Economist favours tax!
The Financial Times “undercover economist”, Tim Harford, reports on the differences between emissions trading schemes and carbon taxes, in this article. He declares in favour of a tax, since a tax may be more readily altered than a trading scheme, as circumstances change.
“The uncertainty about next year’s emissions is not very worrying, because climate change is caused not by what happens next year, but by the accumulation of emissions since the industrial revolution. If we get the tax wrong and emit too much one year, it will be easy to fix. The economy, on the other hand, is more vulnerable to short-term shocks: get the permit quota wrong, even for one year, and you could cause lasting damage.
Those environmentalists currently yelling that I am an idiot and am not committed to saving the planet have missed the point. The more you fear climate change, the more stringent the tax or quota should be. What I am saying is that whatever you decide about that, it is less risky to use a tax. The government expends so much effort taxing good things, such as saving and spending money. It would be a shame if it lacked the courage to tax something bad for a change.”
On the other hand, we in Europe already have ourselves an emissions trading scheme. Pity that we can’t seem to get it to work properly!
Carbontax.org « Carbonara: CET in Europe said:
[...] Yet another new blog in the USA — this one devoted to promoting the idea of a carbon tax. It’s hard to imagine groups lobbying IN FAVOUR of a tax, but that shows the concern which people have regarding the possibility and effects of [tagclimate change[/tag]. We, however, would prefer an emissions trading scheme to a tax, despite the arguments of this economist. [...]