is one where all

parties bear the full costs and receive the full benefits of their production and consumption. Indeed, it is

if for such reasons among others that major conservative economists, such as Art Laffer and Greg

Mankiw, have supported such a tax (Cf. Ryan, 2013), while many carbon intensive industries, attempting

to protect their perverse subsidy/privilege have attempted to fight it off.

The economic effects of

increasing the prices of carbon

intensive goods through

internalizing the social cost of

carbon can partly be understood

by way of a simple supply and

demand analysis. As the graph

6According to Ackerman (2010), in the United Kingdom, where carbon pricing and cost calculations have a longer,

better-researched history, the latest estimates of the social costs of carbon is a range of $41 to $124 per ton of

CO2, with a central case of $83. The U.S. administrations interagency working group that has been studying the

SCC, however, has come up with a range of values, with a central estimate of $21 per ton of CO2. What this

means, if we follow their estimates, is that only part of the cost of carbon will be added into the price, and this is

problematic. However, many U.S. proposals for a carbon tax currently on the table, some of which I will explore

later, aim to better factor in a carbon price closer to the true social costs of carbon, although determining the

exact price of carbon is a complex, uncertain, methodologically-dependent and value-laden affair (Cf. Watkiss &

Hope, 2011).

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alongside illustrates internalising the costs leads to a higher price per unit for carbon intensive products,

and thus leads to an upward shift along the demand curve, creating a higher price and smaller demand

for carbon intensive goods. Through increasing the costs of carbon intensive products their less carbon

intensive competitors become more competitive, as they will have less of a tax to bear depending on

how much less carbon intensive they are. Thus depending on the short- and long-term elasticity of the

respective market and the relative competitiveness of competitors to carbon intensive goods, including

the cost of carbon into the price will lead to a shift away from carbon intensive goods. As Dieter Helm

points out, when it comes to carbon, nobody particularly wants it. Demand for carbon is indirect

(Helm, 2012, p. 179). Thus, for instance, in the energy sector such a tax would lead to a move towards

more natural gas, wind and solar rather than coal, and in the agricultural sector it would involve a move

away from more fossil fuel-intensive modes of production towards less carbon-, more labour-intensive

(read: job-creating) modes of farming, many of which are already emerging or exist as cost-effectivecompetitors.7 In Australia, for instance thanks to a carbon price wind energy is currently cheaper than

coal despite the fact that it is a country with some of the worlds most abundant fossil fuel resources,

thus illustrating the efficacy of putting a price on carbon (Paton, 2013).

Furthermore, the carbon tax through setting a set price on carbon gives certainty as to the costs of

climate legislation, and thus unlike uncertain wind subsidies or fluctuating prices caused by the

uncertainties inherent in a cap-and-trade system, the carbon tax sends a clear price signal to the market,

which will arguably unleash much needed nascent investment in the clean energy economy. Indeed, the

world is moving towards a low-carbon renewable energy economy, and quite uncoincidentally most of

the major economic leaders are also leaders in clean energy. According to the 2013 Global Climate

Leadership Review, France, Japan, China, South Korea, Germany and the UK are leaders in clean energy

on top of the low-carbon competitiveness index, while the US is ranked 11 th (The Climate Institute,

2013). A carbon tax, through sending important and clear market signals can help the U.S. take the lead

and remain competitive in the emerging low-carbon economy. Given that the National Renewable

Energy Laboratory (Mai, Sandor, Wiser, & Schneider, 2012), claims that the United States can meet 80

7Using Hotellings Model to understand demand, for instance, in the oil sector, an increase in price of oil caused by

a carbon tax would lead to decreases in current output of oil and shifting of production to the future. That is

because by not having priced oil properly we have over-allocated resources in the present relative to a production

profile that aims to maximize gains (Cf. Dahl, 2004, p. 300) . Hotellings Model ignores ethical constraints and

focuses solely on maximizing profit, but nonetheless on this barebones economic model we find that by including

an SCC we push production to the future, which gives more time for the development of alternative sources of

energy and production.

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percent of its electricity needs in 2050 through renewable energy generation using just current (never

mind future) technology, this represents great potential for growth and job creation.

Job Killer or Creator?

Policy designed for creating jobs is often a goal more associated with the left than conservative

principles. Republican Congress members, however, are arguing against a carbon tax on the grounds

that it will kill jobs. While job creation may not be a fundamental concern for conservatives, a policy that

would reduce jobs in the United States would arguably not be a welcome outcome for conservatives.

