The moral inadequacy of carbon taxes

Imagine this:

Instead of backing a constitutional amendment to abolish slavery, President Lincoln proposes to tax ownership of human beings. "This will incentivize Southern landowners to shift to paid agricultural labor," he tells Congress. "Freeing the slaves outright would undermine much of our reunited country's economy."

Or this:

After Pearl Harbor, FDR proposes to tax new automobiles, thereby incentivizing car companies to produce tanks and aircraft for the war effort. "Ordering Chrysler, Ford and General Motors to cease automobile production would be undemocratic," he tells Congress. "And guaranteeing them a 10 percent profit, as some are suggesting, would add unnecessarily to the federal deficit."

Ridiculous? Of course. But not much more ridiculous than proposing a tax on carbon as the solution to climate change.

This column is not unaware that the climate policy wonks and the big green organizations think taxing carbon is a great idea. Or that the Nobel Prize in economics just went to Yale's William Nordhaus for making the case for it. Or that it has been enthusiastically embraced by the U.N. Intergovernmental Panel on Climate Climate, whose recent report gives us 12 years to get our act together.

So let's stipulate that a (very high) tax on carbon would be the most economically efficient way to achieve the necessary reduction in the amount of greenhouse gases being pumped into the atmosphere. And if the sole determinant of climate policy were economic efficiency, everything would be cool.

But it's not. Consider the politics.

In 2012, the Australian government put in place a cap-and-trade program (similar to a carbon tax) that significantly reduced greenhouse gas emissions by raising the price of carbon to $23 per metric ton. The following year, a new government bowed to public and industry pressure and did away with it.

In Washington State, where environmentalism is effectively the dominant religion, voters in the midterm elections soundly rejected a ballot measure that would have taxed oil refineries $15 per ton of carbon. In France, the yellow vest protests have forced the government to suspend a new fuel tax increase.

Yes, carbon taxes are in place in a number of places, but the rates are woefully inadequate to the task of keeping global warming under the new benchmark of 1.5 degrees Celsius above preindustrial levels. The fact of the matter is that in the real world, taxing carbon has done far less to curb greenhouse gas emissions than command-and-control policies such as mandatory mileage and fuel emissions standards.


The standard explanation is that people have a much stronger negative reaction to price increases on commodities that they purchase regularly, like gasoline and home heating fuel, than they do to the hidden costs that come with command and control—even when, as was the case in Australia, measures to compensate for the higher prices are put in place. WYSIWYG (What You See is What You Get) is the term for the psychology of this reaction, yet the wonky hope is that somehow people can be educated to understand that, even if they don't feel it in their bones, carbon taxes are the way to go.

But this misses the deeper point. Taxation—incentivizing good behavior by jacking up the price of bad—deals with a problem indirectly, at one step removed. For some bad behavior, like cigarette-smoking, that's ok. People are willing to put up with a tax that discourages them from a voluntary behavior they recognize as harmful to themselves and to society at large.

But where the bad behavior has led to a profound crisis, the indirect approach undermines urgency, making for cognitive dissonance: "You're telling me that we are creating a disaster and yet all you're proposing is to make it somewhat more expensive for us to keep doing what we're doing? You can't be serious!"

Nor is the dissonance merely cognitive. There's also what might be called moral dissonance—the sense that raising the price tag is morally incompatible with the gravity of the situation. And the greater the moral imperative, the greater the dissonance.

Why are we talking about economic efficiency when, as everyone from Pope Francis on down has made clear, climate change is causing the most harm to the world's most vulnerable?

As it is, we understand environmental protection as a moral obligation. We didn't incentivize, we mandated clean water and clean air, we banned chemicals that destroy the ozone, we required protection of endangered species. If climate change poses a greater threat than all of the above, how can we not be taking commensurate direct action—commanding a shift to green energy, undertaking a Manhattan Project on carbon sequestration, etc.—to combat it?


  1. I think the issue is part of the Authoritarian mindset–where bad behavior is punished as the ONLY way to bring about right behavior. Note how many people this country incarcerates.

