Taxing greenhouse gases is a policy that deserves serious consideration – the kind of consideration it just isn’t getting in the United States. The approach makes sense in theory and, where it has been tried, has worked in practice.
The record shows that a well-designed carbon tax can cut harmful emissions in the most economically efficient way: by letting market forces coordinate the effort. Fears that a carbon tax set high enough to make any difference would harm the economy are contradicted by the evidence; carbon taxes haven’t led to higher public spending; and, with a little ingenuity, the most vulnerable can be protected.
Skeptics may still ask, Why bother about climate change at all? The science isn’t settled, they rightly point out. So why go to extraordinary lengths to deal with what may turn out to be an imaginary problem?
This is an unforgivably simpleminded position. When it comes to climate change, certainty isn’t required to justify action. The risk is such that sane societies should, in effect, insure themselves against it. A moderate, gradually increasing tax on carbon is not a case of going to extraordinary lengths. It’s a prudent, low-risk, low-cost option.
And it has another important benefit: Those opposed to bolder action by the U.S. are right that it won’t help much unless others act, too. The U.S. can and should set a good example, but success requires the participation of the rest of the world, especially big emitters such as China and India. The carbon-tax approach makes measuring and coordinating these efforts easier, because it centers attention on a simple benchmark that works everywhere – in effect, a global price of carbon.
This year’s United Nations climate summit has just wrapped up. It made no attempt to launch a new global compact on greenhouse gases. The hope is that next year’s summit in Paris will rise to that challenge. If it does, fine. If it doesn’t, governments can still make progress unilaterally, and their efforts will add up. Organize those efforts around a carbon tax, and coordinating them internationally will be that much easier.
It’s wrong to dismiss the threat posed by climate change – and there’s no excuse, either, for dismissing the best way to solve it.