# Can a Carbon Tax Solve Man-Made Global Warming?

## In theory carbon taxes are a good idea. But the practical reality is a different story.

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To get at this question, University of Sussex economist Richard Tol has calculated what he evocatively calls the Leviathan carbon tax. Tol defines his Leviathan tax as the maximum carbon tax that is budget-neutral—that is, all other taxes are reduced to zero and replaced by a carbon tax. The Leviathan tax takes into account the carbon intensity of each country, meaning the amount of carbon dioxide generated by every dollar of growth in the economy. He finds that Nigeria and Liberia could finance their entire government budgets with a \$1 per ton carbon tax. Any more than that would funnel more revenues into government coffers and grow the size of their governments relative to their private sectors.

Tol uses World Bank tax data that excludes taxes that directly finance social security programs to determine the percent of GDP paid in tax revenues to the U.S. government. Tol calculates that a tax of \$223 per ton of carbon dioxide could replace all revenues derived from U.S. income and corporate taxes. To replace all tax revenues, China would have to levy a carbon dioxide tax of \$29 per ton; India \$45; Germany \$267; Japan \$450; and the United Kingdom \$855 per ton. In each case, collecting more violates revenue neutrality and increases government tax revenues.

Tol then calculated what level a globally harmonized carbon tax would have to reach to limit greenhouse gas atmospheric concentrations (now 390 parts per million) to 650 ppm carbon dioxide equivalent (CO2e), 550 ppm CO2e, and 450 ppm CO2e. The IPCC argues that it will be necessary to keep greenhouse atmospheric concentrations below 450 ppm in order to have at least a 50-50 chance of keeping the increase in global average temperature below 2.0 degrees Celsius. According to Tol’s calculations, that implies a global \$149 per ton carbon tax imposed beginning in 2015.

Imposing such a steep carbon in tax in countries like China, India, Russia, and Indonesia would dramatically increase the percentage of their GDP that flows into government coffers, which, in turn, would greatly enlarge their governments. On the other hand, if those nations did not collect a \$149 per ton tax, it would mean that other countries would have raise their taxes in order to keep greenhouse gas concentrations below the 450 ppm threshold. By the way, Tol calculates that a \$149 per ton tax could replace two-thirds of current federal income tax revenues in the United States.

Assuming that man-made climate change is imposing damage and costs on third parties, there is a strong libertarian case they should be compensated. However, the preferred Coasean policy of establishing and allocating property rights and then allowing negotiations over proper compensation is impractical. If a carbon tax is to be the next best alternative to a property rights regime for mitigating harms caused to third parties by future climate change, it should be revenue neutral and globally harmonized.

History reveals that the prospect of government fiscal restraint in the presence of new revenue streams is not promising. For example, Thomas Pyle, the president of the Institute of Energy Research, has pointed out that the top rate of the new U.S. income tax in 1913 started out at 7 percent, but under pressure of World War I reached 77 percent by 1918. In addition, Tol’s Leviathan Tax analysis suggests that it is unlikely that a globally harmonized carbon tax is achievable. One counter-argument is that if the U.S. and other developed nations were to adopt a high carbon tax this could spur more rapid technological development of cheaper no-carbon and low-carbon energy technologies that poorer countries could then adopt to leapfrog over further burning of coal, natural gas, and oil.

In 1988, Coase argued, “The fact that governmental intervention also has its costs makes it very likely that most ‘externalities’ should be allowed to continue if the value of production is to be maximized.” Considering how well governments afflicted by political conflicts of interest, chronic corruption, and inherent incompetence can be expected to execute a carbon tax, global warming is likely just such an externality.

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• ||

"Ronald Bailey on Whether a Carbon Tax Can Solve Man-Made Global Warming"

How much longer will my pet rock hold the evil wizards at bay?

• Pudgeboy||

Your basic assumption is wrong. There is no 'balance of evidence' that climate change is caused by humans. Are you really that gullible?

• tarran||

According to the leaked drafts of the latest IPCC omnibus report, it's worse than we thought even though the rate of temperature change (amounting to 0 degrees over the last decade) is lower than their best case scenarios!

Oh, and apparently when Greenpeace produces a PR flyer designed to scare people into giving it money, that's a peer reviewed paper.

If they weren't responsible for so much human misery, this millennial cult would be more pathetically amusing than the two teenage janitors in Monsters Inc.

• Unusual Dave||

I had a thought while reading this article. What if we were go along with these folks. I mean, what if we could mold the carbon tax into something along the lines of the fair tax?

