Barry Rabe and Christopher Borick have come out with a new paper on the politics of carbon pricing in the United States and Canada. They acknowledge the large body of work of economists that have largely concluded that carbon taxes are generally the best approach, for a number of reasons. Rabe and Borick's analysis suggests that although people would actually be willing to pay some sort of a "user fee" that scales with carbon dioxide emissions, they still do not accept the concept of a carbon tax. Whether that is because of the politics of climate change or the politics of energy taxation, they stop short of guessing, but they observe that despite the unfavorable politics of carbon taxation, people actually do pay a large variety of fees, charges, and taxes that are already embedded in fossil fuel extractions and transfers, that have the effect of a carbon tax. Moving forward, Rabe and Borick seem to be suggesting that various jurisdictions will "slouch" towards carbon taxation, essentially accomplishing by stealth what cannot be accomplished in an open political process.
I get quite cynical at times, and get discouraged about whether people deserve the democracy with which they have been endowed, and hard-won in the distant past. As a descriptive matter, Rabe and Borick may be right, but I still believe that the best way forward on pricing carbon is to be transparent. Among other benefits, a public discussion on carbon pricing and climate policy may not necessarily soar to rhetorical heights, but it will never be very good if governments do the right thing and then try to hide it from their constituents. Per my forthcoming book, I think the framing problem with carbon taxes can be overcome, and not just by renaming a carbon tax a "fee," a "charge," or something else. I think the problem that carbon taxes have, that it shares with other public finance problems, is a lack of a proper accounting in the costs and benefits of different policies. Start by making every climate policy ask what it will cost and what it will accomplish.
Monday, 22 August 2011
Wednesday, 10 August 2011
A Suggestion for the Deficit Supercommittee: Carbon Taxes
Introduce a carbon tax, but offset it with income tax decreases. Wouldn't that be something for Republicans to take back to their supposedly over-taxed constituents? Lower income taxes?
The six Republicans that will be on the "Deficit Supercommittee," the Joint Select Committee on Deficit Reduction, have been named -- three by House Speaker John Boehner (Reps. Fred Upton, Jeb Hensarling, and Dave Camp) and three by Senate Minority Leader Mitch McConnell (Sens. Rob Kyl, Rob Portman, and Patrick Toomey). They will join the three Democrats that have been named so far (Sens. John Kerry, Max Baucus, and co-chair Patty Murray). The committee is charged with presenting recommendations for cutting at least $1.5 trillion over ten years. If the committee cannot agree, or if Congress fails to adopt its recommendations, in their entirety (no amendments allowed), then a series of automatic "trigger cuts" will take place, imposing deep cuts to military spending (to supposedly incentivize Republican cooperation) and to nonmilitary programs, including Medicare (to supposedly incentivize Democratic cooperation). Many hands have already been wrung about how hopeless the task, and how the committee members named thus far do not inspire confidence. Politico has pointed out that all six have signed Grover Norquist's anti-tax pledge. New revenues would appear to be out of the question.
I can't solve the problem (I think it is a problem) of getting Republicans to agree to new revenues. I wish there were a way to persuade Republicans to abandon ethanol subsidies, subsidies for oil exploration, and the Bush tax cuts for the rich. But I don't see that happening. What I do see as a possibility is that revenues might be introduced in a new way -- carbon taxes -- that might be viewed as less offensive. The seeds of a possible compromise might involve a new carbon tax, coupled with further income tax reductions. The latter is certain to be a condition of accepting a carbon tax; if there are any Republicans that would accept a straight carbon tax, they are laying low for now. I am convinced that there are Republicans that accept the need for new revenues; they are just too shy to come out of the closet right now. If Tom Coburn can acknowledge the need for increased revenues from reducing what he calls "special giveaways," then there are many more out there who also feel the need to increase revenues. At any rate, I am accepting without agreeing that new revenues would have be offset by more tax cuts. In principal a revenue-neutral carbon tax -- one that recycles the proceeds so that no new net revenue is taken in -- should not be an affront to even Norquist, who at least in 2006 reportedly supported the idea of increasing gasoline tax in exchange for reducing other taxes. That should make the six Republicans feel a little freer of the bonds of their pledge to Norquist.
