https://www.imf.org/en/Publications/WP/Issues/2019/05/02/Glo...
You could implement a carbon tax, and I'd be all for that, but it wouldn't be in the same policy class as diverting an existing stream of budgetary money.
It's what upsets me about these sorts of papers- "civilian" climate change skeptics/deniers point to them as evidence of the dishonesty of consensus community. They are able to take away the wrong message- that consensus community is stretching and manipulating the data, rather than there are $300-600B of subsidies for fossil fuels out there.
Negative externalities are a type of subsidy.
The UK kept that reduced rate on domestic fuel when they brought in a low carbon price floor (another bonus of EU membership). That managed to take almost all coal out of UK power generation - there's only three plants left, all marked to close in the next couple of years. It's already starting to have impact on gas's viability.
As different rules apply to vehicle fuel, and domestic fuel, individual behaviour hasn't been much affected, and cities are still full of dirty air from internal combustion. UK has been particularly weak at improving air quality in the last decade or so.
> We are spending more than $5T annually on fossil subsidies. All you have to do is divert that elsewhere.
"Spending" and "divert" imply a cash flow, not a flow of value in the form of a collection of externalities. That's relevant. Redirecting funds is a different political beast from increasing taxes. To be clear, I want a carbon tax. Let's promote it with logic, not with clumsy attempts at deception.
So I'm a little more flexible in a web discussion than I would hope for from a finance minister. Except actual politicians, of all colours, are even more creative in the hoops jumped to imply wholly incorrectly their own tax raising policies are not a tax hike such that it becomes a logic and fact free zone.
Personally, I want the same as you, perhaps a little further as I'd like those externalities baked into the price of everything, and required to be picked out before sale. Maybe required on every label like how calories or salt content is picked out on food. Then I can choose logically or at least knowingly. I don't think politicians are ever willing, after a little industry lobbying, to give us that... Which applies to far too many issues, not just climate.
No, that's absurd way to put it. It's like saying that shipping industry receives trillions of dollars of invisible subsidy due to not having to rent the ocean water the container ships float on. Yes, if oceans didn't exist, shipping would be quite a bit more expensive, and you can even do the math and put a number on that, but the fact is that if you tried to "divert" these "invisible" subsidies from shipping companies, and taxed them for the trillions of imputed income, you'll soon find that those trillions do not line up shipping companies pockets.
The only reason to call it "subsidy" is to imply that the companies are "unfairly" benefiting, but unless these externalities have actual cost to the economy instead of just imputed carbon/water tax, you'll find no resources to divert.
The ocean analogy isn't such a far stretch either - the increasing levels of pollution and emissions from container traffic, using a particularly dirty fuel and an industry that flushes tanks and oil rich pollutants in international waters has an impact on water quality, fish stocks and other ocean life. Roads are a subsidy on cars as they are paid for by general taxation rather than specifically on vehicle use.
Those externalities should all be priced in to discourage impactful behaviour, and encourage truly sustainable behaviour, on the sole viable planet we currently have. At the very least we can make a poor choice knowingly.
It very much does have actual cost, just not today or tomorrow, so it's a bit harder to calculate.
If I break your bike in the middle of winter, the cost won't actualize until spring when you would have used it, and instead have to pay for the bus. So sure, it's not a Q4 cost, but it is real nonetheless.
It reminds me of nothing so much as the tenor of criticism of Trump, especially early in his term. The man is already a monster! You don't need to keep lying to make him look like one, and all it does is turn of people who mightve agreed with your legitimate criticism!
[1] To be clear, I have no reason to think that our counterparts on the right don't do this too. It just makes more of an impact to realize that everyone around you is dishonest and stupid than it does to realize that everyone in a relatively alien subculture is.
Why the heck would climate get a uniquely honest political conversation? Politicians of all colours lie, obfuscate and distort the facts on all issues all the time, whilst continuing to hurtle in a direction most of the country's voters would prefer not. Unless the US experience has been very different, most votes will be for least worst, not in favour of either as tribal loyalties mostly died last century, only really remaining tribal with the elderly. It's one of the reasons for such a deep mistrust and disillusionment of politics and may have contributed to some of the world's "surprise" results lately, along with so many polls being proved wrong.
Honesty and politics are oil and water. The honest discussion is usually elsewhere.
> Then the report adds that there is actually another kind of subsidy, which it calls a post-tax subsidy. This subsidy reflects the difference between “actual consumer fuel prices” and the full societal and environmental costs of a fuel.
Ok, but China is adding millions of brand new drivers to the roads every year, they've had to institute a lottery system just to determine who can apply for a license. They're building roads, bridges, gas stations etc as fast as they can to accommodate all of the new drivers and you can see this documented in the China episode of Grand Tour last season. This is going to happen with or without subsidies (Besides, I highly doubt China is subsidizing their citizens petrochemical purchases in any meaningful amount).