We could propose a constitutional convention to modify the 16th amendment to make sure the tax remained revenue neutral.

Couldn't everyone conceivably win?

• ||

I'm satisfied by the evidence that some of the climate change we've seen is caused by humans. Perhaps on the order of 1/3. It does not necessarily follow that

omg the governments should do somethingz!!!

• Russell||

• ||

"Your basic assumption is wrong. There is no 'balance of evidence' that climate change is caused by humans. Are you really that gullible?"

Bailey is sensible on most issues so I am gonna give him the benefit of doubt and say yes, yes he is.

• allen||

Indeed. In fact, the phrase "balance of (scientific) evidence" has no value in determining scientific validity. It really smacks much more of a legalistic formulation.

If AGW proponents were really interested in the science, as opposed to their current attempted utilization of the credibility of science as a cudgel with which to silence their opponents, the *hypothesis* that human action results in global warming would still be awaiting verification via a falsifiable experimental/observational prediction.

It's the lack of any such verification that results in the emphasis on peer-review and consensus. If you don't have the evidence what's left but to try to turn the entire issue into a popularity contest?

It's unfortunate Mr. Bailey has chosen to accept the validity of AGW and the more so since the popularity of AGW is everywhere, except in the regulatory offices of government and the Congressional Progressive Caucus, sagging.

• mtrueman||

The greenhouse effect has been well understood for some 150 years. CO2 and other gases trap heat in the atmosphere. In a single year the USA releases some 5 billion tonnes of CO2 into the atmosphere. Doesn't seem like much of a stretch to assume that all the countries dumping CO2 year after year would have some cumulative effect on the climate.

Science will never be able to definitively tell us what the near or distant future holds in store for us. Science deals with the observable, repeatable and the measurable. The climate some 50 years hence fails all three requirements. Finally, science is not going to provide the answers we seek.

My concern over the proposed tax is that there are no good substitutes for fossil fuels. A kilogramme of gasoline contains 13,000 watt hours of energy. The best batteries we have today store about 300 watt hours per kilogramme. Even if people were incentivised to turn away from fossil fuel, there isn't a suitable alternative for them to turn to.

• tarran||

This is utter tripe. If a tax is supposed to compensate people for externalities, then all the money collected should be distributed among the people who are harmed.

The government has just as much claim on it as I do: none at all.

Oh wait, that's right! The tax isn't about compensation: they can't ID victims! It's to act as a disincentive to energy production! So that the amount of carbon put into the atmosphere is reduced by the magic amount to keep temperatures pinned at 1973 levels (that magical time when everything was perfect!)! Ok, hod do they set the tax to act as the thermostat control? And why the fuck would revenue neutrality play into it?

Essentially, this is a new tax that ossifies the economy, acts as a wealth transfer from the productive to the parasitic political classes and does nothing to solve a problem that probably does not exist.

• Ron Bailey||

t: The roundabout idea is that the tax would prevent harm to third parties by discouraging people from engaging the deleterious action, e.g., burning fossil fuels that produce global warming. Again, it is admittedly roundabout.

• DesigNate||

It's not just roundabout Ron, that's outright impossible.

• Trident||

Yes!!!

Let's use the aggressive force of the state to curb "bad behavior".

Why didn't anyone else think of this?

The guys at Reason truly are indispensable for the libertarian cause.

• KM||

I every AGW believer would simply hang out their clothes to dry and go to bed when it got dark (or at least turned off their electron-gobbling appliances) their 'crisis' would have been solved a generation ago. But no...they want me to pay for their inability to conserve.

• the origin of the feces||

Their ignorance is unbearable, yet, it's their endless hypocrisy that pushes sane men over the edge.

• Libertarius||

There is no dichotomy between theory and practice; carbon taxes are a failure in both counts.

It's a pathetic excuse for giving the government more money. It's a bureaucrat saying, "Hey I didn't do anything to contribute to pollution, so I will collect punitive fees from those who do."

Predictably, it would make energy unaffordable for many people and result in even more pollution. Bastiat's "seen and unseen" applies here. The left doesn't realize that they are setting themselves up to be the most hated and rejected people of the future; once the brainwashing and media bias *finally* wears off, the people will see that 100 years of "progress" has led them to poverty and rotted their society from the inside out.

