A good question on Friday from a student at Westminster College:
If revenue-neutral carbon taxes are such a great idea, why has only British Columbia adopted this policy?
I gave what I thought was a decent answer in class, but wanted to put some more thoughts down in writing:
1) People prefer the devil they know to the devil they don’t. ...
2) People don’t (yet) accept that climate change is a serious problem. ...
3) Economists think about the world differently than “normal people”. ...
4) There will be winners and losers. ...
Go read the Standupeconomist.com to get the details.
Me? I think that carbon taxes are a great way to raise government revenue too (especially with a large and growing government debt). So, why hasn't anyone adopted this idea? As far as I can tell there are no good reasons. Here are some bad reasons:
- Because people like to spend borrowed money
- Because people would rather not repay borrowed money
- Some politicians have convinced the public that a tax is a bad thing
- Some politicians have convinced the public that everyone other than oneself is on the government dole and those government benefits should be cut
