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Discussion > Raff’s Carbon Tax

"As we've seen with Phil Clarke's example of British Colombia it doesn't actually work either."

It reduced emissions, at a faster rate than the country as a whole, without damaging growth or people's standard of living.

Jun 21, 2016 at 9:34 AM | Unregistered CommenterPhil Clarke

Phil, it iworked for a couple of years and then stopped working, even as the tax continued to rise. The improvements weren't even as good as the 4 years before it started the tax. As I pointed out, growth and standards of living aren't necessarily connected to energy use. Many countries have improved their efficiency without affecting productivity and even improved GDP but that physically can't continue indefinitely. Warmists have a bad habit of projecting lines into the future ignoringy evidence that the effect diminishes over the range.

Jun 21, 2016 at 9:53 AM | Unregistered CommenterTinyCO2

Phil Clarke
Have you looked at the official Canadian link I posted earlier?

My original words


Phil Clarke
Looking at official Canadian data here which shows emissions for years 1990, 2005,2014 I would say that Ontario, Nova Scotia, New Brunswick and Quebec have all done better that British Colombia by getting "greenhouse gas" emissions below 1990 levels which British Colombia has failed to do.

BC, didn't do as well as at least four provinces which actually reduced emissions 1990-2014 and about as well as another three which increased emissions 1990-2014 by a similar percentage. I'd call that a fail against other Canadian provinces. Perhaps the other provinces have better than BC emission reduction strategies?

Jun 21, 2016 at 10:06 AM | Unregistered CommenterSandyS

…we need to raise enough tax to pay our bills…
Why? Can we not just reduce those bills, in the first place? Stop giving money to NGOs, for a start; stop the vanity projects, such as HS… whatever numbers they are putting on them. Reduce bureaucracy; increase the number of tax-inspectors (one branch of government that has actually been reduced); perhaps even change the entire tax system, to remove the many tax-avoiding loop-holes employed by the very, very wealthy – Land Value Tax is one that I have seen that makes a great deal of sense, even if I may not be able to adequately describe its benefits (its simplicity, ironically, is one of its main features); even Vodaphone would have to pay more tax than they have paid, so far (the bulk of which was taking the Tax Office CEO, or whatever his title, out to lunch a few times).

Ah, but so many love the principle of taxation – make the rich pay for it… except they don’t. The tax burden generally falls on the middle earners; the rich get off, scot-free, and the poor get government largesse, for which they are supposed to be grateful.

Jun 21, 2016 at 10:15 AM | Registered CommenterRadical Rodent

Mark Hodgson
By not taxing (VAT and Carbon Tax) food and domestic energy, the major expenditure for poorer members of society, then taxing spending on non-essential purchases and increasing untaxed allowances will theoretically improve the lot of the less well off?

The British have a long history of financing things, mainly wars by debt, more so than most nations I think. Only in the last few years has the debt created by the South Sea Bubble been finally paid off, or was going to be. There was one particular MP in the 19th century who spent his life trying to convince the government to reduce debt, unfortunately his name escapes me at the moment.

Jun 21, 2016 at 10:20 AM | Unregistered CommenterSandyS

SandyS - the BC tax was only in force for the last 6 years of the 18 year period 1990-2104. As the article states "The provinces of Quebec and British Columbia, which rely on abundant hydroelectric resources for their electricity production, show more stable emission patterns across the time series and a decreasing pattern since 2005."

It is also important to examine all the factors across the provinces. Ontario, for example enacted a Green Energy Bill which caused the closure of all its coal plants, giving it a 'quick win' and the primary driver of its reduction. BC gets most of its electricity from hydro.

Emissions for Canada as a whole started declined around 2005/6 however the national decline reversed in 2008/9 but continued in BC. It is not true to state the tax continued to rise, it was frozen at $30 tonne in 2010, when emissions began to climb slowly again, the tax is estimated to reduce CO2e by 3 million tonnes per annum.

It's also worth noting that Canada's CO2 footprint per capita is about 21 tonnes, 2.5 times greater than ours and higher even than the US.

I checked this - BC has per capita emissions of 13.2 tonnes CO2 eq.