• Nowsane||

Yes, there is really no evidence of AGW that would justify such a tax. The earth has had several timeframes in which CO2 has been at higher levels than it is today. Besides, there are several other potential reasons for our current environment, rather than AGW, like the Pacific Decadal Oscillation, which drives things like El Niños and La Niñas.

• the origin of the feces||

Hey, science has no place in this. AGW is a religion. Please try to stay on topic.

• Buzz B||

The PDO went negative in 2007, yet 2010 was the warmest on record. It fails the correlation test. And it has nothing to do with the ENSO cycle.

• cthorm||

There are 2 ways to avoid climate change: geoengineering and competitive non-carbon energy production. Geoengineering is extremely unappealing on its face, at least in my sane opinion. Competitive non-carbon energy can only be achieved through advanced nuclear power. Carbon taxes aren't workable. Natural gas can reduce CO2 emissions, but only as long as its displacing coal.

• ||

Wrong and wrong again. If CO2 had the heat-retaining abilities touted by alarmists and also consisted of more than 1/32 of the natural contribution of CO2 to the atmosphere, nuclear might provide a "solution" to this "problem". The problem is that it simply doesn't. This is why DOE reports on "greenhouse gas" emissions regularly omit H20 from their lists.

• Death Rock and Skull||

"Carbon" is "bad", so taxing it and giving the money to government makes things right?

• the origin of the feces||

Things can never be right until finally you wake up and admit to the fact that you are in no way qualified to be making decisions of any kind.

• ||

The balance of the scientific evidence currently bears this out

These words you keep using.. "balance", "evidence"...

• Tman||

"Considering how well governments afflicted by political conflicts of interest, chronic corruption, and inherent incompetence can be expected to execute a carbon tax, global warming is likely just such an externality."

So to clarify Ron, are you saying you no longer support a Carbon Tax?

I think you've been clear about your thoughts concerning AGW, but normally you were promoting the Carbon Tax as the only answer, which seems borderline insane coming from a Libertarian. Have you decided that the "political conflicts of interest, chronic corruption, and inherent incompetence" inherent with a Carbon Tax would create more problems than it would solve?

• Ron Bailey||

T: Thinking hard about it. Still, if "something must be done" then the "something" of a carbon tax may be the least bad of the "somethings that must be done."

• Torontonian||

And we're already doing that just fine.

• the origin of the feces||

It obvious that you are the intelligent and logical one.

Mr. Bailey, clean out your desk, you've been replaced.

• T o n y||

Presumably we can use whatever tools at our disposal in the process of adapting to the new environment... just not government, the tool we use to mobilize resources on a large scale.

Natural selection never stops. Not using all the tools at our disposal is a good indicator that we're destined to be selected out.

• DesigNate||

\$

• Tman||

I'm still surprised that you have such confidence in a solution made necessary by the "something must be done" mentality.

When I look at how fracking has done more to lower carbon emissions than any tax or externality-based "restriction" it's clear to me that the "something must be done" crowd not only does NOT have the answer, but more likely has a solution that will exacerbate current problems or even create new ones that will be ten times worse.

• TheZeitgeist||

When I look at how fracking has done more to lower carbon emissions...

Exactly. United States has carbon footprint right around where we were circa Kyoto Protocol. No thanks to electric cars, hybrid cars, windmills, ethanol, or solar. Natural gas makes money making energy, it saves consumers money, it does not come from somewhere-Arabia and its combustion products are organic as breath exhaled.

This makes natural gas a horrible thing to heat-cycle machine haters, which is what Warmers really are. They want to banish sprawl, have us all ride trains and live in imitations of New York, any cars left having sex appeal of birth control, because its 'better' to their cultural sense. They hate any Carnot cycle dynamo, yet wallow in techno-luxuries such affords. They are hypocrites fooling themselves.

That makes CH4 a threat. So, sure enough, methane starts turning Evil in the Clowns' sacred video-game-oracle-sims. Fracking somehow becomes a bigger gangrape on Gaia than seam and strip mining, Matt Damon making a shitty movie pitching in. Anything to make one of the most fundamental and common organic molecules in the universe a Boogeyman.

That is insane, and that is a cult - The Church of Carbon Clowntology - starring Al Gore as their Hubbard-shyster-sellout.

Always beware the prophet that profits Carbon Clowns, you've been had.

• Torontonian||

My single biggest problem with any carbon tax proposal is that governments would be the recipients. (There are certainly other problems to be dealt with.)

I would have less issue if the tax were collected and pooled globally (instead of nationally) and 100% of the proceeds paid out as per capita dividends directly to 7 billion individual humans. (Yes, I said there would be other problems... namely logistics.)