However, evidence points to the fact that the Republican opposition to carbon tax on the grounds of job

loss is unfounded as a carbon tax can actually assist in creating jobs. Indeed implementing a carbon tax

will create many more jobs in the long run than not doing so would. That is not to say that some jobs

wont be lost in the transition to a clean economy, as just like in any economic transition or progress,

some jobs will be gained while some will get lost, but overall if the carbon tax is implemented the gains

in jobs will be significant, and so the Republican opposition on the grounds of job loss is a bit more than

suspect. Allow me to expand.

Consider, as Dan Hind (2012) points out, that the triumph ofproductivity has perverse consequences,

insofar as the abundance of energy and mechanical labour provided by fossil fuels and associated

technologies has made more and more people economically unnecessary, shifting them to the margins

of our economy, while those who have access to the fruits of the fossil fuel revolution richly reap its

rewards. Furthermore, as Huber (2009) argues, and as is evidenced by vast income disparities in the U.S.

and the world over, by decisively shifting productive forces from human labour to machines, fossil fuels

generalised the conditions for a class monopoly over the means of production thus reducing the amount

of meaningful jobs available and creating great inequalities.8 Clean energy, however, when compared to

fossil fuels, uses far more of its budget on hiring people and less on acquiring vast machines, supplies,

land and energy itself (Cf. Pollin, Heintz, & Garrett-Peltier, 2009).

More than simply not hurting jobs, much evidence shows that the transition spurred on by the carbon

tax will help to create many more jobs than the fossil fuel industry does. Even in West Virginia (which

has the highest dependence on coal in the country with the coal industry directly employing 3% and

indirectly 9% (McIlmoil, Hansen, Boettner, & Miller, 2010)), comparative studies show that a developed

renewable resources industry could provide far better fiscal returns to the county and state than coal

8Cf. Wealth Inequality in America:http://www.youtube.com/watch?v=QPKKQnijnsM

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presently does, while raising wages and expanding overall employment opportunity (Cf. Hansen, Collins,

Hendryx, Boettner, & Hereford, 2008). According to Robertson (2010), the coal mining industry

maintains 82,595 jobs nationwide, while the wider coal industry supports 174,000 permanent jobs

nationwide, despite the fact that coal accounts for around 40% of energy production. On the other

hand, conservative estimates for a transition to just 20 percent national power generation from wind

shows 500,000 jobs created (Robertson, 2010). Already in 38 states and the District of Columbia, job

growth in the clean energy economy outperformed total job growth between 1998 and 2007 (Pew

Charitable Trusts, 2009). Just the currently underdeveloped solar industry currently employs more

people than there are ranchers in Texas, actors in California and coal miners nationally (Spross, 2013).

Indeed significant amounts of evidence show there is a great net gain in job creation through the switch

to a clean economy, and the jobs gained, furthermore, are healthier and more environmentally benign.

Pollin et al. (2009) found that for every $1

million invested in renewable energy as

compared to the fossil fuel industry, more

jobs would be created at more than a 3-1

margin. Indeed as the graph9 alongside only

begins to reveal, a move towards a clean

energy economy can help reverse trends

towards the obsolescence of human capital,

i.e. the transition will help create more jobs, and more ecologically friendly ones at that. Thus the slogan

of green jobs and the clean economy is not a mere rhetorical political slogan, but is underpinned by the

reality that the fossil fuel industry is based more on exploiting natural resources, while the clean

economy is based more on the use of human capital. A carbon tax by shifting production and R&D

towards a clean economy can help us to accrue such gains, and although there will be losses in the fossil

fuel industry, overall jobs will increase substantially. Thus, as the Financial Times Editorial Board points

out, the claim made by more than 85 Republican members of Congress that carbon taxes would kill

millions more jobshas no evidence to support it (2013).

As Joseph Schumpeter argues, the process of industrial mutation that incessantly revolutionizes the

economic structure from within is one of the underpinning strengths of capitalism (in Gilding, 2013).

