Professional Documents
Culture Documents
Status quo
Inherency........................................................................................................................................................
Energy policy inevitable.................................................................................................................................
Solvency
Generic solvency............................................................................................................................................
Regulations solvency......................................................................................................................................
Carbon taxes better than CAF......................................................................................................................
Economy solvency..........................................................................................................................................
Oil solvency....................................................................................................................................................
Global modeling.............................................................................................................................................
Taxes good......................................................................................................................................................
Price volatility carbon tax solves.................................................................................................................
Price volatility economy..............................................................................................................................
Cap-and-trade comparisons
Cap-and-trade price volatility......................................................................................................................
Cap-and-trade competitiveness...................................................................................................................
Cap-and-trade - wealth transfer......................................................................................................................
Carbon tax solvency > Cap-and-trade............................................................................................................
Cap-and-trade corruption.............................................................................................................................
Advantages
Competitiveness
Competitiveness addon...................................................................................................................................
Warming
Warming is real...............................................................................................................................................
Warming Africa module..............................................................................................................................
China
China addon....................................................................................................................................................
China soft landing........................................................................................................................................
China model.................................................................................................................................................
China free trade...........................................................................................................................................
China social unrest......................................................................................................................................
China deforestation/biodiversity.................................................................................................................
Soft power
Soft power addon............................................................................................................................................
Soft power uniqueness....................................................................................................................................
Environmental leadership links......................................................................................................................
Generic soft power links...............................................................................................................................
Answers
A2: States CP................................................................................................................................................
A2: Backstopping.........................................................................................................................................
A2: Oil prices high.......................................................................................................................................
A2: Economy DA.........................................................................................................................................
A2: Counterplans..........................................................................................................................................
Make no mistake, climate legislation is coming, though almost certainly not until a new presidential
administration takes office. Climate change will be the subject of loud political debate on Capitol Hill this summer when the
Senate considers Americas Climate Security Act also known as Lieberman-Warner. But this will only be a dress rehearsal; few
are under any illusion that final climate law will emerge from this initial exercise. In less than a year , however, this situation
could easily be reversed. The new president will likely be a game-changing force, as all three top presidential
contenders have committed themselves to tackling global warming. Also decisive might be the new movement of
US governors who are publicly demanding a state-federal partnership to proactively address climate and energy issues. These
demands were aired last month when 18 states signed such a declaration, issued at the Governors Conference on Climate Change at
Yale University. The states record of fostering groundbreaking environmental policies that ultimately evolve into national law is
well established. State innovation was, for example, at the heart of the battle against acid rain. State laws served as models for the
federal Clean Air Act, Clean Water Act, and legislation creating Superfund sites. In addition to the cap-and-trade program
that will be launched in September by the ten Eastern states in the Regional Greenhouse Gas Initiative (RGGI), two other
regional groupings of states are working to establish carbon trading the Western Climate Initiative and the
Midwestern Governors Association. They have rolled up their sleeves, convened key stakeholders, and are hammering out the actual
details of how to establish and implement an effective cap-and-trade mechanism. This is wisdom that would go a long
way in Washington as lawmakers debate Lieberman-Warner, which would create a national cap-and-trade
program.
comprehensive: they include more detailed representations of the ocean, land-surface, sea-ice, sulphate
and non-sulphate aerosols, the carbon cycle, vegetation dynamics, and atmospheric chemistry, and at finer
spatial resolution.10 Recent understanding of how sea surface temperature affects the characteristics of tropical storms and
cyclones, and how ocean subsurface temperatures, thermocline depths and thicknesses affect activity of the El Nio Southern
Oscillation (ENSO) cycle, tropical cyclone intensification, and landfall prediction will further enrich modelling capacity. Today's
models have been well validated against the recorded data from past decades. Climate model projections ,
driven by anticipated future greenhouse gas and aerosol emissions, indicate that Earth will continue to
warm, with associated increases in sea level and extreme weather events . Modelling cannot be an exact science.
There is debate about humankind's future trajectories for greenhouse gas emission. There are residual uncertainties about the
sensitivity of the climate system to future atmospheric changes. The range in the forecast increase in world average temperature
(14?58C) by 2100 indicates both uncertainty about future greenhouse gas emissions and marginal differences in design of the
several leading global climate models (UK, Germany, USA, etc). The spatial pattern of projected temperature and particularly
rainfall changes also differ between models. Hence, estimates of climate changes over coming decades are indicative rather than
predictive.1 Note also that the uncertainty is symmetrical: underestimation of future climate change is as likely as overestimation.
Longer term, the probability of exceeding critical thresholds-causing step-changes in climate, environment
planet uninhabitable. The stark warning comes from scientists who are working on the final draft of a new report by the
Intergovernmental Panel on Climate Change (IPCC). The report, due to be published this week, will draw together the work of
thousands of scientists from around the world who have been studying changes in the world's climate and predicting how they might
accelerate. They conclude that unless mankind rapidly stabilises greenhouse gas emissions and starts reducing
them, it will have little chance of keeping global warming within manageable limits. The results could
include the destruction of the Amazon rainforest and the Great Barrier Reef, the forced migration of
hundreds of millions of people from equatorial regions, and the loss of vast tracts of land under rising
seas as the ice caps melt. In Europe the summers could become unbearably hot, especially in southern countries such as
Greece, Spain and Italy, while Britain and northern Europe would face summer droughts and wet, stormy winters. "The next 10
years are crucial," said Richard Betts, leader of a research team at the Met Office's Hadley Centre for climate prediction. "In that
decade we have to achieve serious reductions in carbon emissions. After that time the task becomes very much harder." Among
the scientists' biggest fears is that rising temperatures and levels of greenhouse gases could soon
overwhelm the natural systems that normally keep their levels in check . About half the 24 billion tons of carbon
dioxide generated by human activities each year are absorbed by forests and oceans -a process without which the world might
already be several degrees warmer. But as CO2 levels rise and soils dry, microbes can start breaking down accumulated organic
matter, so forests become net producers of greenhouse gases. The sea's power to absorb CO2 also falls sharply as it warms. The
latest research suggests the threshold for such disastrous changes will come when CO2 levels reach 550
parts per million (ppm), roughly double their natural levels. This is predicted to happen around 2040-50. "At the moment the
real impact of our emissions is buffered because CO2 is absorbed by natural systems. However, if we reach this threshold they could
be magnified instead," said Betts. "It means we must start the action needed to reduce greenhouse gas emissions in the next few
years." His warnings were backed up by Dr Malte Meinshausen, a researcher at the Potsdam Institute for Climate Impact Research
in Germany. He has used computer modelling to work out what might happen if greenhouse gas emissions were cut immediately, in
10 years' time or later. His results showed that immediate action might allow mankind to hold CO2 levels at 450ppm -well below
the 550ppm danger level. However, Meinshausen and his colleagues recognise that this is unrealistic because the world's
governments are in such disarray over global warming. The best hope, they say, is that a global plan will emerge in the next few
years, most likely from the renegotiations of the Kyoto treaty on reducing emissions. "We have to make sure carbon emissions peak
no later than 2015 and then fall at around 3% a year. If we let them keep rising after that date it becomes much harder to bring them
under control," said Meinshausen. His views were echoed by Dr Carol Turley of Plymouth Marine Laboratories who has been
studying how rising CO2 levels are acidifying the ocean. When the gas dissolves in water it creates carbonic
acid. "Rising acidity makes it much harder for marine organisms to build shells," she said. Turley, like the other
scientists, has contributed to the IPCC report but all commented this weekend on the basis of already-published research. " If we
do not take action in the next decade, by 2100 swathes of the ocean could have been stripped of creatures from
plankton to coral reefs," she said. "Such changes would devastate ecosystems and fisheries."
is a matter of hard, cold scientific fact supported by numerous studies conducted by many respected
scientists.7~ In the overwhelming majority they agree: Earths atmosphere has far too much of what we now must
think of as carbon die-oxide. It is warming our planet to the point where life, human life, is endangered .
We are going to have to do something decisive and effective about this killer. No matter how successful or enlightened we think
ourselves to be, we are not exempt from the need to actin the same way that we are not exempt from the need to breathe.
emerge, while old diseases mutate and adapt. Throughout history, there have been epidemics during
which human immunity has broken down on an epic scale. An infectious agent believed to have been the plague
bacterium killed an estimated 20 million people over a four-year period in the fourteenth century, including nearly one-quarter of
Western Europe's population at the time. Since its recognized appearance in 1981, some 20 variations of the HIVvirus have infected
an estimated 29.4 million worldwide, with 1.5 million people currently dying of aids each year. Malaria, tuberculosis, and choleraonce thought to be under control-are now making a comeback. As we enter the twenty-first century , changing conditions have
enhanced the potential for widespread contagion. The rapid growth rate of the total world population, the
unprecedented freedom of movement across international borders, and scientific advances that expand the
capability for the deliberate manipulation of pathogens are all cause for worry that the problem might be greater in
the future than it has ever been in the past. The threat of infectious pathogens is not just an issue of public
now? The prime reason is the world's survival. Like all animal life, humans live off of other species. At
some point, the number of species could decline to the point at which the ecosystem fails, and then
humans also would become extinct. No one knows how many [*171] species the world needs to support human life, and to
find out -- by allowing certain species to become extinct -- would not be sound policy. In addition to food, species
offer many direct and indirect benefits to mankind. n68 2. Ecological Value. -- Ecological value is the value that species have in
maintaining the environment. Pest, n69 erosion, and flood control are prime benefits certain species provide to man. Plants and
animals also provide additional ecological services -- pollution control, n70 oxygen production, sewage treatment, and
biodegradation. n71 3. Scientific and Utilitarian Value. -- Scientific value is the use of species for research into the physical
processes of the world. n72 Without plants and animals, a large portion of basic scientific research would be impossible. Utilitarian
value is the direct utility humans draw from plants and animals. n73 Only a fraction of the [*172] earth's species have been
examined, and mankind may someday desperately need the species that it is exterminating today. To accept that the snail darter,
harelip sucker, or Dismal Swamp southeastern shrew n74 could save mankind may be difficult for some. Many, if not most, species
are useless to man in a direct utilitarian sense. Nonetheless, they may be critical in an indirect role, because their extirpations could
affect a directly useful species negatively. In a closely interconnected ecosystem, the loss of a species affects other species
dependent on it. n75 Moreover, as the number of species decline, the effect of each new extinction on the remaining species
increases dramatically. n76 4. Biological Diversity. -- The main premise of species preservation is that diversity is better than
simplicity. n77 As the current mass extinction has progressed, the world's biological diversity generally has decreased. This trend
occurs within ecosystems by reducing the number of species, and within species by reducing the number of individuals. Both trends
carry serious future implications. Biologically diverse ecosystems are characterized by a large number of
specialist species, filling narrow ecological niches. These ecosystems inherently are more stable than less
diverse systems. "The more complex the ecosystem, the more successfully it can resist a stress . . . . [l]ike a
net, in which each knot is connected to others by several strands, such a fabric can resist collapse better than a simple, unbranched
circle of threads -- which if cut anywhere breaks down as a whole." n79 By causing widespread extinctions, humans have
artificially simplified many ecosystems. As biologic simplicity increases, so does the risk of ecosystem
failure. The spreading Sahara Desert in Africa, and the dustbowl conditions of the 1930s in the United States are
relatively mild examples of what might be expected if this trend continues. Theoretically, each new
animal or plant extinction, with all its dimly perceived and intertwined affects, could cause total
ecosystem collapse and human extinction. Each new extinction increases the risk of disaster. Like a
mechanic removing, one by one, the rivets from an aircraft's wings, [hu]mankind may be edging closer to
the abyss.
the ground is insufficient to meet global demand. Petrol prices are also largely dependent on the price of refined petrol in Singapore.
Australian wholesale prices mirror Singapore market prices because Australian refiners have to compete against petrol imports and
Singapore is a major refining centre. Like it or not petrol is an international traded commodity, and Australia is part of that global
market. Secondly, don't forget that petrol prices in Australia are among the cheapest in the OECD (prices in the UK, for example,
are about double what we endure here). Surely even a politician with only the most rudimentary grasp of basic economics would
understand that market competition is the most effective way to keep prices down -- not regulation. And competition does exist in
the petrol market. In spades. This is evidenced by the discounting cycles you see as petrol stations cut margins to lift sales
(remember here that most profits for a petrol station come from other retail, not fuel) and competitors follow suit. What is
particularly astounding is that this populist panacea is being proposed just a week after Cabinet received a weighty report on oil
sustainability in Queensland. The report -- compiled by a team of experts chaired by the new Minister for Sustainability, Andrew
McNamara -- warned that we are fast approaching the time of Peak Oil and need to take drastic steps to
reduce our reliance on liquid fuels. It specifically stressed the need to increase our investment in public transport,
encourage development of alternative fuels, reduce petrol consumption, and rethink our approach to urban planning.
With the end of oil looming global economic depression and war are inevitable.
Paul Roberts (energy expert and writer for Harpers) 2004, The End of Oil, pg.12-13
Suppose, for example, that worldwide oil production hits a kind of peak and that, as at Ghawar, the amount of oil that oil
companies and oil states can pull out of the ground plateaus or even begins to decline a not altogether inconceivable scenario. Oil
is finite, and although vast oceans of it remain underground, waiting to be pumped out and refined into gasoline for your
Winnebago, this is old oil, in fields that have been known about for years or even decades. By contrast, the amount of new oil that is
being discovered each year is declining; the peak year was 1960, and it has been downhill ever since. Given that oil cannot be
produced without first being discovered, it is inevitable that, at some point, worldwide oil production must peak
and begin declining as well less than ideal circumstances for a global economy that depends on cheap oil
for about 40 percent of its energy needs (not to mention 90 percent of its transportation fuel) and is nowhere even
close to having alternative energy sources. The last three times oil production dropped off a cliff the Arab oil embargo
of 1974, the Iranian revolution in 1979, and the 1991 Persian Gulf War the resulting price spikes pushed the world into
recession. And these disruptions were temporary. Presumably, the effects of a long-term permanent disruption
would be far more gruesome. As prices rose, consumers would quickly shift to other fuels, such as natural gas or coal, but
soon enough, those supplies would also tighten and their prices would rise. An inflationary ripple effect would set in. As
energy became more expensive, so would such energy-dependent activities as manufacturing and transportation. Commercial
activity would slow, and segments of the global economy especially dependent on rapid growth which is to say,
pretty much everything these days would tip into recession. The cost of goods and services would rise, ultimately
depressing economic demand and throwing the entire economy into an enduring depression that would make
1929 look like a dress rehearsal and could touch off a desperate and probably violent contest for whatever
oil supplies remained.
complexity and unpredictability of the task at hand gives us little choice but to start transforming our
energy system now. Energy poverty is not some future problem that may or may not materialize, but one that is
occurring right now and will generate widespread instability and conflict if it is not immediately
addressed. Even the long-term energy problems, like the decline of cheap oil or rising CO2 concentrations, call
for immediate action. It may be true that we can take two or even three decades to deploy carbon-free technologies and policies
without seriously exceeding our 550ppm carbon budget. The point to remember here, though, is that to have those technologies
ready by 2030, we need to start working on them today. Starting now dramatically improves our chances of
success, because it means we have more options, more freedom in how we deal with our en ergy
problems. Starting now will allow our solutions more time to work, which means that we could take the cheaper, low-intensity
routes the incremental improvements in energy efficiency, for example, or the gradual improvements from low- to no-emission
cars, or the cost-effective phasing out of coal-fired power plants rather than having to make a last-minute, potentially ruinous
leap to fuel cells. Starting now means we can test a fuller range of energy technologies and develop a full range of energy tools and
methods and policies that give us an energy economy that is more diverse, more flexible, and, we hope, more
effective.Conversely, the costs of inaction are significant. Each year that we fail to commit to serious energy
research and development or fail to begin slowing the growth of energy demand through fuel efficiency, each year that
we allow the markets to continue treating carbon as cost-free, is another year in which our already unstable energy
economy moves so much closer to the point of no return. Every delay means that our various energy gaps, when we
finally get around to addressing them, will be wider and costlier to fill. By then, it will be too late for low-cost solutions and diverse
portfolios and smooth, incremental transitions. Instead, we will need largescale solutions that can be deployed
rapidly. Little room will remain for concerns about sustainability or efficiency or equity, and our chances for long-term success
will be seriously impaired.
10
11
efficiency and reduce consumption are only randomly effective and cannot contribute to the urgent need
to reduce fossil fuel consumption in the next two decades, the period in which such consumption must be
curbed and reversed if we are to mitigate the most serious impacts of global warming. Besides rationing,
carbon taxes are the easiest and clearest way to reduce fossil fuel use and they also conform to the "free market" philosophy of
minimal government interference and regulation. They also conform to the principle that The Polluter Pays. In this case, the largest
energy consumers are the largest polluters and thus pay the most. Potential tax and public benefits of carbon taxes. Even with an
initially modest carbon tax of $37 per ton of carbon (equal to about 10 cents per gallon of gasoline), US
CO2 emissions could be reduced by 5% over time, and could raise an estimated $60 billion revenue ,
equaling the 2004 budget deficits of all fifty states. Over time this tax would be gradually increased, thus bringing
in more revenue while allowing the development and application of renewable energy technologies . Carbon
taxes could be used in various ways: either returned as tax rebates or credits, or placed in a dedicated fund for things like education,
energy efficiency, public transportation, health, etc. Thus, continual funds would be made available for the programs and services
most used by the less affluent. They could also substitute for regressive taxes like the sales or property tax, and would, if used to
spur renewable energy, create new jobs. With carbon tax revenues dedicated to public interest uses, the poor would be compensated
many times over for higher energy costs.
12
worst thing about the present inadequate political approach is that it will generate public backlash. Taxes
will increase, with no apparent benefit. The reaction would likely delay effective emission reductions, so
as to practically guarantee that climate would pass tipping points with devastating consequences for
nature and humanity. Carbon tax and 100% dividend, on the contrary, will be a breath of fresh air, a boon and
boom for the economy. The tax is progressive, the poorest benefitting most, with profligate energy users forced to pay for their
excesses. Incidentally, it will yield strong incentive for aliens to become legal; otherwise they receive no dividend while paying the
same carbon tax rate as everyone. Special interests and their lobbyists in alligator shoes will fight carbon tax and 100% dividend
tooth and nail. They want to determine who gets your tax money in the usual Washington way, Congress allocating money programby-program, substituting their judgment for that of the market place. The lobbyists can afford the shoes. Helping Washington figure
out how to spend your money is a very lucrative business. But we can save the planet and alligators by making sure that not one thin
dime of the carbon tax is siphoned off by lobbyists for their clients 100% must be returned to citizens as dividend. Make this your
motto: 100% or fight! No alligator shoes! Check the position of your congresspersons. If they spout things like global warming
is the greatest hoax in the history of the universe, check the shoes of the people who visit them or have dinner with them.
Changes in Congress are needed if we want our children and grandchildren to win this one. Because of
great benefits to the nation, humanity and nature, this approach soon would be adopted by other nations,
providing an obvious path toward international agreements.
13
of global warming, about making us less captive to Middle East oil, or investing in renewable energy,
unless you have a corporate carbon tax that eliminates the last incentive to pollute: that it's cheaper. With all we are facing -from health and environmental concerns to war abroad -- making dirty energy a less attractive option to consumers and business is
nothing to be afraid of. But it's particularly attractive because the revenues of a corporate carbon tax can be used to
bring the cost of clean energy down. Used to fast-track renewable energy research and development and deployment of clean
energy and energy efficient technologies, a corporate carbon tax would generate more than $50 billion annually, helping us get
technologies out of the laboratories and onto our roads and into our homes and businesses, jumpstarting America's global
competitiveness in the process. But above all else, a corporate carbon tax sends a powerful message: that America
will lead the world on climate change, helping polluting countries from developing nations to China take
the steps they need to get this crisis under control. With the right leadership, the United States will emerge
as that leader. But if the last six years is any indication, it won't happen on its own. It will take choices that are not only tough but
smart and a president who is honest with the American people about the stakes. A president who shows us that with the right
leadership, America will not suffer by tackling global warming and ridding ourselves of Middle East oil, but prosper. Getting this
challenge right comes down to a simple, fundamental belief about America -- that we have always drawn our strength from our unique
ability to come together around our best, most innovative ideas in common purpose, making our country and world stronger. With the
stakes of global warming so high, the American people are ready to do that again. They're ready to change course -- to move away
from polluting energy sources and toward a cleaner future. And with the right leadership, they will be ready for a corporate carbon tax.
It's a big idea whose time has come.
14
in the room. From a business standpoint, it makes sense to advocate a federal policy approach that addresses the issue in an
equitable, efficient manner. What we need is an economy-wide solution that provides incentives for companies and individual
consumers alike to reduce the carbon they emit from all sources. The best approach to drive these reductionsand the
technological innovations that will help achieve themis a broad-based carbon tax, which addresses carbon
dioxide emissions from all sectors of the economy, including transportation, manufacturing and power generation. Heres why: A
well-crafted carbon tax that starts at a modest rate and increases gradually and predictably over time can
establish incentives throughout the U.S. economy to reduce carbon dioxide emissions with minimal
disruption. First, it would provide incentives for everyone to conserve. Second, it would promote higher
utilization of existing power plants that are low emitters of carbon and encourage low-carbon fuel choices
for the future. And third, it would encourage the development of new technologies. A carbon tax would
allow us to share the cost of reducing greenhouse gas emissions across all sectors of the economyand minimize
the disruption of any one area. An economy-wide carbon tax is the least prescriptive policy approach as it does not mandate
reductions in any one sector. Compared to other market-based approaches, such as cap-and-trade policies, a carbon tax provides
greater certainty regarding cost impacts. A carbon tax would not mandate targeted reductions from one sector or another, but would
instead send economic signals that enable businesses and individuals to make informed decisions. For this reason, many economic
experts believe that a carbon tax is more efficient than a cap-and-trade policy for addressing climate change over the long-term. To
be clear, adoption of a carbon tax need not increase the overall tax burdeninstead, revenues from a
carbon tax could support reductions in inefficient existing taxes on productive labor and investment . And
even if climate change turns out to be less of a problem than many might think, a carbon tax is a no regrets policy that will result
in lower overall air emissions and the benefits of greater energy efficiency. Why would the CEO of a large energy company
advocate less energy consumption? Because its important to take the long view on environmental as well as economic issues. And
its also where my faith in American innovation comes in. A mandate to benefit the environment will spur the kind of
technology innovation that we saw in the last century. Innovation that propelled us to become the worlds
leading economy. Set the right goals and Americans can and will lead the way. Our international
competitorsmotivated by mandatory emissions reductionshave gotten a head start. Japan is the world
leader in solar power and hybrid cars, and Europe leads in wind power. Their economies will benefit from greater
energy efficiency, and ours will be disadvantaged if we lag behind.
