Breaking Eggs

The editors of the New York Times are, apparently, four square behind a regressive tax on poor residents of Washington State:

Climate scientists and economists have long argued that the single best way to slow global warming is to put a price on greenhouse gas emissions from fossil fuels and raise that price over time, thus creating a sensible market incentive to reduce emissions and invest in cleaner energy sources. Carbon pricing was also high on the list of urgent recommendations of the United Nations Intergovernmental Panel on Climate Change, which warned in a major report this month that without swift action to control emissions the world will begin suffering global warming’s worst consequences — including, but not limited to, the displacement of millions of people by drought and sea-level rise — as early as 2040, much sooner than previously forecast.

It is thus encouraging that in this time of torpor and climate denial at the highest levels of the federal government, voters in the state of Washington will soon be given the chance to adopt, by initiative, a carbon pricing plan that would charge polluters like refineries a fee for emitting greenhouse gases. This would be what economists call a Pigovian tax, after the British economist Arthur Pigou. In this case, the fee would factor in the now unaccounted for costs of more frequent and intense hurricanes, wildfires, droughts and other natural disasters linked to climate change. In the words of George Frampton, a senior environmental adviser to Bill Clinton and co-founder of a group that favors carbon taxes, Partnership for Responsible Growth, it’s an overdue stab at “honestly pricing carbon,” which industry has until now been able to hurl into the atmosphere pretty much for free.

presumably on the grounds that you can’t make an omelet without breaking eggs. My question is why are the eggs that are broken always poor eggs?

As structured Washington’s tax is regressive. It will hardest on the poor in the form of higher energy bills.

The record of carbon taxes in reducing carbon emissions is mixed but its record in raising revenue is strong. On the emissions side their biggest effect has been to give European bureaucrats more opportunities for graft.

A better-structured plan would be one that was much, much higher and prebated the tax on a scale based on income. Such a plan would fall more heavily on the rich who, since carbon emissions increase geometrically with respect to income (relatively few of the poor have private jets or 10,000 sqft mansions), apparently need greater incentives to reduce their carbon emissions.