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147 comments on DrumBeat: October 30, 2006

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MUDLOGGER on October 30, 2006 - 4:24pm Permalink | Subthread | Parent | Comments top
Aye, and there's the rub.

Taxing people to change the world hits the low and middle income demographic. If you live in Richmond, then a few quid more on a chelsea tractor wont bite. (especially if you set your own pay)

If you own a villa in southern France, a few bob on your cheap flight wont hurt. Hell it will keep the great unwashed at home, where they should be: Cleaning our first house so it is nice n tidy when we get back

Nope. Hate to say this as a life long libertine and free market capitalist, GW-PO is bigger than all of us.

It is time to start BANNING STUFF BY LAW unless it is really vital. Who needs a chelsea tractor? Who needs a second home in France? Who needs aspirational consumerism?

Problem is, who will dare stand up and say this? Especially when a looming minority of Chinese and Indian Middle Class are poised to get there share of aspirational consumerism.

Naah. It just gets worse. Nobody will vote for national penury, nobody will stop the economic arms race if there is a chance that another nation will overtake and devour our nation.

We just are not wired that way. What made us successful as a species in the trial of the ice ages is now working against us:

Greed for fats and sweet honey; Tribalism,bonding and social organisation; tool making skills; sheer brain power; capacity for abstract thought;planning and mapping.

Great stuff when there are less than 2 million clever monkeys on planet. ''Gives you a nice edge'' - to missquote Oddball.

Its all a little bit problematic when there are 6.5 billion (and counting)clever monkeys on the planet.

We are fucked.

But before we are finally fucked, just watch the alpha-monkeys suck even more tax out of us.

We are victims of our own success (a trite way of describing overshoot).

Or

Too clever by 'alf.

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LevinK on October 31, 2006 - 12:10am Permalink | Subthread | Parent | Comments top
I think that imposing a carbon tax without some sort of compensation program is pretty much like performing appendix surgery without applying anestesia. It will still save your life, but it will damn certainly hurt like hell.

Without it I don't find carbon tax to be that good idea at all - to continue the analogy, it is known that sometimes the pain itself can kill the patient.

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Oilrig medic on October 31, 2006 - 1:44am Permalink | Subthread | Parent | Comments top
so can the anesthesia
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LevinK on October 31, 2006 - 11:30am Permalink | Subthread | Parent | Comments top
You are not suggesting to remove anesthesia from the medical practice do you?
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Telumehtar on October 31, 2006 - 10:36am Permalink | Subthread | Parent | Comments top
Sorry but recompensation is a Rob Peter to feed Paul sort of initiative.  Either it hurts all, or it had best hurt nobody.

Otherwise, it looks and is just another way to "redistibute the wealth" or another little socialist/communist program.

The rich as a percentage of people do not make up the bulk of polution from personal activities.  It is the masses of which the bulk are lower and middle classes with their 2+ cars(yes even the poor in America own multiple cars) AC/heated homes and 2+ TVs, Appliances, etc that the real problem resides in.

But then taxing the rich and giving a pass to the poor has been a social goal of the liberals for a long time, and if they can meld PO and GW into furthering this goal, all the better.

No, if you are serious about reducing energy usage, you make it hurt for the greatest number of people so that the greatest number of people reduce or stop using that energy.  Compensation merely prolongs the amount of time they will use that energy.

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LevinK on October 31, 2006 - 11:03am Permalink | Subthread | Parent | Comments top
I am not proposing to "tax the rich and give the poor". This interpretation is entirely yours.

I am proposing to progressively tax the exessive consumption. Thus the tax will not be tailored for any social group, but will be against the fossil fuel consumption itself, which approach when you think of it makes the most sense. We have already such taxes: for example are taxes on alcohol and tobacco against poor people (assuming lower classes drink and smoke more)? I don't think so. They are against the consumption of these products itself. A milioneirre that doesn't drink, smoke, and drives a hybrid may find himself paying much less taxes then a poor suburban family that drives SUVs.

We as a society can easily agree on some levels of consumption which are essential for the basic needs, and make people progressively pay for the extra. I see this most easily implemented using tax rebates or something like it.

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Telumehtar on October 31, 2006 - 11:14am Permalink | Subthread | Parent | Comments top
Perhaps you specifically were not talking about a redistribution scheme built into the law, but when this topic has been brought up before, the topic of somehow lessoning the effect for the poor seems to repeat itself.

Lessoning the effect for anyone however is a mistake.  It needs to hurt, and needs to hurt as many as possible so as to curb usage of X product.

A straight tax on fuel is fine.  It hurts everyone equally from a usage standpoint.  Don't want to be hurt?  Stop drinking, smoking, or putting around in your car.