Economies are not static entities, and thus protecting the fossil fuel industry by not implementing a

9Created from data in Robertson (2010)

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carbon tax would not only result in fewer jobs, it would be equivalent to protecting the telephone

industry from the development of cell phones or the horse-and-cart industry from the development of

cars, an unjustifiable form of protectionism preventing technological progress clearly against good

conservative principles as well as broader job creation and pollution reduction. As conservatives are

fond of pointing out, government shouldnt be in the job of picking winners and losers, but protecting

the fossil fuel industry from the full costs of the production does just that with the losers being broader

society and the environment. That is not to say that we shouldnt perhaps think about assisting those

who might lose out as we transition to clean energy, as, for instance, a 2009 bill from Rep. Larson has. 10

However, shielding the fossil fuel industry from the full costs of their production in order to save the

limited jobs they create, which is less than would be created otherwise, is both bad for job creation and

contrary to conservative principles of a free, fair, transparent and accountable market.

Shrinking Government, Reducing Taxes and Helping the Poor

I believe that any conservative who heard that a policy could shrink government, reduce taxes and help

the poor, would be more than happy to support such a policy, all other things being equal. Well, a

carbon tax when compared to its alternative, could do all of the above depending on how it is

structured, and so, given that the alternative of EPA regulations is pretty much inevitable if a carbon tax

is not put in place11, a carbon tax should be a conservatives cup of tea, so to speak.

Firstly, if the U.S. is to go ahead with expanded EPA regulation of greenhouse gasses emission under the

Clean Air Act instead of a carbon tax, then doing so involves expanding the EPAs reach to cover power

stations and other stationary sources, which would involve creating the regulatory framework and

enforcing the regulations at each and every source a contested process that is currently underway (Cf.

Chait, 2013). That is certainly quite a substantial government feat, which would require substantial

growth of the EPA i.e. government hardly a goal of most conservatives. Efforts to block the EPA,

furthermore, will be stalling the inevitable as the Supreme Court has granted EPA authority to do so, and

10Cf.http://www.carbontax.org/blogarchives/2009/03/06/new-larson-bill-raises-the-bar-for-congressional-

climate-action/11

To quote from theCitizens Climate Lobby: Efforts to block new EPA regulations are destined to be an exercise in

futility amounting to little more than political grandstanding. Such legislation has no chance of moving in the

Democrat-controlled Senate. Even if it passed in both chambers, the President would veto any such bill.

Equally futile would be attempts to block CO2 regulations through the court system. In 2007, theSupreme Court

ruled that the EPA has the authorityandthe obligation to regulate greenhouse gases that contribute to global

climate change. And just last year, a three-judge panel from the U.S. Court of Appeals for the District of

Columbiaupheld a finding from EPAthat greenhouse gas emissions endanger public health.

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they will do so unless we accept Obamas challenge and implement a market -based solution like the

carbon tax.

A carbon tax, on the other hand, if implemented, would avoid the need for copious EPA greenhouse gas

regulation, and could be levied upstream at the source of fossil fuels, at bottlenecks of production, andat the border, which would drastically reduce the need for government expansion, such that by

collecting the tax from upstream fuel producers and a few big sources of CO2 the government would

only have to charge thousands of businesses, not millions of Americans (Washington Post Editorial

Board, 2013). The carbon tax would thus eliminate the need for the massive central planning and

spending required to more broadly enforce the Clean Air Act. Indeed, according to an overwhelming

majority of the IGM Experts Panel of economists, a carbon tax would be the least expensive way to

reduce carbon-dioxide emissions (IGM Experts Panel, 2011).

Furthermore, if a carbon tax becomes the predominant policy for dealing with climate change it could

reduce the need for clean energy subsidies and its associated lobbying and rent-seeking. This is a

potential gain, for as any good conservative will tell you, markets are neutral and look for the most

efficient responses whereas governments pick winners and losers in subsidy choices, and sometimes

they get it wrong and create lock-in to incumbent technologies and businesses, foreclosing

opportunities to spur innovation (Cf. Hsu, 2011).12 Furthermore, as Dieter Helm points out, with

subsidies not only do we often pick the wrong winners, but typically the better-off invest and get the

subsidies, and the poor pay a disproportionate part of the bill (2012, p. 89). Thus a carbon tax can most

effectively tackle climate change, reduce the size of government, and, if designed correctly, even assist

the poor.

12Subsidy removal, however, cannot be on sided, for if we remove subsidies to the clean energy industry they

need to be accompanied by removal of the much larger subsidies to the American fossil fuel industry, which

receives $502 Billion in subsidies annually through direct support to those industries, consumer rebates and

avoided taxes on pollution (International Monetary Fund, 2013).

