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With atmospheric carbon levels ever on the rise, climate change is becoming harder to reverse, and will begin to impact both the United States and smaller, more vulnerable nations with rising temperatures and tides. Though individual effort to be more environmentally conscious is important, the U.S. should implement a carbon tax to prevent natural disasters and their economic consequences, hold corporations accountable for their disproportionate carbon emissions in order to meet international goals regarding carbon levels, and generate revenue for the government that could then be invested in improving American lives.
The climate change that is projected to occur with the current rate of greenhouse gas emissions could have devastating consequences for individuals and communities, and should be prevented through a carbon tax targeting the biggest emitters.
Carbon, a greenhouse gas, traps heat near the surface of the earth, increasing the probability of many extreme weather events: droughts, floods, fires, and heat waves (Sanders). These occurrences already impact the United States and will become more common over time; for example, Hurricane Harvey paralyzed Houston with forty inches of rain, while a drought in Massachusetts “resulted in a loss of ten to fifteen percent of the crop” for one cranberry grower (McNeil).
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The repercussions of global warming are likely to be absorbed by individuals like farmers, whose livelihoods are most vulnerable to the change in environment. Poorer areas especially will suffer more as a result of natural disasters like hurricanes, and are also more vulnerable to health impacts associated with global warming.
According to Renee Cho, writer for Columbia University’s Earth Institute, “if temperatures rise 4.5˚ C by 2090, 9,300 more people will die in American cities due to the rising heat”, and the spread of insects will increase risk of diseases like Zika, West Nile, and Lyme.
Lower-income groups, lacking the resources to protect themselves against the health consequences, are disproportionately affected by the nation’s carbon emissions. Considering how much of the atmosphere’s carbon levels is the fault of industry, making individuals responsible for preventing climate change is unnecessary and ineffective. A carbon tax is the large scale action the nation needs to address the biggest source of greenhouse gases, and can cut emissions and lift the burden of the climate change that will put American jobs and lives on the line.
A carbon tax is key in decreasing greenhouse gas emissions of the largest producers, using an economic incentive to prevent economic consequences of global warming. While it is impossible to make definitive predictions of the future change in global temperature, the current rate of carbon emissions is almost certain to create an increase, which holds potential for immense damages; a temperature increase of 4.5° C by 2100 could cost the U.S. $520 billion annually. The consequences are projected to be extreme in agriculture alone; “for every degree Celsius the global thermostat rises, there will be a 5 to 15 percent decrease in overall crop production” due to floods, fires, and pests (Cho).
Considering the severity of the economic repercussions of climate change, economic incentive directed towards the biggest producers would be both justified and effective. According to economist Dr. Noah Kaufman, in a $50 per ton tax scenario, greenhouse gas emissions are projected to fall 3.2 percent per year—39-46 percent below 2005 levels by 2030. Of course, estimates as applied to the United States are based on economic models, but the effects can be observed in British Columbia, which implemented a carbon tax in 2008. Its $30 per ton tax structure has reduced residential consumption by about 15 percent, and fuel consumption by 5-15 percent (Rodio). A carbon tax, by putting a price on unsustainable practices, is the economic incentive needed to reduce the fuel consumption related to greenhouse gas emissions. The U.S. stands to take significant economic hits in the future with climate-related damages; a carbon tax would be both effective and efficient in reducing emissions and their impact.
A carbon tax on the biggest emitters holds corporations accountable for their disproportionate greenhouse gas production and encourages a shift to clean energy sources. The energy industry currently is one of the biggest producers of greenhouse gases; less than 3,000 of the largest fossil fuel producers cover 85% of greenhouse gas emissions (Sanders). However, the government is not currently doing anything to curb these emissions at the source—in fact, according to Clayton Coleman of the Environmental and Energy Study Institute, “Estimates put US direct subsidies to the fossil fuel industry at roughly $20 billion per year”. Energy industries earn massive profits off of the use of harmful materials, and while they are being encouraged by the government, it is unlikely to stop. In the past decade, the top five oil and gas companies made $1 trillion (Sanders), benefiting from their destructive fuel consumption while pushing the consequences onto the American people. Businesses will not sacrifice profits for the sake of the earth; the only effective option is to make it more expensive to use carbon-based fuel than to switch to clean and renewable energy sources. Under the right structures, a carbon tax could encourage this transition in energy production一the proposed Climate Action Rebate Act is designed to use the market to incentivize clean energy innovation, and would divert revenue back to that cause (Coons). Though this transition could raise energy prices, using revenue to improve technology makes renewable energy a more feasible option for much of the country, and would lower its cost over time. With the right investments, the nation can shift from the practices that drive climate change, and hold corporations accountable for the future of the planet.