Anyway, cutting out governments eliminates any issues of poor countries or rich countries, large countries or small countries... forget about countries and think about individuals.

• Homple||

So, we give the government a few more billions of our earnings and it will control the weather?

Are the Underpants Gnomes part of this plan?

• Raston Bot||

carbon taxes would ideally displace top-down command-and-control regulations such as the Environmental Protection Agency’s new rules on electric power plant emissions and subsidies to wind, solar, and bioethanol energy production.

Ideally, yes. Realistically, they would supplement them.

• TheZeitgeist||

The United States cannot is not the big carbon kid anymore. The BRIC dumps more CO2 than the United States does these days, a multiple of the USA's output actually, and thirty years ago they were not half.

So, no matter what you believe about global warming, the USA "tackling climate change" on its own is laughable, no matter the approach (carbon taxes, carbo-credits, whatever).

That reality makes places like California, itself a rounding error in China's carbon statistics, trying "carbon mitigation" schemes, taxes, blah-blah that much more stunningly stupid. If California shit nothing out smokestacks but rainbows, starting tomorrow, it would not matter carbon-wise.

• Death Rock and Skull||

"In Adler's view, the people who benefit from producing, selling, and buying products and services that emit carbon dioxide should similarly be held liable for the damages caused to their neighbors as a consequence of emissions-induced temperature increases. Such damages might include flooding from rising sea levels and more intense rain events or crop losses due to changes in rain and temperature regimes."

This reasoning is just constipated straining to get to a conclusion. It is too far removed from the common law property rights referred to. Those liable for damage should be clearly identifiable, and if not then the damage should be considered a natural risk of owning property.

• ||

Those liable for damage should be clearly identifiable, and if not then the damage should be considered a natural risk of owning property.

Exactly. It is not impractical to solve this problem by relying upon property rights, it's just inconvenient to those who suppose at the outset that a rights violation has occurred, but can't show how it has occurred to a sufficient standard of any conception of property rights.

"One way to address the regressive distributional consequences is a tax-and-dividend proposal in which every American receives an equal share of the carbon taxes collected that is deposited each month in their bank accounts."

The tax and dividend proposal is the proper way to compensate people for externalities. This is a special case of a tax and dividend scheme for compensating the general public for the use of any natural resource.

This is what is missing in most libertarians view of property - the insights of Thomas Paine in the Agrarian Justice.

• Libertarius||

It's an excuse for giving money to the government under the pretense of collective mooching. Shut up.

"While this idea addresses the concern about the regressive nature of carbon taxes, it lessens the incentives that offset taxes would provide for increased work and investment. "

Why should the government be artificially increasing incentives for work and investment?

It should do justice by those inflicting and experiencing externalities.

• T o n y||

Soooo... what would you do? Obviously not the most libertarian-friendly option. So, nothing?

• Libertarius||

If it were spring I would take my ZR1 out on 29 and, from a dead stop and in third gear, mash the pedal and take it to 150 without shifting, roaring so loudly through those corners that I hope a pussycrat can hear me from ten miles away.

• Libertarius||

Render unto Gaia.

• Sevo||

Ron Bailey| 1.16.13 @ 5:40PM |#
"t: The roundabout idea is that the tax would prevent harm to third parties by discouraging people from engaging the deleterious action, e.g., burning fossil fuels that produce global warming. Again, it is admittedly roundabout."

Ron, if the tax is actually revenue-neutral, then some peoples taxes will be reduced when this tax is implemented.
So in some cases, the tax will penalize use and in other cases the reduction in other taxes will make the result opposite of the intent.

• Babrfb||

Will someone please explain how the data and methodology on climate change can produce any sort of causality?

1. Even with core samples, we don't have the entire data set. To model any data set based on less than 1% of all data would be flawed.

2. Assuming all of the data were available, what does it mean? The temperature measured where? Temperature varies across the globe, so could an average increase be meaningful?

3. If the data were complete and meaningful, how could you possibly hold ceteris paribus? How could you rule out other factors? After all, the earth has cooled and warmed before without man's involvement. Could the warming be due to the earth's relative position to the sun? Could the sun be putting out more energy than before? Could the earth's tilt have changed? How do you control for these things?

4. If you can establish definitive correlation between "green house" gases and temperature, how would you rule out reverse causality? Could it be that higher temperatures cause more green house gases? How would you prove otherwise?

