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US Carbon Emissions

  • The world emits about 35 billion tons of carbon dioxide each year (this is from a warmist site).
  • The US “contribution” to this amount is about 6 billion(this is a high end estimate).
  • US emissions have been flat for two decades.
  • The highly reliable IPCC estimate is that a ton of CO2 does about $30 in damages over the course of the next century. Remember this is already a Present Discounted Value. This is not an annual value but rather an aggregate one (Professor Stavins is not exactly a free-market ideologue).

Which leads to some observations/questions:

  1. If you are part of Professor Mankiw’s “Pigou” club, which I am not, this suggests that a $30 per ton tax on CO2 emissions would, if NO ONE changed their behavior, generate $180 billion in carbon tax revenues.
  2. This amount is about half of current corporate income tax payments.
  3. This amount is less than 20% of the total amount of estimated dead weight losses inflicted on our economy from how poorly our tax system is structured.
  4.  Can anyone, anywhere, show me the $180 billion in other taxes that the US would be willing to reduce in order to make this tax carbon neutral? Or would folks be willing to see annual Medicare, Education, Social Security, etc. benefits fall by $180 billion.
  5. Supposing highly inelastic demand for carbon generating activities, and complete ability to monitor and track CO2 emissions and complete ability to actually collect all of the taxes needed to do this, the idea is that this $180 billion would be made available to “pay for” the damages done by the CO2 emissions. This is sort of how a court system would work, but when a court awards damages, we are guaranteed (actually, scratch that, the lawyers take a bunch) that the “victims” actually get compensated. Do you think that the tax revenues will actually be used to compensate the climate “victims?” I’m 7 feet tall too. I can’t wait to see the establishment of a government sponsored agency that would specialize in creating carbon tax backed securities, would anyone want to bet me on that?
  6. Assuming away 5, would “paying for” $180 billion worth of “climate change damage” be ANYWHERE NEAR the way you would want to spend $180 billion to deal with ANY problem of your choosing? Where on the list would climate change damage prevention actually fall? Ahead of working on the problem of antibiotic resistance? Ahead of suicide prevention? Ahead of automobile safety? Ahead of efforts to upgrade ancient sewers and water treatment facilities? Or to think globally a bit, ahead of providing clean burning and reliable fuels to poor countries? Ahead of helping 2 billion people gain access to clean water? Or better yet, ahead of doing something to end to utter tragedy that is taking place in South Sudan and Darfur? Again, I’ll be on board with your world if you tell me that paying for CO2 emissions is more important that putting an end to the slaughter of thousands and thousands of human beings. And no, climate change has not, and will not, lead to the slaughter of thousands and thousands of human beings.

And maybe my biggest question, which will of course get crickets like all of the others. Suppose we do implement a rather aggressive carbon tax policy, designed and implemented by all of the “experts.” Once it is passed and is operating, what is the probability that “this is it?” Do you think we’d see a call for the end of electric car subsidies? A reminder that in the presence of the tax people will all find their own ways to adapt? You can all stop laughing now.

6 Responses to “US Carbon Emissions”

  1. Harry says:

    Where does begin, with this whole question you raised?

    Most of us would assume we should not harm our neighbor, all other things being equal. It follows that we should compensate those for our harms against them, and for that reason tort lawyers were created. In modern times in some places we apply a more sophisticated system than the old one, an eye for an eye, etc.

    So in the service of justice, everybody is to pay a carbon tax (does anybody remember this was an idea advanced by Senator Gore in 1992 for the US?) to compensate, among others, Angolan anchovy fishermen, who would be happy for the money, for the damage done to their future anchovy harvests?

    And this is worth — what, in net present value terms? Well, that depends on a lot on the discount rate one uses, and the value of the currency in which the damages are calculated.

    Also, while one can calculate that the United States uses one fifth of the hydrocarbon fuels in the world (assuming that figure is correct) does that figure include just the man-made CO2 we can identify? Does it include the CO2 produced from the forest fires that burned last summer from Arizona to New Mexico, and how many metric tons was that?