A carbon tax coupled with income tax cuts can nevertheless be surprisingly tricky to set up. Treasury won't know until tax returns are in and all carbon tax proceeds are processed, exactly how much of each was collected. In other words, there is no way to guarantee that carbon tax proceeds will be completely offset by income tax breaks. In fact, since there is no way of knowing the baseline counterfactual -- how much income tax proceeds would have been collected without tax breaks -- it is impossible to know if there will be a one-for-one offset.
But so what? What if the American public, the Supercommittee, and at least a majority of both chambers can accept a little uncertainty about revenues? That is going to be the case anyway, as income tax revenues are hard to predict ex ante in any case. The Supercommittee just has to agree, and get a majority of the House and Senate to agree, that in reasonable scenarios, the proceeds from a carbon tax would be about the same as the reduction in proceeds from a further tax cut. It could and should take into account that carbon tax proceeds would likely decline over time, as people and firms and the entire economy adjust to higher prices. Initially, carbon tax proceeds should be more than income tax reductions. Over a ten-year period, it would be reasonable to expect carbon tax proceeds to be greater than income tax reductions over the first five years, and the reverse to be true over the last five years.
One thing I don't know is whether Republicans could stand the United States not being an international pariah for inaction on climate change.
The six Republicans that will be on the "Deficit Supercommittee," the Joint Select Committee on Deficit Reduction, have been named -- three by House Speaker John Boehner (Reps. Fred Upton, Jeb Hensarling, and Dave Camp) and three by Senate Minority Leader Mitch McConnell (Sens. Rob Kyl, Rob Portman, and Patrick Toomey). They will join the three Democrats that have been named so far (Sens. John Kerry, Max Baucus, and co-chair Patty Murray). The committee is charged with presenting recommendations for cutting at least $1.5 trillion over ten years. If the committee cannot agree, or if Congress fails to adopt its recommendations, in their entirety (no amendments allowed), then a series of automatic "trigger cuts" will take place, imposing deep cuts to military spending (to supposedly incentivize Republican cooperation) and to nonmilitary programs, including Medicare (to supposedly incentivize Democratic cooperation). Many hands have already been wrung about how hopeless the task, and how the committee members named thus far do not inspire confidence. Politico has pointed out that all six have signed Grover Norquist's anti-tax pledge. New revenues would appear to be out of the question.
I can't solve the problem (I think it is a problem) of getting Republicans to agree to new revenues. I wish there were a way to persuade Republicans to abandon ethanol subsidies, subsidies for oil exploration, and the Bush tax cuts for the rich. But I don't see that happening. What I do see as a possibility is that revenues might be introduced in a new way -- carbon taxes -- that might be viewed as less offensive. The seeds of a possible compromise might involve a new carbon tax, coupled with further income tax reductions. The latter is certain to be a condition of accepting a carbon tax; if there are any Republicans that would accept a straight carbon tax, they are laying low for now. I am convinced that there are Republicans that accept the need for new revenues; they are just too shy to come out of the closet right now. If Tom Coburn can acknowledge the need for increased revenues from reducing what he calls "special giveaways," then there are many more out there who also feel the need to increase revenues. At any rate, I am accepting without agreeing that new revenues would have be offset by more tax cuts. In principal a revenue-neutral carbon tax -- one that recycles the proceeds so that no new net revenue is taken in -- should not be an affront to even Norquist, who at least in 2006 reportedly supported the idea of increasing gasoline tax in exchange for reducing other taxes. That should make the six Republicans feel a little freer of the bonds of their pledge to Norquist.