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According to Handley (2013), the House Republican leadership has pledged to reject any climate

measure that generates revenue for the government, this, however, still leaves political room for two

different forms of carbon tax which do not increase government revenue. The first is revenue-neutral

tax swaps and the second is a carbon fee and dividend. A revenue-neutral tax swap starts from one of

the few uncontroversial conclusions of economics, that it is better to tax bads than goods (Financial

Times Editorial Board, 2013). Realizing that, the aim is to move taxes away from goods, such as income

and payrolls, towards bads such as pollution. A revenue neutral carbon tax-swap does just that, thus

promoting the goods and not the bads. Some might worry that such tax-swaps would

disproportionately affect the poor. However, according to a study done by MIT, depending on how one

structures such revenue-neutral tax swaps the carbon tax could actually be structured so as to reverse

its potentially regressive nature and make it a progressive tax which helps the poor (Rausch & Reilly,

2012- see table below). Thus a revenue-neutral tax swap could reduce the size of government, reduce

other taxes and be progressive and assist the poor, while tackling climate change all good conservative

goals. 13 As the Congressional Budget Office has pointed out, many analyses point to the projection that

a tax swap could actually lead to a net increase in output, albeit a less carbon intensive increase in

output (Congressional Budget Office, 2013, p. 11).

13CTCorp = Corporate Tax Swap; CTPersin = Personal Marginal Income Tax Rate Swap; CTPayroll = Payroll Tax

Swap; CTTranser = Carbon tax revenue used to increase transfer payments e.g. social security, Medicaid, etc.

Source: Rausch and Reilly 2012

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flight from those countries. Indeed, the United Kingdom provides an important example of this, for

through regionally focused climate policy they have reduced their regional emissions over the past

decade. However, when it comes to looking at overall emissions, including those associated with the

goods they consume, the UK has actually increased their emissions by 10% since 1993 by importing

carbon intensive goods mostly from countries like China (House of Commons Committee on Energy and

Climate Change, 2012). Indeed, about half the increase in Chinas CO2 emissions from 2002-2005 were

linked to the export of goods to the US and EU (Wijkman & Rockstrom, 2012, p. 43). Thus, given that the

US is already the largest importer of embedded emissions from China, it is argued that climate

legislation would simply enhance that trend further. Such an objection, when levelled against EPA

regulations or regional cap and trade, is a justifiable one, as such policies only focus on national

emissions. However, this is where a carbon tax once again proves to be a more effective policy, as one

of the carbon taxes complimentary policies, border taxing, can move us away from such limited regionalaction towards a more global and effective response to climate change, which protects the U.S.

economy from competition from other countries that do not take on climate legislation. Allow me to

explain.

A border tax works by ensuring that products that are exported from the U.S. to countries that do not

have a carbon price are granted carbon tax exemption, and are thus competitive in such countries.

Goods that are imported into the United States are taxed according to their carbon content so that they

do not have an unfair advantage in the U.S. over locally produced goods that were already subject to the

carbon tax. Given that U.S. production is often more energy efficient than, for instance, Chinese

production, a carbon tax with border taxing may actually help to promote U.S. products, and thus

enhance US competitiveness. Further aiding the U.S. competitiveness, the revenue gained from the

border taxes import tax could go to the U.S., which also provides major incentive to other countries to

implement such a tax themselves in order to keep the revenue from such a tax, rather than see it go

elsewhere. Thus, as Dieter Helm argues, a carbon tax coupled with border taxing is is a pragmatic

mechanism for gradually translating bottom-up carbon taxes into an international agreement (2012, p.

192) or for muscling countries like China and India into climate action, a task the U.S. has long claimed it

hopes to achieve.

Although border taxing is a complex process and it will be difficult to gain exact precision, it is both a

possible and integral element to ensuring the integrity and efficacy of climate legislation, for otherwise

we will continue to shoot ourselves in the feet by exporting production to dirtier parts of the wold

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through regionally limited legislation. In response some have argued that it would violate WTO

regulation on fair competition. However, as world renowned WTO scholar Professor Joost Paulewyn

shows, the WTO has exemptions for environmental considerations and border taxing should pass WTO

scrutiny (Pauwelyn, 2012). Despite the fact that such a tax could pass WTO scrutiny my proposal would

be that the revenue gained from the import taxes, and the import taxes alone, be directed towards a

climate change fund such as the Green Climate Fund, otherwise such a proposal might be fought against

on the grounds that it serves as a way for the US government to siphon off funds from the rest of the

world. Even if my suggestion was put in place, a carbon tax coupled with border taxing still has the

major benefits not only of protecting the U.S. from unfair competition and promoting broader

international action on climate change, but also of reducing both carbon production and consumption,

unlike the UKs policy did and the EPA would. Thus a carbon tax, unlike much other climate legislation,

ensures that any climate gains are not rendered meaningless by carbon intensive imports. Thus for anyconservative concerned about free market fairness, the carbon tax once again proves to be truer to it

than EPA regulations could be, thus putting paid to the misleading argument put forward by Jay

