(Nobel-winner) Thomas Schelling just gave a talk here at GMU Econ on “Two Major Infrastructure Worldwide Projects to Prepare for Global Warming.” He said most work on global warming focuses on how to prevent it, and that there’s been a bit of a
It's not so binary: the costs of protective barriers and destroyed development are finite and are sometimes worth it. Some coastal development may be worth the cost of extra protective barriers, or it may be profitable enough to get a positive return before it is swallowed by the sea, the tax selects against development that is not profitable enough for either of these scenarios.
Why tax perfectly reasonable construction which is not subject to loss from GW? How does the government know the optimal tax, what the time limit is, or what the return will be on construction?
The government could release its information and let developers decide. Of course, the govt has been consistently wrong about the magnitude and effect of GW.
The main reason for a tax: government loves to collect taxes, and any excuse will do.
I forgot to mention that the estimate of a 90 percent chance of a sea level rise between 0.4 and 0.9 meters from 2000 to 2100 was for the RCP 4.5 scenario, which is a realistic scenario. (As opposed to the very unrealistic RCP 8.5 scenario.)
A tax would be preferable to a ban because in many cases it's perfectly reasonable to build knowing the constructions will be usable only for a limited time.
Your goal is to limit coastal development, under the prediction that it will all be flooded by GWarming.
Why the puny application of a tax? We have to stop ALL of that doomed development. Have the government regulate no more coastal development. Future generations will thank you.
"No money would be saved up". That is, it would be taxed and spent. Spent on what? Possibly you can describe a similar program that has created net value. Or, is this a flight of fancy into the ideal future?
It's not only the fossil fuel exporters who would get hurt by the tax. Use of fossil fuels represents an increase in comfort and wealth for many in the world. Of course this cannot last because the fuels are non-renewable and it comes at the cost of pollution and emission of greenhouse gasses (some regions notice these adverse effects much more than others), but getting rid of fossil fuels does mean a (temporary) decrease in wealth through a reduced amount of available energy and/or through higher costs of the same amount of energy while renewable energy sources are catching up to the demand and still developing efficiency-wise.
What the tax would do is discourage development of coastal areas, and thereby implicitly encourage development in non-coastal areas. Current and near-future GDP would only be reduced by the difference in profitability between coastal and non-coastal development, not by the entire value of planned coastal development.
Later on less stuff in coastal areas needs to be protected and this increases GDP, Schelling thinks by more than the previous reduction.
It's not that complicated, but it does go beyond "taxes are bad, government is evil, markets are good" plattitudes.
The proposal: Tax people now and save the cash to spend on Global Warming projects in the future.
Why I am laughing.
o Global warming predictions have failed to predict the future.
o Collecting cash and saving it is an action on pieces of paper. The effect is to reduce current production and consumption. This is the opposite of the current "spend our way to wealth" theory of government. Progressives should get their story straight.
o Collecting cash and spending it now is a transfer of resources to speculative projects of probably little value. There will be a department holding special government bonds showing how much cash was collected and already spent, as with Social Security.
This does employ government cronies and businesses created by politicians and their families. So, that is what will happen to any tax.
o Taxes are wonderful (smile). They have a long history of creating prosperity and avoiding problems through the analytical and forward-looking wisdom of government.
The transaction cost of eliminating something like a payroll tax is negative and a carbon tax is trivial. All fossil energy producers and vendors have sales records that can be translated into carbon equivalent, depending upon the product, with trivial variation. It can all be at the wholesale level with very few organizations actually being taxed.
The point is that a tax shift will devastate a few and benefit the many. For the size of the fossil fuel industry, very few people work in the industry that is highly capital intensive and highly automated.
Yes, the tax man won't like it, he won't have as many jobs either. Eliminating payroll taxes and adding a carbon tax at the source (no exceptions for government purchases, etc.) would layoff thousands of IRS employees enforcing payroll taxes while using a few dozen to monitor taxes at fossil fuel choke points (refineries, rails, pipelines, etc.).
The term "revenue neutral" is stupid. Such a tax regime may not add to the Treasury's coffers, but it will devastate large sections of the country and ultimately decrease the tax base dramatically.
Anyone who thinks govt can dramatically tax rural and suburban America and hand out the cash to city dwellers without significant transaction costs and second-order impacts, isn't really thinking.
It's not so binary: the costs of protective barriers and destroyed development are finite and are sometimes worth it. Some coastal development may be worth the cost of extra protective barriers, or it may be profitable enough to get a positive return before it is swallowed by the sea, the tax selects against development that is not profitable enough for either of these scenarios.
