Carbon tax
Carbon dioxide emissions are rising primarily as a result of human activity, particularly electricity generation, farming, industrial activity and transport. As levels approach 400ppm increasingly stringent measures will be imposed to begin the process of slowing the increase – with the ultimate objective of stabilising the gas levels. The technique which is thought likely to produce the largest impact is the imposition of a carbon tax – a tax effectively on carbon emitters. It does have the advantage that it adheres to the eminently logical polluter pays principle but the ability of a nationally implemented tax to solve a global problem has yet to be tested.
The Irish government now introduced a carbon tax in the budget and a good summary of the effect on the economy is available from an ESRI paper which sets out an economic analysis. The government consultation process on the matter is summarised in this document. A carbon tax is classified as a Pigovian tax – a good example of a name reflecting sentiment.
Whether we like it or not the option of doing nothing about Carbon Dioxide levels is one that carries substantial risk, and the issue of the political acceptability of a carbon tax will ultimately hinge on the the ability of the affected population to perceive the risk, set against their acceptance of the tax. Unless the rationale for the tax is clearly set out and the concept sold to the affected population a carbon tax runs the risk of creating inequalities and being very unpopular – a case of the affected becoming the afflicted.
Almost everything in relation to global warming comes down to a question of whether “logic will prevail”. We do not have any particular insight – and while we do not advocate asking the “flat earth society” a quick head count might yield a clue.