A carbon tax coupled with income tax cuts can nevertheless be surprisingly tricky to set up. Treasury won't know until tax returns are in and all carbon tax proceeds are processed, exactly how much of each was collected. In other words, there is no way to guarantee that carbon tax proceeds will be completely offset by income tax breaks. In fact, since there is no way of knowing the baseline counterfactual -- how much income tax proceeds would have been collected without tax breaks -- it is impossible to know if there will be a one-for-one offset.
But so what? What if the American public, the Supercommittee, and at least a majority of both chambers can accept a little uncertainty about revenues? That is going to be the case anyway, as income tax revenues are hard to predict ex ante in any case. The Supercommittee just has to agree, and get a majority of the House and Senate to agree, that in reasonable scenarios, the proceeds from a carbon tax would be about the same as the reduction in proceeds from a further tax cut. It could and should take into account that carbon tax proceeds would likely decline over time, as people and firms and the entire economy adjust to higher prices. Initially, carbon tax proceeds should be more than income tax reductions. Over a ten-year period, it would be reasonable to expect carbon tax proceeds to be greater than income tax reductions over the first five years, and the reverse to be true over the last five years.
One thing I don't know is whether Republicans could stand the United States not being an international pariah for inaction on climate change.
Monday, 8 August 2011
Why We Hate Consumption Taxes, Part II
Building on my last post on why the British Columbia provincial HST is in trouble, I wonder, even when some environmental regulation is accepted as being necessary, why environmental taxes are so disfavored. Among the federal political parties in Canada, we have the anomalous situation of the governing Conservative Party favoring some sort of a command-and-control approach to climate change regulation, while the last-century-liberalism NDP favors a cap-and-trade approach. Neither party is being honest, of course; the Prime Minister will hand out opaque sweetheart deals on a sector-by-sector basis, producing no emissions reductions, and stricken NDP leader Jack Layton promises that a cap-and-trade program will not raise energy prices which, of course, would therefore produce no emissions reductions. And the party that has championed a carbon tax, the Liberals, swooned to their lowest Parliamentary representation in recent history in the recent election.
Why is "tax" a dirty word? In my forthcoming book on carbon taxes, I argue that people harbor certain psychological biases in evaluating policy instruments. First, people have demonstrated a propensity to "do no harm" not only in their private lives, but in choosing policy instruments. The "do no harm" phenomenon, most thoroughly studied by Jonathan Baron, suggests that people prefer to allow more harm to occur by omission than they would permit to allow by an affirmative act or policy. So, for example, a Baron and Ilana Ritov study showed that there was a policy bias in favor of letting children die of the flu than for allowing children to die from a vaccination policy. How does this make taxes unpopular? I argue in my book that an environmental tax more obviously harms people than any other policy instrument. More than any other policy instrument, a voter can imagine and visualize somebody that would be harmed by an environmental tax -- it is often themselves that they can see being harmed by a tax! By contrast, a command-and-control-style regulation very effectively conceals from voters the true cost of regulation. People tend to harbor the illusion that imposition of a regulatory costs will stay where it is imposed, an illusion that Jack Layton either harbors himself or actively perpetuates for political gain.
Second, people also harbor an "identifiability bias" in favor of harming people that are less tangible, less noticeable, and less identifiable. George Loewenstein has most extensively studied this, finding that even a tiny increment of information -- the addition of an id number, without a name, face or any other identifying information -- tended to elicit more sympathy from research subjects than those without an id number. How does this cast a shadow over environmental taxes? Environmental taxes harm identifiable people, as opposed to other instruments, that harm unidentifiable people. Command-and-control, and even cap-and-trade, impose amorphous costs on people and firms that do not exist as clearly in most peoples' minds.