    To get our planet stabilized it is going to take almost draconian measures–people don’t do what is in their best interest unless they get direct immediate benefits.

  2. Interesting that you are so offended of the (moral) authority of the church; yet you have no problem imposing your own brand of authoritarianism in the name of your religion – climate change.

  3. Churches demonstrate their lack of moral authority all the time. The list of immoral acts supported by churches would exceed the bandwidth here.

    Climate change is not a religion, like its denial. It is established scientific fact based on the weight of available evidence. It exists whether you choose to believe it or not.

  4. Poor people exist, AND rely on cheap fossil fuels to survive (and to keep their kids surviving!), whether liberals choose to believe it or not.

    Mr. Macron, with all his trendy Global Warming zealotry, lost sight of that fact. End Result: Paris wound up on Fire.

    So don’t be a Firebug. We all must acknowledge the reality that the Paris Agreement salesmen are pushing WAY too hard and too fast, as though low-income and fixed-income people don’t exist.

  5. So in response you attack research for alternative sources. Your concern is phony. You are moaning more about the profits of fossil fuel producers, not the poor.

    Mr Macron followed the conservative dogma of austerity and indifference for the poor, while giving away public resources to the wealthy.

    Stop being such an obvious shill to big oil. Reality makes a mockery of your denial here. Even the Paris Accord is really a half measure. Conservative opposition to it is both dishonest and venal.

  6. It exists whether you choose to believe or not…

  7. Not at all. The weight of the evidence and research demonstrates it. It’s telling that the majority of research against climate change is privately funded and outside of the usual methodological vetting system. Garbage shill work.

    Your denial is irrational, dishonest and self serving. All the hallmarks of religious belief.

  8. Nope. Don’t believe in God and you can’t prove he exists. Climate change is proven by the weight of evidence and research.

    You are just showing me your willingness to lie in support of a position which is irrational. Religious belief.

  9. There are plenty of scientists who state otherwise; plus every so often you hear about manipulated data to secure funding or to support an agenda.
    That being said, I’ll address the article in a new post.

  10. See, your passion in this area demonstrates it is your religion.

  11. You are inadvertently correct! . . . The Grand Old Delusion certainly does exist “whether you choose to believe or not.”

  12. That was stupid. The weight of the evidence is the weight of the evidence. Your need to lie about it and pretend it’s on par with your irrational belief is proof of how little rational support exists for your position.

  13. Not at all. The weight of the evidence means it is far more established and proven than the detractors

    As for data manipulation, the entire point if vetting methodology is to refute claims such as yours. The sheer volume of research, the peer review process and the amount of work built upon predecessors are there to counter such arguments.

    Your claim is empty garbage and conspiracy theory to cover for the lack of evidence to support your view. It is far easier to blurt out nonsense to dismiss research then it is to bother to understand how it’s done. There is no proof of anything to support what you are saying. Crackpots use it as a go to argument for science denial.

  14. I am so sick and tired of these behavior modification taxes/laws. What it does is penalize everyone but the rich who by default get to do what they please regardless setting up another have and have not dynamic. If they really want change something they can either do it by changing attitudes or use a rationing system where everyone feels the pinch.

  15. Parker the Church has no moral authority. Climate Change isn’t my religion it is simply a reality. What have I imposed on anyone?

  16. Passion doesn’t demonstrate a religion. Besides I certainly wouldn’t classify Spuddie as being “passionate” about climate change. He is simply honest and not afraid to face reality.

  17. Mandatory emissions standards and fuel economy standards are seen by the citizenry as immediately beneficial in other ways (cleaner air, paying less at the pump) and are fairly non-threatening as compared to, say, shutting down the fossil fuel economy by edict. If Australia, Washington state, and France did not have the political will to sustain carbon taxes, it is extremely hard to imagine that they or the U.S., China, Russia, India, and the OPEC countries will have the political will to shut down the fossil fuel industry by direct command and control. And if the situation is as dire as you believe, and if the analogies to Lincoln and FDR in wartime are valid, would you support a declaration of war or rebellion against countries that are undermining the campaign against carbon emissions?