15
fell only 3 percent, compared to a 13 percent reduction in the five-year period before RECLAIM. There
was extreme price volatility aggravated by California's electricity crisis of 2000. NOx permit prices ranged from
$1,000 to $4,000 per ton between 1994 and 1999, but soared to an average price of $45,000 per ton in 2000, with some individual
trades over $100,000 per ton. Such high prices were not sustainable, and SCAQMD removed electric utilities from
RECLAIM in 2001. SCAQMD also dropped its plan to expand RECLAIM to VOCs. Despite the hope that RECLAIM
would be simple and transparent, there were serious allegations of fraud and market manipulation,
followed by the inevitable lawsuits and criminal investigations. One particular problem with RECLAIM
that is likely to plague any international GHG emissions-trading regime is the lack of definite property
rights to the emissions allowances the program creates. A clich of the moment is that industry would like some clarity and
certainty about any prospective GHG regulatory regime. A cap-and-trade program, however, cannot provide
certainty precisely because emissions allowances are not accorded real property rights by law.[8] The
government can change the rules at any time, making emissions allowances worthless. This is exactly
what happened to electric utilities in Los Angeles : their allowances were terminated, and the utilities were subsequently
required to install specified emissions-control technologies and to pay fines for excess emissions. In effect, some Los Angeles firms
had to pay three times over for emissions reductions. A GHG emissions-trading scheme on an international level
will be even more vulnerable to these kinds of unpredictable outcomes. To the extent that a GHG emissionstrading program results in international cross-subsidization of the economies of trading partners, it is going to be politically
unsustainable in the long run. An international emissions-trading program is also unlikely to survive
noncompliance by some of its members.
16
Inherency
Inherency card.
Joshua P. Fershee, Visiting Assistant Professor, Penn State Dickinson School of Law. J.D., Tulane Law
School, Wyoming Law Review, 2007 lexis
A carbon tax would place an excise tax on fossil fuel sales, i.e., sales of coal, petroleum products, and natural gas, based on the
fuel's carbon content. n124 A federal carbon tax has been promoted by several, and diverse, sources. Duke Energy, one of the largest
energy companies in the United States, is an ardent supporter of a carbon tax, arguing that it "is an effective fiscal policy option that
would simultaneously support federal tax reform initiatives, reduce carbon dioxide emissions, and promote sound energy policies."
n125 On the other end of the spectrum, [*290] former Vice President Al Gore is also a strong proponent of carbon taxes n126 and
has even suggested using a carbon tax in place of some payroll taxes. n127 Despite growing appeal at both the federal and global
level, n128 increased carbon taxes have, to date, proven politically untenable in the United States . As noted
above, the Bush Administration n129 and many members of Congress adamantly oppose carbon taxes, n130 arguing that such a tax
would improperly impose economic harm. n131 Although there are some indications that politicians from both
sides of the aisle are more open to (at least some) carbon taxes than ever before, n132 no serious proposals are
17
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Generic solvency
Carbon Tax is better than other alternative getting it started is the key.
Komanoff 9/26/2007 Dingell Opens the Door with a Hybrid Carbon Tax
http://www.carbontax.org/blogarchives/2007/09/26/dingell-opens-the-door-with-a-hybrid-carbon-tax/ Date
Accessed:6/23/2008
With a mighty creak of long-rusted hinges, a door is finally opening in Washington. The present Congress will apparently be asked
to consider a carbon tax. The measure actually, a hybrid carbon and petroleum tax will be introduced by the powerful
chairman of the House Committee on Energy and Commerce, Rep. John Dingell (D-Michigan). Today Dingell posted on his
Web site a summary of the bill, which he began drafting in June. The current version would phase in,
each year for five years, a charge of $10 per ton of carbon content of coal, oil and natural gas; plus an
additional 10 cents/gallon for gasoline and jet fuel (kerosene). By the end of the five-year period the
charges would reach $50/ton of carbon plus 50 cents/gallon of gasoline and jet fuel. These equate to 63
cents a gallon of gas and 90 cents for one hundred kilowatt-hours assuming the nationwide average fuel
mix.Dingell is asking the public for comments. Here's ours: we think the bill is terrific. In line with what
we said when we founded the Carbon Tax Center, and as Dingell himself wrote last month in the
Washington Post, "[S]ome form of carbon emissions fee or tax would be the most effective way to
curb carbon emissions and make alternatives economically viable." Moreover, as we elaborate below, his
supplemental tax on gasoline and jet fuel has the look of genius.How much carbon and petroleum would
Dingell's hybrid carbon tax eliminate? A lot, if you change one key parameter; instead of halting the tax
after year 5, continue ramping it up. If the tax works and the impacts on families and businesses can be
offset through tax-shifting and rebates, why stop?We examined a 20-year ramp-up starting Dingell's "10/10" tax in
2008 and continuing through 2027 to a level of $200 per ton of carbon plus $2/gallon on gasoline and jet fuel. Here's where the U.S.
would be in the representative year 2025: Carbon dioxide emissions would be down by 1.55 billion metric tons from projected
levels, a 20% drop a decrease equivalent to current emissions from England, France and Italy combined . Petroleum
consumption would be 4.5 million barrels a day less than otherwise, an 18% decrease from projected
usage, and more than 10% greater than Iran's current production. Moreover, these reductions could be
supplemented by savings from other targeted policies and programs to reduce use of petroleum, natural
gas and coal-fired electricity. (Indeed, a companion section of Dingell's bill will call for phasing out the
federal tax deduction on mortgage interest on very large homes, thus ending a subsidy through which
middle and working class families subsidize gargantuan sprawl homes for the wealthy.) No other single
policy measure not broader CAF standards, not a national Renewable Energy Standard, not a
massive biofuels push, and certainly not a new generation of subsidized nuclear power plants can
produce nearly the carbon and petroleum savings promised by the Dingell hybrid carbon tax, provided it
extends beyond the initial five-year period.The brilliant touch in the Dingell bill is the supplemental tax
on gasoline and aviation fuel. Dingell obviously grasps that a carbon tax alone can't end America's
dangerous oil dependence. A straight carbon tax falls most heavily on coal, both because coal's carbon
content is so high and because electricity, the form in which coal's energy is delivered, is more priceelastic than gasoline.Using CTC's four-sector spreadsheet model, which looks individually at electricity (40% pf U.S. CO2 emissions), gasoline (21%), jet fuel
(4%) and "other" (35%), we estimate that without the annual 10/gallon levy on gasoline and jet fuel, the oil savings in 2025 would be nearly 40% smaller 2.8 million barrels
The hybrid tax thus saves 60% more petroleum, and 20% more CO2, than a straight $10/tona-year carbon tax.Is the Dingell tax set at the best level? We would like to see it higher considerably
higher. The U.S. economy and America's millions of vulnerable households could almost certainly handle
a steeper ramp-up, provided the tax was made revenue-neutral. The climate crisis demands more than just
the provisional $10 rate; CTC has been urging a $37/ton-a-year tax. But getting started at all is a
tremendous step, and Dingell's clear-sightedness and courage, in a Congress little characterized by either,
deserve our admiration. What should be done with the revenue from the hybrid carbon tax? Needless to
say, the quantities are enormous $180 billion annually after Dingell's initial five years, and much more
if the ramp-up is extended. While CTC strongly favors the revenue-neutral route, Rep. Dingell has his
own ideas for using the revenues as will just about everyone else.For now, we urge you to read
Dingell's Web statement and post a comment on his site and at other sites that cover climate, energy, oil,
national security, and politics. Having a legislator of Dingell's stature even float a carbon-tax trial balloon
is a very important and positive development possibly a breakthrough. There's a lot riding on it. Be
heard.
a day vs. 4.5 mbd.
23
Generic solvency
Carbon taxes would provide incentives for efficiency, conservation, and renewables.
Kenneth P. Green, resident scholar, Steven F. Hayward, F. K. Weyerhaeuser Fellow, and Kevin A. Hassett,
senior fellow and director of economic policy studies at AEI, American Enterprise Institute, "Climate
Change: Caps vs. Taxes" June 2007
Incentive Creation. Putting a price on the carbon emissions attendant on fuel use would create numerous
incentives to reduce the use of carbon-intensive energy. The increased costs of energy would flow
through the economy, ultimately giving consumers incentives to reduce their use of electricity,
transportation fuels, home heating oil, and so forth. Consumers, motivated by the tax, would have
incentives to buy more efficient appliances, to buy and drive more efficient cars, and to better insulate
their homes or construct them with more attention to energy conservation. A carbon tax would also create
incentives for consumers to demand lower-carbon power sources from their local utilities. A carbon tax,
as its cost flowed down the chains of production into consumer products, would lead manufacturers to
become more efficient and consumers to economize in consumption. At all levels in the economy, a
carbon tax would create a profit niche for environmental entrepreneurs to find ways to deliver lowercarbon energy at competitive prices. Finally, a carbon tax would also serve to level (somewhat) the
playing field among solar power, wind power, nuclear power, and carbon-based fuels by internalizing the
cost of carbon emission into the price of the various forms of energy.
Carbon taxes would transperntly, quickly, and effectively influence industry and
indivual behavior away from CO2 consumption.
Michael J. Zimmer, attorney at Thompson Hine LLP in the energy practice and also serves this academic
year with the Ohio University Consortium of Energy, Economics and the Environment, Sustainable
Development Law & Policy, Winter 2008 lexis
The international debate over reducing worldwide carbon emissions increasingly focuses on effectively reducing carbon emissions
by formulating novel policy tools after the Kyoto Protocol expires in 2012. One recommendation posits that if a tax is
24
Generic solvency
A carbon tax would be the appropriate incentive to modify behavior away from
traditional energy toward alternate energy.
Michael J. Zimmer, attorney at Thompson Hine LLP in the energy practice and also serves this academic
year with the Ohio University Consortium of Energy, Economics and the Environment, Sustainable
Development Law & Policy, Winter 2008 lexis
A "carbon tax" is a tax on the carbon content of fuels; effectively, it is a tax on the CO[2] emissions
produced from burning fossil fuels. n1 The current prices of gasoline, electricity, oil, coal, and other fuels
do not include the full economic costs of the health, resource, and environmental externalities associated
with the broad usage of these energy sources in the United States and around the world. The failure to
force industry and consumers to shoulder these externalities suppresses the economic incentive to develop
and implement carbon-reducing measures like energy efficiency, renewable energy, advanced metering,
storage, additional transmission, or clean technology. On the other hand, taxing fuels based on their
carbon content infuses these incentives at every point in the chain of production and consumption, from
an individual's choice of the type and usage of vehicles, appliances, and housing, to business choices of
product design, capital investment, facilities location, and government's choices when setting regulatory
policy direction. n2
Carbon taxes would be more balanced producing net games five times higher.
Kenneth P. Green, resident scholar, Steven F. Hayward, F. K. Weyerhaeuser Fellow, and Kevin A.
Hassett, senior fellow and director of economic policy studies at AEI, American Enterprise Institute,
"Climate Change: Caps vs. Taxes" June 2007
* Effectiveness and Efficiency. A revenue-neutral carbon tax shift is almost certain to reduce GHG emissions
efficiently. As economist William Pizer observes, "Specifically, a carbon tax equal to the damage per ton of CO2 will lead to
exactly the right balance between the cost of reducing emissions and the resulting benefits of less global warming."[10] Despite the
popular assumption that a cap-and-trade regime is more certain because it is a quantity control rather than a price control, such
a scheme only works in very limited circumstances that do not apply to GHG control. The great potential
for fraud attendant on such a system creates significant doubt about its effectiveness , as experience has shown
in both theory and practice in the gyrations of the European ETS. The likelihood of effectiveness also cannot be said
for regulations such as increased vehicle fuel economy standards. In fact, such regulations can have perverse effects
that actually lead to increased emissions. By making vehicles more efficient, one reduces the cost of a unit of fuel,
which would actually stimulate more driving, and, combined with increasing traffic congestion, could lead to an
increase in GHG emissions rather than a decrease. As Harvard researchers Louis Kaplow and Steven Shavell point out,
"The traditional view of economists has been that corrective taxes are superior to direct regulation of
harmful externalities when the state's information about control costs is incomplete ," which, in the case of
carbon emissions reductions, it most definitely is.[11] And when it comes to quantity controls (as a cap-and-trade system would
impose), Pizer found that My own analysis of the two approaches [carbon taxes vs. emission trading] indicates that price-based
greenhouse gas (GHG) controls are much more desirable than quantity targets, taking into account both the
potential long-term damages of climate change, and the costs of GHG control. This can be argued on the
basis of both theory and numerical simulations. Pizer found, in fact, that a carbon-pricing mechanism
would produce expected net gains five times higher than even the best-designed quantity control (i.e.,
cap-and-trade) regime.[12]
25
Generic solvency
Taxes encourage alt energy it is the maximum incentive
Schlesinger (William, writer for Duke University Office of News and Communications, 5/16/05,
Carbon Tax Provides Fairest Incentive For Curbing Global Warming, online:
http://www.dukenews.duke.edu/2005/05/carbontax.html, acc: 6/23/08)
A carbon tax would be paid whenever a molecule of carbon dioxide is emitted to the atmosphere by
burning fossil fuels. Utilities would pay it based on their smokestack emissions and pass the cost to
consumers in their monthly electric bill. Each of us would pay it when we fill up with gasoline, based on
the content of fossil carbon in the fuel. A carbon tax would provide the maximum incentive for bright
engineers to improve the efficiency of fossil fuel use in all sectors of society. It also would maximize the
potential for important "cross-sector" transfers of efficiency. For instance, if engineers find efficient ways
to reduce CO2 emissions from the power plants that provide our electricity, the utilities carbon tax
savings could be passed along to consumers. The same principle might make it cheaper to operate an
electric car than a gas-powered one. More of us would be motivated to buy electric cars, especially given
the price of gasoline these days. A carbon tax does not necessarily mean a net increase in our cost of
living. Carbon tax revenues could be directed to general government expenditures, so that income tax
rates could be reduced for all Americans -- or perhaps those at the lower income levels. Importantly, our
current income tax structure provides no personal choice to reduce our tax; indeed, the more we earn, the
more we pay on April 15. A tax on carbon, which would show up in higher costs for electricity or
gasoline, would provide an incentive for each of us to use energy more efficiently if we wanted to pay
lower taxes. Still want an SUV? Buy it, but each year youll pay more for gasoline than your neighbor
who has a Toyota Prius. Want to live in the country? Fine, but remember it will cost you to drive the extra
miles to work each day. Want to save some money at home and send less to the taxman? Put on a warm
sweater and lower your thermostat. Conservation and efficiency must both play a role in our attempt to
reduce dependence on dwindling production of foreign oil. A carbon tax provides an equal incentive for
both pathways to be part of the solution.
those in 1990, which amounts to a 24 percent reduction from current levels, Mr. Koehn said. The climate
action plan serves as the roadmap to meet our reduction goal, he said. The tax grew out of efforts by a committee of
residents and members of the City Council and Chamber of Commerce to try to enable Boulder to reach goals set by the United
Nations Kyoto Protocol, which seeks to curb global warming.
26
Generic solvency
Taxes promote energy efficiency
Carbon Tax Center (an organization supporting an American carbon tax, 2/26/08, Carbon Tax
Center- Introduction, online: http://www.carbontax.org/introduction/#why, acc: 6/23/08)
The rationale for a carbon tax is simple: the levels of CO2 already in the Earths atmosphere and being
added daily are destabilizing established climate patterns and threatening the ecosystems on which we
and other living beings depend. Very large and rapid reductions in the United States and other nations
carbon emissions are essential to reverse runaway climate change and avert resulting severe weather
events, inundation of coastal areas, spread of diseases, failure of agriculture and water supply,
infrastructure destruction, forced migrations, political upheavals and international conflict. A carbon tax
must be the central mechanism for reducing carbon emissions. Currently, the prices of gasoline,
electricity and fuels in general include none of the costs associated with devastating climate change. This
omission suppresses incentives to develop and deploy carbon-reducing measures such as energy
efficiency (e.g., high-mileage cars and high-efficiency heaters and air conditioners), renewable energy
(e.g., wind turbines, solar panels), low-carbon fuels (e.g., biofuels from high-cellulose plants), and
conservation-based behavior such as bicycling, recycling and overall mindfulness toward energy
consumption. Conversely, taxing fuels according to their carbon content will infuse these incentives at
every chain of decision and action from individuals choices and uses of vehicles, appliances, and
housing, to businesses choices of new product design, capital investment and facilities location, and
governments choices in regulatory policy, land use and taxation.
Revenue neutral carbon taxes with 5-year adjustments protects business and
ensures completion of reduction goals.
Michael J. Zimmer, attorney at Thompson Hine LLP in the energy practice and also serves this academic
year with the Ohio University Consortium of Energy, Economics and the Environment, Sustainable
Development Law & Policy, Winter 2008 lexis
Setting a clearing price for carbon that can be periodically evaluated for its effectiveness in achieving
public policy and market performance objectives is a simpler and more economically efficient approach
than a cap-and-trade program. The cost of carbon can be set through a tax mechanism, and its progress in
reducing energy intensity can be evaluated every five years. This built-in evaluation process permits
adjustments to be made, which will ensure achievement of emission reduction goals. Technical inputs can
be provided by DOE, EPA, NOAA, and the National Academy of Science each cycle for review with
final economic evaluations of the tax conducted by Treasury and the Federal Reserve. In the United
States, potential economic harm could be diminished by offsetting the revenue resulting from a new
carbon tax upon its enactment, with mirroring reductions in the payroll tax, the corporate tax rate, and the
alternative minimum tax. Additional revenue can be reserved in trust for government funding of clean
energy technology and advanced energy R&D. Economic feedback would be provided with balance to
benefit the corporate, small business, and individual tax payers to reduce the economic burden of the new
carbon tax scheme by starting with a tax that is "revenue neutral." The key effectiveness of a carbon tax
program that is currently being overlooked is that such a tax may become revenue neutral. Revenue
neutrality shifts the economic burden to industries requiring behavioral and competitive modification
consistent with global policy shifts while preserving efficiency, energy intensity, and benefits of stability
in the U.S. economy. No cap-and-trade proposal offers similar revenue neutrality and the specter of
economic stability. Rather, cap-and-trade arguably creates some market winners, many market or industry
sector losers, opportunities for gaming, and makes U.S. consumers the biggest losers of all.
27
Warming solvency
Carbon taxes can prevent ecocide, but the window is only 1-2 years
U.S. scientist urges carbon tax to help climate by Donna Smith, scientist for Reuters, 06/23/08,
http://www.guardian.co.uk/business/feedarticle/, 06/23/08
The U.S. scientist who 20 years ago first told Congress that the Earth's climate was warming said on
Monday that urgent action is needed to cut greenhouse gases and a tax proposal on carbon emissions.
James Hansen, the director of NASA's Goddard Institute for Space Studies, said at a congressional
briefing that a carbon tax would be the most efficient way to cut global warming emissions and encourage
non-fossil energy sources."We have to level with the public that there has to be a price on carbon
emissions," Hansen said. "That this is the only way we are going to begin to move toward a carbon free
economy."Hansen said urgent action is needed to cut carbon dioxide emissions that are warming the
globe and are already causing arctic ice to melt. He said world leaders had only one or two years to act
before the Earth reaches a "tipping point" with major consequences to the global climate and species
survival."We have reached an emergency situation," Hansen said. He said the government should not
keep the proceeds from any carbon tax, but refund the money to taxpayers to help them pay for more fuel
efficient technology. President George W. Bush has opposed any broad program to curb carbon emissions
saying it would hurt the economy and has consistently resisted any tax increases. But global warming is
an issue in this year's presidential campaign and is expected to be a major topic of discussion at next
month's meeting of leaders of the Group of Eight industrial nations in Japan. Twenty years ago today,
Hansen testified before a Senate committee and told lawmakers that "the greenhouse effect has been
detected, and it is changing our climate now."Hansen's testimony helped spur the first congressional
efforts to curb greenhouse gases. The most recent effort, legislation that would have created a cap-andtrade system for carbon emissions died in the Senate earlier this month in face of a veto threat from the
White House.
28
Warming solvency
Carbon Tax best way to help decrease global warming
Juliet Eilperin and Steven Mufson(Washington Post staff writers) 4/1/2007 Tax on Carbon
Emissions Gains Support http://www.washingtonpost.com/wpdyn/content/article/2007/03/31/AR2007033101040.html Date Accessed: 6/23/2008
As lawmakers on Ca/pitol Hill push for a cap-and-trade system to rein in the nation's greenhouse gas emissions, an unlikely
alternative has emerged from an ideologically diverse group of economists and industry leaders: a carbon tax. Most legislators view
advocating any tax increase as tantamount to political suicide. But a coalition of academics and polluters now argues that a simple
tax on each ton of emissions would offer a more efficient and less bureaucratic way of curbing carbon
dioxide buildup, which scientists have linked to climate change. "We want to do the least damage to the growth of GDP," said
Michael Canes, a private consultant and former chief economist for the American Petroleum Institute, who led a Capitol
Hill briefing on the subject in late February sponsored by the conservative George C. Marshall Institute. Between a cap system
and a carbon tax, "a carbon tax will be the much more cost-effective way to go ," he said, though he added that
there are other ways to reduce emissions. Robert J. Shapiro, a private consultant who was a Commerce Department official in the
Clinton administration, agrees. A cap-and-trade system -- involving plant-by plant-measurements -- would be difficult to
administer, he said, and would provide "incentives for cheating and evasion." And the revenue from a carbon
tax could be used to reduce the deficit or finance offsetting cuts in payroll taxes or the alternative minimum
tax. A carbon tax offers certainty about the price of polluting, which appeals to many economists and businesses. William A. Pizer,
a senior fellow at the centrist think tank Resources for the Future and a former senior economist for President Bush's Council of
Economic Advisers, estimates that the benefit-to-cost ratio of a tax-based system would be five times that of a
cap-and-trade system. "You're going to pay one way or another, whether it's a tax or a permit program," Pizer said, adding that
while a cap would provide more certainty on how much emissions would be cut, "the consequences of being uncertain about
emissions over any short period of time just aren't that serious." Under a cap-and-trade system, the government would set an overall
limit on emissions and allocate permits to emitters. If one plant reduces its emissions more quickly than another, it can sell its
credits to the other emitter. A carbon tax would simply increase the cost of emitting each ton of carbon, which could then be passed
on to consumers. While Democrats have vowed to push through some sort of carbon dioxide control in this Congress, Bush has
consistently opposed mandatory limits, so it remains unclear whether the United States will adopt any system before the next
election. Moreover, the fact that many economists back the tax approach is no guarantee that it will prevail over the five cap-andtrade plans already proposed in the Senate. The complexity of the cap-and-trade system is part of its virtue for some politicians,
since it may mask the system's impact on prices. Such a system also appeals to conservative lawmakers who like the idea of letting
the market determine the price of carbon, while keeping revenue out of the hands of government. Some economists say it would
channel capital to the most economically worthwhile projects first. Environmentalists are split on a carbon tax. Fred Krupp,
president of Environmental Defense, which is handing out baseball caps emblazoned with the slogan "Just Cap It" on Capitol Hill,
called such a tax "an interesting distraction." "It doesn't give us the guarantee the emissions will go down," he said. But Carl Pope,
executive director of the Sierra Club, said: "It will be more effective if people know that in year 'X' they will pay this much.
