Network News

X My Profile
View More Activity

Will our fiscal crisis save the planet?

Donald Marron thinks that the likeliest path to a carbon tax -- or a cap-and-trade program -- is as a fix to our budget woes:

Perhaps the environmental community should make common cause with the budget worrywarts. In principle, a carbon tax is a powerful two-birds-with-one-stone policy: it cuts carbon emissions and raises money to finance the government. (This is equally true of a cap-and-trade approach in which the government auctions allowances and keeps the proceeds.) Perhaps there’s a future 60-vote coalition that would favor those outcomes even if various energy interests would be opposed?

Such a coalition is unthinkable today. Opposition to energy taxes runs deep, as Senator Graham experienced. But fiscal concerns will continue to grow in coming years, and spending reductions may not be enough to get rising debts under control. If so, maybe we’ll see a day in which a partnership of the greens and the green eyeshades will take a stab at a carbon tax.

I think there's something to this. If you grant that new taxes are inevitable over the next 20 years, then it makes sense for greens to try to get budget hawks to embrace a carbon tax rather than a VAT.

By Ezra Klein  | October 11, 2010; 3:36 PM ET
Categories:  Climate Change  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Greg Mankiw's tax bill
Next: Column: Where to find the next Facebook

Comments

I think it continues to make sense for greens to push for a cap-and-dividend or tax-and-dividend that pays back directly to the people most of not all of the revenues. Skimming 10 or 20% for deficit reduction might be alright, though that's a slippery slope (but then, what isn't?) toward undermining the progressive value of and achievable popular support for a carbon policy.

Posted by: JonathanTE | October 11, 2010 3:59 PM | Report abuse

The question is, are these taxes inevitable? Is it inevitable that Washington will return to sanity? Was it ever sane to begin with?

Posted by: will12 | October 11, 2010 4:17 PM | Report abuse

There may be some useful suggestions in a Time Magazine/CNN piece today (http://www.time.com/time/politics/article/0,8599,2024718,00.html).

Posted by: rmgregory | October 11, 2010 4:25 PM | Report abuse

"it makes sense for greens to try to get budget hawks to embrace a carbon tax rather than a VAT"

Not going to happen. What you need is support from some Republicans. But Republicans have chosen a) to take lots of money from energy-producers, b) to deny the existence of the climate-change problem, and c) to oppose all taxes. The Republican party has absolutely no "budget hawks" - the budget deficit is spending minus revenue, but they want much less revenue and basically the same spending (once you've taken Social Security, Medicare, and defense out of consideration, as their rhetoric does, the prospect of sufficient cuts elsewhere is impossible).

I'm afraid the only hope on the climate-change front is for technical advances which improve the outlook in spite of poor government policy. Luckily, the prospect for such advances is quite bright, not least because other nations with smarter policies have given them a boost (e.g. with feed-in tariffs for solar power).

Posted by: richardcownie | October 11, 2010 4:27 PM | Report abuse

Ezra is assuming the budget hawks really care about the deficits, and are not just using hawkery to beat down any programs that benefit the lower classes not the rich as all good policies should.

Assuming California defeats Prop 23 and continues on its more efficient use of energy and more renewables path, it will show the competitive value of lower energy costs and cleaner alternatives. Already forward-thinking businesses elsewhere are also realizing the savings of efficiency and alternatives.

We won't make much if any significant progress though until there are more visible consequences, like an ice-free Arctic in the summer, more severe storms and more high temps that people can't wish away with denialism.

Posted by: Mimikatz | October 11, 2010 4:40 PM | Report abuse

While I don't support either, there's more of a chance of a carbon tax than a VAT tax, and a carbon tax can at least by avoided by increased efficiencies in energy usage by orders of magnitude, while there would be no avoiding a VAT tax, and thus no avoiding getting up out of business by a VAT tax, if you happen to me (as so many are) a low-margin business.

But I think increasing taxes on business, or business processes, is not the way to go, unless you want to put a drag on the economy in tough economic times, and people just aren't as worried about eco-alarmism as eco-alarmist want them to be, and they pretty much won't be, until it's 125° outside.

