The Global Warming Policy Foundation, usually considered skeptical about taking action on climate change, has issued a paper called “It Pollutes, So Tax it: Need We Say More about Carbon Dioxide?”
That would seem to recommend a tax on carbon dioxide emissions and to an extent it does. But the paper by Peter Hartley of Rice University is not a ringing endorsement of a carbon tax. It discusses many aspect of the climate change issue and its recommendation for a carbon tax is tepid. Here is the summary:
“Accumulation of carbon dioxide in the atmosphere will warm tropospheric and surface temperatures and thereby change other climate attributes. The negative externality is global in scope and all countries contribute to it. The resulting collective action problem may be one reason attempts to slow CO2 accumulation have failed. Another may be that the most efficient policy instrument for restricting emissions, namely a globally-uniform emissions tax, has not been tried. Instead of attempting to limit CO2 emissions at the global level, however, a suite of alternative policies may achieve better outcomes while circumventing the collective action problem.”
I added the emphasis.
As part of the GWPF publication, Canadian economists Ross McKitrick and Robert Lyman respond to Hartley’s paper. They admire his discussion of many aspects of the climate change issue, while questioning the positive role that carbon taxes (or their cousins, emissions permits) might play in addressing climate change.
Then two other prestigious authors, William Happer and Bruce Everett, weighed in—in a separate paper also published by GWPF (with a reply by Hartley), “Why Carbon Taxes are a Bad Idea.” Their conclusion:
“Pigouvian taxes [as a carbon tax would be] are appropriate when an identified externality (a) is negative and (b) can be quantified. Carbon dioxide meets neither test, and a carbon tax would create a substantial dead-weight loss to the economy for no benefit at all.”
Kudos to the Global Warming Policy Forum for airing a variety of views. The issue articulated here is threefold. First, if carbon dioxide emissions are to be reduced and many countries are willing to agree to do so, a carbon tax might be a good idea. Second, that outcome is unlikely.
Those ideas stem from the initial paper by Hartley. with commentary by McKitrick and Lyman.
Third: Any attempt at reducing carbon dioxide emissions is wasteful because (among other reasons) past predictions of dire warming have not come about and therefore the models of future predictions are flawed. As Happer and Everett observe:
“In our universe, cause must precede effect. It makes no sense to argue that the consequences of warming are occurring, even though the predicted warming itself has not happened.”
Image is from PublicDomainPNG from Pixabay.