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You’d think supporters of a climate policy endorsed by more than 3,600 U.S. economists, the UN Secretary General, International Monetary Fund, World Bank, and Intergovernmental Panel on Climate Change (IPCC), to name a few, would be riding high. Instead, many advocates of carbon pricing are on the defensive against skeptics who claim it can never work in America.
“The politics of tax-centered climate policy are hopeless,” declared New York Times columnist Paul Krugman in 2022. “This may be the optimal economic policy for reducing
carbon pollution, but as the centerpiece of climate reforms, it has proven a political disaster,” asserted two prominent University of California at Santa Barbara political scientists in 2020. That view has become conventional wisdom among many journalists as well. It also helps explain why drafters of the original Build Back Better proposal did not include carbon pricing.
But to call the cause of carbon pricing “hopeless” seems premature when a record 68 such programs covered 23% of all global emissions in 2022, according to the latest World Bank
report. America’s leading trade partners–the European Union, China, Canada, and Mexico–all use some form of carbon pricing. At the start of 2023, Washington state bounced back from its previous setbacks and began implementing a new “cap-and-invest” carbon pricing system. A rising carbon tax reportedly came within one vote of being included in the Inflation Reduction Act of 2022.
Climate activists are not about to give up on a policy instrument described by the IPCC in 2022 as “one of the most widely used and effective options to reduce GHG emissions.”
If you want to hone your arguments in favor of a carbon tax, learn what the rest of the world is doing and gain some hope, read this informative brief by Jonathan Marshall, Economics Research Coordinator.
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