I'm still for a more progressive tax on the rich, that taxes folks in very small increments moving upwards, but not stopping, so that people making $10,000,000 a year (including actors and athletes) pay a little bit more in taxes than someone making $8,000,000 a year. But . . .by all means. Find a way to tax business in a sluggish economy. While you're at it, why don't we just find a way to punish companies for hiring people?

Posted by: Kevin_Willis | October 11, 2010 5:05 PM | Report abuse

I've always thought any energy bill should be titled something like "The Deficit Reduction and American Energy Independence Act of 20XX." No mention of global warming.
Nothing green. Just deficit reduction and freeing ourselves from foreign oil.

Posted by: juliecon | October 11, 2010 5:16 PM | Report abuse

The environmental charges recently levied on air travel in Germany are being used for general fiscal purposes, not for specifically environmental projects.

Posted by: gagkk | October 11, 2010 6:03 PM | Report abuse

There is no reason for that to be inevitable unless the government stays in the Medicaid business.

Posted by: krazen1211 | October 11, 2010 6:54 PM | Report abuse

As the virtues of a carbon tax versus life tax (VAT) are debated, it seems that venerable reports regarding wanton election fraud (http://www.washingtonpost.com/wp-dyn/content/article/2008/10/28/AR2008102803413.html) are more important. When Mr. Popcorn (and his friends) are contributing an election, there should be an investigation...

Posted by: rmgregory | October 11, 2010 7:40 PM | Report abuse

here's an interesting blast from the past, including a bit on the environment as property, with emissions fees etc providing a good share of future government revenues. http://www.pkarchive.org/theory/backwrd2.html

Posted by: gagkk | October 11, 2010 9:09 PM | Report abuse

Chesapeake sold their oil and gas leases in Texas to China. Guess we don't need that oil and gas in the U.S. Do you think they were big foreign contributors to the Republicans or the Chamber of Commerce? Oh that's right, the Supreme Court (right wing) said they don't have to open their books. If we sell secrets it's treason. What is it when you sell the government like the GOP is doing? What is it when they sell our natural resources?

Posted by: littledog | October 12, 2010 10:46 AM | Report abuse

Chesapeake sold their oil and gas leases in Texas to China. Guess we don't need that oil and gas in the U.S. Do you think they were big foreign contributors to the Republicans or the Chamber of Commerce? Oh that's right, the Supreme Court (right wing) said they don't have to open their books. If we sell secrets it's treason. What is it when you sell the government like the GOP is doing? What is it when they sell our natural resources?

Posted by: littledog | October 12, 2010 10:47 AM | Report abuse

Ezra simply thinks the rich have too much, and they should be forced to share it, which is done by taxing the rich and running the proceeds through the federal money shrinker. He believes the rich not only have enough money already, but that the rich think the only way for them to have enough is to keep much of the population as poor as can be. The incentive the so-called rich have is actually to have as many people as possible to be successful. But the Obama administration both needs their success even as it bemoans the wealthy people earning more than $250,000. At $250,000 in Idaho, particularly if you own your house, I will call you wealthy. At $250,000 in Nort Jersey with property taxes of $15,000 a year, income tax approaching another $15,000 a year, a $4,000 monthly mortgage and a kid or two in college, I see something else. I see a real taxpayer getting no help from the government who is footing his own bills and the government waste that is killing us. I see someone who is living paycheck to paycheck.

Ira, why don't you go do something useful like get some more education so you can enlighten us even more?

Posted by: buggerianpaisley1 | October 12, 2010 12:51 PM | Report abuse

Post a Comment

We encourage users to analyze, comment on and even challenge washingtonpost.com's articles, blogs, reviews and multimedia features.

User reviews and comments that include profanity or personal attacks or other inappropriate comments or material will be removed from the site. Additionally, entries that are unsigned or contain "signatures" by someone other than the actual author will be removed. Finally, we will take steps to block users who violate any of our posting standards, terms of use or privacy policies or any other policies governing this site. Please review the full rules governing commentaries and discussions.




characters remaining

 
 
RSS Feed
Subscribe to The Post

© 2010 The Washington Post Company