Finally, the famous endowment effect, pioneered by Daniel Kahneman, Jack Knetsch, and Richard Thaler, seemed to indicate that people had a much higher valuation for goods that they already had, as opposed to goods that they didn't have. Some economists have expressed this people having a higher willingness to accept than they have a willingness to pay, but from my perspective, I think it demonstrates that people have a status quo bias -- phraseology not original to me, but most useful for me purposes. And the connection to taxes? At bottom, the endowment effect is a reluctance to trade, and a tax, more than any other policy instrument -- signals a trade. The trade could well be a beneficial one, as many environmental taxes can be demonstrated to produce much more benefit than cost, but it is a trade nonetheless, and people don't like trading away from their current situation. Again, what is so glaringly obvious about an environmental tax is that improving the environmental will cost. The fact that the cost is less than the benefit is a calculation that is a second-order calculation that is dominated by the fact of the cost.
Why is "tax" a dirty word? In my forthcoming book on carbon taxes, I argue that people harbor certain psychological biases in evaluating policy instruments. First, people have demonstrated a propensity to "do no harm" not only in their private lives, but in choosing policy instruments. The "do no harm" phenomenon, most thoroughly studied by Jonathan Baron, suggests that people prefer to allow more harm to occur by omission than they would permit to allow by an affirmative act or policy. So, for example, a Baron and Ilana Ritov study showed that there was a policy bias in favor of letting children die of the flu than for allowing children to die from a vaccination policy. How does this make taxes unpopular? I argue in my book that an environmental tax more obviously harms people than any other policy instrument. More than any other policy instrument, a voter can imagine and visualize somebody that would be harmed by an environmental tax -- it is often themselves that they can see being harmed by a tax! By contrast, a command-and-control-style regulation very effectively conceals from voters the true cost of regulation. People tend to harbor the illusion that imposition of a regulatory costs will stay where it is imposed, an illusion that Jack Layton either harbors himself or actively perpetuates for political gain.
Second, people also harbor an "identifiability bias" in favor of harming people that are less tangible, less noticeable, and less identifiable. George Loewenstein has most extensively studied this, finding that even a tiny increment of information -- the addition of an id number, without a name, face or any other identifying information -- tended to elicit more sympathy from research subjects than those without an id number. How does this cast a shadow over environmental taxes? Environmental taxes harm identifiable people, as opposed to other instruments, that harm unidentifiable people. Command-and-control, and even cap-and-trade, impose amorphous costs on people and firms that do not exist as clearly in most peoples' minds.
Finally, the famous endowment effect, pioneered by Daniel Kahneman, Jack Knetsch, and Richard Thaler, seemed to indicate that people had a much higher valuation for goods that they already had, as opposed to goods that they didn't have. Some economists have expressed this people having a higher willingness to accept than they have a willingness to pay, but from my perspective, I think it demonstrates that people have a status quo bias -- phraseology not original to me, but most useful for me purposes. And the connection to taxes? At bottom, the endowment effect is a reluctance to trade, and a tax, more than any other policy instrument -- signals a trade. The trade could well be a beneficial one, as many environmental taxes can be demonstrated to produce much more benefit than cost, but it is a trade nonetheless, and people don't like trading away from their current situation. Again, what is so glaringly obvious about an environmental tax is that improving the environmental will cost. The fact that the cost is less than the benefit is a calculation that is a second-order calculation that is dominated by the fact of the cost.
Monday, 25 July 2011
The HST in trouble: why do we hate consumption taxes?
In British Columbia, a referendum is being held on the Harmonized Sales Tax, or HST, which has boosted the effective sales tax on most goods and services in the province. The previous system of a Provincial Sales Tax (PST) and a federal Goods and Services Tax (GST) was a bit confusing, but lower.
There has been considerable grumbling about the way that the BC HST came to be, and in fact led to the resignation of Premier Gordon Campbell. But process concerns aside, most of the unhappiness over the HST is really about unhappiness with higher taxes. The next sentence might ordinarily be, "of course, nobody likes higher taxes." But why? Would taxpayers really prefer, for example, to see their government default rather than pay higher taxes? In the case of the absurd stubbornness of the Tea Party Republicans in the US, how many rich people -- say, households with more than $250,000 in gross income -- would actually object to higher taxes from repeal of the Bush tax cuts? Certainly, they be better off paying higher taxes than having their federal government default. But, I suppose, Tea Party activists would reply that the alternative is not default, but reduced spending.
