Home » Uncategorized » Sucking and Blowing on Carbon Pricing not a Clever Idea

Sucking and Blowing on Carbon Pricing not a Clever Idea

We are so smart it hurts!

People have so many clever ideas. They have clever reasons for thinking democracy is a failure, that voting is a waste of time, that politicians are all corrupt, that governments can’t be trusted with tax money, that only individual action is worthwhile, that individual action is hopeless.

Here is an example. Steven Cohen, Executive Director of the Earth Institute at Columbia University has a fairly recent piece arguing that no-one should waste time trying to price carbon.

Cohen believes that “The real battle — and the one we should be fighting — is not over the economics of carbon, but over public funding of the basic research needed to make the transition to a fossil fuel-free economy.”

As an economist I am tempted to say that Cohen doesn’t really understand how raising the price of carbon will promote the basic research needed to make the transition to a carbon-free economy.

I am also tempted to argue with him over whether it really is impossible to get other nations to accept a carbon pricing scheme. China is alreading exploring carbon pricing, so Cohen may simply be wrong. And I am not sure we even need to get others to accept an international pricing scheme: we could say to nations like India that want to sell to us, “You charge a carbon tax on on what we import or we will.” It is pretty obvious that the US, the world’s largest import market, has the power to impose a carbon tax on imports.

But Cohen is absolutely right about expanding basic research. I support his argument that far.

I just think he looks a bit dumb asking people to develop new low-carbon technology while we continue to subsidize competing fossil fuels. That is called trying to suck and blow at the same time. Cohen has some clever ideas, but a good part of his cleverness might be wasted saying why only his ideas will work.

And maybe I make the same mistake sometimes. Don’t you?



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