    So, when one hears that a carbon credit is worth $30, the next question is, “Why not $300, or ten thousand Argentine pesos? Or did you pick $30 because it will buy lunch for two at Applebee’s?”

    The answer is that they started at $180 billion (not €180 billion) and worked backwards, with a modest figure. This, after all, is just the global carbon tax, not the global wealth tax, or the global value-added tax. Tax ’em for the mice, tax ’em for the lice, tax ’em for looking in the mirror twice.

    The bigger the pile of money, the better we can speculate how if we were in charge how we might spend it more wisely than the UN, which is likely to shovel a big portion of it to our mortal enemies. Even if we were to send, say twenty trillion dollars to Wintercow (after taxes, that would be $1.1 trillion, I doubt he could handle the redistribution of that well.

  2. Harry says:

    “…about half of the dead weight losses” from our tax system.

    WC’s estimate of the dead weight losses from the tax system may be correct, but he did not continue with the dead-weight losses from regulation by government at every level, which I assume is because Wintercow does not have the time to blog 24/7. And this is just about the regulation that has proliferated relentlessly in varying degrees at all levels of government here in the land of the free, and does not include the rest of the world.

    The regulators will not give up their jobs and authority easily, and that is a big obstacle to overcome. In my little township, some of the members of the board of supervisors think of themselves as supervisors of us, rather than supervisors of their employees, and that is a big difference. Maybe some of this goes back to Wilson, Dewey, and the Progressive ideas about how we should all be organized.

    Perhaps the League of Nations would have done a better job of determining the price of carbon credits than the IPCC.

  3. Speedmaster says:

    We can stop debating the what-ifs now. These folks know what will happen.

    Listen To Voices From The Future Describe What Climate Change Will Feel Like
    “Apocalypse now? A heartwrenching online game called FutureCoast invites anyone to leave messages about the strange and sometimes terrifying scenarios they imagine in a future of rising seas and warming temperatures.”

  4. Harry says:

    Having replacing a 40 watt incandescent light bulb with another, I am reminded of how stupid regulation never goes away.

    I was in a town meeting with my US Congressman. I think it was 2011. I asked him, what are you going to do about the light bulbs? He said, don’t worry, that would be taken care of, which meant, “Why are you asking me this question that would violate my oath not to discuss controversial subjects for which I do not have an answer that lets me take it both ways.”

    Not spending much time on that subject, I assumed that he along with his colleagues would pass a law to repeal. Silly me.

    For the Europeans have seen the light, I knew this, staying in German hotels, a few years before, that coil in the lamp that made you squint at the book, figuring they might cut down on electricity generated by the wind turbines. Ever since WWII, it cost a few pfennig to put into the slot to take a hot shower.

    So, while we are on the subject of regulation and the environment, and while the war on hydrocarbons is about to end coal-fired energy because today we have instrumentation to detect trace mercury emissions, why does the government insist, still, that we buy those stupid light bulbs?

    There is an economic lesson here for WC to teach, about the government telling you to buy light bulbs because in the long run they will pay for themselves soon if the government boosts the cost per kilowatt hour.

    I know a guy in town, not a drug dealer, who has a supply of 100-, 80-, 75-, and 70- watt bulbs, and, assuming they will not cost $10,000 per gram or kilo, I am going to buy $50 worth, or thereabouts.

    My question is, does anybody running for congress think it would help them if they said, “Elect me and I will end this stupid thing we have done with light bulbs, and everyone will get a free chicken in the pot.”

  5. Harry says:

    Two points:

    One, Picketty is French and therefore disposes him toward the Kyoto accords and a system of worldwide carbon taxes. This is ad hominem, but in the debate he should reveal this conflict. (France has a lot of nuclear power, which would entitle them to a boatload of carbon credits.

    Second, don’t we already tax fossil fuels heavily already, and have not the Europeans done that for years?

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