  18. Hey, did I forget to remind you that Food Costs are directly tied to Fuel Costs? Your daily bread ain’t truckin’ itself to Wal-Mart, ya know.

    So the last thing the poor people need are a buncha Carbon-Taxing G-W Zealots trying to price the very food right outta their childrens’ mouths.

    The less-affluent families in your neighborhood need the cheap fossil fuels, to get up the same ladder you did. We honestly do NOT need a bunch of cull-the-herd Malthusians deciding to rip off the poor to pay for their G-W kool-aid Cult…..!

  19. Fuel costs which are artificially inflated due to lack of alternatives and active attacking of research of alternatives. You have a loser of an argument here with concern for what appears to be the interests of petroleum producers.

    Fossil fuels are a finite resource. Poor people are not going to benefit from increasing costs of fuel due to scarcity and wasteage. Your concern for them is phony here. Fossil fuels are cheap due to the government subsidizing the industry with corporate welfare. Corporate welfare which could be directed towards other sources.

    “do NOT need a bunch of cull-the-herd Malthusians deciding to rip off the poor to pay for their G-W kool-aid Cult…..!”

    That appears to be more your position. You are stumping for exploitation of the poor and direction of public resources away from long term policies.

    Science deniers like yourself never present a sane or honest argument in service of your position.

  20. Obviously expecting market solutions to destructive long term problems is not working at all. Your attitude is that we should reward corruption because it is difficult to combat. That is rather toxic to sane governance.

  21. The fact of the matter is the average person in the United States and around the world place global warming down on the list of things to be worried about. The problem is, climate change is the religion of the environmental nazis and global elite who attempt to change behavior through government oppression instead of capitalism and market behavior.
    Our current life styles and that of the world are based on the performance and dependability of fossil fuel‘s. Technology does not yet exist that can adequately replace fossil fuels with environmentally friendly fuel’s; after all, it takes 57 solar panels to generate enough energy for one lightbulb.
    Until battery technology improves to where by a vehicle can drive for a few days without recharging daily: electric cars are confined to the major cities. In addition, the people that live in flyover country need pick up trucks, SUVs, combines and harvesters that run on diesel fuel.
    One final issue is that the environmentalists are unwilling to compromise when it comes to nuclear energy; at least in the United States. Government regulation has all but prevented the building of any new nuclear facilities. The good socialists on this page want to be more like Europe; then why don’t we build nuclear reactors like Europe does? Nuclear power may not reduce all carbon emissions; but it would sure put a pretty good dent into the numbers.
    Finally, the good people of the United States are tired of the environmental hypocrites who want to over regulate our lives for the better meant of their political and religious beliefs; that is the environment and climate change. I’m tired of hearing Al Gore, Brad Pitt, Angelina Jolie, and all the other elite lecture the average American on their carbon footprint; when they live in $50 million mansions, fly private jets, and live a much more extravagant lifestyle than your average American. Your average American doesn’t have the luxury to worry about the environment; when they’re worried about paying their bills and saving for retirement.
    Speaking of the average American, why should they pay more in taxes, or bare additional burden to save the environment; when the Chinese and Indians produce more pollution then the United States and Europe combined?
    This is a long-term problem that will eventually be solved with technology. However, to the disappointment of the environmentalists that live today; it’s not going to happen in their lifetime or their children’s lifetime.

  22. I’m not a fan of punitive taxes. First of all, they usually don’t work. Raise cigarettes to $20 a pack and smokers will still smoke. Make gas $20 a gallon and drivers will still drive. They’ll bitch about it, but they’ll pay it.

    But, mostly, punitive taxes are really just a cheap way to generate revenue, which compromises whatever good intention might be ostensibly behind them. And taxes have a way of perpetuating themselves. Where I live, there’s a “temporary” turnpike toll that was supposed to have ended in 1972 when the highway was paid for. But did it? Of course not. It’s still going strong and has more than quadrupled since its inception.

    Cash cows don’t die as long as they keep producing milk. Government 101.

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