Timmons, the National Association of Manufacturers (NAM) President and CEO16, which said that a

carbon tax will severely harm the U.S. ability to compete with other nations. If anything, by attempting

to block a carbon tax the NAM is ensuring that EPA regulations will emerge which will indeed hinder U.S.

competitiveness and damage meaningful action to tackle climate change by focusing only on national

emissions and not on the global picture as carbon taxing can.

Morally Corrupt Opposition

Bertrand Russell once wrote about the American

revolutionary Thomas Paine, "He had faults, like

other men; but it was for his virtues that he was

hated and successfully calumniated. Likewise with

a carbon tax, the fossil fuel industry seems to

recognize the virtues of such legislation will mean a

move away from their perverse privilege/subsidy of

being able to pollute the atmosphere freely. Thus

much of the industry is doing anything in their

means in order to protect their perverse privilege,

16Cf.http://www.nam.org/Communications/Articles/2013/02/A-Carbon-Tax-Would-Wallop-Our-Economy.aspx

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including fabricating disinformation, spreading lies, creating/funding biased and/or flawed studies17 and

investing millions in dishonest lobbying. Worst of all they are masking their attempts in the name of

conservative principles, whereas their campaign is actually a perversion of good conservative principles

(or pretty much any set of principles that isnt solely based on protecting the fossil fuel industry bottom-

line). Thus Republicans in Congress who toe the industry line by opposing a carbon tax are rather

hypocritically and arguably corruptly being untrue to conservative principles. Furthermore they are

ignoring the core of democracy by ignoring the will of the people, for as Ryan Koronowski (2013)

reports, according to polling, a revenue neutral carbon tax that would provide dividends back to

taxpayers and invest in renewable energy received 70 percent support, and US voters favor a carbon tax

over spending cuts by a 4-1 margin. 93 percent of Democrats favored a carbon tax, and 66 percent of

Republicans did too. Thus according to my argument it seems that

congressmen who oppose a carbon tax do not do so because they trulyrepresent their constituency or for principled reasons; they do so most

likely because they are either misinformed or corrupt and beholden to a

small high-paying portion of their constituency, the fossil fuel industry.

Why the U.S.?

The question that many might ask when faced with the prospect of a

U.S. carbon tax is, Why America?. This is indeed a very important

question, which has many answers. Firstly, implementing such a policy

in the United States may be the most effective single policy to tackle

climate change, given the that the U.S. is the biggest historical emitter

of greenhouse gas emissions, and one of the biggest current net and per

capita greenhouse gas emitters, and arguably the center of world

consumption. Even though China currently produces the highest

amount of greenhouse gasses, the US currently imports the highest

amount of Chinese goods than anywhere else and if the imported

carbon was included in the U.S. emission count it would probably make

the U.S. the highest net greenhouse gas emitter in the world. Indeed,

the American populace consumes 25 percent of the worlds energy

17Cf. The Institute for Energy Researchs (Murphy, 2013), the NAMs (Lavoie, 2013), American Institute for

Petroleums (Mufson, 2012) and American Legislative Exchange Councils Koch-funded Beacon Hill Institute study.

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despite representing just 5 percent of global population five times more than the average Chinese

person and 160 times more than a Bangladeshi18 such that, if we take the projections of climate

science seriously, the average American is responsible, through his or her greenhouse gas emissions,

for the suffering and or deaths of one or two future people (Nolt, 2011). Furthermore, in order to feed

the growing demand for energy the U.S. has been waging many inordinately expensive wars, both literal

and metaphorical, on both the environment and humans across the globe.

For those who think America is unfairly being targeted it is worth keeping in mind that other countries

are already doing their bit and generally more than the US, as the table on the previous page shows.