Jun 21, 2016 at 10:52 AM | Unregistered CommenterPhil Clarke

Correction, the BC tax was frozen in 2012, not 2010 as I said


The tax, which rose from 10 Canadian dollars per ton of carbon dioxide in 2008 to 30 dollars by 2012, the equivalent of about $22.20 in current United States dollars, reduced emissions by 5 to 15 percent with “negligible effects on aggregate economic performance,” according to a study last yearby economists at Duke University and the University of Ottawa.

The tax made fuel more expensive: A gallon of gas, for example, costs 19 United States cents more. It encouraged people to drive somewhat less and be more careful about heating and cooling their homes. Businesses invested in energy efficiency measures and switched to less polluting fuels.

Despite the price increases, voters warmed to the tax. Last year only 32 percent of British Columbians opposed the tax, down from 47 percent in 2009.

Perhaps most surprisingly, so did big business. And for good reason. As it turns out, a
carbon tax is the most efficient, market-friendly instrument available in the quiver against climate change.

“We were not very happy when it was first announced,” said Jock A. Finlayson, head of policy at the Business Council of British Columbia. Now, “within the business community there is a sizable constituency saying this is O.K.”

http://www.nytimes.com/2016/03/02/business/does-a-carbon-tax-work-ask-british-columbia.html?_r=0

Jun 21, 2016 at 11:22 AM | Unregistered CommenterPhil Clarke

"BC has per capita emissions of 13.2 tonnes CO2 eq." Phil

So? It's still higher than the UK. And parts of the US and UK are a lot lower than their national average too. It depends upon energy sources and activities as you pointed out. Without measuring the CO2 of the materials and products that BC individually imports and exports you can't tell what the real CO2 value is, any more than the UK value is a real reflection of how much CO2 we consume.

But the tax stopped working as a significant incentive before they stopped increasing the tax. CO2 reduction compared to the rest of Canada was faster in the 4 years before the scheme started than the 4 years after. It doesn't negate the point that the early CO2 reductions are easy compared to the later ones.

Work out the difference between the Canadian energy costs with those of the UK. How much of a tax nudge do people need to get down to 2 tonnes per person? And beyond as developing nations want their share and population continues to grow. The UK has an advantage over the US and Canada in that we're all close together. Homes are smaller, we have less posessions, roads and parking spaces are smaller, we've even got less money. All help to reduce how much energy we use. Is that what you see for the future of the US and Canada? Have you worked out how little 2 tonnes gets you in terms of lifestyle, never mind putting a tonne into infrastructure, government, schools etc. Play about with those CO2 calculators and see what you get for your low CO2 lifestyle and then tell me a modest tax would get you there.

Jun 21, 2016 at 12:25 PM | Unregistered CommenterTinyCO2

Of course, the final question should be: “Why do we need to ‘tax CO2’ in the first place?” The evidence shows that humans have little to do with the rise in CO2; the evidence also shows that CO2 has little to do surface temperatures, so why this obsession with restricting human emissions of CO2? Oh, yes… you want to punish the developed world for offering a desirable result to the developing world; the obvious solution is to tax the successful into oblivion, and keep the poor where they belong. How sweet.

Jun 21, 2016 at 1:07 PM | Registered CommenterRadical Rodent

CO2 reduction compared to the rest of Canada was faster in the 4 years before the scheme started than the 4 years after.

Even if that is true, it is not significant:it takes years for businesses to decide to change their behaviour. There are better metrics:-

Average annual BC per capita emissions in the with-tax period were 12.9 percent less than in the pre-tax period; this percentage drop was three-a-and-a-half times as great as the 3.7 percent fall in per capita emissions for the rest of Canada between the same periods.

For both BC and Canada, emissions declined more steeply during the pre-tax period than in the with-tax period, for both BC and Canada. Indeed, for Canada, when per capita emissions are statistically smoothed, they actually increased over the course of the latter period, albeit at a rate too small to register as statistically significant.

Quantifying the previous point, over the entire 2000-2013 period, per capita emissions of greenhouse gases in British Columbia fell relative to those in the rest of Canada at an average rate of approximately 1 percent per year.


BRITISH COLUMBIA’S CARBON TAX: BY THE NUMBERS

It was indeed a modest but effective tax that met its aims. Contrary to dark mutterings here the economic roof did not fall in. A journey of a thousand miles starts with a single step.