Companies are highly motivated by costs." Moreover, he worries that rationing carbon allowances based on historical emissions
would reward companies that spew out the most greenhouse gases now and did the least to limit them in the past. Dan Becker,
director of the Sierra Club's program on global warming, said the nation may need to adopt a carbon tax in several years but "we're
not there yet. Some industries that have historically opposed carbon limits embrace the idea of a tax because their sectors would
not be singled out for regulation. "A poorly constructed cap-and-trade system can be as punitive as a regressive
tax," said Scott Segal, an electric utilities lobbyist. Red Cavaney, president of the American Petroleum Institute, told a National
Press Club audience in February that his industry prefers that lawmakers explore a range of policy options before imposing a cap.
"A cap-and-trade system isn't necessarily the be-all and end-all," he said. "A carbon tax, everything, should be on the table from the
beginning."
29
Warming solvency
A carbon tax would decrease the amount of carbon emissions in the atmosphereThis solves for global warming
GREGORY MANKIW, September 16, 2007.( Harvard professor of economics, former governor of
Massachusetts, adviser to President Bush, One Answer to Global Warming: A New Tax (6/23/08)
http://www.lexisnexis.com/us/lnacademic/results/docview/docview.do?
docLinkInd=true&risb=21_T4020234282&format=GNBFI&sort=RELEVANCE&startDocNo=1&resultsU
rlKey=29_T4020234285&cisb=22_T4020234284&treeMax=true&treeWidth=0&csi=6742&docNo=17
In the debate over global climate change, there is a yawning gap that needs to be bridged. The gap is not
between environmentalists and industrialists, or between Democrats and Republicans. It is between
policy wonks and political consultants. Among policy wonks like me, there is a broad consensus. The
scientists tell us that world temperatures are rising because humans are emitting carbon into the
atmosphere. Basic economics tells us that when you tax something, you normally get less of it. So if we
want to reduce global emissions of carbon, we need a global carbon tax. Q.E.D. The idea of using taxes to
fix problems, rather than merely raise government revenue, has a long history. The British economist
Arthur Pigou advocated such corrective taxes to deal with pollution in the early 20th century. In his
honor, economics textbooks now call them ''Pigovian taxes.'' Using a Pigovian tax to address global
warming is also an old idea. It was proposed as far back as 1992 by Martin S. Feldstein on the editorial
page of The Wall Street Journal. Once chief economist to Ronald Reagan, Mr. Feldstein has devoted
much of his career to studying how high tax rates distort incentives and impede economic growth. But
like most other policy wonks, he appreciates that some taxes align private incentives with social costs and
move us toward better outcomes. Those vying for elected office, however, are reluctant to sign on to this
agenda. Their political consultants are no fans of taxes, Pigovian or otherwise. Republican consultants
advise using the word ''tax'' only if followed immediately by the word ''cut.'' Democratic consultants
recommend the word ''tax'' be followed by ''on the rich.'' Yet this natural aversion to carbon taxes can be
overcome if the revenue from the tax is used to reduce other taxes. By itself, a carbon tax would raise the
tax burden on anyone who drives a car or uses electricity produced with fossil fuels, which means just
about everybody. Some might fear this would be particularly hard on the poor and middle class. But
Gilbert Metcalf, a professor of economics at Tufts, has shown how revenue from a carbon tax could be
used to reduce payroll taxes in a way that would leave the distribution of total tax burden approximately
unchanged. He proposes a tax of $15 per metric ton of carbon dioxide, together with a rebate of the
federal payroll tax on the first $3,660 of earnings for each worker. The case for a carbon tax looks even
stronger after an examination of the other options on the table. Lawmakers in both political parties want
to require carmakers to increase the fuel efficiency of the cars they sell. Passing the buck to auto
companies has a lot of popular appeal. Increased fuel efficiency, however, is not free. Like a tax, the cost
of complying with more stringent regulation will be passed on to consumers in the form of higher car
prices. But the government will not raise any revenue that it can use to cut other taxes to compensate for
these higher prices. (And don't expect savings on gas to compensate consumers in a meaningful way: Any
truly cost-effective increase in fuel efficiency would already have been made.) More important,
enhancing fuel efficiency by itself is not the best way to reduce energy consumption. Fuel use depends
not only on the efficiency of the car fleet but also on the daily decisions that people make -- how far from
work they choose to live and how often they carpool or use public transportation. A carbon tax would
provide incentives for people to use less fuel in a multitude of ways. By contrast, merely having more
efficient cars encourages more driving. Increased driving not only produces more carbon, but also
exacerbates other problems, like accidents and road congestion.
30
Warming solvency
Carbon tax would reduce the amount of carbon in the atmosphere and to fight
global warming - A carbon tax would decrease the amount of co2 in the
atmosphere better than a cap and trade program
Todd Woody, journalist, Report: Carbon Tax a Better Way to Fight Global Warming 02/14/07,
(http://blogs.business2.com/greenwombat/2007/02/report_carbon_t.html, date acc: 06/23/08
A former Clinton administration commerce department official today released a report arguing that a
global tax on companies' greenhouse house gas emissions is a more efficient way to combat global
warming than the carbon trading markets endorsed by a host of government officials and corporations
like Alcoa (AA), BP, (BP), DuPont (DD), Duke Energy (DUK) and General Electric (GE). "A carbon tax
would both directly reduce greenhouse gas emissions and provide powerful incentives for technological
progress," wrote Robert J. Shapiro, a Washington D.C. consultant, veteran think tanker and former under
secretary of commerce for economic affairs. "Carbon taxes also should provide greater incentives for
companies to develop new, environmentally-friendly, technologies or abatement strategies than a capand-trade program." Shapiro's study was released by the American Consumer Institute, a free-market
oriented Washington group. Corporations currently are not charged for the economic and environmental
impacts of their greenhouse gas emissions, though those "externalities" affect everyone. Under a carbon
tax, those consequences would be calculated and a tax imposed accordingly. "Since every government
needs revenues, the challenge is to design taxes so they distort those relative prices as little as possible.
One possibility is to make the base of the tax as broad as possible, so its rate can be low and most people
and activities are affected equally," Shapiro wrote. "Carbon taxes generally meet this criterion, although
not as well as broad income or consumption taxes. However, their economic drawback of raising the price
of carbon-intensive products and operations, relative to those which are not carbon-intensive, is also their
environmental purpose." Companies that do not emit greenhouse gases - such as solar and wind producers
- or sell greener goods and services - would benefit. The government could use carbon tax revenue to
support renewable energy technologies, cut corporate taxes or increase health spending, according to
Shapiro. In contrast, cap-and-trade programs impose a ceiling on greenhouse gas emissions and then
allow companies that lower their emissions to sell carbon allowances to those that do not. Europe created
a carbon trading market to implement the Kyoto Accord and legislation before the U.S. Congress calls for
a similar market in the U.S. Shapiro contends that global carbon trading is too complex and susceptible to
market manipulation by shady companies and corrupt governments. While Shapiro says a carbon tax
would be cheaper and easier to implement, he acknowledged the challenges in getting governments and
corporations to agree on what specifically will be taxed and the tax rate.
31
Warming solvency
Carbon taxes key to checking warming.
Reuters, "U.S. scientist urges carbon tax to help climate" June 23, 2008
The U.S. scientist who 20 years ago first told Congress that the Earth's climate was warming said on
Monday that urgent action was needed to cut greenhouse gases and proposed a tax on carbon emissions.
James Hansen, the director of NASA's Goddard Institute for Space Studies, said at a congressional
briefing that a carbon tax would be the most efficient way to cut global warming emissions and encourage
non-fossil energy sources. "We have to level with the public that there has to be a price on carbon
emissions," Hansen said. "That is the only way we are going to begin to move toward a carbon free
economy." Hansen said urgent action was needed to cut carbon dioxide emissions that are warming the
globe and are already causing arctic ice to melt. He said world leaders had only one or two years to act
before the Earth reaches a "tipping point" with major consequences to the global climate and species
survival. "We have reached an emergency situation," Hansen said. He said the government should not
keep the proceeds from any carbon tax, but refund the money to taxpayers to help them pay for more fuel
efficient technology. President George W. Bush has opposed any broad program to curb carbon emissions
saying it would hurt the economy and has consistently resisted any tax increases. But global warming is
an issue in this year's presidential campaign and is expected to be a major topic of discussion at next
month's meeting of leaders of the Group of Eight industrial nations in Japan. Twenty years ago today,
Hansen testified before a Senate committee and told lawmakers that "the greenhouse effect has been
detected, and it is changing our climate now."
32
Warming solvency
Carbon taxes solve warming - they spur innovation and alternative energy.
Fareed Zakaria, Newsweek, The Case for a Global Carbon Tax April 16, 2007 lexis
There's an obvious problem with this model--where will the money for subsidies come from?--but there's another glitch as well. The
technology for clean coal doesn't really exist yet in a form that can be widely used. There are various pilot projects and experiments
but nothing that is, as yet, economically viable. Both problems can be solved by the same simple idea--a tax on spewing carbon into
the atmosphere. Once you tax carbon, you make it cheaper to produce clean energy. If burning coal and
petrol in current ways becomes more expensive because of the damage they do to the environment,
people will find ways to get energy out of alternative fuels or methods. Along the way, industrial societies will
earn tax revenues that they can use, in part, to subsidize clean energy for the developing world. It is the only way to solve the
problem at a global level, which is the only level at which the solution is meaningful. Congress is currently considering a variety of
proposals that address this issue. Most are a smorgasbord of caps, credits and regulations. Instead of imposing a simple carbon tax
that would send a clear signal to the markets, Congress wants to create a set of hidden taxes through a "cap and trade" system. The
Europeans have adopted a similar system, which is unwieldy and prone to gaming and cheating. (It is also unsustainable if Brazil,
China and India don't come onboard soon.) A carbon tax would also send the market a clear and powerful signal to
develop alternative energies. Daniel Esty, a Yale environmental expert whose new book, "Green to Gold," is a blueprint for
new thinking about the environment, argues that the only way forward is a "transformational approach that creates
incentives for innovation and alternative energy. The way we think about these issues is old-fashioned. We're still trying
to limit, regulate, control and inspect. We need to become much more market-friendly. Put in place a few simple
rules, and let the market come up with hundreds of solutions. We're not even 10 percent of the way down such a
path." In the end, everyone realizes that innovation is the only real solution to the global-warming problem . And
that's where Cheney is right. Conservation and energy efficiency are smart policies, but not enough . In America
over the last three decades, almost all machines and appliances we use to power our lives have become significantly more efficient
(with the exception of cars). And yet we consume three times as much energy as we did 30 years ago. Why? Because rising living
standards mean rising energy use. We can slow down the growth, but some increase is inevitable. We have more efficient air
conditioners. But now we air-condition our whole houses. Our bed lamps conserve power. But we also plug in two phones, a
BlackBerry and three iPods.
Carbon Tax solves quickly enough trying to further accelerate would hurt the
transition
Carl S. Milsted January 9, 2008 the future of the carbon tax holistic politics
http://www.holisticpolitics.org/GlobalWarming/Future.php date accessed June 23, 2008
At the beginning of this chapter I said that the U.S. needs to cut its carbon dioxide emissions by 75% just
to keep world emissions constantif we allow the rest of the world to catch up. Yet in my carbon tax
calculations I assumed that the reduction in carbon burning would be less. We have a contradiction. This
is intentional. I don't want to immediately cut carbon burning by 75%. It would be a huge burden on the
economy and likely unnecessary. The world hasn't caught up yet, so we have time. And the world can
likely withstand a few years of carbon dioxide emission growth as long as it is followed up by shrinkage.
Actually, a near-immediate 25% reduction in carbon burning would be considered ambitious by many
environmentalists. It is more than the Kyoto Treaty calls for. The bigger environmental benefit of a
carbon tax is not the immediate conservation, but the market created for real long term solutions. At a
doubling of retail energy costs, many existing alternative energy technologies become economically
viable: passive solar, flat plate collectors, hybrid cars, and maybe even more exotic technologies such as
photovoltaics, electric cars and Stirling engine hot water heaters. But such technologies will take time to
deploy. In fact, it may be better not to deploy such technologies too fast, as better solutions are still in the
laboratories. For example, light emitting diode technology is catching up with fluorescent light
technology, and LEDs don't contain mercury. Photovoltaics are also improving rapidly . Rushing can be
wasteful. But in a decade or two we will see carbon emissions down by 50% or more if we replace either
the income tax or FICA with a carbon tax. And when this happens we may not be able to raise sufficient
funds via a carbon tax no matter what the tax rate. At that time another tax will be needed to supplement a
carbon tax. For Social Security, a national sales tax would make sense. A sales tax has the same
regressivity as FICA, but unlike FICA a sales tax encourages the working class to save. For the income
tax, the problem is more challenging. You can find many ideas to help answer this challenge in other
chapters on this site. And even should they prove insufficient, and the income tax must be reinstated, the
effort would still be worthwhile. The economy could use a vacation.
33
Warming solvency
Carbon Tax would decrease emissions by 80% and help advert future changes in
climate
Darren Samuelsohn, E&ENews PM senior reporter 5/16/2007 Rep. Stark tosses carbon tax proposal
into warming debate carbon tax center http://www.carbontax.org/blogarchives/2007/04/26/rep-starkintroduces-carbon-tax-bill/ date accessed June 23, 2008
Rep. Pete Stark (D-Calif.) introduced legislation today that aims to curb global warming by taxing the
carbon content of fossil fuels. Stark acknowledged in an interview he faces a tough slog, but he insisted it
should be seen as an alternative to the more widely discussed cap-and-trade approach to reducing
greenhouse gases. "Its viability depends on industry's concern that cap-and-trade becomes a bureaucratic
gaming nightmare," Stark said. "We've had some indication from people who are concerned that the capand-trade is just too complex and subject to some kind of politically staffed bureaucracy getting involved
in it." Instead of cap-and-trade, Stark said an energy tax would be easier for government to administer and
consumers to understand. It also would not set competition among different sectors of the U.S. economy
that is expected if lawmakers move toward a cap-and-trade bill. "It might very well become the lesser of
some evils," Stark said. Stark's bill would tax coal, petroleum and natural gas at $10 per ton of carbon
content when the fuel is either extracted or imported. The tax would increase $10 every year until the
Energy Department and Internal Revenue Service determine U.S. carbon dioxide emissions have dropped
80 percent from 1990 levels -- a threshold many scientists say could help to avert catastrophic changes to
the Earth's climate. Endorsements for a carbon tax come from many notables in the energy policy debate,
including former Vice President Al Gore, New York Times columnist Thomas Friedman and Democratic
presidential candidate Sen. Christopher Dodd (Conn.). To industry groups and several leading energy
companies, including Exxon Mobil Corp., a carbon tax also belongs in the debate over solutions to global
warming. "If your goal is to put a price on carbon for the goal of changing behavior, it's a lot more
transparent," said Lou Hayden, a senior policy analyst at the American Petroleum Institute. In written
comments to the House Energy and Commerce Committee, API said taxes should be considered along
with voluntary efforts and cap-and-trade.
34
used to reduce payroll taxes in a way that would leave the distribution of total tax burden approximately
unchanged. He proposes a tax of $15 per metric ton of carbon dioxide, together with a rebate of the
federal payroll tax on the first $3,660 of earnings for each worker.
35
Warming solvency
Carbon tax would reduce the amount of carbon in the atmosphere and to fight
global warming - a carbon tax is the most efficient way to curb the amount of
co2, fossil fuels, and other greenhouse gases in the atmosphere
Donna Smith, scientist for Reuters, U.S. scientist urges carbon tax to help climate 06/23/08,
http://www.guardian.co.uk/business/feedarticle/, date accessed 06/23/08
The U.S. scientist who 20 years ago first told Congress that the Earth's climate was warming said on
Monday that urgent action is needed to cut greenhouse gases and a tax proposal on carbon emissions.
James Hansen, the director of NASA's Goddard Institute for Space Studies, said at a congressional
briefing that a carbon tax would be the most efficient way to cut global warming emissions and encourage
non-fossil energy sources."We have to level with the public that there has to be a price on carbon
emissions," Hansen said. "That this is the only way we are going to begin to move toward a carbon free
economy."Hansen said urgent action is needed to cut carbon dioxide emissions that are warming the
globe and are already causing arctic ice to melt. He said world leaders had only one or two years to act
before the Earth reaches a "tipping point" with major consequences to the global climate and species
survival."We have reached an emergency situation," Hansen said. He said the government should not
keep the proceeds from any carbon tax, but refund the money to taxpayers to help them pay for more fuel
efficient technology. President George W. Bush has opposed any broad program to curb carbon emissions
saying it would hurt the economy and has consistently resisted any tax increases. But global warming is
an issue in this year's presidential campaign and is expected to be a major topic of discussion at next
month's meeting of leaders of the Group of Eight industrial nations in Japan. Twenty years ago today,
Hansen testified before a Senate committee and told lawmakers that "the greenhouse effect has been
detected, and it is changing our climate now."Hansen's testimony helped spur the first congressional
efforts to curb greenhouse gases. The most recent effort, legislation that would have created a cap-andtrade system for carbon emissions died in the Senate earlier this month in face of a veto threat from the
White House.
Carbon Tax would decrease emissions by 80% and help advert future changes in
climate Darren samuelsohn, E&ENews PM senior reporter 5/16/2007 Rep. Stark tosses carbon tax
proposal into warming debate carbon tax center http://www.carbontax.org/blogarchives/2007/04/26/repstark-introduces-carbon-tax-bill/ date accessed June 23, 2008
Rep. Pete Stark (D-Calif.) introduced legislation today that aims to curb global warming by taxing the
carbon content of fossil fuels. Stark acknowledged in an interview he faces a tough slog, but he insisted it
should be seen as an alternative to the more widely discussed cap-and-trade approach to reducing
greenhouse gases. "Its viability depends on industry's concern that cap-and-trade becomes a bureaucratic
gaming nightmare," Stark said. "We've had some indication from people who are concerned that the capand-trade is just too complex and subject to some kind of politically staffed bureaucracy getting involved
in it." Instead of cap-and-trade, Stark said an energy tax would be easier for government to administer and
consumers to understand. It also would not set competition among different sectors of the U.S. economy
that is expected if lawmakers move toward a cap-and-trade bill. "It might very well become the lesser of
some evils," Stark said. Stark's bill would tax coal, petroleum and natural gas at $10 per ton of carbon
content when the fuel is either extracted or imported. The tax would increase $10 every year until the
Energy Department and Internal Revenue Service determine U.S. carbon dioxide emissions have dropped
80 percent from 1990 levels -- a threshold many scientists say could help to avert catastrophic changes to
the Earth's climate. Endorsements for a carbon tax come from many notables in the energy policy debate,
including former Vice President Al Gore, New York Times columnist Thomas Friedman and Democratic
presidential candidate Sen. Christopher Dodd (Conn.). To industry groups and several leading energy
companies, including Exxon Mobil Corp., a carbon tax also belongs in the debate over solutions to global
warming. "If your goal is to put a price on carbon for the goal of changing behavior, it's a lot more
transparent," said Lou Hayden, a senior policy analyst at the American Petroleum Institute. In written
comments to the House Energy and Commerce Committee, API said taxes should be considered along
with voluntary efforts and cap-and-trade.
36
Warming solvency
Carbon tax would reduce the amount of carbon in the atmosphere and to fight
global warming - A Carbon Tax would greatly reduce the amount of carbon
emissions within a decade
Carl S. Milsted January 9, 2008 the future of the carbon tax holistic politics
http://www.holisticpolitics.org/GlobalWarming/Future.php date accessed June 23, 2008
At the beginning of this chapter I said that the U.S. needs to cut its carbon dioxide emissions by 75% just
to keep world emissions constantif we allow the rest of the world to catch up. Yet in my carbon tax
calculations I assumed that the reduction in carbon burning would be less. We have a contradiction. This
is intentional. I don't want to immediately cut carbon burning by 75%. It would be a huge burden on the
economy and likely unnecessary. The world hasn't caught up yet, so we have time. And the world can
likely withstand a few years of carbon dioxide emission growth as long as it is followed up by shrinkage.
Actually, a near-immediate 25% reduction in carbon burning would be considered ambitious by many
environmentalists. It is more than the Kyoto Treaty calls for. The bigger environmental benefit of a
carbon tax is not the immediate conservation, but the market created for real long term solutions. At a
doubling of retail energy costs, many existing alternative energy technologies become economically
viable: passive solar, flat plate collectors, hybrid cars, and maybe even more exotic technologies such as
photovoltaics, electric cars and Stirling engine hot water heaters. But such technologies will take time to
deploy. In fact, it may be better not to deploy such technologies too fast, as better solutions are still in the
laboratories. For example, light emitting diode technology is catching up with fluorescent light
technology, and LEDs don't contain mercury. Photovoltaics are also improving rapidly . Rushing can be
wasteful. But in a decade or two we will see carbon emissions down by 50% or more if we replace either
the income tax or FICA with a carbon tax. And when this happens we may not be able to raise sufficient
funds via a carbon tax no matter what the tax rate. At that time another tax will be needed to supplement a
carbon tax. For Social Security, a national sales tax would make sense. A sales tax has the same
regressivity as FICA, but unlike FICA a sales tax encourages the working class to save. For the income
tax, the problem is more challenging. You can find many ideas to help answer this challenge in other
chapters on this site. And even should they prove insufficient, and the income tax must be reinstated, the
effort would still be worthwhile. The economy could use a vacation.
37
greenhouse gas emissions rather than a decrease. Fortunately, promising ideas are already circulating that
would help make the transition to a less carbon-intensive economy compatible with maintaining and
creating high-quality jobs.
38
Warming solvency
Carbon tax would reduce the amount of carbon in the atmosphere and to fight
global warming - A carbon tax is the only way for the U.S. to regulate carbon
levels.