But do we really want reduced spending? Do Americans know that the decades-old Reading is Fundamental literacy program, government spending that has leveraged private support, and costs the American taxpayer a measly $25 million per year, has been thrown under the bus? Are we really so adamant about getting rid of such government "waste"?
This is British Columbia, of course, and probably the childish theatrics of Washington DC do not extrapolate well to Victoria, BC. But undoubtedly the same anti-tax sentiment cuts across both Americans and British Columbians, and in both cases, cuts across political party lines. Much of the HST-bashing has been at the behest of the left BCNDP, as opposed to the right Tea Party. But there is a populism in both cases that plays to what I think is a pathology about taxes.
Public opinion polls generally ask voters to make false choices, like choosing between higher taxes and lower taxes. Because polls intrude upon the private time of respondents, the nuances of public policy choices are omitted, so the condition of lower taxes -- less government programs -- is omitted. And taxes are the most conspicuous targets of opportunistic politicians, because it is so easy to conceal the tradeoffs of paying taxes. Ask yourself this: if it was put to American voters whether they would be willing to pay 8 cents per year to continue Reading is Fundamental, would most Americans vote for it? Of course they would. Everybody loves programs, and everybody hates taxes.
The question I have for opponents of the HST is this: what exactly would you propose to make up for the lower government revenue? Would it be higher income taxes, or less government programs? And tax whom higher, or cut which government programs? Be specific. See? It's not simple, is it?
There has been considerable grumbling about the way that the BC HST came to be, and in fact led to the resignation of Premier Gordon Campbell. But process concerns aside, most of the unhappiness over the HST is really about unhappiness with higher taxes. The next sentence might ordinarily be, "of course, nobody likes higher taxes." But why? Would taxpayers really prefer, for example, to see their government default rather than pay higher taxes? In the case of the absurd stubbornness of the Tea Party Republicans in the US, how many rich people -- say, households with more than $250,000 in gross income -- would actually object to higher taxes from repeal of the Bush tax cuts? Certainly, they be better off paying higher taxes than having their federal government default. But, I suppose, Tea Party activists would reply that the alternative is not default, but reduced spending.
But do we really want reduced spending? Do Americans know that the decades-old Reading is Fundamental literacy program, government spending that has leveraged private support, and costs the American taxpayer a measly $25 million per year, has been thrown under the bus? Are we really so adamant about getting rid of such government "waste"?
This is British Columbia, of course, and probably the childish theatrics of Washington DC do not extrapolate well to Victoria, BC. But undoubtedly the same anti-tax sentiment cuts across both Americans and British Columbians, and in both cases, cuts across political party lines. Much of the HST-bashing has been at the behest of the left BCNDP, as opposed to the right Tea Party. But there is a populism in both cases that plays to what I think is a pathology about taxes.
Public opinion polls generally ask voters to make false choices, like choosing between higher taxes and lower taxes. Because polls intrude upon the private time of respondents, the nuances of public policy choices are omitted, so the condition of lower taxes -- less government programs -- is omitted. And taxes are the most conspicuous targets of opportunistic politicians, because it is so easy to conceal the tradeoffs of paying taxes. Ask yourself this: if it was put to American voters whether they would be willing to pay 8 cents per year to continue Reading is Fundamental, would most Americans vote for it? Of course they would. Everybody loves programs, and everybody hates taxes.
The question I have for opponents of the HST is this: what exactly would you propose to make up for the lower government revenue? Would it be higher income taxes, or less government programs? And tax whom higher, or cut which government programs? Be specific. See? It's not simple, is it?
Friday, 22 July 2011
What do Tony Abbott and Carole James have in common?
Who?!
