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Comment 83 for Design Comments for the GHG Scoping Plan (sp-design-ws) - 1st Workshop.
First Name: David
Last Name: Schonbrunn
Email Address: David@Schonbrunn.org
Affiliation:
Subject: Carbon Tax
Comment:
While I am not an economist, I have been very struck by the website, carbontax.org which contains the writings of Charles Komanoff. Rather than offering a series of links to articles and publications there, I urge CARB to thoroughly explore the site. I see several very large advantages to carbon taxes, as compared to cap and trade programs: Cap and trade will require the creation of new institutions and expertise, which will be very costly. The thousands of lawyers and investment bankers that will be needed to make it work will add tremendous cost to the emissions reduction process. Conferences currently being offered on the business opportunities that will be created by cap and trade suggest that vast sums that otherwise could go back to the public, or into emissions reduction projects will be siphoned off by entrepreneurs. A carbon tax will be simple and inexpensive to administer and will not require an army of lawyers. The proceeds of the tax could be used to create cost-effective transit systems, as well as other low-carbon mitigations. Another possibility is to return the entire proceeds to taxpayers, to offset the increased cost of consumer goods. Another tremendous problem with cap and trade is the potential for sophisticated gaming. (Think of how Enron manipulated the California energy market.) A carbon market would appear quite opaque and arcane to the public. A carbon tax, on the other hand, is very straightforward. It should be easy to catch bad actors. The chief benefit cited for cap and trade is the certainty that the target will be achieved. This is dubious: if the system is itself flawed, as was Europe’s, or if it is gamed, it won’t achieve its goal. On the other hand, a carbon tax can be adjusted in response to observations of energy consumption levels. This isn’t rocket science! I urge CARB to conduct a full public evaluation of the potential benefits of a carbon tax before being stampeded by the business community into adopting cap and trade. The very popularity of cap and trade with the business community should be enough to cause CARB to stop and evaluate whether implementing it would truly be in the public interest.
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Date and Time Comment Was Submitted: 2008-08-01 18:50:24
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