Phil Davies, December 2007, Putting a Price on carbon, http://web.ebscohost.com/ehost/pdf?
vid=18&hid=109&sid=afdb72b8-f9d0-4677-954c-80d55eecb69b%40sessionmgr102 ; 6/23/08
Maybejust maybepoliticians are starting to listen to economists. If greenhouse emissions need to be
decreased to address global warming (a scientific debate), economic theory suggests that prices rather
than quantities are the policy tool of choice. And the most direct way for policymakers to affect price is to
impose a tax. "The scientists tell us that world temperatures are rising because humans are emitting
carbon into the atmosphere," writes N. Gregory Mankiw, a Harvard University professor and former
adviser to Bush, in a September article in the New York Times. "Basic economics tells us that when you
tax something, you normally get less of it. So if we want to reduce global emissions of carbon, we need a
global carbon tax."
Carbon tax would reduce the amount of carbon in the atmosphere and to fight
global warming A carbon tax is the only option for fighting the cost of carbon
emissions in the environment
Daniel Rosenblum, Carbon Tax, not Peak Oil, Can Save Climate, 03/5/2007
(http://www.carbontax.org/blogarchives/2007/03/05/carbon-tax-not-peak-oil-can-save-climate-2/ date acc.
6/24/08)
The Times article closes by quoting a Chevron engineer: " peak oil is a moving target [and the supply
of] oil is always a function of price and technology." True enough. Our task is to make the use of oil, coal
and gas a function of a climate-aware price and technology. At present, the fuel prices that determine the
demand side of the equation include nothing for the climate damage resulting from burning those fuels,
resulting in vast overuse. Moreover, those feedback mechanisms I mentioned in my 2005 talk invariably
overshoot the mark, resulting in the kind of wild price swings that Yergin described. These fluctuations
drown out underlying movements toward higher prices, frustrating investment in low-carbon alternatives
on both the demand and supply sides. What to do? A tax on carbon fuels will internalize the costs of
carbon damage and make manifest today the long-term trajectory of rising carbon-fuel prices. No other
policy option not cap-and-trade, not fuel efficiency standards, not subsidies for renewables can do
that.
39
Warming solvency
Taxes can eliminate coal
Walsh (Bryan, distinguished writer and columnist for Time magazine, 1/04/08, Plan B How to Stop
Global Warming, online: http://www.time.com/time/health/article/0,8599,1700189,00.html, acc: 6/23/08)
The key to Brown's Plan B is winding down our dependence on coal the carbon-heavy fuel that the
people over at the environmental website Grist like to refer to as "the enemy of the human race." Right
now the world is on pace to build hundreds of new coal power plants over the coming decades, adding
vast amounts of carbon dioxide into the atmosphere, and if that happens the fight against global warming
is as good as lost. Brown argues that rapid action to improve energy efficiency, develop renewable
sources of power and expand the Earth's forest cover could reduce carbon emissions enough to allow us
to phase out coal power and meet that 80% target. The numbers are simple. It's easy to ridicule the
"switch a light bulb, save the planet" school of environmental planning, but Brown points out that by
making the most of efficiency improvements in lighting and appliances, we could reduce power demand
sufficiently to obviate the need for 1,410 coal plants. That's more than the 1,382 coal plants the
International Energy Agency predicts will be built by 2020. If we start pumping out new wind turbines
with the same industrial urgency the U.S. produced tanks and bombers in World War II, Brown writes, we
could generate 3 million megawatts of wind power by 2020, enough to meet 40% of the world's energy
needs. Solar thermal, plug-in hybrid and geothermal technology are all part of Plan B. (Did you know that
the geothermal energy contained in the upper six miles of the Earth's crust is 50,000 times more powerful
than all of our oil and natural gas? Brown does.) To push the transition to a cleaner, more efficient
economy the Plan B economy Brown argues for a worldwide carbon tax to be phased in at $20 per
ton each year between 2008 and 2020, topping out at $240 per ton. That might seem excessive, but
Brown points out that even a carbon tax higher than $240 per ton wouldn't cover all the environmental
and health costs of burning fossil fuels, from climate change to air pollutionrelated illnesses. And while
it's difficult to imagine any politician standing up for such a tax, he reminds us that we already have a
precedent for a heavy tax that takes into account negative externalities and attempts to discourage
consumption: cigarette taxes. Altogether Brown calculates that his Plan B would cost the world an
additional $190 billion a year. That might seem high, until he compares the price tag to the global military
budget, which stands at more than $1.2 trillion. All we have to do is find the political and popular will to
implement the plan. But that's the problem. Brown's proposals are solid, but the real battle over climate
change is now political, not technological, and it's one that too many environmentalists tend to discount.
If you've drunk the green Kool-Aid, it can seem frustratingly obvious why we need a $240 carbon tax, or
why the climate change challenge is on par with World War II, and thus demands Rosie the Riveter redux.
But the true, painstaking challenge of the next few years will be building a broad political coalition that
will support that level of commitment. Brown's Plan B is a great blueprint for combating climate change,
but we might need a Plan C to put it into action.
40
Warming solvency
Tax on carbon reduces emissionsWilliam C. Brainard and George L. Perry (editors for Brookings Paper on Economic Activity)
2005, 2, p. ix- Article- Editors Summary
http://muse.jhu.edu/journals/brookings_papers_on_economic_activity/v2005/2005.2brainard.pdf
acc:
06-23-08
The authors emphasize that growth in the developing world will be the main driver in carbon buildup. In
their base case, the developing countries account for almost 60 percent of emissions in 2025 and 70
percent in 2050.China and India are the countries where the greatest increase in energy consumption will
take place and therefore where most new power generating facilities will be built. And it is much less
expensive to reduce emissions by building new facilities with the new technology than by retrofitting old
ones. Thus any successful program to reduce carbon emissions will have to center on these and other
countries in the developing world. The authors note that either a uniform tax on carbon emissions in all
regions or a system of global tradable permitsboth of which have been proposedcould, in principle,
provide the needed incentives to restrain emissions. However, they recognize that negotiations to do
either may be difficult, and they believe that the only practical way to reduce emissions may be to secure
the cooperation of the limited number of decision makers who license new power plants and set new
efficiency standards. Whatever route is taken to achieve global cooperation, since most of the carbon
reduction will have to be done in regions that can least afford the added cost, the authors stress that part
of the incremental cost of CCS in China, India, and other developing nations should be borne by the highincome countries.
41
Regulations solvency
Carbon tax would get rid of state regulations like tradable permits and fuel
efficiency standards. There would be no need for them.
Kenneth P. Green, resident scholar, Steven F. Hayward, F. K. Weyerhaeuser Fellow, and Kevin A.
Hassett, senior fellow and director of economic policy studies at AEI, American Enterprise Institute,
"Climate Change: Caps vs. Taxes" June 2007
Elimination of Superfluous Regulations. Because a carbon tax would cause carbon emissions to be
reduced efficiently across the entire market, other measures that are less efficient--and sometimes even
perverse in their impacts--could be eliminated. With the proper federal carbon tax in place, there would
be no need for corporate average fuel economy standards, for example. California's emissions-trading
scheme, likewise, would be superfluous, and its retention only harmful to the Golden State. As
regulations impose significant costs and distort markets, the potential to displace a fairly broad swath of
environmental regulations with a carbon tax offers benefits beyond GHG reductions.
42
Carbon tax puts burden on oil industry rather than auto industries
Carl Pope (Huffington Post) Sept.29, 2007 Mister Dingell's Carbon Tax Gambit
http://www.evworld.com/news.cfm?newsid=16308 acc: 6-23-08
Washington, DC -- It certainly looks like it. The settlement of the short-lived strike by the United Auto
Workers is seen as having resolved the threat that retiree health care costs posted to General Motors'
competitiveness, and the company's stock price soared on the news. Meanwhile, Congressman John
Dingell, whose wife Debbie is a GM lobbyist, has embraced GM's long-standing policy preference in
dealing with global warming and America's oil dependence; that is, to tax fuel. Dingell has embraced -officially, at least -- the idea of a $50 per ton tax on carbon, roughly $15 per ton of carbon dioxide, phased
in over five years, and pegged thereafter at the rate of inflation. GM prefers a carbon tax, which puts the
burden of emissions cuts on the oil industry (and GM's customers), over tougher federal fuel economy
standards for cars, trucks and SUVs. Recently, the company also embraced a cap-and-trade system that
would also price carbon, thereby joining USCAP, an alliance of environmental and business groups
working for such legislation. In announcing his proposal Dingell said, "We need to act in order to prevent
a serious problem. The world's best scientists agree we need to reduce greenhouse gas emissions by 60-80
percent by 2050 in order to limit the effects of global warming and this legislation will put us on track to
do just that. This is a massive undertaking, and it will not be easy to achieve, but we simply must
accomplish this goal; our future and our children's futures depend on it."
43
Economy solvency
Carbon tax would provide more flexibility, reducing costs.
Congressional Budget Office, A CBO Study, "Policy Options for Reducing CO2 Emissions"
February 2008 http://www.cbo.gov/ftpdocs/89xx/doc8934/02-12-Carbon.pdf
Incentive-based approaches can reduce emissions at a lower cost than more restrictive command-andcontrol approaches because they provide more flexibility about where and how emission reductions are achieved.
Under a tax, policymakers would levy a fee for each ton of CO2 emitted or for each ton of carbon contained in fossil fuels. The
tax would motivate entities to cut back on their emissions if the cost of doing so was less than the cost of
paying the tax. As a result, the tax would place an upper limit on the cost of reducing emissions, but the total amount of CO2 that
would be emitted in any given year would be uncertain. In contrast, under a cap-and-trade program, policymakers would
set a limit on total emissions during some period and would require regulated entities to hold rights, or allowances, to the
emissions permitted under that cap. (Each allowance would entitle companies to emit one ton of CO2 or to have one ton of carbon
in the fuel that they sold.) After the allowances for a given period were distributed, entities would be free to buy and sell the
allowances among themselves. Unlike a tax, a cap-and-trade program would place an upper limit on the amount of emissions, but
the cost of reducing emissions would vary on the basis of fluctuations in energy markets, the weather (for
example, an exceptionally cold winter would increase the demand for energy and make meeting a cap more expensive), and the
technologies available for reducing emissions. Given the gradual nature of climate change, the
uncertainty that exists about the cost of reducing emissions, and the potential variability of the cost of meeting a
particular cap on emissions at different points in time, a tax could offer significant advantages. If policymakers
chose to specify a long-term target for cutting emissions, a tax could be set at a rate that could meet that
target at a lower cost than a comparable cap. In addition, if policymakers set the tax rate at a level that reflected the
expected benefits of reducing a ton of emissions (which would rise over time), a tax would keep the costs of emission
reductions in balance with the anticipated benefits, whereas a cap would not.
only emission reductions that cost less than the tax rate, it would automatically adjust the quantity of
emission reductions to keep their costs in line with their anticipated benefits, whereas a cap would not.
When analysts take into account the degree to which costs are likely to vary around a single best estimate, they conclude that
a tax could offer much higher net benefits than a cap. One study suggests that the net benefits of a
worldwide tax on CO2 emissions in 2010 would be more than eight times larger than those of an equivalent
inflexible cap. If the policies are assumed to be set in place for 100 years, the efficiency advantage of a tax declines to a factor of
five.9 Another study concluded that a tax could offer up to 16 times greater expected net benefits than a cap
under some assumptions.10 A third study examined outcomes when cost shocks were assumed to be correlated
across timethat is, an unusually high cost of meeting the cap in any given year increases the likelihood of a higher than average
cost in the following year. Using their base-case parameter estimates for factors that might affect costs (such as baseline emissions
and changes in technology) and assuming a 10-year policy, those researchers estimated that the net benefits of a tax
would be roughly five times higher than those of a cap.11 Taken together, those studies suggest that the
net benefits of a tax could be roughly five times those of an inflexible cap (see Figure 1-2)assuming that both
policies were designed to balance expected costs and benefits. Viewed another way, any long-term emission-reduction
target could be met by a tax at a fraction of the cost of an inflexible cap-and-trade program. That cost
savings stems from the fact that a tax could better accommodate cost fluctuations while simultaneously
achieving a long-term emission target. It would provide firms with an incentive to undertake more
emission reductions when the cost of doing so was relatively low and allow them to reduce emissions less
when the cost of doing so was particularly high.
44
Economy solvency
Carbon tax avoids inevitable economic collapse from other alternatives namely,
cap-and-trade.
The Economist, Doffing the cap; Economics focus June 16, 2007 lexis
Tradable emissions permits are a popular, but inferior, way to tackle global warming The pressure for
political action on climate change has never looked stronger. Even George Bush has now joined the
leaders of other rich countries in their quest to negotiate a successor regime to the Kyoto protocol, the
treaty on curbing greenhouse gases that expires in 2012. Too bad, then, that politicians seem set on a second-best
route to a greener world. That is the path of cap-and-trade, where the quantity of emissions is limited (the cap) and the right to emit
is distributed through a system of tradable permits. The original Kyoto treaty set up such a mechanism and its signatories are keen to
expand it. The main market-based alternativea carbon taxhas virtually no political support. A pity,
because most economists agree that carbon taxes are a better way to reduce greenhouse gases than capand-trade schemes. That is because taxes deal more efficiently than do permits with the uncertainty
surrounding carbon control. In the neat world of economic theory, carbon reduction makes sense until the marginal cost of cutting carbon emissions is equal to
the marginal benefit of cutting carbon emissions. If policymakers knew the exact shape of these cost and benefit curves, it would matter little whether they reached this optimal
these pitfalls, some cap-and-trade advocates want to set price floors and ceilings within carbon-trading systems. One of the most
prominent bills in America's Congress, for instance, includes a "safety valve". If the price of carbon rises beyond a threshold, the
government will allocate an unlimited supply of permits at that price. Such reforms, in effect, make a cap-and-trade system work
more like a carbon tax. A third advantage of carbon taxes is that they raise revenue. Governments can use this cash to reduce
other inefficient taxes, thereby cutting the economic costs of carbon abatement. Or they can use the money to compensate those, such as the poor, who are hit disproportionately
hard by higher fuel costs. Cap-and-trade schemes, in contrast, have traditionally given away permits, which leaves no room to reduce the economic costs of climate control by
cutting taxes elsewhere. But here, too, change may be afoot. To mimic the advantage of a carbon tax, many cap-and-trade fans now want governments to auction at least a share
of the permits. All of which raises an important question. If cap-and-trade schemes are to be reformed so that they look more like carbon taxes, why are politicians so reluctant
Add in these political arguments and the choice between a carbon tax and cap-and-trade becomes less obvious. Politicians are heading down the second-best path to combat
climate change, but it may be the only one that leads anywhere.
45
Oil solvency
Implementing carbon tax will decrease oil dependence
climateandenergy.org, 2007 Dangers of oil dependence
http://www.climateandenergy.org/Explore/DangersOfOilDependence/Index.htm Date Accessed: 6/23/08
Moving away from fossil fuels can lower greenhouse gas emissions, strengthen our economy, and ease
international tensions. Unhealthy relationships. The dangerous dynamic of oil dependency creates a foreign policy problem for
the globe, not just the U.S. All too often, foreign policy finds itself filtered through the lens of oil. Oil-producing nations (such as
Iran, Saudi Arabia, Russia, Venezuela, and Nigeria) have the oil-consuming U.S. and European Union at a significant disadvantage.
Western countries are forced to compete for resources with Japan, India, and China, and experience pressure to compromise on
important policy measures. In the U.S., hunger for fossil fuels also requires high defense budgets (that
contribute to increased deficit spending), and draws attention away from the domestic agenda . Use and
abuse. Global oil consumption is growing, especially in developing nations, and related human rights abuses are increasing as well.
Chaos. Oil revenues can wreak havoc on developing economies where democracy is fragile and/or authoritarian, corrupt regimes
pose significant threats. Those who control the oil reap the profits while the rest of the population struggles
with poverty, human rights abuses, civil unrest, radicalism, and terrorism. Cycles and Complications. During the
last century, this destructive cycle became apparent in the oil-rich Middle East. Today it is occurring in Africa, as that continent too
becomes a growing source of oil exports. With extreme weather like droughts and flooding, plus increased famine and disease,
climate change is likely to complicate and intensify these problems. More than Oil. Problems of oil dependence are not just about
transportation. Fossil fuels and their by-products are the basis for a disproportionate amount of our economy. The manufacture of
many other valuable products plastics, fertilizers, medical technologies, etc. also depends on petrochemicals. Our economy is far
too dependent on a fossil fuel model in general - burning fossil fuels of any kind produces some amount of greenhouse gas
emissions, which in turn contributes to climate change. This is always risky. Solutions. We can begin the transition toward a new
energy economy not dependent on fossil fuels. Plan Ahead. Increased incentives are needed to encourage more
research, development, and demonstration projects such as for biorefineries, technologies for carbon sequestration
and compressed air storage, batteries for hybrids and electric vehicles, etc. One way to finance these incentives is to
implement a revenue-neutral carbon tax. The proceeds can be split between research and development of renewables, and
tax credits (or dividends) that mitigate the carbon taxs impact on lower-income people. Consume wisely. Reducing
consumption of all fossil fuels helps to lower greenhouse gas emissions and avert radical climate change .
Switching to alternative fuels and technologies like plug-in hybrids will help decrease oil and gas dependence. Increasing CAFE
standards, offering tax credits for fuel-efficient vehicle purchases, and supporting public transportation helps as well. Energy prices
should accurately reflect the true costs of energy security, environmental impacts like climate change, and the need to preserve fossil
fuels which are non-renewable resources - for future generations.
46
Oil solvency
Carbon tax spurs innovation and solves dependence.
Daniel Rosenblum, carbontax.org, "A Carbon Tax When Oil Approaches $100/Barrel?" November 9,
2007 http://www.carbontax.org/blogarchives/2007/11/09/a-carbon-tax-when-oil-approaches-100barrel/
Rising Global Demand for Oil Provoking New Energy Crisis according to todays New York Times. Yesterdays front page of the
Wall Street Journal headlined As Energy Prices Soar, U.S. Industries Collide. Why not just rely upon high gasoline prices to bring
down demand instead of adding insult to injury with a carbon tax? One reason is that high gasoline prices alone are not
enough to reduce consumption of gasoline and the resulting carbon dioxide emissions. Consumers,
whether businesses or households, need a clear price signal that future prices are going to remain high
before they are motivated to make the investment decisions necessary to reduce consumption. The
volatile gas prices of the last few years just dont provide that kind of signal . The rising global demand for oil
headlined in the Times story is faster in developing countries, but as the Times correctly noted, Americans appetite for big cars
and large houses has pushed up oil demand steadily in this country, too. The problem is that while it may be a rational economic
decision to invest in a more efficient car, house, truck or airplane if gas prices are expected to remain at or above current levels, the
economic decision-making is very different if consumers believe prices may plummet in two months. Europe has had considerably
higher gasoline prices for many years and, not coincidentally, Europeans generally drive much smaller and more efficient vehicles.
While volatile prices do not encourage investment in efficiency, a clear and certain trajectory of increasing carbon taxes would do
so. The revenue-neutral carbon tax proposed by the Carbon Tax Center provides that clear price signal. And, the
gradual trajectory of increased prices that we propose gives consumers time to adjust to the higher prices
by both investing in efficiency and making behavioral changes that will further reduce energy use. For more
on how consumer demand for gasoline responds to price, see our issue paper by clicking here. Another important reason why a
carbon tax continues to be essential even with high oil prices is that the goal of a carbon tax is to reduce carbon dioxide
emissions, not just to reduce consumption of gasoline. Generation of electricity accounts for
approximately 40% of carbon dioxide emissions , compared to about 21% from gasoline and 4% from
aviation. Two-thirds of the emissions reductions from a carbon tax are expected to come from the
electricity sector, 11% from gasoline and only 1% from aviation. Coal use is increasing and will continue to increase
without a price signal that reflects the harm caused by carbon dioxide emissions from coal-fired electric generating plants. In
addition, high oil prices encourage the development of new sources of energy with huge carbon dioxide
emissions such as the Alberta oil sands projects. Tar sands development is the single largest contributor to
the increase in climate change in Canada according to Greenpeace Canada. Even worse, according to a study by the Sage
Centre and World Wildlife Fund-Canada, "voracious water consumption by Alberta's oilsands threatens the quality and quantity of
water available to Saskatchewan and the Northwest Territories through the Mackenzie River system." In fact, today's New York
Times cites a new study finding that "[h]igh levels of carcinogens have been found in fish, water and sediment downstream from
Alberta's huge oil sands projects." A carbon tax would reduce the economic incentive for such projects by
holding down the price of oil. A carbon tax actually applied to such projects would destroy their economics. Finally, right
now the high oil prices are enriching oil producing countries and oil companies and causing severe
damage to the United States economy. A revenue-neutral carbon tax will reduce demand and lead to
reduced prices for the oil itself. The results? Reduced carbon dioxide emissions, less money going
overseas and to big oil companies, carbon tax revenues returned to all Americans and strengthening our
economy, and increased national security as we reduce our dependence on foreign oil. Win-win-win-win!
47
Oil solvency
Carbon Tax is the only way to solve oil dependence
Charles Komanoff 24 June 2006 Fuel Tax Magic http://www.energybulletin.net/node/17867 Accessed
June 26, 2008
...I offer two answers. Combined, they just might hold a solution to our era's twin overriding crises: the
oil-dependence crisis and the climate crisis. The first answer is that as we extend our time horizon,
gasoline's price-elasticity, or price sensitivity to break free of the jargon, gets larger -- a lot larger. Going
out several years or more, individuals have greater scope to take actions that economize on gasoline. They
can junk the gas-guzzler, or at least not replace it with another one when the old one gives out. They
might calculate the dollar tradeoffs between density (high rents but less need to drive) and sprawl (the
reverse) and pick up stakes for a less car-dependent area. They may gravitate toward job opportunities
closer to home. And they can make more durable commitments to behavioral changes that reduce the
need to drive, like forming a carpool or buying a roadworthy bicycle or selling the far-away vacation
home. The consensus of economists who have studied gasoline use is that the "long-term" price elasticity
-- the effect on demand eight or ten years hence -- is between 50% and 70%, or roughly triple the 20%
"short-term" elasticity I'm seeing in my spreadsheet. That is, over the long haul, rises in the price of gas
are likely to dampen demand several times as much as the modest changes we've seen in the past year or
two. The second reason price-elasticity matters is that prices of gasoline and other fuels will probably
climb in the future. Or, to be candid, fuel prices need to climb far and fast if America is to ever get off the
oil spike and the world as a whole is to avoid disastrous climate change. For all the promising antidotes to
oil dependence, from ethanol and hybrid cars to rearranging living patterns so people and goods don't
have to move as much, there's a growing awareness that the only surefire way to advance on all fronts is
to create an irresistible and universal market pull by pricing gasoline at a very high level -- perhaps in the
$10 a gallon range. And now that the climate crisis is overtaking oil dependence as the ultimate energy
nightmare, people are starting to face the fact that only vastly higher prices for all fossil fuels can reduce
CO2 emissions across the board, through conservation, not just of gasoline but of all petroleum products
as well as natural gas and coal. Yes, I'm talking about a carbon tax -- the only mechanism powerful and
direct enough for the daunting task of phasing out fossil fuels.