Residents of my home province of British Columbia remember Carole James as the former leader of the British Columbia New Democratic Party, the opposition party now for over a decade. Her scowling, smug demeanor is believed widely enough to be a reason for the BCNDP's failure to return to power that she was ousted recently on favor of Adrian Dix. Of course, it could also just be the refusal of the feel-too-much-think-too-little BCNDP to grow up that has kept it from governing. It was Carole James at the helm of the BCNDP during which then-Premier (that's Canadian for "Governor") Gordon Campbell instituted the controversial BC carbon tax. Back to that in a moment.
Tony Abbott is the leader of Australia's opposition, the main threat to the government currently headed by Prime Minister Julia Gillard. The fact that his firebrand, feel-too-much-think-too-little conservatism makes him an implausible leader for Australia has given Gillard the political room to institute a carbon tax. It is true that Gillard needed to do something anyway because her Labour Party governs only with the cooperation of Australia's Green Party, and they have demanded that Gillard do something about climate change.
So the two major non-European carbon tax proposals of the last several years have been instituted when the opposition is weak. Notice also that in one case the opposition has been too far left -- the BCNDP -- and in the other case the opposition has been too far right -- Tony Abbott and his knaves.
Perhaps there is a correlation between extremism and opposition to carbon taxes. After all, conservative Canadian Prime Minister Stephen Harper and Canadian NDP leader Jack Layton have ganged up on Liberal party leaders that have proposed a federal carbon tax. Looks like centrism and pragmatism are so last decade in Canada.
Residents of my home province of British Columbia remember Carole James as the former leader of the British Columbia New Democratic Party, the opposition party now for over a decade. Her scowling, smug demeanor is believed widely enough to be a reason for the BCNDP's failure to return to power that she was ousted recently on favor of Adrian Dix. Of course, it could also just be the refusal of the feel-too-much-think-too-little BCNDP to grow up that has kept it from governing. It was Carole James at the helm of the BCNDP during which then-Premier (that's Canadian for "Governor") Gordon Campbell instituted the controversial BC carbon tax. Back to that in a moment.
Tony Abbott is the leader of Australia's opposition, the main threat to the government currently headed by Prime Minister Julia Gillard. The fact that his firebrand, feel-too-much-think-too-little conservatism makes him an implausible leader for Australia has given Gillard the political room to institute a carbon tax. It is true that Gillard needed to do something anyway because her Labour Party governs only with the cooperation of Australia's Green Party, and they have demanded that Gillard do something about climate change.
So the two major non-European carbon tax proposals of the last several years have been instituted when the opposition is weak. Notice also that in one case the opposition has been too far left -- the BCNDP -- and in the other case the opposition has been too far right -- Tony Abbott and his knaves.
Perhaps there is a correlation between extremism and opposition to carbon taxes. After all, conservative Canadian Prime Minister Stephen Harper and Canadian NDP leader Jack Layton have ganged up on Liberal party leaders that have proposed a federal carbon tax. Looks like centrism and pragmatism are so last decade in Canada.
Wednesday, 20 July 2011
American Electric Power IS the canary in the coal mine..
Used to an industry, coal mining, in which canaries were exploited for their sensitivity to dangerous air, it might be a little ironic to suggest that American Electric Power has become the canary in the most gaseous, noxious, and foul environment of all: climate debate.
Last week AEP announced it will abandon plans to capture carbon dioxide emitted from its relatively new (31 year-old) Mountaineer coal-fired power plant in West Virginia. Having already sunk $100 million private dollars into the CCS project, and expecting $334m more federal dollars, it was a surprise, and yet it wasn't a surprise that AEP backed off. The reason is that it gave up on a childish Congress coming up with any climate plan to price carbon, which CCS needs desperately to be economical.
AEP CEO Michael Morris, originally a lawyer, is one of the most forward-thinking power chiefs in the world. To turn around the biggest carbon dioxide-emitting firm in the world and make it approach the next century as if it will be a carbon-limited one, is like turning an aircraft carrier around on a dime. For the head of the company that could absorb the largest cost of all from carbon pricing to call for carbon pricing, is not just forward-thinking, it is, incredibly, the right thing. A puerile Congress could use someone like Morris.
