Exxon Mobil Lends Its Support to a Carbon Tax Proposal

 

Jordan Silva

Environmental Economics

Dr. Eubanks

Blog Post 4

 

Exxon Mobil Lends Its Support to a Carbon Tax Proposal

(https://www.nytimes.com/2017/06/20/science/exxon-carbon-tax.html?ref=energy-environment)

           

This article talks about imposing a carbon tax on companies that make energy derived from fossil fuels. The proposal would have “an initial tax of $40 per ton of carbon dioxide produced, which would add 36 cents to the cost of each gallon of gasoline sold.” The money raised would benefit lower income families with around $2,000 a year as a dividend. This tax is supposed make the free market move faster towards renewable energy than current regulations.

Putting a carbon tax in place would be the opposite of beneficial. For starters, production may shift to other countries with lower carbon taxes, Businesses may also hide their pollution in order to pay less in taxes. External costs are also difficult to measure making it hard to know exactly how much the tax should be to be most effective. The tax would also make the cost of just about everything increase and outweigh the benefit giving to lower income families.

According to nationalreview.com, “William Nordhaus, an economics professor at Yale University who won the Nobel Prize in economics last year for his work on climate-change policy, is a long-time advocate for a carbon tax. Nordhaus has underscored the ‘importance of near-universal participation in programs to reduce greenhouse gases.’ In 2007, he estimated that if only half of the world’s countries agreed to participate in a carbon-tax effort, there would be an ‘abatement cost penalty of 250 percent.’ In other words, the countries that have imposed the carbon tax will have to more than double their carbon-tax rates in order to compensate for the free-riding countries.” (Robert Bryce). Lesser developed countries are more concerned with economic stability than reducing their pollution. Making the United States do more work to compensate free ridding countries seems like the wrong approach. Profits ahead of climate change seems to be the issue with many countries and getting everyone to play by the rules of a carbon tax is a stretch to say the least.

An alternative to a carbon tax according to futurefuelstrategies.com, “What if, instead of making fuel and other commodities and services more expensive, we used a financial incentive to make technologies that help reduce emissions – such as solar, wind and geothermal energy – more affordable?” (Sumedha Basu). This approach would make your home electricity bill cheaper with the use of solar panels and driving an electric car more affordable to everyone.

 

Works Cited

1.       Bryce, Robert. "The Three Major Problems with a Carbon Tax." nationalreview.com, 4 Feb. 2019, www.nationalreview.com/2019/02/carbon-tax-proposals-three-major-problems/.

2.       Basu, Sumedha. "Why We Need the Opposite of a Carbon Tax to Reduce Emissions." Future Fuel Strategies, 9 July 2020, futurefuelstrategies.com/2020/07/09/why-we-need-the-opposite-of-a-carbon-tax-to-reduce-emissions/.