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Oil solvency
Carbon Tax would decrease oil dependence & reduce employment taxes
Bill Bradley 4/1/2007 We can get out of these ruts http://www.washingtonpost.com/wpdyn/content/article/2007/03/30/AR2007033002071_pf.html Date Accessed: 6/23/2008
We also need to change our tax system to reduce our oil dependence. In general, we ought to reduce taxes
on things we need, such as wages, and raise taxes on whatever is dangerous to us, such as pollution and
resource depletion. We could implement a $1 per gallon gasoline tax; or an equivalent carbon tax, which
is a tax on any energy source that emits carbon dioxide; or equivalent taxes on other major air pollutants:
volatile organics, nitrogen oxide, lead, sulfurous dioxide and particulates. These taxes could be phased in
over five years, with the revenue going to reduce employment taxes (Social Security, Medicare or
unemployment insurance) for employees and employers alike. The gasoline or carbon tax would
encourage the nation to reduce its dependence on insecure sources of foreign oil, and with payroll taxes
reduced to 15 percent of labor costs, businesses would have an incentive to hire workers. Such a shift in
taxation -- away from jobs and toward pollution, energy and natural resources -- would draw many of the
24 million part-time employees into the full-time workforce, and millions more who are not working
would be more likely to find jobs. After a few years of adjustment in the case of a gasoline or carbon tax,
cars would be more fuel-efficient, so consumers would pay what they used to pay for the same amount of
driving, and the broad middle class would continue to pay lower employment taxes. The result would be
increasing demand for goods and services; shrinking dependency payments such as unemployment
compensation and welfare; lowered social costs, such as crime and avoidable illness; and a more
equitable tax system that encourages rising employment.Reducing employment taxes also makes sense on
grounds of competitiveness and equity. Employment taxes now hit our most successful companies
hardest. A company such as Microsoft or McKinsey desperately needs talented people, and there is a
limited pool of those with the requisite skills. As a part of a company's compensation package, it has to
pay enough to offset the employment taxes paid by the employee. If it doesn't make up the taxes in higher
wages, the employee can go somewhere else where the employer will cover the taxes. Meanwhile, at a
lumberyard where there is an excess of labor, the company doesn't have to pay higher wages and the bulk
of the employment taxes hit the workers. Perversely, it is the lowest-paid workers and the companies
most essential to economic growth that are hit hardest by employment taxes. We will never make these
simple changes in our political system or in our energy and tax systems if we don't tell the truth about our
national circumstances. Political leaders should not arrogate to themselves, based on a desire to hold onto
political power, the right to hide the truth from the people. If we tell people the truth we can trust them to
do the right thing. Sounds like a radical notion, but it's really just common sense. Once we face the truth
about our abysmal voter turnout, our oil addiction, our health-care and education crises, and our
inadequate national savings, there is good news. There are answers to all our current problems. It's not
rocket science. What's required is the political will to enact policies that can allow us to thrive in the 21st
century. An administration bold enough to tell the truth will find an audience ready for bold solutions.
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Oil solvency
Increased taxes result in reduced consumption
Knickerbocker, Brad, February 2008 North America Gets Its First Carbon Tax. Christian Science
Monitor Vol. 100 Issue 65 Acc: 06/23/08 http://web.ebscohost.com/ehost/detail?
vid=3&hid=107&sid=640d75aa-bd8f-45b7-aa39-fba35986f2c4%40sessionmgr103
Taxing carbon-spewing machines to slow global warming certainly has an eat-your-peas aspect to it: "Trade your SUV for a hybrid
or we'll make you pay!" Then again, tax policy can have a huge and positive impact on individual and group
behavior. In part, high cigarette taxes explain why rates of smoking among Americans have plummeted.
The Canadian province of British Columbia last week became the first jurisdiction in North America to
enact a consumer-based tax on carbon emissions. The Vancouver Sun reported: "The move was seen as a huge win by
environmentalists, who depicted B.C. as a leader in taking action on climate change. 'I think this is a landmark decision in
North America as far as government addressing global warming,' said Ian Bruce of the Suzuki
Foundation. 'The B.C. government has decided to use one of the most powerful incentives at its disposal
to reduce pollution,' he added." The goal is to raise US$1.75 billion over the next three years by taxing virtually all fossil
fuels, including gasoline, diesel, natural gas, coal, propane, and home-heating fuel. It starts in July at $10 per ton of carbon
emissions, rising to $30 per ton by 2012. Consumers will pay an extra 2.4 cents a liter (9 cents per US gallon) this year for gasoline,
rising to 7.2 cents by 2012. Home heating oil would rise 2.8 cents a liter (10.6 cents per US gallon), going up to 8.3 cents per liter
over the same period. The Globe and Mail (subscription required) reported: "'It has been a dramatic turn, I think, for this province
with this budget to say we're not just going to be talking about climate action,' said Finance Minister Carole Taylor. She said the
strategy is to 'tax something that we know is bad for us,' and use the revenue to stimulate wide social change
by providing incentives for people and businesses to become more energy efficient ." The plan is meant to be
"revenue neutral," meaning that overall taxes won't climb. To compensate, corporate and personal income tax rates will drop, and
low-income families will receive an annual tax credit of $100 per adult and $30 per child. To jump start the program, every resident
will get a one-time payment of $100 this year. The Canadian Press reported: "[British Columbia] Premier Gordon Campbell said he
won't try to pressure any other provinces to take action on climate change but he hopes B.C. serves as an example. He said by giving
British Columbians tax breaks on things such as fuel-efficient cars and energy-efficient appliances, British Columbians are being
given real choices on battling climate change. 'It'll drive investment in the economy,' Campbell said. " The new carbon tax is not
seen as a panacea. It's expected to help cut B.C.'s greenhouse-gas emissions by about 5 percent by 2020, but that's well short of the
government's goal of a 33 percent reduction. The Times Colonist in Victoria, B.C., quotes University of Victoria climatologist
Andrew Weaver as saying that the tax will send an important message: "To me, what's important is the actual signal to the market
that carbon is going to have a price. And that price is going up, not down. And that, in itself, is enough to
do a paradigm shift as to how we do stuff." So far, the rest of Canada is not following British Columbia's lead. Ontario's
strategy, for example, includes a commitment to shut down the province's coal-fired generating plants. United Press International
quotes Ontario Premier Dalton McGuinty as saying: "We're doing something differently here in Ontario that suits our economy and
the direction that we're pursuing." Some federal officials in Canada are concerned that individual plans by provinces could be
more costly and less efficient than a unified approach. The National Post reported:"'(Canadians) don't want to pay more for cars,
they don't want to pay more for other things because the governments can't get their act together and co-operate,' [Finance Minister
Jim Flaherty] said." That's essentially the argument the Bush administration has been using to block California and other states from
regulating vehicle greenhouse gas emissions.
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Global modeling
Other Countries model after U.S. policies
Makram Haluani 2003 Benign Neglect: Cooperation in the Western Hemisphere
http://www.questia.com/googleScholar.qst;jsessionid=LjnV1YQL29qLRWD5yq0y2LFPyXBy1yyNjxDv2
Ks3L6Qvdvycfxrh!-1672927978?docId=5000642709 Date Accessed: 6/26/2008
Governments around the world base foreign policy strategies on their interpretations of US attitudes.
They look for both consistencies and changes in the speeches, press conferences, and remarks of senior
US officials. The course of international events depends on these attitudes, and the rest of the world
knows it. This practice is especially true of Latin American countries, whose governments have followed
recent trends in US presidential discourse with some concern. On August 25, 2000, Republican
presidential candidate George Bush proclaimed, "Should I become president, I'll look south, not as an
afterthought, but as a fundamental commitment." He assured his audience that he would be the "mejor
amigo" of Latin America. Indeed, as president, Bush's first visit abroad was to Mexico and not to Canada,
a significant departure from tradition. According to Bush, Latin America holds a central place in US...
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Global modeling
International efforts to reduce warming will be rolled back without US action.
Liana G.T. Wolf, Yale Law School, J.D., Georgetown International Environmental Law Review, Fall
2006 lexis
When a problem requires action by many different nations, the most ideal solution usually arises out of
multilateral cooperative behavior. However, when such an ideal solution is not obtainable, other mechanisms must be used
to achieve joint action. This paper proposes the SCM Agreement as a viable mechanism for encouraging countries to internalize
their environmental costs that have global effects. Under the SCM Agreement as written, or under the proposed amended version,
the failure of the United States to impose the costs of reducing greenhouse gas emissions on its energy intensive industries should be
classified as a hidden subsidy subject to countervailing duties. These countervailing duties could be used for funding climate change
projects, and they could compensate for the trade distorting effects of the U.S. action. n168 This would give the United States the
incentive to actively reduce its greenhouse gas emissions in a more cost effective manner since the countervailing duties could only
continue as long as the trade distorting subsidy was in effect. The international system is currently plagued by "poor stewardship of
the global commons, lack of liability for transboundary environmental harms, and free riding in treaties." n169 [degree] If the
European Union and other countries are going to absorb the costs of reducing greenhouse gas emissions, the United States should
not be able to reap a competitive advantage from shirking its own environmental responsibilities. If the United States is
allowed to shirk its responsibilities, the European Union and various other industrialized countries may be
forced to reduce their environmental efforts to remain competitive in the international market. If that
occurs, global warming will continue to have an increasingly destructive effect on the global environs.
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Taxes good
Carbon taxes are revenue neutral.
Carbon Tax Center, May 2008, http://www.carbontax.org/introduction/#no-tax-increase Acc:
06/26/08
A carbon tax should be revenue-neutral. At least thats what we (Carbon Tax Center) and many other
carbon tax proponents are advocating. Revenue-neutral means that little if any of the tax revenues raised
by taxing carbon emissions would be retained by government. The vast majority of the revenues would be
returned to the American people, with some small amount utilized to mitigate the otherwise negative
impacts of carbon taxes on low-income energy users. Two primary return approaches are being discussed.
One would rebate the revenues directly through regular (e.g., monthly) equal dividends to all U.S.
residents. In effect, every resident would receive equal, identical slices of the total revenue pie. Just such
a program has operated in Alaska for three decades, providing residents with annual dividends from the
states North Slope oil revenues. In the other method, each dollar of carbon tax revenue would trigger a
dollars worth of reduction in existing taxes such as the federal payroll tax or state sales taxes. As carbontax revenues are phased in (with the tax rates rising gradually but steadily, to allow a smooth transition),
existing taxes will be phased out and, in some cases, eliminated. This tax-shift approach, while less
direct than the dividend method, would also ensure that the carbon tax is revenue-neutral. Note that each
individuals receipt of dividends or tax-shifts would be independent of the taxes he or she pays. That is,
no persons benefits would be tied to his or her energy consumption and carbon tax bill. This separation
of benefits from payments preserves the incentives created by a carbon tax to reduce use of fossil fuels
and emit less CO2 into the atmosphere. Of course, it would be extraordinarily cumbersome to calculate
an individuals full carbon tax bill since to some extent the carbon tax would be passed through as part of
the costs of various goods and services.
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Taxes good
A carbon tax would allow us to reduce income tax.
Moffat, Mike, 2007 About.com
http://economics.about.com/od/incometaxestaxcuts/a/pigouvian_tax.htm
Like Dr. Greg Mankiw, I am also a big fan of Pigovian taxes. He quite rightfully points out that they
"allow us to correct market failures without heavy-handed regulations, while raising government revenue
so we can reduce more distortionary forms of taxation." So like Mankiw, I'm a supporter of the aims of
the Pigou Club. What are Pigovian Taxes Wikipedia has an excellent article on Pigovian taxes, which
begins: "A Pigovian tax is a tax levied to correct the negative externalities of a market activity. For
instance, a Pigovian tax may be levied on producers who pollute the environment to encourage them to
reduce pollution, and to provide revenue which may be used to counteract the negative effects of the
pollution. Certain types of Pigovian taxes are sometimes referred to as sin taxes, for example taxes on
alcohol and cigarettes." In a country like Canada with socialized medicine, the cigarette tax atcs as a
Pigovian tax - it (more than) raises the revenue necessary to offset the expense to the health care system
generated by smoking. Why I Support Pigovian Taxes One of the uses of taxes is to discourage activity
that has negative externalities, or we believe is otherwise economically/socially harmful. That's why these
'sin' taxes exist - they discourage people from smoking and drinking. It's also argument often put forward
by those in favour of marijuana legalization - that a better and more cost-effective way of detering usage
would be to legalize marijuana and tax it rather heavily. These taxes also raise revenue for the state. In
2004-2005, the Canadian government collected $16.7 billion in "other" taxes, which were largely
Pigovian taxes such as energy taxes and excise taxes on cigarettes and alcohol. Since taxes deter the
activity that is being taxed, then why in the world would we ever tax income? Don't we want to
encourage hard work and entrepreunership? Yet in Canada, over 45 percent of federal government
revenue comes from personal income taxes and 15 percent comes from corporate income taxes. I've been
rather hard on the supporters of the FairTax, but they have the right idea. Taxing activities we wish to
encourage (work) does not make a great deal of sense when we can tax acitivities we are not as interested
in promoting (consumption). The FairTaxers take it too far - the amount of revenue needed to finance all
the government programs we value cannot be generated by simply a consumption tax alone. But the basic
idea is sound. I live in the Southwestern Ontario region of Canada, an area with perhaps the poorest air
quality in all of the country. Each year we have a record number of smog days. Wouldn't it make sense
that we try to discourage the use of electricity generated from coal and the use of fossil fuels? Yes, this
would have negative effects on the economy in isolation, but if we used the revenue generated from such
a tax to lower employment insurance premiums or income tax rates, it's likely that the net economic effect
would be positive. Yes, we can go too far with Pigovian taxes. Wikipedia states that "One argument that
has been put forward against the levying of Pigovian pollution taxes is that if the tax is too high it will
lead to a level of pollution that is less than the social optimum." But can anyone claim that we have the
current optimum level of work? The optimum level of investment? The optimum level of savings? If we
are forced to overtax something, and we are given the cost of running government, air pollution seems
like the best place to start. It's true that Pigovian taxes tend to be regressive in the sense that they cause
the poor to pay a higher proportion of their income on them than the rich. While this doesn't seem to
bother many when we discuss raising the taxes on cigarettes, the overall effect of increased use of
Pigovian taxes would cause a level of regressivity that Canadians are uncomfortable with. This
regressivity effect can be eliminated through bundling Pigovian taxes with some form of negative income
tax, like the U.S. Earned Income Tax Credit, such that average tax rates remain progressive. With so
many advantages, I full-heartedly support the increased use of Pigovian taxes in Canada or any other
country. While I'm not a famous well-respected economist like Dr. Mankiw, I would still like to ask for a
membership into his club.
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into the cost of doing business, they can affect plant and building design considerations, new clean
technology development, electricity storage and deployment for industry, and appliance selection and the
purchase of the family car for the individual. n6 The United States has had tradable permits for sulfur
dioxide ("SO[2]") since the enactment of the Clean Air Act Amendments of 1990. In that period, the tradable permits
have varied in price by over forty percent . n7 Yet due to carbon's higher relative market penetration within
the United States and global economy, compared to that of SO[2], similar price fluctuations would likely
affect all aspects of the U.S. economy, including consumer spending, budgeting, capital expansion, and
inflation. n8
Price volatility can wreck the economy and stem alternate energy production.
Congressional Budget Office, A CBO Study, "Policy Options for Reducing CO2 Emissions"
February 2008 http://www.cbo.gov/ftpdocs/89xx/doc8934/02-12-Carbon.pdf
The flexibility in reducing emissions that a tax affords is important because the cost of cutting emissions by a given amount could
vary from year to year depending on such factors as the weather, the level of economic activity, and the availability of low-carbon
technologies. A tax would provide a steady, predictable price for emissions. An inflexible cap , however, could
result in volatile allowance prices, making a cap-and-trade program more disruptive to the economy than
a tax would be. Experience with cap-and-trade programs has shown that price volatility can be a major concern when a
programs design does not include provisions to adjust for unexpectedly high costs and to prevent price spikes. For example, one
researcher found that the price of sulfur dioxide allowances under the U.S. Acid Rain Program was
significantly more volatile than stock prices between 1995 and 2006 (see Figure 1-3).12 Price volatility was most
apparent in the summer of 2000 in Southern Californias Regional Clean Air Incentives Market (RECLAIM), a program that capped
emissions of nitrous oxide (NOx) from the power sector. A heat wave caused demand for electricity to soar that summer, while the
availability of imported power from other states declined. The increase in demand had to be met by running many of Californias
old gas-fired generating facilities, which had not yet installed NOx emission controls. As a result, the demand for NOx RECLAIM
Trading Credits for 2000 rose significantly, boosting their average annual price tenfold (from $4,284 per ton in 1999 to almost
$45,000 per ton in 2000) and contributing to high wholesale electricity prices in California during that period.13 In addition to the
California experience, allowance prices in the European Unions (EUs) Emission Trading Scheme (ETS)a trading
program that covers CO2 emissions from roughly 12,000 sources across 27 countries fell drastically when it became
evident that policymakers had overallocated emission allowances. Price volatility could be particularly
problematic with CO2 allowances because fossil fuels play such an important role in the U.S. economy .
They accounted for 85 percent of the energy consumed in the United States in 2006. CO2 allowance prices could affect
energy prices, inflation rates, and the value of imports and exports. Volatile allowance prices could have
disruptive effects on markets for energy and energy-intensive goods and services and make investment
planning difficult.14 The smoother price path offered by a CO2 tax would better enable firms to plan for
investments in capital equipment that would reduce CO2 emissions (for example, by increasing efficiency or using
low-carbon fuels) and could provide a more certain price signal for firms considering investing in the
development of new emission-reduction technologies.
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target is not met? What if new technology becomes cheaper? What if a global cap-and-trade program is
established? All these variables will cause government to reassess its target . The large number and influence of
firms and interests that care deeply about carbon emissions ensure that each of these retargeting sessions will be extremely
contentious and drawn-out. These sessions will cause further uncertainty among utilities, renewable energy entrepreneurs, and
investors. Carbon tax solves the clarity issues that threaten prevention of global warming and energy investors. Progressive Nation,
"Curb Your Enthusiasm for Curbing Carbon with Cap-and-Trade" April 23, 2007 These problems highlight key ironies. Although
a cap-and-trade program is often called "market-based," it is extremely sensitive to the whims of the
government and special interests. It makes perfect sense describe it as big government with a market face. Likewise,
utilities say that a national program will reduce regulatory uncertainty, but only when compared with no
national program at all. On the other hand, instituting a flat carbon price on carbon equivalent emissions
is simple, effective, and unobtrusive. Power plant emissions must be properly monitored, but small discrepancies will not
destroy the program. An inaccurate reading by a few percent will result in a small percentage tax loss to the
government, not a 90% decrease in price that makes the program useless. Additionally, businesses face a
clear price target. They can easily incorporate the price into their business models and make a rational
decision to cut emissions. Alternative energies also know exactly what price they must meet to become
competitive, the only variable being the price of the underlying fuel source. With hundreds of years of coal deposits in the United
States, long-term coal prices should stay relatively stable. Finally, once the government sets the price, it does not need to make any
more difficult policy choices. The market takes over. The government may need to get involved to change the price in the long-run,
but setting a good initial price that recognizes the cost of installing new technology and the price differential between coal and
renewables should mitigate this potential intervention. Some are concerned that a carbon price will raise their tax bills by an
equivalent amount, but consumers can have their payroll and/or income taxes slashed by a figure roughly equal to that of the new
tax. They will still want the cheapest possible price, and businesses are still out to make the biggest profit possible. A carbon price
will allow the cheapest electricity to flow from cleaner sources. Thus, the utilities and businesses are advocating the policy counter
their general philosophical leanings and best interest. While a cap-and-trade program is bureaucratically complex
and does not allow for rational business decisions, a carbon price only requires a small government entity
to administer, does not necessarily raise taxes overall, and provides a stable basis for future cost
projections. Democrats who support this carbon price can therefore argue to the right of conservatives, save for those who believe
only voluntary emission reduction programs are warranted. A carbon price corresponds with many of the hyphenated phrases they
love as it is a "small-government" and "business-friendly" solution when compared with a cap-and-trade program. Additionally, it
better captures the "entrepreneurial spirit" of Americans wanting to create energy-efficient and renewable energy technology. A price
on carbon makes sense - global warming imposes a cost on societies around the world, and it should not be costless to emit it. Yet
opponents are sure to emphasize that it can be described using the naughty word "tax." Yet with carbon, it's certain which option is
naughty and which one nice.
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this success to have been uneven. There has been significant volatility in emission permit prices, ranging
from a low of $66 per ton in 1997 to $860 per ton in 2006, as the overall emissions cap has been
tightened, with the price moving up and down as much as 43 percent in a year .[1] Over the last three
years, SO2 permit prices have risen 80 percent a year , despite the EPA's authority to auction additional permits as a
"safety valve" to smooth out this severe price volatility.
particularly for an input (carbon) whose aggregate costs might be as great as petroleum in the coming
decades," and that "experience suggests that a regime of strict quantity limits might become extremely
unpopular with market participants and economic policymakers if carbon price variability caused
significant changes in inflation rates, energy prices, and import and export values ."[5] Nordhaus is not alone in
this concern about price volatility. Shapiro similarly observes: Under a cap-and-trade program strict enough to affect
climate change, this increased volatility in all energy prices will affect business investment and
consumption, especially in major CO2 producing economies such as the United States, Germany, Britain,
China and other major developing countries.[6]
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Cap-and-trade competitiveness
International regimes kill US competitiveness.
Kenneth P. Green, resident scholar, Steven F. Hayward, F. K. Weyerhaeuser Fellow, and Kevin A.
Hassett, senior fellow and director of economic policy studies at AEI, American Enterprise Institute,
"Climate Change: Caps vs. Taxes" June 2007
It is possible that the defects of
previous emissions-trading programs could be overcome with more careful design and extended to an
international level, though this would require an extraordinary feat of diplomacy and substantial refinements of international law.
Even if such improvement could be accomplished, it would not provide assurance against the prospect
that the cost of such a system might erode the competitiveness of the U.S. economy against developing
nations that do not join the system. The second reason for skepticism about global emissions trading is that it fails the "no
There are two final, overriding reasons to be doubtful about global emissions trading.
regrets" test. It is considered bad form nowadays to express doubt or skepticism about the scientific case for rapid and dangerous
global warming in the twenty-first century. If warming is either less pronounced than some current forecasts predict or if emissions
reductions have limited effect in moderating future temperature rise, however, a severe global emissions-reduction policy through
emissions trading (on the order of a minimum 50 percent cut by 2050) could turn out to be the costliest public policy mistake in
human history, with the costs vastly exceeding the benefits.
change and adapt its institutions, its relative position will necessarily worsen.