Last week AEP announced it will abandon plans to capture carbon dioxide emitted from its relatively new (31 year-old) Mountaineer coal-fired power plant in West Virginia. Having already sunk $100 million private dollars into the CCS project, and expecting $334m more federal dollars, it was a surprise, and yet it wasn't a surprise that AEP backed off. The reason is that it gave up on a childish Congress coming up with any climate plan to price carbon, which CCS needs desperately to be economical.
AEP CEO Michael Morris, originally a lawyer, is one of the most forward-thinking power chiefs in the world. To turn around the biggest carbon dioxide-emitting firm in the world and make it approach the next century as if it will be a carbon-limited one, is like turning an aircraft carrier around on a dime. For the head of the company that could absorb the largest cost of all from carbon pricing to call for carbon pricing, is not just forward-thinking, it is, incredibly, the right thing. A puerile Congress could use someone like Morris.
Sunday, 10 July 2011
Australia's carbon tax -- go get 'em, Julia, we're right behind you....
Is it possible to feel sorry for a prime minister who, by most accounts, stabbed her colleague Kevin Rudd in the back to get her job? Well, yes, if you have a soft spot for anyone outside of Europe who proposes a carbon tax, which she has. The fact that she has run out of almost all other political options does detract a bit from the political courage of posting a carbon tax. She, after all, has promised the Green Party something on climate change, and cap-and-trade has already died a Kerry-Lieberman death in Australia.
Australia's A$23 per ton carbon tax is expected to generate about A$28 billion in revenue, about A$9 billion of which has already been earmarked for high-emitting and trade-exposed such as aluminum smelting, steel, and pulpmaking. Coal mining companies will get about A$1.3 billion. The tax level, already higher than historical trading prices in the European Union Emissions Trading System, is planned to rise by 2.5 percent per year, plus inflation, and switch into a cap-and-trade program in 2015 (I guess nobody is talking about that because too much can happen before then).
The volcanic politics of carbon taxes always makes for great politico-watching. A group called the Energy Collective reports that 8000 in Sydney and 10,000 people in Melbourne rallied in favour of the carbon tax, which is more than opposition leader Tony Abbott can claim. Actually, the world should thank Tony Abbott for being such an implausible leader, which is needed for Julia Gillard's move. Sound familiar? It was the then-nonexistence of a British Columbia NDP that gave then-Premier Gordon Campbell the room to maneuver to put in the BC carbon tax. Doesn't that tell us something? That children at both the extreme left and right have opposed the two significant carbon tax programs in the last three years.
Good luck, Julia. We're right behind you....
Australia's A$23 per ton carbon tax is expected to generate about A$28 billion in revenue, about A$9 billion of which has already been earmarked for high-emitting and trade-exposed such as aluminum smelting, steel, and pulpmaking. Coal mining companies will get about A$1.3 billion. The tax level, already higher than historical trading prices in the European Union Emissions Trading System, is planned to rise by 2.5 percent per year, plus inflation, and switch into a cap-and-trade program in 2015 (I guess nobody is talking about that because too much can happen before then).
The volcanic politics of carbon taxes always makes for great politico-watching. A group called the Energy Collective reports that 8000 in Sydney and 10,000 people in Melbourne rallied in favour of the carbon tax, which is more than opposition leader Tony Abbott can claim. Actually, the world should thank Tony Abbott for being such an implausible leader, which is needed for Julia Gillard's move. Sound familiar? It was the then-nonexistence of a British Columbia NDP that gave then-Premier Gordon Campbell the room to maneuver to put in the BC carbon tax. Doesn't that tell us something? That children at both the extreme left and right have opposed the two significant carbon tax programs in the last three years.
Good luck, Julia. We're right behind you....
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| NO!!! |
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| YES!!! |
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