I believe that the entire argument has fundamental data and methodology problems. As Milton Friedman once suggested, you can judge a field by the validity of its models, and climate science (and main stream economics for that matter) has very poor models.

• The Derider||

Austrian economics rejects modeling and mathematical analysis. You have no dea what you are talking about.

http://mises.org/journals/qjae/pdf/qjae3_2_3.pdf

• ||

Since Milton Friedman wasn't an Austrian and the OP didn't mention Austrian economics, it kinda sounds like you're actually the one who doesn't know what you're about. Or perhaps more accurately, you've invented a partner to argue with. Undoubtedly not the first time you've had to make up a friend. I'll let you guys get back to it.

• The Derider||

Friedman was a mainstream economist.

Here are the non-mainstream economic schools of thought.
http://en.wikipedia.org/wiki/Heterodox_economics

• Sevo||

• DesigNate||

Those are all questions REAL scientist would be asking to double and triple check what the AGW scientist have "concluded". But for shitheads like Tony and joe, science is only about consensus.

• The Derider||

Plus Ronald Bailey, and all the actual scientists.

• The Derider||

Ron do you blame yourself at all for the steadfast anti-science views that too many on the right hold on global warming?

Part of the reason solutions are more difficult and expensive now is that you, and people like you, were calling global warming bullshit for decades.

• Libertarius||

That's not even a nice try, numbnuts; quite the opposite. It is global warming bullshitters who have been telling us for decades that the earth was going to be a desert rock by now, so obviously we should adopt communism to save the world.

In the 1960's, the original global warming advocates admitted openly, in writing, that the purpose of their alarmism was to use it to smuggle the country into communism. They never thought it would go this far (if they did, they would have kept their mouths shut about what they were doing).

It is a disgusting crime that no so-called "journalist" has really bothered to dig into the roots of where all this shit came from. It's a mantra that we're all supposed to chant, but I say fuck you, and your whims do not = "science".

• ||

+100

I think it was at the first climate summit in 1975 when they did that. If you have evidence that they did it on other earlier occasions please let me know. I want it.

• The Derider||

There were no global warming advocates in the 60's. The term didn't even exist until 1975.

Do you have any proof for your paranoid conspiracy theory?

• Sevo||

The Derider| 1.16.13 @ 7:44PM |#
"Ron do you blame yourself at all for the steadfast anti-science views that too many on the right hold on global warming?"

Deidiot, do you blame yourself for all the single-digit IQs in the world?
If not, you should.

• ||

Assuming that man-made climate change is imposing damage and costs on third parties...

But then why would we assume that? If the climate science showing a causal chain from increased carbon dioxide emissions to specific climate events is up to snuff, there would be no reason to make this assumption - we could simply rely on the accuracy of the climate models to tell us what specific climate events could be causally chained to carbon emissions generally, if not to particular producers, and settle the liabilities through property rights as we normally would. The only thing that makes a property rights system impractical in dealing with climate liability is the fact that you can't prove it. That's a weakness alright, but not one of property rights and individual liability. Your premise is faulty.

• Kroneborge||

The world is full of uncertainty, that doesn't mean actions can't be taken to reduce risk.

• Sevo||

Kroneborge| 1.17.13 @ 3:37PM |#
"The world is full of uncertainty, that doesn't mean actions can't be taken to reduce risk."

Yes, pulling guns on people because you're worried is such a good idea!

• TomG||

Why not go to the source? The IPCC reports (ipcc.ch) cover in detail the costs and benefits of various actions. The conclusion of the last report was that the cost of action and the cost of inaction probably about balance. That's coming from the people who are arguing for action.

The argument gets worse once you take into account opportunity costs and and the risks associated with everything being a false alarm or the climate changing anyway even if we stop emitting.

Also, keep in mind that Europe is directly or indirectly responsible for most of the carbon in the atmosphere now, both through the industrial revolution and through massive deforestation. Yet Europe only wants to take current emissions into account, placing a disproportionate burden on the US.

• TomG||

I think another point bears pointing out: there is simply no way to stabilize carbon emissions through energy savings; most industrial processes require a minimum amount of energy, and energy being expensive, are not that far from that minimum. The only way to stabilize carbon emissions is either to actually consume less and less per person (negative growth, lowering the standard of living), or to switch to nuclear.

The first choice is not realistic given that politicians are booted if the positive growth they deliver isn't large enough. So that leaves switching to nuclear, either breeder reactors or Thorium. Switching to nuclear is a great option, but it doesn't require a carbon tax, it just requires governments to stop interfering with the deployment of nuclear power plants.