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Carbon tax reduces emissions more than cap & trade given an open society while
avoiding wealth transfers
http://www.economics.harvard.edu/faculty/cooper/files/Kyoto_ct.pdf Alternatives to Kyoto: the Case for a
Carbon Tax Richard N. Cooper Harvard University 2006
This strategy of concealing or seriously downplaying an important consequence of proposed actions will
not work in open societies where skepticism of government claims has grown significantly. A strategy
more likely to be successful is to acknowledge that carboniferous energy needs to become more
expensive, and to accomplish the required increase in prices with an internationally agreed tax, revenues
to accrue to each tax-levying country, to avoid the issue of large unconditional transfers among countries.
Many countries would welcome the additional revenue; countries where this is not the case could use the
revenues to lower other taxes. This proposal an alternative to Michaelowas -- is discussed in more
detail in the following section. It is not assured of success. But in my judgement it has a better chance of
actually reducing greenhouse gas emissions than does the proposal in Michaelowas paper.
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Consensus says carbon tax is cheaper and more effective than cap and trade
Brian Hansen February 19, 2007 "Carbon tax called more effective option than cap-trade for addressing
warming" Inside Energy with Federal Lands, Pg. 12
The U.S. government should enact a simple carbon tax instead of a complex cap-and-trade scheme if it
wants to tackle the problem of global warming, a noted economist said last week. Robert Shapiro, cofounder and chairman of Sonecon, a Washington-based consulting firm, said a carbon tax would reduce
greenhouse gas emissions more effectively than a cap-and-trade program, and with fewer administrative
and economic side effects. "There is a general consensus among economists that a carbon tax would be
more environmentally effective and economically efficient than a cap-and-trade program," Shapiro told
reporters Wednesday in a conference call announcing a new study he wrote on the subject. He prepared
the study for the American Consumer Institute, a Washington think tank and advocacy group.
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Cap-and-trade corruption
Permits encourage cheating and economic slowdown.
Kenneth P. Green, resident scholar, Steven F. Hayward, F. K. Weyerhaeuser Fellow, and Kevin A.
Hassett, senior fellow and director of economic policy studies at AEI, American Enterprise Institute,
"Climate Change: Caps vs. Taxes" June 2007
A cap-and-trade approach to controlling GHG emissions would be highly problematic. A lack of
international binding authority would render enforcement nearly impossible, while the incentives for
cheating would be extremely high. The upfront costs of creating institutions to administer trading are
significant and likely to produce entrenched bureaucracies that clamor for ever-tighter controls on carbon
emissions. Permit holders will see value in further tightening of caps, but will resist efforts outside the
cap-and-trade system that might devalue their new carbon currency. Higher energy costs resulting from
trading would lead to economic slowdown, but as revenues would flow into for-profit coffers
(domestically or internationally), revenues would be unavailable for offsetting either the economic
slowdown or the impacts of higher energy prices on low-income earners.
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Cap-and-trade corruption
Cap and trade is vulernable to corporate manipulation.
Keith Crane, senior economist and James Bartis, senior policy researcher at the RAND Corporation, a
nonprofit research organization, November 29, 2007
To understand the drawbacks of cap-and-trade, one has to look not only at the successful U.S. acid rain
program but the failed European Emissions Trading Scheme, the first phase of which started in January
2005. European Union members each developed emissions goals, then passed out credits to polluters. Yet
for a variety of reasons, the initial cap was set so high that the polluters fell under it without making any
reductions at all. The Europeans are working to improve the scheme in the next phase, but their chances
of success aren't good. One reason is the power of lobbyists. In Europe, as in the U.S., special interests
have a way of warping the political process so that, for example, a corporation generous with its
campaign contributions might win an excessive number of credits. It's also very easy in many European
countries to cheat; because there aren't strong agencies to monitor and verify emissions, companies or
utilities can pretend they're cleaner than they are. The latter problem might be avoided in the U.S. by
beefing up the Environmental Protection Agency. But there's reason to suspect that many of the corporate
interests pushing for a federal cap-and-trade program are hoping for a seat at the table when credits are
passed out, and they will doubtless fudge numbers to maximize their credits; some companies stand to
make a great deal of money under a trading system. Also hoping to profit, honestly or not, would be
carbon traders. Large financial institutions would jump into the exchange to collect commissions on
carbon trades, just as they do with crude oil and wheat. This presents opportunities for Enron-style market
manipulation.
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Competitiveness addon
Carbon tax key to maintaining US economic competitiveness.
Paul Anderson, Chairman and CEO, Duke Energy, Grabbing the Carbon Elephant 2005
An economy-wide carbon tax is the least prescriptive policy approach as it does not mandate reductions in any one sector.
Compared to other market-based approaches, such as cap-and-trade policies, a carbon tax provides greater certainty regarding cost
impacts. A carbon tax would not mandate targeted reductions from one sector or another, but would instead
send economic signals that enable businesses and individuals to make informed decisions . For this reason,
many economic experts believe that a carbon tax is more efficient than a cap-and-trade policy for addressing climate change over
the long-term. To be clear, adoption of a carbon tax need not increase the overall tax burdeninstead, revenues from a carbon tax
could support reductions in inefficient existing taxes on productive labor and investment. And even if climate change turns out to be
less of a problem than many might think, a carbon tax is a no regrets policy that will result in lower overall air emissions and the
benefits of greater energy efficiency. Why would the CEO of a large energy company advocate less energy consumption? Because
its important to take the long view on environmental as well as economic issues.And its also where my faith in American
innovation comes in. A mandate to benefit the environment will spur the kind of technology innovation that
we saw in the last century. Innovation that propelled us to become the worlds leading economy. Set the
right goals and Americans can and will lead the way. Our international competitorsmotivated by
mandatory emissions reductionshave gotten a head start. Japan is the world leader in solar power and hybrid cars,
and Europe leads in wind power. Their economies will benefit from greater energy efficiency, and ours will be
disadvantaged if we lag behind.
change and adapt its institutions, its relative position will necessarily worsen.
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Warming is real
Global warming is real.
Johann Hari, The Independent (London), The last gasp of the global warming deniers January 25, 2007
lexis
And so, at last and at least, the words come. The evidence is now so thuddingly inescapable that even George W.
Bush - a man who, when pricked, bleeds oil - has acknowledged "the serious challenge of global climate change "
in his State of the Union address. It is only a rhetorical concession, another excuse to fiddle as the West Antarctic ice-sheet melts but it is also a crux moment in the history of global warming denial. Today, the small, lingering band of global
warming "sceptics" are beached on the farthest shores of the wrong side of history. They are alone, abandoned
even by Global Warming Bush and the oil industry. Yet this is not a time to gloat. It is time to appeal to them to join the fight for
survival. Deniers, I am sure some of you were sincere. Man-made global warming is such a horrifying event, it is natural to want to
scramble for scraps of evidence suggesting it can't be true. And there are some small misanthropic parts of the environmentalist
movement it is perfectly natural to recoil from. The direct action group Earth First! famously made the vile statement that "the Aids
epidemic, rather than being a scourge, is a welcome development in the inevitable reduction of human population ??? If [it] didn't
exist, radical environmentalists would have to invent [it]." Maybe you wrongly thought all environmentalists were like this. Maybe
that's why you were so eager to disprove our core issue. I know it's painful to give up on something you have passionately believed.
So let's - for one last time - go through your arguments. Deniers' Myth Number One: Scientists are divided on whether
man is causing global warming. In 2004, the universally-respected journal Science studied 928 randomly
selected scientific papers containing the words "global climate change". None of them - not one disagreed with the view that global warming is being caused to a significant degree by burning fossil
fuels. As Jim Baker, who was head of one of the leading scientific organisations in the US, explains, "There is a better
scientific consensus on this issue than any other, with the possible exception of Newton's Law of
Dynamics." Deniers' Myth Number Two: The current warming of the world is simply part of the planet's natural
cycle. After all, there were no carbon emissions when the last ice age ended - why should the current warming be due to them?
There is a sliver of truth in this: natural climate change has not stopped, and it never will. But we have
superimposed onto it a great blast of greenhouse gases of our own, with far stronger effect . To understand
this, you only have to grasp some basic 19th-century physics. As Professor Chris Rapley of the British Antarctic Survey explains,
"There are natural greenhouse gases in the earth's atmosphere which trap heat on the planet , keeping the
surface temperature 30 degrees warmer than it otherwise would be. Since the start of the industrial revolution, we have
released lots more greenhouse gases - around 1,000 billion tonnes of them. This has enhanced the natural
greenhouse effect, and trapped more heat - currently 0.6 degrees. The more greenhouse gases we add, the warmer we'll
be. It's not rocket science." Deniers' Myth Number Three: The current warming in the world is all due to changes in the
energy output of the Sun. In 1991, the Danish scientists Knud Lassen and Eigil FriisChristensen found a correlation between
temperature changes on Earth from 1850 onwards and sunspot activity, which usually indicate changes in the intensity of solar
radiation. As the sun warmed, we warmed. Other scientists studied this closely, and found out that they were partly right: up to 40
per cent of the planet's warming is indeed due to solar activity. But since 1980, sunspot activity has been declining yet temperatures down here have been soaring to the highest levels ever recorded . So while the Sun can take
some of the flak, the world's scientists agree: the other 60 per cent remains with us. Deniers' Myth Number Four: In the 1970s,
scientists were warning about "global cooling" and a looming Ice Age. How can we now trust these warnings of global warming? In
fact, in the 1970s two - literally two - scientists tentatively suggested that cooling could occur over millennia. To compare that
meek, misreported suggestion by two people to the overwhelming scientific consensus from tens of thousands of climatologists is, I
am sure you deniers can see now, dishonest. Denier's Myth Number Five: Global warming is a religion. People have always had an
innate psychological need to believe in a looming apocalypse - this is just the latest version.
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Warming is real
The most recent and reliable models all prove warming is real and human caused.
Biotech Business Week, Recent findings from Duke University, U.S., provide an update on new
April 30, 2007 lexis
Evidence presented in the first phase of the Intergovernmental Panel on Climate Change's 4th
Assessment Report, released in Paris, paints the clearest picture yet that human-derived greenhouse gases are
playing a significant role in observed global warming, said a Duke University scientist who co-authored one of the
report's main chapters. "We are now seeing, not merely predicting, effects of greenhouse warming on a scale
and in ways that were not observable before," said Gabriele Hegerl, associate research professor at Duke's Nicholas
School of the Environment and Earth Sciences, who also co-authored a summary of the report for policymakers. " When you
look at the changes in temperature, circulation, ocean warming, arctic sea ice reduction and glacial retreat
together, it paints a much clearer picture that external drivers, particularly greenhouse gases, are playing a
key role," she said. "As a result, we can be much more confident that 20th century climate changes were not
just linked to natural variability." Hegerl was a coordinating lead author of the IPCC report's chapter on "Understanding and
Report 1:
Attributing Climate Change." Francis Zwiers of the Canadian Centre of Climate Modeling and Analysis was also a coordinating
lead author of the chapter. IPCC assessment reports are issued every five to six years to provide a comprehensive review of the
current state of knowledge on climate change. The 2007 report will be issued in four phases during the year. The first phase,
released in Paris, focuses on the physical evidence of global change. The IPCC operates under the auspices of the United Nations
Environmental Programme and the World Meteorological Organization and draws on the expertise of about 2,500 scientists
worldwide. Hegerl and her chapter's team of co-authors were charged with reviewing the evidence of changes observed so far and
assessing which changes can be attributed to greenhouse gas increases and other external influences on climate. In the chapter, they
look at the actual measurements of climate and weather changes and compare them with predictions made for the 20th century by
sophisticated computer models. "We've studied improved observations from land, sea and space, as well as
better temperature reconstructions covering the last 1,000 years ," Hegerl said. By comparing observation against
modeled projections, she said scientists are gaining a better sense of which external climate influences have been important.
"Understanding the observations is really what this all is about. For instance, looking at the patterns of change in 20th-
century temperatures, we can now distinguish between changes caused by greenhouse gases, man-made
aerosols, variability in solar radiation and major volcanic eruptions," Hegerl said. "We can also better
understand which changes in the more distant past were caused by external influences of climate, such as
volcanic eruptions, and how strong the variability of the climate system is. "One of the most fascinating things is
that we see that changes have already happened or are happening now in more climate variables than just temperature," Hegerl
added. "For instance, there have been observed changes in ocean temperatures, global rainfall and in circulation of the atmosphere.
We now are beginning to understand that these changes occur at least partly in response to anthropogenic influences on climate.
This allows us to better evaluate model simulations, which do simulate aspects of these changes, although not as
successfully as they simulate changes in temperature," she said. "There are still things, like ice-sheet melting, that the models don't
do very well yet. But overall, the predictions and uncertainty ranges of future climate change are becoming
much better understood and much more credible," Hegerl said. The IPCC report "hits the nail squarely on
the head," she said. "It gives a very balanced view of the evidence for climate change, predictions of future
change, and the remaining uncertainties, and it draws input from very large number of scientists
worldwide."
76
country will slip into civil war the next year. Ethnic conflict in Darfur was exacerbated by drought and
competition for water, and some experts see it as the first war caused by climate change . That's too simplistic,
for the crucial factor was simply the ruthlessness of the Sudanese government, but climate change may well have been a
contributing factor. In a forthcoming book, ''Economic Gangsters,'' Mr. Miguel calls for a new system of emergency aid for
countries suffering unusual drought or similar economic shocks. Such temporary aid would aim to reduce the risk of warfare that,
once it has begun, is enormously costly to stop and often damages neighboring countries as well. The greenhouse gases that imperil
Africa's future are spewing from the United States, China and Europe. The people in Bangladesh and Africa emit almost no carbon,
yet they are the ones who will bear the greatest risks of climate change. Some experts believe that the damage that the West does to
poor countries from carbon emissions exceeds the benefit from aid programs. All this makes the United States' reluctance
to confront climate change in a serious way -- like a carbon tax to replace the payroll tax, coupled with
global leadership on the issue -- as unjust as it is unfortunate.
77
China addon
China will model the plan.
The Washington Post, Anne Applebaum, "Global Warming's Simple Remedy" February 6, 2007
lexis
Any lasting solutions will have to be extremely simple, and -- because of the cost implicit in reducing the use and emissions of
fossil fuels -- will also have to benefit those countries that impose them in other ways. Fortunately, there is such a solution, one that
is grippingly unoriginal, requires no special knowledge of economics and is easy for any country to implement. It's called a
carbon tax, and it should be applied across the board to every industry that uses fossil fuels, every home or
building with a heating system, every motorist, and every public transportation system. Immediately, it would produce a
wealth of innovations to save fuel, as well as new incentives to conserve . More to the point, it would produce a
big chunk of money that could be used for other things. Anyone for balancing the budget? Fixing Social Security for future
generations? As a foreign policy side benefit, users of the tax would suddenly find themselves less dependent on Persian Gulf oil or
Russian natural gas, too. Most of all, though, the successful use of carbon taxes does not require "American leadership," or a U.N.
committee, or a complicated international effort of any kind. It can be done country by country: If the British environment minister
or the German chancellor wants to go ahead with it tomorrow, nothing is preventing them. If a future American president wants to
rally the nation around a patriotic and noble cause, then he or she has the perfect opportunity. If the Chinese see that such a
tax has produced unexpected benefits in America and Europe, they'll follow. And when that happens, we'll
know that the apocalyptic climate change rhetoric has finally been taken seriously.
Chinese carbon tax saves hundred-of-thousounds lives and will stabilize long-term
growth in China.
Maximilian Auffhammer, assistant professor in the Department of Agricultural and Resource
Economics at the University of California at Berkeley, and Richard Carson, a professor in the
Department of Economics at the University of California at San Diego, is immediate past president of the
Association of Environmental and Resource Economists, The Washington Post, China's Chance to Lead
August 2, 2007 lexis
China would gain in several ways from implementing a substantial carbon tax. By reducing its fossil fuel consumption,
China would prevent the deaths of hundreds of thousands of citizens because of the short- and long-term
consequences of air pollution from burning coal. Investments in energy-efficient durable goods,
encouraged by a carbon tax, would generate energy savings over the lengthy life of these investments.
The demands of China's rapid economic growth are outstripping the country's ability to provide the
infrastructure necessary for continued growth; a carbon tax would slow short-term growth and allow
infrastructure investments to catch up. Ultimately, this would lead to greater long-term growth . If China
fears a drag on its economy from the carbon tax, it could make such a tax partially or fully revenue neutral by reducing other taxes.
78
China addon
Chinese hard landing will cause massive social unrest.
The International Herald Tribune, Matthew Benjamin and David Tweed, "Risk of bust growing
for Chinese economy" July 31, 2006 lexis
Growth is hurtling along at the fastest pace in a decade, defying official efforts to curb investment in unneeded factories and realestate projects. The government's immediate concerns are that overheated growth will saddle China with excess capacity, create
more asset bubbles and increase friction with the United States and other trading partners. ''China's unbalanced growth
model has now gone to excess and seems in danger of veering out of control,'' said Stephen Roach, the
chief global economist at Morgan Stanley in New York. ''The longer China's economic boom runs, the
tougher it will be to avoid a more treacherous endgame.'' That might include defaults on bank loans, and eventually
deflation and a collapse of asset values. Such a hard landing would risk breeding social unrest within China while
drying up export markets for neighbors like South Korea and Taiwan.
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Bank says that in the first half of 2007 China grew faster than its potential growth rate (currently estimated at around 10.5%) for the first time in a decade (see chart 2).
However, excess demand is tiny compared with previous phases of overheating so the risk of soaring inflation causing a hard landing in the near future is remote. A second
much-talked-about threat is the bursting of China's stockmarket bubble. Share prices have risen by 400% in just over two years, and average price-earnings ratios based on
historic profits are around 50 (based on forecast 2008 profits they are a still-racy 30). Even though almost everyone reckons this is a bubble, history suggests that a bust is not
imminent and that share prices could continue to rise for a lot longer: both Japan's Nikkei and America's NASDAQ saw p-e ratios well above 100 at their peaks. Even if share
prices did tumble this year, the impact on the economy would probably be relatively modest. The total value of tradable sharesthat is, excluding those held by the government
is only 35% of GDP compared with 180% in America at its peak in 2000. Equities account for less than 20% of Chinese households' total financial assets, compared with half
in America, so price swings have less impact on spending. When Chinese share prices collapsed by 55% from 2001 to 2005, GDP growth remained robust. Over the past year
there has been little sign that people are saving less and spending their capital gains, so a slump in share prices should not have much impact either. Share prices can also affect
the cost of capital. But only a small proportion of Chinese companies are listed on the stock exchange and those that are rely mainly on internal finance. Only 10% of total
financing for investment this year has come from equities. A more serious problem is that because firms have invested in other companies' stocks, a slump in share prices could
directly hurt their profits and hence their investment. According to a study by Morgan Stanley, one-third of listed companies' profits in the first half of 2007 came from shareprice gains and other investment income. If share prices sink, so will profits, which would make shares look even more overvalued. Some analysts also worry that a sharp
plunge in equity prices could seriously hurt banks' balance sheets, causing them to squeeze their lending. Chinese banks are officially not allowed to lend to investors to buy
shares, but anecdotal evidence suggests that households and firms have taken out loans disguised as mortgages to buy shares. If so, the effect of the bubble bursting could be
larger than the direct impact on consumers' wealthespecially if, as seems more likely, the bubble continues to swell for another couple of years before it finally bursts. In
many ways China today looks ominously similar to Japan before its bubble burst at the start of the 1990s, resulting in a decade of stagnation. Like Japan, China has high rates of
saving and investment, low real interest rates, soaring asset prices, a big current-account surplus and upward pressure on its currency. After the Plaza accord between the big
industrial countries in 1985, the Japanese yen rose by 80% against the dollar in three years. Many in China have concluded that the blame for Japan's economic malaise in the
1990s lay largely with the appreciation of the yen. Beijing has therefore allowed the yuan to rise by only 10% since July 2005. But Japan's real mistake was its loose monetary
policy to offset the impact of the rising yenwhich further inflated the bubbleand then its failure to ease policy once the bust had happened. By holding down the value of
the yuan and allowing a consequent build-up of excess liquidity, China risks repeating the same error. However, Paul Cavey, a China economist at Macquarie Securities,
suggests that China may have more in common with Taiwan in the 1980s than with Japan. Taiwan's bubble was even bigger, with share prices rocketing by 1,800% between
1985 and 1990. In Japan, reserve accumulation did not play a big role in the bubble. By contrast, the foreign-exchange inflows into Taiwan were greater in relation to its GDP
than those seen recently in China. Taiwan, like Japan, saw a big rise in its exchange rate, by 60% in the four years to 1989. In 1990-91 the Taipei stockmarket slumped by 75%,
even more than the Tokyo market did. But Taiwan's growth remained fairly strong because policy was eased much sooner than it was in Japan. In other words, contrary to
Beijing's fears, a big exchange-rate rise does not inevitably lead to economic depression. The other big difference between China and Japan in the late 1980s is that Japan had a
serious property bubble against which banks had lent heavily. Although a house-price crash would have much nastier consequences for China's economy than a share-price
crash, because 80% of China's urban households now own their home, there is no evidence of a nationwide housing bubble. Average house prices across China are rising at an
annual rate of 8%, with double-digit gains in some cities, such as Shenzhen and Beijing. In a developed economy such increases might seem a little bubbly, but not in one in
which nominal GDP is growing at an annual pace of 15%. The ratio of house prices to average income has fallen by 25% in China since 1999. In contrast, at their peak last year
American house prices had risen by 45% relative to incomes. A collapse in house prices therefore seems unlikely in China. If neither a surge in inflation nor a bust in asset
prices seem likely to derail China's economy over the next year or two, what about a recession in America? Exports account for over 40% of China's GDP, so some economists
predict that a fall in exports as a result of a downturn in America would create massive excess capacity and a sharp fall in profits and investmentthe making of a nasty hard
landing. But the popular notion that China is dependent on export-led growth is a myth; domestic demand is much more important. This year the increase in China's net exports
(ie, less imports) is likely to account for about one quarter of its growtha record amount. But even without this external boost, GDP growth would still have been a respectable
9%. During America's 2001 recession, China's export growth fell by 25 percentage points, but imports also slowed sharply, so GDP growth (as officially reported) remained
strong. Since then, the share of its exports to America has shrunk; the European Union and other emerging economies are now more important markets. In the three months to
August, Chinese exports to America increased by 14% compared with a year earlier, whereas those to the EU grew by 40%. America's slowdown so far largely reflects a
collapse in house-building, but if consumers cut their spending, the impact on Chinese exports would be harsher. The World Bank estimates that if American consumption falls
by the equivalent of 1% of GDP, this could knock 0.2-0.5 percentage points off China's GDP growth, depending on how much the Federal Reserve does to cushion the
downturn. A recession in America would reduce China's growth, but since Beijing's policy-makers are fretting that the economy is starting to overheat, weaker exports and
slower GDP growth might be a good thing. Not only would it reduce the risk of inflation, but it would also help to
trim China's embarrassing trade surplus. If a fall in exports threatens to slow growth by more than
desired, the government's strong fiscal position means that it has plenty of room to boost domestic
demand by spending more on infrastructure, education or health. The budget was in small deficit in 2006, but may now be in surplus
hence
even excluding the large surpluses of state-owned enterprises. China's public-sector debt is only 18% of GDP, much lower than the 75% average in developed economies,
giving the government ample room for a fiscal stimulus. In the short term, therefore, an American downturn is more likely to cause sniffles in China than a heavy cold. Indeed,
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China model
China uses US inaction on carbon to rationalize its economic growth and carbon
use.
