Thursday, March 13, 2008

a carbon tax would give you a choice

Wednesday's Edmonton Journal says that "[i]ndustry estimates of the cost vary from $60 to $100 per tonne to capture, transport and store the carbon [dioxide]." Meanwhile, Stelmach says he will cap industry's abatement costs at $15 a tonne. While Albertans ultimately pay for costs imposed on Alberta industry just as they pay through personal income taxes, the fact that the Alberta government will have to pay the difference between $15 and the actual cost of mitigation (a cost which, as I argued below, could be lowered like that for any other tradable good if the premier were not opposed to free trade) out of its general revenues should make more immediately obvious the link between Stelmach's spending plans and the fact you will have to foot the bill.

Do you think it is fair that a person who always takes public transit or walks / cycles and uses low energy appliances should pay as much for CO2 mitigation through taxes as a person who drives a gigantic gas guzzler and has no interest in conservation? Economists generally think of "efficiency" instead of "fairness" since "what is fair" is typicaly a value issue that is often not settled by evidence and argument. But it isn't "efficient" either, because, quite aside from fairness, apart from changing the incentives for end consumption you are not addressing the fundamental driver of the whole carbon emissions problem (to the extent that it is really is a problem for Albertans).

At least with a carbon tax you could avoid it by changing your lifestyle.

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