Furthermore even developing countries like China and South Africa are soon set to join the ranks of

countries with a price on carbon, and even the worlds poorest countries are putting in place mitigation

strategies to reduce their emissions (Cf. King, 2013). While many developed countries are meeting more

ambitious climate targets, as the graph below from Bianco et al. (2013) shows, even if regulations under

the EPA were expanded and

states acted incredibly

ambitiously on climate change,

which they arguably wont, the

States still wouldnt meet its

international climate change

goals, which are the lowest of all

developed country goals and

arguably much less than their

fair share of world emission

reductions.19 Similarly Burtraw et al. (2011) showed that new EPA regulations will at best reduce

greenhouse gas emissions in 2020 by only 13%. Bianco et al. thus conclude that major climate legislation

is needed in order to get us to those goals.

Carbon tax legislation arguably can get us to meet U.S climate goals. According to John Millers analysis

of EIA data, If the predictions that carbon taxes and reduced fossil fuels consumption will help expand

the economy based on a substantial expansion of renewable energy supplies, energy efficiency

technology improvements, and expanded green jobs is correct, then the $100/MT level of carbon taxes

18(Biello, 2013),

19Cf.http://climateactiontracker.org/countries/usa.html?utm_&&&

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energy policy should effectively achieve most of its claimed goals (2013). Furthermore analysis from

Charlie Komanoff of the Carbon Tax Center study show that H.R. 1337 Americas Energy Security

Trust Fund Act of 2009 which puts a steadily increasing price on carbon dioxide emissions, could

achieve Americas target ofan 80% reduction in CO2 emissions by 2050 (Robertson, 2010, p. 20). Even

more than that what is important to remember is that these numbers focus only on carbon emissions

from production in the U.S. and not carbon consumption from imports, which would also be reduced

through the use of border taxing, thus carbon taxing would make even greater reductions on

greenhouse gas emissions.

Furthermore, the question, Why America? is a question that sees a carbon tax as a burden, and while it may

indeed be a short-term burden through rising prices on carbon-intensive goods and practices, as I have

hopefully shown throughout this paper it is arguably less of a burden than alternative policies such as EPA

regulation, which will be put in place if a carbon tax is not. Furthermore, in the long run it will be a policy

which will have great benefits for us and our children that outweigh the short-term burdens. Given that we

are often so willing to make sacrifices for our children and the future, this is arguably one of the short-term

sacrifices we need to make, and arguably easily more justifiable than the sacrifices imposed upon the U.S.

populace through the sequester.

In the face of wartime the American populace was willing to work together to make sacrifices to shift the

economy, and the moral imperative in the climate case is arguably even stronger, as climate change could

halt and substantially reverse global progress on poverty reduction, and cause innumerable conflicts,

suffering and environmental degradation among many other negative effects.20

As was the case when the

U.S. ended slavery, it realized that even though slavery made certain activities profitable, those profits were

not worth the exploitation involved. Similarly with regards to reigning in industrys ability to freely pollute the

atmosphere, while certain industries remain profitable because of the perverse privilege/subsidy of foisting

their costs onto society at large, it is time we realized that such exploitation is unacceptable. Doing so is

moral and societal progress that has no political color to it. Whether you are a Republican, a Democrat, an

Independent, a plain American, or a citizen of the world, ensuring that we have a liveable world with a

thriving society and economy is a goal I like to think that we all share, rather than ensuring (through our

obstinacy) that a massive relatively inefficient EPA regulative apparatus is put in place instead. Nonetheless,

in asking the U.S. to make the smaller relative sacrifice of a carbon tax for the greater good, it is important to

put that sacrifice into perspective, so I end with a quote from Carl Safina (N.d.):

20http://hdr.undp.org/en/mediacentre/humandevelopmentreportpresskits/2013report/

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Of all the psychopathology in the climate issue, the most counterproductive thought is that solving the

problem will require sacrifice. As though our wastefulness of energy and money is not sacrifice. As

though war built around oil is not sacrifice. As though losing polar bears, ice-dependent penguins, coral

reefs, and thousands of other living companions is not sacrifice. As though withered cropland is not a

sacrifice, or letting the fresh water of cities dry up as glacier-fed rivers shrink. As though risking seawater

inundation and the displacement of hundreds of millions of coastal people is not a sacrificeand reckless

risk. But dont tell me to own a more efficient car; that would be a sacrifice! We think we dont want to

sacrifice, but sacrifice is exactly what were doing by perpetuating problems that only get worse; were

sacrificing our money, and sacrificing what is big and permanent, to prolong what is small, temporary,

and harmful. Were sacrificing animals, peace, and children to retain wastefulness while enriching those

who disdain us. When we stop seeing our relationship with the whole living world as a matter of

sustainability, and realize it is a matter of moralityof right and wrongwe might make the momentwe need.

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