Carbontax.org, "What About China?" May 23, 2008
The imminence of Chinas leap-frogging the U.S. as the Worlds #1 annual carbon emitter it may happen as early as this year or
next is being cited to defend American inaction on carbon reductions. This stance ignores several central points. For one thing,
the U.S. will continue to be the worlds biggest contributor to global climate change long after China, or even India, surpasses us in
annual emissions. Thats because carbon dioxide molecules, once emitted, remain resident in the atmosphere for approximately a
century. Considering the many decades in which Americas carbon emissions dwarfed everyone else's, of the CO2 now warming
Earth, more than three times as much is the product of American emissions as Chinese emissions. Based on present trends, the
earliest that China will surpass the United States as the leading source of CO2 is mid-century, i.e., around 2050. (See Slideshow,
slide #8.) Second, the United States will continue to dump the most CO2 into the atmosphere on a per capita basis for years to come.
The average American is responsible for creating as much CO2 in a day as do people in developing countries in an entire workweek.
Third, just as corporations here use Chinas inaction on carbon to justify U.S. inaction, so too are industry
and government in China using our temporizing on carbon to rationalize theirs. The way out of this
alliance of denial, as The New York Times terms it, is to stop delaying and start acting. Breaking this cycle
should be easier for the United States, insofar as our per capita use of energy (and emissions of carbon) is many times
greater than Chinas, and given our well-developed political and administrative institutions. Last, while it is true that only
concerted action by all the worlds nations and peoples can meet the climate crisis head-on, it is equally
true that every action that reduces carbon emissions helps protect and stabilize climate. The injunction
that the perfect must not become the enemy of the good has never been so apt as it is here and now, in
Earths climate emergency.
China's rejection of mandatory caps puts more pressure on the United States.
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China model
China and the US are in an alliance of denial on climate change policy.
New York Times, "Warming and Global Security" April 20, 2007 lexis
On Monday, 11 retired admirals and generals released a detailed 68-page report arguing that climate change could be a ''threat
multiplier'' in already fragile parts of the world. Rising sea levels could threaten the livelihoods of more than one billion people
living within 45 miles of Asia's coastlines. In Africa, recurring heat waves could cause widespread shortages of food and water,
leading to large-scale migrations and escalating tensions. Anthony Zinni, the retired Marine general, made the point elegantly when
he said that ''we will pay for this one way or the other'' -- either now, to control the emission of greenhouse gases, or later, in military
engagements and ''human lives.'' These same themes were taken up at the United Nations, where the Security Council, under
Britain's leadership, held its first-ever discussion of the link between climate change and international conflict. An
overwhelming majority of nations voiced grave concerns about climate change, and many urged stricter
worldwide controls on greenhouse gases. Among the few doubters were the United States and China -neither of which has mandatory controls (the Bush administration actively opposes them). Both argued that the
Council was the wrong place to raise the issue. What they were really saying was that they don't want to
be pushed. In an alliance of denial, China and the United States are using each other's inaction as an
excuse to do nothing.
think a price mechanism is important,'' Mr Zhou said, admitting a price mechanism could cost China
economic growth. Australia has rejected global calls for a carbon tax, arguing it would cost the viability of domestic coal
production. Treasurer Peter Costello chaired the G20 meeting of finance ministers and central bankers -- and pushed for a collective
approach to climate change. Australia was joined by the US, China and Russia at the G20 as countries not to have ratified the Kyoto
Protocol. The meeting also urged governments to reopen trade negotiations and secure the future supply of resources through
investment. Mr Costello hailed the meeting -- marred yesterday by violent anti-globalisation protests -- as a success. ''These
discussions were conducted in the best G20 tradition, with open and frank dialogue, as countries worked to achieve co-operative and
practical solutions to major international economic problems,'' he said.
nations like China and India, energy specialists say, would certainly avoid joining any international effort
on global warming without an emphatic move by the United States. ''Every year we delay, we contribute
to another year of delay in China, India and elsewhere ,'' said Jason S. Grumet, executive director of the National
Commission on Energy Policy, a bipartisan group of energy experts. ''The ecological and economic imperative is to start now.''
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is completely unraveling
province has been a major beneficiary of the new economy, as it's one of the wealthiest provinces, earning about $2,000 per year per person, but is adjacent to Jiangxi and
Guangxi provinces that earn only $100-200 per person per year. These enormous income disparities form a major engine of the social unrest. Guangdong is a historically
significant region for riots. China's last two crisis civil wars both began in this region. The Taiping Rebellion began here in 1852, and Mao Zedong's Long March began here in
1934. In each case, the results were devastating for China. The rebellion spread north to Beijing and out into the midlands, killing tens of millions of people each time. There
increasingly hostile. China's 1989 Tiananmen Square massacre triggered Taiwan's 1990 Wild Lily student rebellion, whose purpose was to advocate Taiwan's nationhood and
independence from China. One of the leaders of the Wild Lily rebellion, Chen Shui-bian, has been Taiwan's president since 2000, and has announced plans to move towards
independence, albeit slowly. In fact, Taiwan is just one of China's problem provinces. Two of its western provinces, Buddhist-dominated Tibet and Muslim-dominated Xinjiang,
also have secessionist movements. In a way, the western provinces are even more important to China than Taiwan, since China must maintain hegemony in Central Asia for its
own security. Thus, Chen's election and plans have infuriated the CCP, which can't afford to be weak on Taiwan without giving comfort to Tibet and Xinjiang, In fact, China's
rhetoric took a great leap forward in December, when new statements said it was China's "sacred responsibility" to use Chinese
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from North Korea indicate that they have been mobilizing for war since April, 2004, focusing on an attack from the U.S. But North Korea is believed to have several nuclear
weapons and the missiles to deliver them, and Beijing knows that some of those missiles may be headed in their direction. Skyrocketing food prices Food has been getting
increasingly expensive in China. According to recent studies, industrial construction and erosion are eating up 0.5% of China's farmland each year. China lost 2/3 of its farmland
in 40 years, but has 2.3 times as many people. (Using my standard benchmark measure of 0.96% annual increase in food production per acre of farmland, the above figures
mean that the amount of food per capita is ((2 / 3) / 2.3) * (1.0096^40) = 42% of what it was 40 years earlier.) Or course China's food problems are consistent with what's
happening in the rest of the world. A Washington Post analysis earlier this year indicated that food prices are skyrocketing around the world. This is happening because of what I
call the "Malthus Effect," which causes the population to grow faster than the food supply, except during major genocidal wars. Population growing faster than the food supply
causes food to become relatively scarce, causing food prices to rise. China has particularly added to this problem in the couple of years, as it's been importing food to feed
people in its overheated economy. This makes China's food problems especially critical, when combined with the other problems. If there's a recession in China in 2005, then
China won't be able to import enough food to meet its shortfall, and migrant workers will be unable to get jobs and make money to send back to their families in rural areas.
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behaves. Will it create and sustain an international environment that supports China's rising prosperity and manages potential points of friction? China's growth depends
heavily on exploiting opportunities for trade and investment. Fortunately, a global trading system, supervised by the World Trade Organisation (of which China has also been a
member since 2001) already exists. Apart from its role in promoting liberalisation, the WTO has the invaluable function of turning what would otherwise be conflicts among
great powers into questions of law. Maintaining a healthy WTO is as important for China as it is for the US. That is why they share a strong interest in a successful conclusion of
the Doha round of trade negotiations. No comparable norms and rules have governed the international monetary system since the breakdown of the Bretton Woods system of
fixed exchange rates in 1971. What some analysts think of as a second Bretton Woods exchange rate regime has grown up, based on the link between the Chinese renminbi and
the US dollar. But this is a purely informal arrangement. In July, China moved its exchange rate anchor from the dollar to a currency basket. It also accepted a minuscule
appreciation against the dollar. Yet as the US current account deficit explodes towards 7 per cent of GDP, the tensions over trade will grow, with dangerous consequences both
for trade and the wider political relationship. It is wrong to argue, as some Chinese do, that low US savings alone are at fault. The US cannot adjust its external balance, on its
own, without precipitating a global recession. Global macroeconomic co-operation will be needed, to which China can - and must - contribute through currency appreciation
and an expansion of domestic demand. Now turn from economics to the geopolitics of territory and security. Neither the US nor China is geographically expansionist today,
Potential points of friction exist, however: Taiwan is one and North Korea is
another. Yet the Chinese authorities must be aware of their strategic vulnerability. Distrustful neighbours - India, Japan, Russia, South Korea and Vietnam - encircle their
though both have been expansionist in the past.
country, while the US, in effect a giant island, is free from this constraint. China could bring these neighbours into a classic balance-of-power coalition against it if it behaved in
an unduly aggressive manner. A Chinese invasion of Taiwan would surely have that result even if it did not lead to war against the US. It is overwhelmingly in China's interest
to assuage its neighbours' concerns, therefore, rather than exacerbate them. On terrorism by non-state actors, the two powers will always be on the same side. This leaves the
competition for resources and, above all, for energy. If the price of oil were to go still higher, China and the US might be tempted to use military power to secure resources and
so increase their perceived energy security. That would be immensely dangerous. Much the more sensible response would be to increase energy efficiency, to co-operate in
developing energy technologies and to trade for resources in the world market rather than attempt to secure them by force. As George W. Bush and Hu Jintao met in New York
on Tuesday night, what stretched before them was a very long-term relationship between two increasingly equal powers. China's economy may exceed the US economy in size
within a generation. Its military is certain to become increasingly powerful. In the longer term, however, their populations may come closer to balance. When the US became
independent, almost 230 years ago, China's population was more than 100 times as big. Today, it is just over four times as big. By the 22nd century, the US population may be
half of China's, as the latter's birth rate falls as low as those of Japan or Hong Kong, while the US continues to absorb high levels of immigration. Relations between the two
powers will never be warm. But they could be workmanlike. China is not yet a law-governed capitalist country, let alone a democracy. But it is, above all, busily importing the
market. It should also approach more closely to democracy as its population becomes more prosperous, sophisticated, urbanised and demanding. It is in US interests to promote
the phase of US unilateral hubris must be coming to an end, as the limits of its power
become ever more evident. A country that cannot control Iraq can hardly remake the globe, on its own. Both powers should
see the benefits of co-operation rather than conflict. Both should also recognise the advantages of strengthening
multilateral institutions that diffuse great-power conflict and give the rest of the world a stake and a say in their decisions. Provided
their leaders recognise the need to sustain peace and co-operation, they should be able to manage their relations. We must hope
this peaceful development. Equally,
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China deforestation/biodiversity
Rapid Chinese growth is causing deforestation and destroying biodiversity.
The Korea Herald, "Korea needs environmental leadership" April 8, 2008 lexis
China's rivers, reservoirs, and other water resources are so polluted that they are affecting the Yellow Sea
and other oceans. Hazardous solid wastes are often dumped untreated. Serious deforestation and overuse
of other natural resources have fueled economic growth, but have also diminished biodiversity and
endangered many forms of wildlife. Neither the United Nations nor other countries can keep China in check. The
superpower is reluctant to admit that it is a major environmental polluter, or to commit significant funding to environmental
programs, even though it is just beginning to recognize the seriousness of the problem.
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provide less than half of the oil our economy uses. This leaves us heavily dependent on the Middle
Eastern regimes that control the vast majority of the world's known oil reserves. Many of these regimes are either actively
hostile to the United States, as is the case with Iran, Iraq and Libya, or unsteady autocratic regimes
beholden to Islamic fundamentalists, like Saudi Arabia. Not surprisingly, many of these same regimes
funnel oil revenues into support for global terrorist organizations. The Saudi royal family, for instance, pumps
millions of dollars into radical religious schools and mosques across the Middle East that spread the puritanical teachings of the
Wahhabi sect of Islam. These schools preach hate toward America. Many of these schools train the very Al-Qaeda terrorists who
struck America on September 11. Mr. Chairman, our dependence on Middle East oil severely undermines our ability to combat
international terrorism. Fearing another Arab oil embargo, some of our diplomats cow tow to Middle East
autocrats and permit their anti-democratic, anti-American practices to go unanswered. It is distressing that
U.S. foreign policy in the Middle East is often held hostage to oil interests. The question we must ask ourselves is
how can we break free of this crippling dependence? The title of today's hearing is the Facts and Myths Behind Foreign Oil
Dependency. The fact is that we will remain beholden to these Middle Eastern suppliers until we scale back America's
addiction to oil. The myth is that we can drill our way out of dependency.
values, culture and lifestyle produces a powerful backlash. Terrorism becomes to them the equalizing
factor." Dunford concluded by saying, "Reducing our dependency on fossil fuels is good. To reduce terrorism, we have to
find the root of terrorism, and I believe it runs though Jerusalem and the Arab/Israeli conflict."
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Oil impacts
Oil wealth is a curseit hurts the economy and causes corruption and civil wars
Lutz Kleveman, free-lance journalist (has worked for CNN, Daily Telegraph, Newsweek) and book
author, 2003, The New Great Game, pg. 88
In dealing with its sudden oil wealth, says Andrew Rearick, director of a think tank in Almaty that counsels foreign companies
investing in Central Asia, Kazakhstan has not yet done as badly as Nigeria but, God knows, it is not Norway, either. The
Scandinavian country is seen as the one model for how a country manages to absorb the shock of an oil jackpot without serious
political or social crises, while at the same time distributing the wealth on a relatively equal basis . In almost every oil state
across the globe, the sudden windfall of petrodollars has proved more of a curse than a blessing, leading to
corruption, social tensions, coup detats, and civil wars. After the oil crisis of 1973, most governments of oil exporting
countries spent their new massive revenues on enormous investments in social programs, infrastructures, the military, and subsidized state companies. However, the economies were unable to absorb such a massive cash infusion and in the 1980s , when the
oil prices dropped, these luxuries were no longer affordable and the boom ended. The modern skyscrapers of Lagos and
Caracas sat empty while unemployment and poverty skyrocketed. In most oil countries, economic growth in the two
decades following 1973 was lower than before the oil rush, and per-capita incomes dropped. Many
countries experienced deep social and political crises. In Iran, the shahs modernizing program of the Great Civilization
led to the Islamic revolution, while in Nigeria one generals putsch was followed by another. Algeria and Sudan drifted into bloody
civil wars, while Venezuela has been plagued by constant riots and military overthrows, bringing the country (and its oil industry) to
a virtual standstill under the present rule of President Hugo Chavez.
Oil wealth causes corruption, economic decline, political oppression, and civil wars
Lutz Kleveman, free-lance journalist (has worked for CNN, Daily Telegraph, Newsweek) and book
author, 2003, The New Great Game, pg. 263
No matter how many soldiers and civilians have so far died in Iraq and other Great Game battlefields for the sake of brazen energy
imperialism, they wont be the last. With the industrialized worlds addiction to oil growing unabated, more energy wars are a
realistic prospect. As the planets remaining oil reserves are going to last for only a few more decades, the struggles over
access and profits between countries and multinational corporations are fast becoming fiercer, and they
continue within the societies of oil-rich countries. In Kazakhstan, Nigeria, Venezuela, Sudan, Angola, the Arab
sheikhdoms, and many other countries sudden oil wealth has led to corruption, economic decline,
political oppression, revolutions, or civil wars. We are drowning in the excrement of the Devil, the Venezuelan OPEC
founder Juan Alfonzo once said of an oil booms dire side effect.
governance. Because such regimes rely less on revenues derived from a broad-based system of taxation,
they also have less need for popular legitimacy and feel less pressure to be accountable. Corruption and patronage
are rife. Many governments of oil-rich countries spend a very high proportion of state income on internal security. They
purchase weapons and maintain sizable armed forces to suppress democratic movements or other
challenges to their power. In such situations, rulers often foster and manipulate conflicts among different
communities, factions, and ethnic groups as a means to hold onto control. However, this intensifies friction within
the society. Discontented and aggrieved groups turn increasingly to protest and sometimes hostilities. Rivals rise to challenge
discredited leadership. Ruthless criminal entrepreneurs, who sense opportunities for pillaging resources, use
violence to achieve their objectives. In a developing country with a poorly diversified economy, seizing control of a prized
resource is the most likely ticket to wealth and power.
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to want what you want,' and that has to do with cultural attraction and ideology and agenda setting . . ." On these measures, China, Russia, Japan, and even Western Europe
traditional measures, there is increasingly more going on in the world that those measures fail to capture. We must mobilize
international coalitions to address shared threats and challenges. America needs the help and respect of other nations.
We will be in trouble if our unilateralism prevents us from getting it.
very survival of civilization itself. Even the United States and Israel have for decades tended to regard terrorism as a mere tactical nuisance or irritant
rather than a critical strategic challenge to their national security concerns. It is not surprising, therefore, that on September 11, 2001, Americans were stunned by the
unprecedented tragedy of 19 al Qaeda terrorists striking a devastating blow at the center of the nation's commercial and military powers. Likewise, Israel and its citizens, despite
the collapse of the Oslo Agreements of 1993 and numerous acts of terrorism triggered by the second intifada that began almost three years ago, are still "shocked" by each
suicide attack at a time of intensive diplomatic efforts to revive the moribund peace process through the now revoked cease-fire arrangements [hudna]. Why are the United
States and Israel, as well as scores of other countries affected by the universal nightmare of modern terrorism surprised by new terrorist "surprises"? There are many reasons,
including misunderstanding of the manifold specific factors that contribute to terrorism's expansion, such as lack of a universal definition of terrorism, the religionization of
politics, double standards of morality, weak punishment of terrorists, and the exploitation of the media by terrorist propaganda and psychological warfare. Unlike their historical
The
internationalization and brutalization of current and future terrorism make it clear we have entered an Age of
Super Terrorism [e.g. biological, chemical, radiological, nuclear and cyber] with its serious implications
concerning national, regional and global security concerns.
counterparts, contemporary terrorists have introduced a new scale of violence in terms of conventional and unconventional threats and impact.
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proposal cannot be an acceptable option for American policymakers. Much of the world has come
together to help the United States in the fight against terrorism, out of the realization that a common
threat can only be beaten through a cooperative effort. It is high time for the United States,
metaphorically speaking, to get out of its oversized, gas-guzzling S.U.V. -- and join the rest of the world
in doing more to combat global warming and protecting the planet.
US action to increase efficiency responds to our lack of action and sends a strong
message to allies.
Paul Roberts (energy expert and writer for Harpers) 2004, The End of Oil, pg. 325
Politically, a new U.S. energy policy would send a powerful message to the rest of the players in the
global energy economy. Just as a carbon tax would signal the markets that a new competition had begun,
so a progressive, aggressive American energy policy would give a warning to international businesses,
many of which now regard the United States as a lucrative dumping ground for older high-carbon
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technology. It would signal energy producers companies and states that they would need to start
making investments for a new energy business, with differing demands and product requirements. Above
all, a progressive energy policy would not only show trade partners in Japan and Europe that the United
States is serious about climate but would give the United States the leverage it needs to force muchneeded changes in the Kyoto treaty. With a carbon program and a serious commitment to improve
efficiency and develop clean-energy technologies, says one U.S. climate expert, the United States could
really shape a global climate policy. We could basically say to Europe, Here is an American answer to
climate that is far better than Kyoto. Here are the practical steps were going to take to reduce emissions,
far more effectively than your cockamamie Kyoto protocol.
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A2: States CP
Federal government key.
Franz T. Litz, Esq., Senior Fellow, world resources institute, Prepared for the Pew Center on Global
Climate Change, toward a constructive dialogue on federal and state roles in u.s.climate change policy
June 2008
The Arguments for Federal Action There are, of course, reasons some climate change policies might be better
effectuated at the federal level, notwithstanding the states important roles as first movers, policy innovators and on-theground implementers. Among the reasons are the broader coverage of a federal program, the ability to level the
competitive playing field for citizens and businesses, and the ultimate need for coherent and
comprehensive national and international action. Indeed, many state leaders have themselves made these arguments to
advocateand sometimes even to sue the federal government to compelnational action. The Challenge Demands All 50
States. A federal program guarantees coverage across all 50 states. In contrast, an approach that relies
solely on state actions leaves substantial gaps in program coverage. Not all states have acted to
meaningfully tackle climate change. Even among those states that have acted, there are differences in the
scope and stringency of their policies. A federal program would bring all 50 states into the climate change effort. Federal
Action Levels the Playing Field. A federal program would tend to level the playing field for businesses in all 50 states. Although the
state laboratories of democracy produce useful policy products, they also present a more difficult environment for
companies doing business in multiple states. Those companies must contend with different rules and
regulations, which presents competitiveness issues. In addition, the potential for emissions leakagethe result of
shifts in production from areas with stringent policies to areas without policiesis greater in an environment where some states act
and some do not.
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A2: States CP
Federal action is the only way to prevent a slew of commerce clause challenges.