China is going to have more drivers than the United States has people in the country in the near future and that will only continue to grow. Are you going to tell more than a billion people to never get a car and to only walk places?
What about the fact that China is actively constructing hundreds of coal power plants? Or the fact their middle-class is rapidly growing which will mean more energy demands (which will mean more fossil fuel consumption) and more consumer goods (more plastics, from fossil fuels)?
>Since the early 2000s, China's middle class has been among the fastest growing in the world, swelling from 29 million in 1999 (2 percent of population) to roughly 531 million in 2013 (39 percent of population).
China has over 400,000 electric buses (99% of the world) and the longest high speed rail in the planet. High-speed rails carry twice as many passengers each month as the country’s airlines.
4.2% of new car purchases in China were electric vehicles in 2018. China has 250 million electric motorcycles/scooters (99% of the world's). These numbers are growing rapidly every year.
China is also the world's largest producer of photovoltaic power not to mention the world's leading installer of solar panels. Their literal stated goal for 2050 is to reach 1,300 GW of solar capacity, which is enormous. That would make it the source with the largest installed capacity in China.
China has a lot of problems, but fossil fuel addiction is not one of them.
2050 is too late as well. To make a big difference the timetable for that capacity would have to be 2030 and all the baseline would have to be hydro or nuclear. This is unlikely to happen even if they really want to do it.
Now consider that we also have USA to handle who are notorious about ignoring climate change targets...
Now, even 5 C is not a cataclysmic event but it will be very bad on a global scale - mostly water availability and farming, related price shocks and social upheaval.
with under-charging for domestic air pollution accounting for about half of the total subsidy and global warming about a quarter.
I’m not completely against calling the huge unpriced externality of carbon emissions a “subsidy”; but markets are reactive and once we start charging a carbon tax, we’ll start emitting less carbon dioxide (good!) But we’ll lose out on much of this “subsidy”, too.
You mean we will have to pay less to deal with the health effects of air pollution and and the economic effects of global warming? I'm not clear what subsidy we "miss out on" here.
Effectively what would happen is high CO2 parts (such as concrete) would be manufactured in a country that doesn't tax it. If you say "Oh, well we'll just tariff it!" then the next step would be to ship it to a country without said tariff. That country could then move the goods directly to the taxed nation or it could ping pong a bit till it reaches it's end goal.
Would that raise prices? Absolutely, but probably less than the $100 tax would. All the while increasing the amount of CO2 emitted due to all the shipping that would occur.
And, if you don't think that would happen, just look at how it's worked out with child labor laws.
The balancing act would be to tax hard enough to make industries want to decrease their emissions, yet low enough that importing isn't more economically viable. As a bonus, you could spend that revenue in building out clean energy sources to effect change faster.
Duties are based on the country of origin, a middleman country would have to do something substantial to the goods to change the country of origin (for example taking wafers and manufacturing them into bare printed circuit boards).
Even with a country doing something significant they could still be subject to counterveiling and/or anti-dumping duties for another country. For example the tariff 8517700000 which is frequently used for parts of mobile phones like the screen/keypad/bezel/antenna from say Vietnam are still potentially subject to ADD/CVD for China. Or photo-voltaic cells/panels universally flag as potentially subject to ADD/CVD regardless of the declared country of origin.
In examples like the above two part of the scope of the investigation involves companies in those countries known to use things from CN, such as aluminum extrusions for the 8517700000, that are subject to ADD/CVD so they have to disclaim it on a case by case basis or pay the ADD/CVD charges.
Source: this is what I do for a living and the 8517700000 VN example is actually from this morning with some mobile phone displays.
Take food as an example. With the recent china soybean tariffs the way that some manufactures got around it was first shipping the goods to Thailand.
From there it is either processed or re-exported.
https://www.scbeic.com/th/detail/product/4730
So long as the middleman country/countries have lax regulations and the actors aren't pushing heavily on them, then goods can flow (all be it at increased cost due to additional shipping/repackaging).
Yeah, except people have tried to do this with aluminum by bringing it through Mexico and it doesnt' really work. This is partly why say 8517700000 from Vietnam like in my example is potentially subject to anti-dumping as if it were from China.
https://fortune.com/2016/09/09/chinese-aluminum-giant-is-tie...
Sure, it works for some handbags or sunglasses, even a few cargo containers of product, but any meaningful amount and forget about it.
Trees and other plants take carbon from air, energy from the sub, and use it to build themselves. We take carbon from them and put it back into the air, using the excess energy to move and think.
Which was in the air in the past few months to handful of years depending on how fresh the food is and what it is (plant, animal). Unlike the CO2 from fossil fuels which was sequestered for millions of years. And had that not been harvested for food, it would have sat their being decomposed in a field somewhere returning that carbon right back into the atmosphere via animals and bacteria snacking on it as they broke it down.
The oil and coal only happen when organic matter is subjected to pressure and non-porous geological layers. Otherwise you get peat fields and those emit methane.