Jun 21, 2016 at 1:24 PM | Unregistered CommenterPhil Clarke

Phil Clarke,
So like the UK Canada found that an accelerating Carbon Tax cause issues for the population, particularly the poorer sections, as pointed out to Raff several times. Not only that it failed to achieve any decent reductions in emissions. Yet is was a success?

The Canadian economy has performed poorly during the 21st century, so the appearance of success of this policy may not be all it seems. Perhaps due to the fact it is one of the highest per capita emitters of CO2 in a period of rising oil prices.

Jun 21, 2016 at 1:38 PM | Unregistered CommenterSandyS

Not only that it failed to achieve any decent reductions in emissions. Yet is was a success?

12.9% per capita. Three and a half time better than the country as a whole. I call that decent.

Have you actually read the evidence I've supplied? What were these issues you mention? The tax is supported by two thirds of British Columbians so they seem to be Ok with it ......

Jun 21, 2016 at 1:44 PM | Unregistered CommenterPhil Clarke

Tiny: So China and India would have no problem selling goods because they still have small per capita CO2 footprints, even if the products themselves were produced in exactly the same way.

No, the tax would be per-ton of CO2 so the per-capita emissions don't matter. The dividend I mentioned was calculated per-capita but India and China would not have to pay a dividend (they might choose to pay the tax to government officials' Swiss bank accounts instead, who knows).

Jobs go abroad for lots of reasons but the main one is so that companies can make bigger profits. There's no reason for example why Apple has to manufacture in China. It makes vast profits and has pricing power - it could make things in the USA and accept lower profits. It chooses that making huge profits is more important than US jobs. CO2 taxes wont change that. Same with some other products (esp. for products where the producer has pricing power). When you can pay $100 for a pair of sweatshop made Levis jeans instead of $10 for a no-name pair from the same place containing essentialy the same materials, labour and shipping you know that the manufacturing cost isn't what drives the price - it is the markup required to make company profit forecasts. Such companies choose to make a large profit for themselves rather than share that profit with American workers and a CO2 tax wont change that (although it should make shipping more expensive, perhaps aiding local manufacture a little).

Clearly that paragraph is a little unbalanced as there are many companies that have to manufacture abroad because they compete directly with imports from abroad and can't generate large margins to support more expensive local manufacture. But a CO2 tax applied per ton isn't going to affect where they manufacture if there are offsetting tariffs to compensate where other countries don't apply an equivalent tax.

Sandy, So now your Emissions Tax doesn't actually help the poor, revenues are taken into the tax pot to be spent as government sees fit not on the poor,... The dividend is what compensates the poor, as discussed.

Jun 21, 2016 at 1:59 PM | Unregistered CommenterRaff

The dividend is what compensates the poor, as discussed.

Important point. Revenues are not sunk into the general taxation pot, they are returned 100% to citizens. In BC the Government actually sent cheques to residents ,before the tax was even levied, based on future revenues, (which may help to explain its popularity, heh).

The tax is on fuel usage while the rebate is flat rate per capita, so the winners are people with lower than average usage will benefit, at the expense of those with 2 Humvees on the drive….

Jun 21, 2016 at 2:18 PM | Unregistered CommenterPhil Clarke

It doesn't matter how much you keep presenting the same information Phil, the effect of the tax rises wore off very soon after they were started. The last $10-15 of tax rises had no effect at all. How many dollars would the tax have to be to reduce another 16%?


Raff"No, the tax would be per-ton of CO2 so the per-capita emissions don't matter" but how many tonnes were emitted for those goods exported? They could claim to be far more efficient than US companies. How could you prove them wrong? We can't accurately tell how much CO2 their country emits, they're not going to make it easy for you to compare their goods with yours and find them wanting. They've got nuclear, they've got hydro, how do you know that those goods weren't manufactured using zero carbon energy sources?

Jun 21, 2016 at 2:53 PM | Unregistered CommenterTinyCO2

As far as I can tell - BC petrol is about 10c more than the rest of Canada and about half what it is here in the UK.

Jun 21, 2016 at 3:05 PM | Unregistered CommenterTinyCO2

Phil Clark, Raff,

I have tried to follow this argument, but have not been successful. I don't see the point of extra taxation or the rebate. I'll illustrate my perplexity by using a situation that I used to know well (in other words it may have changed since I was last there quite a few years ago).

