A debate is raging about whether or not taxing carbon dioxide emissions would create or kill jobs.
It’s a debate worth having no doubt, as job creation is something to think about when crafting economic policies. But like most policy debates, discussing job creation misses the point of taxing carbon in the first place: It’s supposed to stem global warming.
On this point taxing carbon dioxide is a fool’s errand. A carbon tax will do nothing to stop global warming on top of making energy more expensive and less reliable for everyone.
In the past few years, conservatives and liberals alike have floated the idea of tax carbon emissions as a way to fight global warming. Some conservatives even argue the tax can levied in lieu of onerous Environmental Protection Agency regulations, and liberals have further contended taxing carbon would help cut the budget deficit.
But pundits have also battled over whether a carbon tax would do the very thing politicians love to tout about their favored policies: create jobs.
Of course it would create jobs, argue liberal pundits and academics. Economist Rick McGahey argues that “if the U.S. implements even a modest federal carbon tax, we could generate $170 billion by 2030 to create jobs” citing a Brookings Institution study. McGahey adds that carbon tax revenues could be used to “build bridges, roads and schools, reduce budget deficits, and cut taxes to spur private investment.”
From these economists’ point of view, carbon dioxide imposes a cost on society through global warming and making companies pay for emitting carbon would undo a social “bad.” Revenues from taxing this “bad” could be given back to people in the form of government spending or rebates. This would spur economic growth and boost green energy investments — so say all-knowing economists.
But there’s a catch: high energy prices. The Heartland Institute’s James Taylor counters that “[n]o credible economists claim that reducing American households’ disposable income will grow the economy and create jobs.” This is exactly what a carbon tax would do. Taylor adds that “all that will be accomplished will be poorer American families, economy-wide economic contraction, jobs destroyed in virtually every American industry, and a Solyndra-style transfer of wealth.”
What both sides of the debate miss is what a carbon tax would do about global warming. The whole point of taxing carbon dioxide from fossil fuels is to force companies to adopt green energy and cut emissions — supposedly the cause of global temperature rises.
No matter your take on the economics of the matter, a carbon tax would do nothing to stop global warming — even if such a tax was imposed on every industrialized nation.
Consider this. Even if the U.S. cut its carbon dioxide emissions by 100 percent, it would only reduce potential warming between 0.08 degrees Celsius and 0.17 degrees Celsius by 2100. At best, we’d offset about 9 percent of the oft predicted 2 degrees Celsius global temperature rise.
This is why scientists and environmentalists argue the whole world needs to cut carbon emissions. Well, if every industrialized country in the world (about 90 countries) cut their emissions by 100 percent only between 0.17 and 0.35 degrees Celsius of warming would be avoided.
Sounds pretty futile to me. Even the U.S. National Academy of Sciences and the UK’s Royal Society admitted that “if emissions of greenhouse gases were to suddenly stop, Earth’s surface temperature would not cool and return to the level in the pre-industrial era for thousands of years.”
Assuming everything they say about global warming bears out in reality, cutting all carbon emissions through policies like a carbon tax and such would maybe benefit your children’s- children’s-children’s-children’s-children’s-children’s-children’s-children’s-children’s-children’s children’s-children’s-children’s children… maybe. Even that sounds a little too optimistic.
So next time someone tells you about all the economic benefits (or costs) of a carbon tax, kindly ask them, “So how much warming will this stop?” I guarantee you the debate will stop right there.
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