Robert B. McKinstry, Jr., Esq., Maurice K. Goddard Professor of Forestry and Environmental Resources
Conservation, The Pennsylvania State University, Penn State Environmental Law Review, Winter 2004
lexis
The absence of federal action also presents certain legal constraints to some forms of state action. These constraints arise from both
the federal Constitutional restrictions applicable to states and a variety of state constitutional law constraints inapplicable to federal
action. Possible federal constraints on state action arise from three sources. First, innovative state programs will likely
face challenges based upon the contention that they will interfere with interstate commerce in contravention
of the restrictions on state action under the "dormant" commerce clause restrictions, n309 particularly where the state
attempts to deal with attempts to escape controls by switching production to other states. Second, attempts to forge interstate
and international cooperation, through mechanisms such as the Climate Change Action Plan may face challenges
based upon the compacts clause of the Constitution. n310 Finally, these programs may face challenges based on the
contention that federal laws preempt state action under the Supremacy Clause of the Constitution, n311 particularly [*68] where
measures attempt to capture mobile source n312 emissions where the Clean Air Act n313 or the corporate average fuel economy
standards n314 may apply. State attempts to create regulatory programs or taxes affecting interstate commerce have repeatedly been
subject to challenges based upon the premise that these unilateral state actions unconstitutionally "discriminate against commerce
under the restrictions imposed by the "so-called" dormant commerce clause. n315 State tax and regulatory programs that regulate
even-handedly and that either do not discriminate against interstate commerce or advance a legitimate state purpose that could not
[*69] be advanced by a less discriminatory alternative will withstand scrutiny under the commerce clause. n316 Most regulatory and
tax programs designed to limit greenhouse gas pollutant emissions within a state could readily withstand such challenges. However,
given the contribution by utilities to greenhouse gas emissions and the many recent experiments in allowing competition in electric
generation, states will need to adopt measures to assure that out-of-state sources face equal restrictions or
costs if they also wish to maintain an equal playing field for in and out-of-state electricity generators and to prevent
generators from fleeing to other states to avoid controls. Such measures may make the state programs more
vulnerable to a commerce clause challenge. Programs to maintain an equal playing field for utilities may withstand
commerce clause scrutiny, because Congress has authorized extensive state monopoly regulation. n317 The challenges should pass
muster if they are properly designed to maintain a level playing field, although the concept of what constitutes a level playing field,
as opposed to an unfair advantage to local generators, may be decided by the predilections of the judges hearing the case or the skill
of the attorneys in framing the issues. Congress could resolve these difficulties by either adopting a comprehensive federal program
or specifically authorizing comprehensive state regulation. n318 It is also possible that the voluntary state agreements to
cooperate on climate change, such as the Climate Action Plan or the plan by California, [*70] Oregon, and Washington to cooperate
on addressing climate change, could be subject to a challenge based on the contention that state cooperation in
the absence of Congressional authorization contravenes the compacts clause of the Constitution. n319 The
wholly voluntary nature of the current arrangements makes the likelihood of such a challenge succeeding remote. Such voluntary
arrangements do not require Congressional approval under the compacts clause. n320 Nevertheless, the compacts clause will limit
the enforceability of these relationships, absent federal action. The most serious limitation on enforceable state programs to limit
GHG pollution emissions is created by federal preemption of state regulation of mobile source air pollution
emissions under two statutes, the federal Clean Air Act and the federal law establishing corporate average fuel economy
standards. Preemption arises in two situations. A state law will be preempted where Congress has evidenced an intent to displace
state law in an area altogether, either through express preemption or by implication. Preemption also arises upon a
showing that there is an actual conflict between the federal standard and the state standard . n321 There would
be no actual conflict between state regulatory initiatives to address climate change and federal law, given the requirements of the
Framework Convention and the federal failure to implement these requirements. However, there are two sources of express
preemption which could seriously impair the states' ability to affect emissions from the transportation sector. Specifically, the Clean
Air Act expressly preempts most state regulation of vehicle emissions standards. n322 The federal corporate average fuel economy
("CAFE") act n323 preempts state regulations "related to fuel economy standards or average fuel economy standards for
automobiles." n324 These provisions will pose barriers to most states' attempts to regulate emissions from the transportation sector,
which represents a major and growing source of GHG emissions. Although [*71] these provisions do not constrain California to the
extent other states are constrained, California's attempt to regulate mobile source emissions through regulatory controls has already
encountered challenges based upon claims of preemption, and it, like other states, may need to consider implementing a different
model for addressing the transportation sector.
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A2: States CP
State law restrictions make uniformity impossible. Fiating through these laws causes
rollback.
Robert B. McKinstry, Jr., Esq., Maurice K. Goddard Professor of Forestry and Environmental Resources
Conservation, The Pennsylvania State University, Penn State Environmental Law Review, Winter 2004
lexis
state programs can still run afoul of idiosyncratic state constitutional and statutory restrictions,
which would not apply to a federal program. For example, in Pennsylvania, use of a tax to capture mobile
sources in a state program would need to comply with the requirements of that state's uniformity clause
n336 that all taxes be uniform and a state constitutional limitation on uses of taxes on products used by
automobiles. n337 Although a greenhouse gas pollution emission tax can likely be crafted that will be consistent with or avoid
these restrictions, one can never predict with confidence how courts will decide an issue of first impression.
Moreover, many state laws prohibit state restrictions that are more stringent than federal restrictions,
raising questions as to whether, how, and the extent to which these states can address greenhouse gas
emissions in the absence of a federal mandate. A federal program with mandatory elements would not be
hindered by and would overcome many possible state law restrictions.
Finally,
State-laboratory arguments support federal action now its the only way to
guarentee clarity and international solvency.
Robert B. McKinstry, Jr., Esq., Maurice K. Goddard Professor of Forestry and Environmental Resources
Conservation, The Pennsylvania State University, Penn State Environmental Law Review, Winter 2004
lexis
Perhaps even more importantly, the experiences gained in the state and private laboratories will inform both the states
that have already acted and states that have not in crafting state implementation plans and state regulatory responses. These
experiences will also assist industry in achieving compliance with the program ultimately implemented by
the federal government, whether through regulatory initiatives under existing regulation or new
legislation. Nevertheless, without federal certainty and a federal floor, progressive and multi-national
industries, states, and localities alike, are likely to suffer, along with the global environment.
Only strong political leadership can maximize the effectiveness of carbon taxes.
Inho Choi, S.J.D., LL.M., The George Washington University Law School, Natural Resources Journal,
Fall 2005 lexis
Emissions trading or pollution taxes can work well in the context of global climate change. Sources of
CO2 emissions are ubiquitous. Because of significant cost variations, trading between both high- and
low-cost sources presents a real opportunity to maximize efficiency gains. Fortunately, there is no
significant problem with monitoring carbon emissions because the carbon content of a fossil fuel can be
used as a proxy for expensive real-time monitoring. These and other factors clearly indicate that
flexibility mechanisms should be employed as a viable policy tool to achieve a carbon reduction goal in a
cost-effective manner. The fact that carbon capture and sequestration are not yet commercially viable
confirms the need for pursuing sustainable energy development: promoting energy conservation and
efficiency, and the development and commercial deployment of cleaner, more efficient energy sources
and technologies. Future climate change law will help to achieve these goals in a way that current U.S.
environmental and energy law have not. These goals are achievable because effective carbon control
policy will raise fuel prices and, thus, increase the economic value of energy efficiency and conservation.
As a consequence, entry barriers to clean energy technologies will be cleared and technological
innovation will be spurred by the elimination of implicit subsidies for existing dirty sources. The key to
success is strong political leadership with the wisdom and courage to tell the truth to and persuade the
American public about the need for prompt action on climate change.
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A2: States CP
Carbon tax is a burden-offset charge.
Eben Albert-Knopp, Vermont Law Review, The California Gas Charge and Beyond: Taxes and Fees in a
Changing Climate Fall 2007 p. ln
A further subset of regulatory fees, burden-offset charges, addresses the burdens imposed by individual
actors on the whole of society. n59 In many situations, an actor's behavior creates a burden that is shared
equally by many people. Climate change is a classic example, where the act of driving a car creates air
pollution that is widely dispersed. n60 Economists term these situations "externalities," since the costs of
the activity are borne externally by the public at large. n61 While consumers pay for the gasoline they
consume, they are not forced to pay for the costs of air pollution to the rest of society. n62 Burden-offset
charges are designed to simultaneously reduce the offensive activity and to help offset the costs to
society-thereby internalizing the external costs. n63
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A2: Backstopping
No spare capacity - carbon taxes necessary to ease pressure.
The Times (London), Carl Mortished, International Business Editor, Energy crisis cannot be solved by
renewables, oil chiefs say June 25, 2007 lexis
The world is blinding itself to the reality of its energy problems, ignoring the scale of growth in demand from developing countries
and placing too much faith in renewable sources of power, according to two leaders of the global energy industry. The chief
executive of Royal Dutch Shell Enhanced Coverage Linking Royal Dutch Shell today calls for a "reality check". Writing in The
Times, Jeroen van der Veer Enhanced Coverage Linking Jeroen van der Veer takes issue with the widespread public opinion that
green energy can replace fossil fuels. Shell's chief gives warning that supplies of conventional oil and gas will struggle to keep pace
with rising energy demand and he calls for greater investment in energy efficiency. Instead of a great conversion to wind power and
solar power, Mr van der Veer predicts, the world will be forced into greater use of coal and much higher CO2 emissions, "possibly
to levels we deem unacceptable". Alternative energy sources, such as renewables, will not fill the gap, says Mr van der Veer, who
forecasts that even with major technological breakthroughs, renewables could account for only 30 per cent of energy supply by the
middle of the century. "Contrary to public perceptions, renewable energy is not the silver bullet that will soon solve all our
problems," he writes. The warning from Royal Dutch Shell Enhanced Coverage Linking Royal Dutch Shell coincides with a critique
of public energy policy by Rex Tillerson, Enhanced Coverage Linking Rex Tillerson, the chief executive of ExxonMobil. Enhanced
Coverage Linking ExxonMobil. Speaking at the Royal Institute for International Affairs in London, Mr Tillerson pointed to a
widespread failure by policymakers to understand the extent to which the aspirations of people in developing countries are fuelling
growth in demand for energy. Mr Tillerson said that world energy demand would rise by 45 per cent by 2030, and
fossil fuels -oil, natural gas and coal -were the only energy sources of sufficient size, adaptability and
affordability to meet the world's needs. Mr van der Veer casts doubt today on the oil and gas industry's ability to keep up
with accelerating demand. "Just when energy demand is surging, many of the world's conventional oilfields are going into decline,"
he writes. Although there is no shortage of oil and gas in the ground, Mr van der Veer says, the industry currently lacks the
technology to recover even half of that resource. Mr Tillerson, speaking at Chatham House, expressed doubts about the oil
industry's ability to raise its game significantly without access to the oil reserves of the Opec countries of
the Middle East. "The supply outlook for non-Opec countries will be modestly up or flat," Mr Tillerson
predicted. He was sceptical about the drive by governments to increase use of biofuels and said that a fifth of America's corn crop
was being used to produce four billion gallons of ethanol, compared with targets of 12 billion gallons by 2012. The ExxonMobil
Enhanced Coverage Linking ExxonMobil chief criticised the EU's carbon trading system, calling it an
administratively complex system that lacked transparency and failed to deliver a uniform and predictable
cost of carbon. "It's all about moving the money around," he said. Mr Tillerson said he would prefer a carbon tax
that would enable the cost of carbon to spread through the economy in a uniform way, letting governments
use the revenues to mitigate its effect by reducing employment or income taxes.
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A2: Economy DA
Business prefer national preemption to guarentee regulatory certainty.
Business Week, Climate Wars: Episode Two April 23, 2007
http://www.businessweek.com/magazine/content/07_17/b4031094.htm
Companies find it's no longer worth arguing this point. They're coming to the bargaining table for many reasons beyond the
science. On Apr. 2 the U.S. Supreme Court ruled that the Environmental Protection Agency can regulate CO2 as a pollutant. That
could bring legal challenges and EPA-imposed mandatory curbs. "The fear that the next Administration's EPA would
have its hand on the lever is a great motivator," says Natural Resources Defense Council attorney David
D. Doniger. Plus, a growing patchwork of state carbon-emissions limits has prompted industries to push
for a preemptive national law. And as energy executives face decisions, such as what kind of power plants
to build for the next 40 years, they want regulatory certainty. Despite the tough road ahead, proponents of
action inside companies are thrilled that the policy fight has finally begun. "We are long past debating the
science," said Entergy CEO J. Wayne Leonard in a recent speech. Waiting for stronger evidence is "the
equivalent of bleeding out of every orifice of your body and hearing your doctor say: 'Before we rush to
judgment, let's wait until all the facts are in'--meaning your autopsy."
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A2: Economy DA
Carbon tax stabilizes the structural threat from the budget deficit
Richard J. Pierce, Jr (Professor of Law, George Washington University) Summer 2007 "ENERGY
INDEPENDENCE AND GLOBAL WARMING' Environmental Law (Lexis-Nexis)
Nordhaus also points out a globally-coordinated carbon tax has the additional advantage of responding to
each nation's fiscal needs. n38 This is a particularly important advantage to the United States. The Federal
Reserve Board has identified our present large structural budget deficit as our most serious long-term
economic problem. n39 No one knows how much longer we can sustain our present level of deficit
spending, but everyone agrees we must reduce the deficit soon. That can be accomplished only through
some combination of increased taxes and reduced spending. A large carbon tax would allow us to get our
fiscal house in order without having to make the politically and economically painful decisions to
increase income taxes or reduce spending. Many politicians and business leaders prefer a cap and trade
system to a carbon tax, but those preferences are based on dubious reasoning. Many politicians prefer cap
and trade because it allows them to avoid the dreaded "t" word. They either do not realize, or prefer to
ignore, the reality that cap and trade imposes a "tax" that is functionally identical to a carbon tax. Either
mechanism can be effective only by increasing the price of carbon-dioxide emitting activities by the same
large amount. The difference lies in the identity of the entities receiving the increased revenues
attributable to that price increase. In the case of a carbon tax, governments receive those revenues. In the
case of a cap and trade system, the holders of the emissions permits receive the added revenues. n40 That,
of course, is why many business leaders favor cap and trade. They hope to obtain massive additional
revenues attributable to the emissions permits the government allocates to them. By now, the extreme
difficulty of the political task of persuading citizens and politicians all over the world to agree to take the
actions needed to respond effectively to global warming is clear. When President Clinton attempted to
persuade Congress to enact a Btu tax that would have added only a few pennies to the cost of
hydrocarbons, his proposal was pronounced dead on arrival in the Senate. n41 It is hard to imagine what
it would take to persuade Congress and the public to accept a carbon tax that would have to [*602] be at
least twenty times the magnitude of the Clinton proposal to be effective. And, a carbon tax is the least
expensive means of responding effectively to global warming. A cap and trade system would be more
expensive, and a command and control system would be much more expensive.
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A2: Economy DA
Carbox taxes cut emissions without economic harm
Gwladys Fouch 4/29/2008 Sweden's carbon-tax solution to climate change puts it top of the green list
http://www.guardian.co.uk/environment/2008/apr/29/climatechange.carbonemissions Date Accessed:
6/23/2008
If there's a paradise for environmentalists, this Nordic nation of 9.2 million people must be it. In 2007
Sweden topped the list of countries that did the most to save the planet - for the second year running according to German environmental group, Germanwatch. Between 1990 and 2006 Sweden cut its carbon
emissions by 9%, largely exceeding the target set by the Kyoto Protocol, while enjoying economic
growth of 44% in fixed prices. Under Kyoto, Sweden was even told it could increase its emissions by 4%
given the progress it had already made. But "this was not considered ambitious enough," explains Emma
Lindberg, a climate change expert at the Swedish Society for Nature Conservation. "So parliament
decided to cut emissions by another 4% [below 1990 levels]. The mindset was 'we need to do what's good
for the environment because it's good for Sweden and its economy'." The main reason for this success,
say experts, is the introduction of a carbon tax in 1991. Swedes today pay an extra 2.34 kronor (20p) per
litre when they fill the tank (although many key industries receive tax relief or are exempted). "Our
carbon emissions would have been 20% higher without the carbon tax," says the Swedish environment
minister, Andreas Carlgren. "It was the one major reason that steered society towards climate-friendly
solutions," reckons Lindberg. "It made polluting more expensive and focused people on finding energyefficient solutions." "It increased the use of bioenergy," concurs Professor Thomas B Johansson from the
University of Lund, a former director of energy and climate at the UN Development Programme. "It had a
major impact in particular on heating. Every city in Sweden uses district heating [where steam and hot
water are piped to a building in a particular area]. Before, coal or oil were used for district heating. Now
biomass is used, usually waste from forests and forest industries." Another reason is that, paradoxically,
energy consumption remained relatively stable at a time of high economic growth. "Non-energy-intensive
industries, such as the service sector, grew more in Sweden, compared to energy-intensive industries,
such as paper mills," states Johansson. Sweden also became conscious of its dependency on fossil fuels
early on, after the oil shocks of the 70s. "The country switched in the 80s to direct electric heating and in
recent years increasingly uses heat pumps, which uses two-thirds less electricity to heat. People were also
helped with subsidies to substitute," says Johansson. And Swedes were perhaps environmentally aware at
an earlier time than most. "The general public concern in terms of climate change really arose in the mid80s. The authorities were very active in the creation of the Intergovernmental Panel on Climate Change in
1988," reckons Johansson. "There was a real wish to turn Sweden into a leading environmental country,"
agrees Lindberg. "And Swedes are proud that their country is leading on environmental issues." Today,
environmental measures are common throughout the country. Take Linkping, Sweden's fifth biggest city,
which is running its fleet of buses and rubbish lorries, a train line and some private taxis on biogas, from
methane produced from the entrails of slaughtered cows. Similarly, Stockholm's central station is
planning to harness the body warmth of 250,000 daily commuters to produce heating for a nearby office
block. The body heat would warm up water that would in turn be pumped through pipes over to a new
office block. And King Carl Gustaf XVI last month had all the lights at royal castles turned off for an
hour to back an energy efficiency campaign. But not all is fine and dandy. Swedes are in love with their
gas-guzzling estate cars, and are among the worst vehicle polluters in the EU. Environmentalists are also
concerned that the authorities' green enthusiasm is waning. "[Swedish PM] Fredrik Reinfeldt is pushing
within the EU for more emphasis on flexibility, ie that a larger proportion of carbon cuts should be done
outside of the EU than inside," says Lindberg which, she argues will not help the EU decrease its
emissions enough to meet the target of limiting the Earth's temperature to less than two degrees Celsius.
The environment minister dismisses the claim, arguing that flexibility is the most-efficient way to reduce
emissions at the European level and that it will help technology transfers to developing countries. More
broadly, is there anything Britain could learn from Sweden? "Homes have virtually no insulation in
Britain. You could do a lot just by doing more of that," says Johansson. "When a building is renovated in
Sweden, it can be properly insulated and renovated, cutting energy consumption by at least half." "Impose
a carbon tax," suggests Lindberg. "You would make it more attractive financially to go for green solutions
than for carbon options." "A carbon tax is the most cost-effective way to make carbon cuts and it does not
prevent strong economic growth," adds Carlgren.
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112
A2: Counterplans
Taxes better than picking a technology
Pearce (David, writer for The Economic Journal, Jul 91, The Role of Carbon Taxes in Adjusting to
Global Warming, online: http://www.jstor.org/stable/2233865?seq=2, acc: 6/23/08)
Carbon taxes act as a continuous incentive to adopt ever cleaner technology and energy conservation.
Standards tend to be 'technology-based', and therefore encourage technology switches up to the point
judged by the regulator to be the 'best available'. But, unless standards are continually revised and set
slightly above the best available technology, there is no incentive for the polluter to go beyond the
standard. A tax, on the other hand, is always present as long as carbon-based fuels are used. There is some
evidence to suggest that this dynamic efficiency aspect of environmental taxes is important (Tietenberg,
I990). In the CO2 context, dynamic efficiency takes on an extra dimension because, unlike, say, sulphur,
CO2 is difficult to dispose of even if it is removed from stack gases. Proposals include injecting the
'captured' CO2 in gas or oil fields, or to the deep ocean. Incentives to develop disposal technologies are
therefore of particular relevance.
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A2: Counterplans
Carbon Tax is key to market based environmental choices.
by Clive Crook, editor, 06/22/08, http://www.ft.com/cms/s/0/5f9f9f96-4060-11dd-bd480000779fd2ac,s01=1.html, 06/23/08
The US constitution makes it difficult for politicians to do much (except fight wars) and this avoids a lot
of damage that would otherwise result. But now and then some intelligent policymaking is needed, and
energy is again a case in point. Nowadays most Americans want to see action on global warming. Sensing
the mood, both presidential candidates advocate a cap-and-trade approach to reducing carbon emissions.
However, a carbon tax is needed. So the candidates must cater to that appetite as well. The US does not
know whether to tax energy or subsidies it, promote domestic oil production or forbid it, treat
ExxonMobil and Chevron as champions or pariahs. So it does all of the above. Instead, it should eradicate
these costly actions by simply using a carbon tax. What it knows for sure is that it wants energy security,
energy independence and clean air. Mr Obama has lately been pandering to the anti-business sentiment
that blames $4-a-gallon petrol on Big Oil and oil-market speculators. It is true, of course, that oil
companies are enjoying a profit windfall from the oil price spike. It is also true, or plausible, that futures
trading has driven spot prices above their market equilibrium. But these are not the main drivers of the oil
price nor for that matter is the high price of oil a bad thing, if you care about climate change. Done
right, a surtax on oil company windfall profits is defensible as long as one admits it would deter future
investment and that working out what reasonable profit means would open a can of worms better left
closed. The main thing, though, is that it would do less than nothing to cut the price of petrol. It is a
sideshow. Like Obama, McCain has a point. The present ban on offshore drilling is a mistake just as it
would have been a mistake for Britain to ban production in the North Sea. If oil can be extracted
profitably and with appropriately strict environmental safeguards from offshore wells (or, for that matter,
from the Arctic National Wildlife Refuge, which Mr McCain still wants to protect), well and good. The
only reason to extract oil is because it is a valuable resource that would otherwise be wasted and that
diversifying US oil supplies has some benefit, not that it would lower the price of petrol. New oil would
take years or even decades to come on stream. So the amount is decreasing anyway. When the new
supplies arrive, they will most likely have no more than a marginal effect on the world market price. The
US has a compelling economic and geopolitical interest in curbing both its use of oil, especially oil
imported from unstable suppliers, and its emissions of greenhouse gases. The right thing is to pursue in a
carbon tax. If ever there were a case for the maxim, get prices right, this is it. The way to curb carbon
emissions is to add the environmental cost of carbon to the price of energy. The current oil price offers a
good opportunity: when it falls (as it probably will) a carbon tax could be used to set a floor, making the
transition to correctly priced energy much easier. Once the price of energy is right, other decisions
become simpler, or can be left mainly to the market. There is no need to legislate fuel economy standards
or subsidise conservation and low-carbon forms of energy; no need for an emissions trading regime, with
all the waste and complexity and gaming that that entails (witness Europes experience); no need to
scapegoat oil companies or environmentalists; no need to mislead or pander. For sure, the politics is a
challenge but not, I am willing to bet, as hard as conventional wisdom insists. Carbon is bad: tax it and
use the money to cut other taxes. A new kind of politician could do something with that.
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