Brad DeLong argues for taxing the rich to deal with climate change

Grasping reality ...

An SUV going ten miles in the city and burning a gallon of gasoline pumps about 3 kilograms--6.5 pounds--of carbon in the form of carbon dioxide into the atmosphere. Should the extra tax on this--and on all carbon emissions--appropriate for global warming be on the order of five cents a gallon, fifty cents a gallon, or a dollar fifty a gallon? Our views will change as we learn more, but at the moment whether the tax should be five or fifty cents a gallon hinges on a question of moral philosophy: how much do we believe that we owe our distant descendents?

And, of course, the first comment always is about the political inpracticality of energy taxes. 

Serenity Now!

Comments

[Eric H]

To be more accurate, you could say, simply, "Brad DeLong argues for taxing the rich." Climate change is simply the cause du jour.

And the proposal undermines the Pigouvian argument by divorcing the tax from the activity.

[John Whitehead]

Eric,

You're right. I think the rationale for the tax is correcting negative externalities, not a question of moral philosophy. Although, these might be observationally equivalent.

[Brad DeLong]

Can Eric Read? The tax is not divorced from the harmful activity. The tax is on the harmful activity.

[Charles Young]

Thanks for drawing attention to Brad's excellent post, and, via it, to John Quiggin's thoughtful article on discounting. There has been too much half-baked economics in the debate, leaping from the valid idea that discounting is the correct way to appraise investment projects to the invalid idea that past generations' welfare matters more than that of future generations - i.e. that a discount rate should be applied to welfare. I'm glad that my previous attempts to argue the other side on this site have had support from such articulate and eminent sources.

[John Whitehead]

Brad,

My objection was based on the magnitude of the tax. At this blog we have to think that we can get a handle on the amount of the tax. So, the magnitude matters in terms of correcting negative externalities.

[Eric H]

Actually, I can read. Unfortunately, I only read the title of this post. Thus, I apologize and retract the last statement of my first comment.

[Scott D]

Since you want to tax fuel at a higher rate are you also prepared to pay more for basically everything you purchase? See SUV's are not the only vehicles that burn fuel at a higher rate than a Honda car. You will also be raising the transport aka freight charges that are passed on to the comsumer by freight companies who ship every product you use by either semi truck or train. why not worry more about why the government is not pushing for more solar or wind generated power instead of letting utilities build more nuclear and coal fired plants which produce far more polution than a 1000 suv's?