Commentary: The Weak Foundation for a Carbon Tax

The late writer, Marty Rubin, once observed, “unlike wine, a bad idea does not improve with age.” That is certainly true with the carbon tax. Not only does it not improve, it is like a zombie that keeps coming back from the dead.

A former Administrator of the Energy Information Administration, Jay Hakes, has just written an article, How to Pass a Carbon Tax, arguing that the way to make a carbon tax politically acceptable is by focusing on all of the good things that can be done with the revenue instead of negatives of a tax. As a general principal, he is right. It is always better to discuss the benefits that can be produced with a new tax. However, the foundation on which he makes his case is too weak to support it.

First, with good reason, most Americans do not trust politicians to do what they say, especially when it comes to taxes. Were that not the case, the national debt would not be so large and there would not be so much anger among the electorate, which explains the popularity of both Bernie Sanders and Donald Trump.

Second, the premise for a carbon tax is that carbon dioxide (CO2) is harmful. How do we know that? Climate advocates, not science tell us so. What do we know with certainty about CO2? It is a nutrient that is essential for the growth of crops, plants, and trees. Satellite photos show that as it has increased in the atmosphere, the planet has been greening. We know that it is a greenhouse gas but its warming potential is not linear, which means that each incremental addition to the atmosphere has less of a warming effect than the preceding increment. That is a reason to challenge apocalyptic predictions about the future. We also know that over the course of the earth’s history, there have been times when CO2 levels have been higher as well as times when temperatures have been higher as well. But, our climate history does not show a correlation between the two. As an aside, although NOAA proclaimed 2015 to be the warmest year on record, it wasn’t. Last year’s average temperature was 54.4 degrees F. In 1934, it was 54.9. So much for honest reporting!

The final reason why the case for a carbon tax is so weak has to do with its implementation. Politicians have an insatiable appetite for spending. A carbon tax is a revenue generating machine in the hands of spending addicts. In 2013, the George C. Marshall Institute published a report, A Skeptical Look at the Carbon Tax, which explained in detail why a carbon tax would not work and would not be a simple tax that substituted for more regressive taxes. It stated that the carbon tax “is supported by a Bootleggers and Baptists coalition of environmentalists, corporate profiteers, and government dependents which will shape its provisions in ways that … accentuate its harmful side. … Judging from past experiences, the carbon tax will not substitute for other taxes or improve their efficiency, nor will it be implemented without political favoritism.”

At a time when we have either the party of big government or bigger government, it takes a suspension of disbelief to believe that a carbon tax would not be a tool for more social engineering by central planning bureaucrats.