beijing canned air pigou externality

For Polluted Beijing, Free Canned Air, Until We're Free
carbon tax oil dividend venezuela land value

WSJ -- How to Break the Tyranny of Oil Wealth

Mainstream media cover basic solutions. We excerpt five 2013 articles from: (1) CNN, Jan For polluted Beijing, canned air Jan 30, on canned air by S. Malveaux; (2) New York Times, Jan 13, on Pigou by A. Davidson; (3) NYT, Jan 29, on carbon tax by E. Porter; (4) Wall St Jrnl, Jan 28, on oil shares by M. OGrady; and (5) EarthSharing, Jan 26, on land tax by F. de Jong of Canada's Green Party.

by Suzanne Malveaux, by Adam Davidson, by Eduardo Porter, by Mary Anastasia OGrady, and by Frank de Jong

One of China's richest men is giving away fresh, canned air in polluted Beijing; to view more .

JJS: The Chinese could breathe clean air if burners had to pay to soil the air.

A majority of economists support some form of Pigovian tax, named after Arthur Pigou, the early-20th-century British economist. Pigou developed the idea of externalities: the things we do that affect others. Pigou argued that we’d probably do fewer damaging things if we had to pay for them.

To read more

JJS: The New York Times is not yet finished with this idea of making polluters pay.

Top economists agree a tax on fuels and the carbon they spew into the atmosphere would be the cheapest way to combat climate change. Most advanced countries rely on some variant of this tax. Does the prospect of more droughts and more powerful hurricanes push Americans to embrace it, too?

Among the 34 industrialized nations of the Organization for Economic Cooperation and Development, these taxes average about $68.4 per metric ton of carbon dioxide. The United States, by contrast, has a gas tax to pay for highway improvement, and that’s about it. Total federal taxes on energy amount to $6.30 per ton.

A tax on energy could single-handedly take on climate change. For starters, it would encourage people and businesses to burn less, reducing emissions at a stroke. One study found that a carbon tax of $15 per ton would reduce greenhouse emissions by 14 percent as people sought to save energy by driving less, insulating their homes and switching to renewable fuels, among other things.

What’s more, it would raise lots of money. Estimates reviewed in a report by the Tax Policy Center ranged from 0.6 percent of the nation’s gross domestic product — for a tax of $20 per ton of carbon dioxide — to 1.6 percent of G.D.P. for a tax of $41 per ton. Consider this: 1.6 percent of G.D.P. is $240 billion a year. And $41 per ton amounts to an extra 35 cents a gallon of gas.

By way of comparison, the Swiss economy does fairly well even while shouldering an effective carbon tax rate of more than $140 per ton.

A carbon tax would fall more heavily on the poor — the Congressional Budget Office estimates that the poorest fifth of Americans spend 21.4 percent of their income on gas and utilities while the richest 20 percent spend only 6.8 percent. But there are several ways to compensate lower-income Americans.

To read more

JJS: The other global New York paper, the Wall St Jrnl, shows how to make carbon taxes affordable by disbursing oil rents.

In a paper published in September by the Center for Global Development, the authors propose offering Venezuelans a plan to replace many of the government's social programs and subsidies funded by oil revenue with direct, "universal, transparent and regular payments" to citizens.

This would ensure that the population is benefiting from the country's oil wealth while at the same time addressing what the authors call the "corrosive effects" of oil in the hands of the state.

When the state has discretion to distribute the fruits of oil extraction without accountability, it is likely to use them to reward political allies.

To read more

JJS: And it’s not just the value of oil that should benefit the people but the value of land and nature in general, too.

Warranted new projects (parks, schools, transit, roads, hospitals) always raise local land values more than the cost of the project. Presently this wealth disappears into the pockets of local land owners. Instead, Land Value Taxation should be used to finance the infrastructure.

The rental value of land is revenue that belongs equally to all by birthrigh. The revenue generated by LVT should also be used to reduce and eliminate income and sales taxes. All taxes should be on the use and the abuse of nature (land, resources, pollution), not on jobs, business or sales.

To view more

JJS: And if urbanites use their land efficiently without vacant lots and abandoned buildings, then they’ll save tons of energy and not pollute nearly so much.


Editor Jeffery J. Smith runs the Forum on Geonomics and helped prepare a course for the UN on geonomics. To take the “Land Rights” course, click here .

Also see:

Smart Taxes Can Help Align Economies & Ecosystem

Humans Did It Once, Can They Do It Again?

Tax Breaks For, and Taxes Upon, Polluters

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