• The Derider||

First, there obviously need to be some regulations around nuclear power. Should your neighbor have the right to install a reactor in his back yard? There are inherent risks to nuclear fission, but those risks are lower than for continued fossil fuel production. If fossil fueled power plants had to pay the full cost of their emissions, the way that nuclear power pays for their risk by complying with safety regulations, nuclear would immediately be more competitive than coal oil and gas in spite of the regulations it faces.

The best possible thing that could happen for the nuclear industry would be carbon taxes.

• Sevo||

The Derider| 1.17.13 @ 8:22PM |#
"First, there obviously need to be some regulations around nuclear power. Should your neighbor have the right to install a reactor in his back yard?"

Absent any issues, yes, idiot.

• Training Semarang||

success for you all.

PELATIHAN SEMARANG

• Kroneborge||

Whether climate change turns out to be real or not, a carbon tax is still the right move. It's much better to tax carbon than labor. Also, you are mitigating the risk of climate change (note I said risk, not certainty)

• The Derider||

I completely agree.

• Sevo||

The Derider| 1.17.13 @ 8:14PM |#
"I completely agree."

You're an idiot, so who cares.

• Sevo||

Kroneborge| 1.17.13 @ 3:35PM |#
"Whether climate change turns out to be real or not, a carbon tax is still the right move. It's much better to tax carbon than labor. Also, you are mitigating the risk of climate change (note I said risk, not certainty)"

I'm glad *you're* willing to tax based on a possibility.
I'd be willing to tax your income at, oh 90%, on the possibility it might help something.
OK by you?

• ygsrf||

2013 Happy New Year,NFL,NBA,fashion kickoff for u

• dshell6154@aol.com||

"Climate activists are linking this to man-made global warming, ignoring the fact that the area covered in the NCDC reports, the contiguous United States (excluding Alaska), comprises only 2 percent of the Earth’s surface. Trends that may manifest in the United States in no way indicate global phenomena. In fact, the United Kingdom’s Meteorological Office has said that there has been no global warming for 16 years and this week announced that temperatures are expected to stay relatively stable for another five years."

http://www.washingtontimes.com.....z2I3ikdTIB

• Buzz B||

This analysis breaks down when it just stops on the Q of whether other nations would impose a carbon tax. A domestic carbon tax would be accompanied by a border tax adjustment on energy-intensive imports from nations that do not put a price on carbon. This is the economic pressure on the Chinas of the world to impose their own carbon tax (or otherwise put a price on carbon). If they do not (possible), the the EUs of the world will collect the BTA from Chinese importers. A rational self-interested actor like China would rather collect the revenue itself than allow the EU to collect such revenue. The consumer nations of the world possess a significant as-yet-unused leverage over exporting nations like China to economically incentivize them to put a price on carbon. It looked like this article was going to get there, and I commend it for as far as it went, but it stopped short of completing the thought.

• Snarkonin||

One Tax to rule them all, One Tax to fine them, One Tax to bring them all and in the darkness bind them.

• Miner49er||

It seems there is more and more muttering about carbpn taxes amongst beltway and big-State solons. Is the author in favor or opposed to a carbon tax?

• Miner49er||

It seems there is more and more muttering about carbon taxes amongst beltway and big-State solons. Is the author in favor or opposed to a carbon tax? Where is the editorial policy if Reason magazine headed, anyhow?

Carbon dioxide emissions are just one of many factors of production. Why put an artificially high price on CO2 emissions,and let other externalities go untaxed? What about the risk exposure to nuclear transition materials with a half-life of 50,000 years? Fukushima radioactive elements have already been detected in American food supplies.

Nuclear power is already highly subsidized, as is so-called "renewable energy". In fact, subsidies, taxes, regulations and other state mandates have made it virtually impossible to value assets or make investment decisions.

When the likely demand or price for a commodity cannot be known with any confidence, or when the cost of capital, or the rates at which a stream of income will be taxed are unknown, the economy seizes up--becomes constipated.

If the external costs of CO2 emissions were material, its effects would be quite evident by now. But they're not. The Leviathan State may be able to get away with taxing, or regulating, or spending, but not all three. The State should limit itself to those essential things that the private market cannot do:
1. Defend the borders,
2. Enforce contracts,
3. Build and maintain essential infrastructure, and
4. Maintain civil order.
Any other functions are superfluous.

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