Did Someone Say 'Carbon Tax?'
Source: Forbes, Robert Hahn and Peter Passell (5/23/11)
"A carbon tax would raise revenue, perhaps a lot of revenue."
Irwin Stelzer, an economist and conservative intellectual who isn't inclined to suffer fools, suggests a carbon tax could help reduce the deficit and enhance national security, even as it stimulates economic growth.
Quite so—in a well-argued policy piece written for the Hudson Institute, Stelzer says the GOP should get over it. We agree, though he may have overstated the virtues of taxing carbon emissions. For starters, a carbon tax wouldn't do much to address foreign oil dependence. No conceivable carbon tax would add more than $1 to the price of a gallon, and that's not nearly enough to induce the sort of conservation needed to get us off the Mideast hook.
Second, we are concerned (as we're sure Stelzer is) that a carbon tax would be sliced and diced to accommodate a zillion interests.
Still, the idea of a carbon tax has a lot going for it. The tax would raise revenue—perhaps a lot of revenue—that could be used to offset other, less-efficient taxes (like the payroll and corporate income taxes) or to reduce the budget deficit. It would harness market forces to the task of transitioning to carbon-saving technologies, and it would restore American leadership in what eventually must be a global effort to cope with climate change.
Someday, politicians will cease their petty ways and build a bipartisan consensus in which tax policy is used to solve big social problems at minimum cost. Or maybe not—but it's nice to dream.