By addressing the biggest source of carbon in the United States, the nation can meet international emission goals and lead the way for global cooperation to prevent climate change. While the US does not make up the majority of global greenhouse gases, it accounts for 18% of the world’s CO2 emissions and, with a carbon tax, can join the 30 European nations that have already established systems of emission reduction (Dinan). By joining an international effort to prevent climate change, the US can set an example in becoming a part of the solution; if developing nations like China, India, and South Africa follow and implement a $75 carbon tax, it could reduce emissions by up to 45%, according to The Washington Post editor Andrew Freedman. The US is a powerful economy and a global leader, and joining smaller nations in efforts to reduce greenhouse gas emissions is important both symbolically and as a measure for reductions through an international accord: the Paris Climate Agreement. The US has since withdrawn, but it initially “committed to reduce its greenhouse gas emissions by 26-28 percent below the 2005 level in 2025” alongside 185 other countries (Sweeney). A carbon tax is a measure that would both meet the initial goals and recommit the nation to the ideals of the accord, joining the world in addressing the climate crisis. It can’t be reversed with just a few countries doing their part一the US needs to commit on a large scale and lead the way for more extensive global efforts.
Though a carbon tax would likely impact the economy, potentially reducing output, it would also generate revenue that could be used to absorb the negative economic consequences of the tax. Potential tax scenarios at $14/ton, $50/ton, and $75/ton would each produce billions in payments: $80 billion, $240 billion, and $340 billion respectively (Kaufman). This can dramatically limit reduction in output if used to change existing tax structures to accommodate the carbon tax. According to Terry Dinan of the Congressional Budget Office, using carbon tax revenues for reductions in payroll taxes, corporate income taxes, and individual income taxes could encourage investment and limit the net reductions in output by about 50%.
While the transition period as the carbon tax is implemented would likely mean GDP would take a hit, the effects would be buffered with revenue use. Furthermore, the short-term costs to businesses are less significant than the long-term effects of climate change; a study by the Carbon Disclosure Project found that “215 of the world’s 500 biggest companies could lose one trillion dollars due to climate change” (Cho). Between production disruption due to floods or fires and a change in stock market values for fossil fuels一such as the drop in value of the coal industry from $37 to $2 billion一companies need to respond to the change in climate sooner rather than later, even if it means absorbing losses in the short-term (Cho). With strategic use of carbon tax revenue, the blow of the tax would be softened and the country could establish a more sustainable economy with the long-term effects in mind.
The new source of government revenue provided by the carbon tax could also be used to protect individuals from rising costs that may be associated with the tax. While a carbon tax without structured revenue use would be regressive because lower-income households spend a greater proportion of income on energy, when revenue is used for equal rebates their tax burden “decreases by 4-5 percent of pre-tax income”, according to Dr. Kaufman. Other options to avoid burdening vulnerable communities with the carbon tax include supplementing safety net systems like food assistance or refundable tax credits, or lowering other taxes (Marron). Lower income groups are already the most impacted by climate change, so progressive revenue use to limit the impacts of the carbon tax are important and beneficial in the longer run.
A carbon tax can be a safety net with the aforementioned measures taken, so it can both prevent the consequences of a change in the environment and extend protections for individuals financially. Specific legislation has been introduced in the past that would further this cause; Senator Bernie Sanders and Senator Barbara Boxer’s Climate Protection Act was structured to “generate $1.2 trillion in revenue over 10 years”, return 60% to offset price increases, and invest in renewable energy and weatherize homes to save money on energy bills (Sanders). The shift in energy source driven by a carbon tax can reduce energy costs long term, further helping low-income households. As renewable energy investments increase, they will become cheaper, and will be more sustainable environmentally and economically, eventually reducing the burden of both climate change and energy costs on American taxpayers. Carbon tax revenue can improve the lives of individuals, offering them assurance of returns from the tax and ensuring a less burdened future—one without the imposing threat of climate change.
Considering the spread of the potential impacts of greenhouse gas emissions, it is necessary that the United States takes legislative measures to prevent climate change by implementing a carbon tax. Not only would it prevent the environmental consequences of carbon emissions, it would hold corporations accountable, contribute to a global response to the climate crisis, and generate significant amounts of government revenue. It would finally take responsibility from individuals and give it to those that profit off of emissions, encouraging a change in energy sources and setting the stage for a more sustainable future.
A Carbon Tax: the Necessary Measure for a Global Climate Crisis. (2022, Apr 30). Retrieved from https://studymoose.com/a-carbon-tax-the-necessary-measure-for-a-global-climate-crisis-essay
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