Fresh water is at a premium along the Florida Keys with supply limited to a single, medium diameter pipeline stretching from the mainland to Key West. Inhabitants of the Keys are therefore strongly encouraged to conserve water and the main way this is done is by imposing very high water charges. However, there are some very wealthy residents who desire lush gardens, which require a high water use. These people are not prevented from using significantly higher water volumes than their neighbours, but they pay for it. Ever increasing water use is matched by geometrically increasing water costs. The outcome: those rich enough get to use the water they desire, the costs they pay help defer costs for ordinary folk. No taxes, no rebate, no costs for imposing taxation or rebates, incentives to reduce water costs for all, those prepared to pay for more, do so through the nose. Overall effect: required water use savings, admittedly with few satisfied customers, but then if you get to live in the Keys.....

So applying this to energy use, why the need for taxes or rebates. It seems to me to be a potential bureaucratic nightmare.

Jun 21, 2016 at 3:18 PM | Unregistered CommenterAlan kendall

Erm… how are these CO2 "reductions" being measured?

Jun 21, 2016 at 3:22 PM | Registered CommenterRadical Rodent

RR, good question.

All I can say is that stated emissions levels are now falling short of the global rise. This gap has been put down to ocean outgassing and other trapped CO2 sources emitting due to warming. Countries supposedly use their fossil fuel use (plus cement) as a calculator. China recently revised its figures upward, possible so that they'd be able to claim greater falls at a later date, but there's still a gap. I'm sure that they wouldn't cheat, ho, ho, ho.

Jun 21, 2016 at 3:34 PM | Unregistered CommenterTinyCO2

AK also a good question. My theory is that warmists think that an outright tax would be too scary for even the most ardent CO2aphobe so they soften it with a rebate. They're betting that the consumer won't spend the rebate on the higher priced items.

Jun 21, 2016 at 3:43 PM | Unregistered CommenterTinyCO2

Has anything beneficial ever been done with money raised from Carbon Taxes?

No.

Has anyone noticed anything unbearable about the climate?

No.

Is there any point in continuing with Carbon Taxation?

No.

Will anyone lose out, by abolishing Carbon Taxation?

Yes, all the people who thought it was a good idea in the first place and have been profiting ever since. No polar bears will suffer.

Jun 21, 2016 at 6:08 PM | Unregistered Commentergolf charlie

This isn't about whether we need a CO2 tax or not but how it would work if we did.

Jun 21, 2016 at 7:22 PM | Unregistered CommenterTinyCO2

I don't know if someone has pointed this out yet, but my understanding of a carbon tax is that it is intended to internalise externalities. In other word, you estimate the future costs associated with emitting CO2, you discount that to today, and you add that as a carbon tax. In doing so, you aim to properly price the use of an energy source that emits CO2 into the atmosphere. It's therefore meant to be a market-based solution; if all possible sources of energy are properly priced (i.e., we pay the full cost of using those sources) then the market should operate efficiently and we will end up with the optimal mix of energy sources. That's the idea, at least.

Jun 21, 2016 at 8:00 PM | Unregistered Commenter...and Then There's Physics

But why is a tax any more useful than what we're currently doing? A carbon tax and a renewables subsidy look remarkably similar to the bill payer. Instead of a rebate, our government fritters the money on windmills. Our energy network is almost at breaking point because there just isn't a way to make current renewables viable for a 24/7 demand. And we haven't tried to add heating and transport to it yet. There's an interesting report out about Germany's energy future and it highlights how very far we are from significantly reducing CO2.

How can you even calculate the cost of future carbon impact, when we still don't know what effect CO2 has?

A tax can only make people use less, it can't spawn new technologies. If those technologies existed then you might nudge people towards them but as your sole car, how likely are you to buy a 100% electric vehicle? Price is not the only factor.

Jun 21, 2016 at 9:16 PM | Unregistered CommenterTinyCO2

Climate kooks think they can use taxes to manage the world's climate?
hahahahahahahahahahahahaha
Tell me another one.

Jun 21, 2016 at 10:05 PM | Unregistered Commenterhunter