The Real Problem with Carbon Taxes

Bruce Everett, a specialist on global energy issues, a Director of the CO2 Coalition, and Adjunct Associate Professor of International Business, Fletcher School at Tufts University, has written an essay titled “The Real Problem with Carbon Taxes.”  In it he argues: “Carbon taxes have reemerged as a political issue. See for example, the recent Wall Street Journal articles by Amy Myers Jaffe (“A Price on Carbon May Be Coming Soon to the U.S.”) and George David Banks (“Why a Price on Carbon Is Unlikely in the U.S. Anytime Soon”).  Perhaps understandably in this highly politicized season, most of this discussion centers on the legislative mechanics of passing a carbon tax.  The discussion should focus instead on the actual merits of such a tax.

“Economists have long recognized that taxation can be a useful means to discourage consumption if – and only if – there is a reason to do so.  Without a clear and defined benefit, such taxes simply divert funds from consumers to the government. Regressive taxes, i.e., those that fall disproportionately on the middle class and the poor, reduce disposable income at a time when families are struggling to meet their needs.  The issue is not can we impose a carbon tax, but why should we?” The essay is available in pdf form below. [pdf_attachment file=”1″ name=”The Real Problem with Carbon Taxes”]

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