Yes that link is wrong; not in my power to fix it.
The link to Schelling's talk points to Martinelli's paper, not what I would have assumed to be an article by Schelling.
Why tax perfectly reasonable construction which is not subject to loss from GW? How does the government know the optimal tax, what the time limit is, or what the return will be on construction?
The government could release its information and let developers decide. Of course, the govt has been consistently wrong about the magnitude and effect of GW.
The main reason for a tax: government loves to collect taxes, and any excuse will do.
I forgot to mention that the estimate of a 90 percent chance of a sea level rise between 0.4 and 0.9 meters from 2000 to 2100 was for the RCP 4.5 scenario, which is a realistic scenario. (As opposed to the very unrealistic RCP 8.5 scenario.)
This paper estimates a 90 percent chance of a sea level rise of between 0.4 and 0.9 meters between 2000 and 2100.
A tax would be preferable to a ban because in many cases it's perfectly reasonable to build knowing the constructions will be usable only for a limited time.
Your goal is to limit coastal development, under the prediction that it will all be flooded by GWarming.
Why the puny application of a tax? We have to stop ALL of that doomed development. Have the government regulate no more coastal development. Future generations will thank you.
"No money would be saved up". That is, it would be taxed and spent. Spent on what? Possibly you can describe a similar program that has created net value. Or, is this a flight of fancy into the ideal future?
Is your point that that people living further from the ocean spend more carbon per capita on heating & cooling?
@ Dallas Weaver
It's not only the fossil fuel exporters who would get hurt by the tax. Use of fossil fuels represents an increase in comfort and wealth for many in the world. Of course this cannot last because the fuels are non-renewable and it comes at the cost of pollution and emission of greenhouse gasses (some regions notice these adverse effects much more than others), but getting rid of fossil fuels does mean a (temporary) decrease in wealth through a reduced amount of available energy and/or through higher costs of the same amount of energy while renewable energy sources are catching up to the demand and still developing efficiency-wise.
No money would be saved up.
What the tax would do is discourage development of coastal areas, and thereby implicitly encourage development in non-coastal areas. Current and near-future GDP would only be reduced by the difference in profitability between coastal and non-coastal development, not by the entire value of planned coastal development.
Later on less stuff in coastal areas needs to be protected and this increases GDP, Schelling thinks by more than the previous reduction.
It's not that complicated, but it does go beyond "taxes are bad, government is evil, markets are good" plattitudes.
The proposal: Tax people now and save the cash to spend on Global Warming projects in the future.
Why I am laughing.
o Global warming predictions have failed to predict the future.
o Collecting cash and saving it is an action on pieces of paper. The effect is to reduce current production and consumption. This is the opposite of the current "spend our way to wealth" theory of government. Progressives should get their story straight.
o Collecting cash and spending it now is a transfer of resources to speculative projects of probably little value. There will be a department holding special government bonds showing how much cash was collected and already spent, as with Social Security.
This does employ government cronies and businesses created by politicians and their families. So, that is what will happen to any tax.
o Taxes are wonderful (smile). They have a long history of creating prosperity and avoiding problems through the analytical and forward-looking wisdom of government.
The transaction cost of eliminating something like a payroll tax is negative and a carbon tax is trivial. All fossil energy producers and vendors have sales records that can be translated into carbon equivalent, depending upon the product, with trivial variation. It can all be at the wholesale level with very few organizations actually being taxed.
The point is that a tax shift will devastate a few and benefit the many. For the size of the fossil fuel industry, very few people work in the industry that is highly capital intensive and highly automated.
Yes, the tax man won't like it, he won't have as many jobs either. Eliminating payroll taxes and adding a carbon tax at the source (no exceptions for government purchases, etc.) would layoff thousands of IRS employees enforcing payroll taxes while using a few dozen to monitor taxes at fossil fuel choke points (refineries, rails, pipelines, etc.).
Not according to the science.
The term "revenue neutral" is stupid. Such a tax regime may not add to the Treasury's coffers, but it will devastate large sections of the country and ultimately decrease the tax base dramatically.
Anyone who thinks govt can dramatically tax rural and suburban America and hand out the cash to city dwellers without significant transaction costs and second-order impacts, isn't really thinking.
Since coastal areas are more temperate and dense and produce less CO2, this is the equivalent of subsidizing CO2 production though.