Combating climate change with a carbon tax

I don’t want to be apocalyptic, but perhaps there is no other way to make my point. Many Swatties may be aware of 350.org, an organization aiming to fix the climate crisis through grassroots action. 350.org is named for a target for safe CO2 concentration in the Earth’s atmosphere at 350 parts per million (ppm). This target is good, if conservative, compared to the concentration level determined by NGOs, international and intergovernmental oraganizations and governments: 450 ppm. There is some internal debate among climate scientists as to what is the safe concentration of CO2 in the atmosphere, however, the lower the level, the “safer” the planet. At 450 ppm, there is a 50 percent chance we will surpass the Intergovernmental Panel on Climate Change’s (IPCC) ‘tipping point’ — an increase of 2 degrees Celsius from pre-industrial levels. This tipping point is just that, according to the IPCC scientist: an irreversible trend towards continually rising temperatures, the melting of the sun-deflecting polar ice caps, thawing of methane containing permafrost areas and reaching the sea’s CO2 holding capacity.

Numerous plans for combating climate change have been voiced (along with the voices that do not acknowledge climate change, but for the sake of this discussion, we must move past them). I do believe that technology holds promises for helping slow humanity’s impact on the environment, but relying on technological fixes comprises the first, easy steps in reducing both our carbon footprint and our overall ecological footprint.

Technological fixes do not usually lead to a decrease in total resources used or total emissions, as aptly observed by William Jevons, a nineteenth century British economist whose book “The Coal Question” concluded that gains in efficiency did not lead to an overall decrease in consumption of resources. In Jevons’s time period, this meant producing iron while using less coal, but the growth of iron production was so great that efficiency gains were not enough to reduce the resources used. Current focus on relative decoupling is better than nothing, but much more needs to be done. The more difficult — and more important — step to make is the absolute decoupling of well-being and resources. Or, in other words, reduced consumption.

Do you think about every consumption choice you make in terms of its environmental impact? I can’t say I always do, and I do not believe it is reasonable to expect individuals to calculate the cost of the externalities from their consumption. Whether it is taxes on cigarettes or pollution from the production of your computer, taxing to correct for externalities is the government’s responsibility and duty.

The U.S. — and every other country — should tax goods and services on the basis of their environmental impact. If simplified, this would take the form of a comprehensive carbon tax implemented on the consumer directly. Now, many advocates of a carbon tax point towards taxing producers for their emission. As per textbook economics, this would have the same effect on total emissions as taxing consumption directly.

However, either option implies a normative choice as to the responsibility for emissions — when clearly both consumers and producers should be conscientious. In the American and Western European contexts, consumers should be the targets of a carbon tax. Fortunately, or unfortunately, this means that the whole planet would have to consider tax emissions on a consumption basis so as not to double-count emissions.

The choice to count emissions by consumption puts the burden on developed countries, or, rather, consumers in developed countries. This is the normatively correct choice given world history since the beginning of industrialization: developed nations have produced the most emissions and have exploited the most resources. Thus a carbon tax should target western consumption patterns. This is not to say that developing countries should not consider their environmental impact, but rather that, as established by the Kyoto Protocol, some allowances for growth must be made.

There is the huge issue of feasibility, especially with regards to international implementation. Though Australia passed a bill for taxing carbon through its lower house last week, this may not even make it past their senate, much less on to the rest of the world. The Australian bill is a weak model for carbon taxation in that it is focused on the production side and that it has generous exceptions. I have no illusions that the world’s largest economies will have huge qualms as to potentially hindering their competitiveness and to moving away from a traditional, goods-based economy.

Furthermore, there are additional barriers — technical barriers — to an effective carbon tax on goods and services and questions of equity. Should the tax be solely on greenhouse gas emissions, or should the tax be based on some calculation of total resources used? The former would be far easier to implement, so, given other hurdles to implementation, greenhouse gas emissions a better option.

Within nations, should governments adjust other forms of taxation to alleviate any undue burden on lower-income groups? This would need to be answered on a country-by-country basis, where countries with already progressive schemes of taxation would likely implement some mechanism for maintaining existing systems of redistribution.

These concerns aside, any dialogue on climate change should be centered on changing consumption patterns, a project best addressed through taxation.

Olivia is a junior. She can be reached at onatan1@swarthmore.edu.

Leave a Reply

Your email address will not be published.

The Phoenix

Discover more from The Phoenix

Subscribe now to keep reading and get access to the full archive.

Continue reading