As for what to do with that tax money in regards to energy, I'm all for using it to build alternative transit systems and renewable energy.  In a sense I suppose this is "recompensation" but its a public return not an individual return and thus the public, whether upper, middle, or lower class get to all see the benefit.

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LevinK on October 31, 2006 - 11:25am Permalink | Subthread | Parent | Comments top
Strongly disagree. Try to compare the pain of a 40K/year family trying to heat its house with a 400K/year family flying to the Caribian for the holidays. Your approach would cause political pressure to lower the tax or to make it marginal, so that the poorest guys will not simply fall off. The end result - it will become so low that because of the poorest 10% of the population, 90% will be able to afford to continue as usual.
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Telumehtar on October 31, 2006 - 11:38am Permalink | Subthread | Parent | Comments top
Ah so then you are back to giving money to the poor which would support what I said originlly about this being a redistribution of wealth scheme.

Or do you have another way that wouldn't involve tax rebates to the poor or making the tax have no teeth?

Seems like an either or situation to me.

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LevinK on October 31, 2006 - 12:00pm Permalink | Subthread | Parent | Comments top
No, I am just pointing out the obvious: the pain will depend both on the income and the amount of consumption.

If we do not provide a way to guarantee covering the basic needs like heating, lighting, using mass transit etc. without penalising them we are basically promoting a 19th century style capitalism. We need to come up with some sort of combination between penalising taxes (alcohol&tabacco) and incomme tax.

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Valuethinker on October 31, 2006 - 12:03pm Permalink | Subthread | Parent | Comments top
A quite simple way would be this.

Say Green Taxes collect £12bn pa.

60 million people in the UK.

Mail them a £200 cheque per person every January 1st.

This is more or less what Alaska does (shares its windfall oil and gas tax) via a personal credit.

The very poor will be better off than they are now.  Everyone who emits less than the average amount of CO2 in a year will be better off than they are now.

The effect on individuals would be less than the effects of a big change in the exchange rate, or losing their job, or a big change in energy prices (another form of 'tax' that we all pay).

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Valuethinker on October 31, 2006 - 12:06pm Permalink | Subthread | Parent | Comments top
The good news is that £12bn of taxes on CO2 emission is quite likely to have a significant impact on CO2 emission.

In the case of the UK, that is about £200/tonne of Carbon emitted, or £56/tonne of CO2.  Some activities (long haul flights to Australia) will get a lot more expensive.

(the Stern report reckons the long term cost of CO2 is c. £85 or about £312/tonne Carbon emitted).

Owning a high CO2 car (say 240gm/km v. 120gm/km which is the most economical Peugeot diesels) would cost about £1200 more pa (on 10k km pa driving).

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LevinK on October 31, 2006 - 12:21pm Permalink | Subthread | Parent | Comments top
This is a very simple and therefore brilliant idea. The best part is it will cost pennies on the dollar to implement it.
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Valuethinker on October 31, 2006 - 11:49am Permalink | Subthread | Parent | Comments top
If we are to use a 'Pigovian' carbon tax (as opposed to tradeable permits

then I think they will only work (and maximise GDP) if the principle is one of revenue neutrality.

The ideal rebate would be to reduce the employer contribution to National Insurance.  Basically we would be reducing about the worst tax in the UK tax system (a tax on employing people which therefore lowers employment, output and investment).   Employment would rise, wages would rise, returns on capital and investment would rise-- the proportions depend on each industry and its competitive conditions.

Politically we could probably make the pill palatable by splitting the take equally between NI for employer and employee.  Even the lowly paid pay NI, whereas a reduction in income tax would benefit the well off by much more.

To the extent that Green taxes led to increases in prices, those on state support would be compensated by the increase in the CPI.  One might have to have specific programmes eg for fuel poverty.

Sadly governments dislike hypothecated taxation (ie a tax tied to a purpose) and they really dislike revenue neutral commitments!

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LevinK on October 31, 2006 - 12:16pm Permalink | Subthread | Parent | Comments top
Sadly governments dislike hypothecated taxation (ie a tax tied to a purpose) and they really dislike revenue neutral commitments!

[rant warning]
Maybe it is time for them to change what they like or dislike, if it is true that our leadership acknowledges GW as a serious problem. I strongly doubt that indeed. I'm not sure at what point the call for a "smaller government" translated in a call for a "passive government" but to me it looks like the roots of the current inaction lie somewhere around that point.

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Valuethinker on October 31, 2006 - 11:42am Permalink | Subthread | Parent | Comments top
Better to give everyone a quota of emission permits, and then the option to buy or sell them.

The poor (the truly poor) will sell their permits, and be richer.  The well off will buy the permits they need.

Politically the dynamite will be in the middle classes because they will have to make tradeoffs.

This is all about the economic aspirations of the middle classes.  Say the 5th-80th deciles of the British population.

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147 comments on DrumBeat: October 30, 2006

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