Monday Message Board

It’s time again, once again, for the Monday Message Board. Post comments on any topic. As usual, civilised discussion and no coarse language. Lengthy side discussions to the sandpit, please.

8 thoughts on “Monday Message Board

  1. [Crossposted at Peter’s link]

    In favour of the sceptical, maverick (Galileo!) go-it-alone option add to the three identified points [in Peter’s post at his link] above the following:

    4. Carbon tax generates revenue from bads while tilting a domestic playing field in favour of “goods”
    5. The same tax brings international brownie points and potential for trade leverage (eg compensatory tariff threats against “dirty energy” imports)
    6. Carbon tax is a stimulus domestically for employment growth in skilled workforces to new technology energy industries. Demand for labour in new industries outweighs job losses in fossil energies (although the export market remains for those too in the short-medium term)
    7. The first player advantage; the comfort of watching others play catch-up
    8. Multiplier effects on young minds, with increased demand for a country’s currently undervalued science and technology courses.
    9. Unquantifiable enhancements of national pride and self-confidence

    I’ve missed a couple.

  2. Rationalist :
    Global carbon pricing isn’t going to happen thanks to Republicans in the US.

    I suppose other nations, with a carbon price, could place tariffs on non-carbon priced unfair trade.

  3. I get the dead tree version of the AFR – especially if it has a column or 2 from someone worth reading.

    Today there was a very good Remembrance Day article. Thanks for a good read.

  4. @Peter Wood

    For quite some time I’ve thought the best interim measure for pricing carbon would be an adjustment to the tax treatment of goods and services entailing the combustion of hydrocarbons.

    We simply set a “dirty energy benchmark” based on bog standard coal combustion (for stationary energy) and bog standard petrodiesel or petrol combustion (for liquid fuels). Deductibility would be pro-rata the benchmark. Anything above the benchmark would incur a penalty rate of tax. The price would then be passed on in all goods and services. Diesel & LPG fuel rebate would be abolished.

    We could set aside pro-rata rebates for those on or below AFTWE in cash or means-tested kind (public services that would normally be non-discretionary, such as housing, education, medical and dental, perhaps a staple food and grocery concession card).

    At the same time we could use perhaps 25% of recovered funds to tender for replacement of the oldest stationary plants with plants meeting much stiffer constraints — perhaps 5-40% of the current footprint with equal availability. We could offer soft loans or other incentives to those able to meet the performance standards after passing due diligence.

    The retooling this would set in train would weaken resistance to a CO2 price and make it possible for any cap and trade system to be a lot more aggressive since some of the upgrades would have involved radical redesign of business procvesses to lower C02 intensity to as near to zero as possible.

  5. Hi Fran

    I’m not quite sure what you mean. Just like an ETS can have free permits, a carbon tax can have “tax thresholds” so that polluting firms face the same marginal pollution costs, but have less of an income effect from a carbon price. Is that what you mean by dirty energy benchmarks?

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