Someone just posted on LBO-Talk Paul Krugman's blog statement,
"festishizing free trade", where Krugman endorses the stand of France's
president Sarkozy that a French carbon tax has to be extended to imports from
other countries. (I am *not* implying that that person agrees with anything I
say,but I do think it was an important posting.) Krugman's remarks can be
found at
http://krugman.blogs.nytimes.com/2009/09/11/fetishizing-free-trade/
This of course means that France would have to judge the environmental
practices of other countries, right down to their effect on each product, and
impose a compensatory tariff for those products which weren't properly
subject to a carbon tax or something equivalent. Or alternatively, France
could just use the measure as an excuse to put pressure on this or that
country.
My point here is *not* to attack tariffs. My point here is that this is
a major complication for the carbon tax, and will involve the carbon tax in
complex politics and international negotiations. And this is a completely
predictable complication. I pointed ou that things like this would happen In
my article of last year, "The carbon tax: another futile attempt at a free-
market solution to global warming"
(www.communistvoice.org/42cCarbonTax.html). I listed 11 circumstances that
would complicate the carbon tax. One of them was precisely the issue of
imports. Referring to a US carbon tax, I wrote:
"The US imports many products, and they would have to be treated
differently than domestically manufactured products. To avoid double
taxation, the government would have to see whether they had already been
subject to the carbon tax abroad and, if so, to what extent."
The carbon tax is just another attempt to avoid effective environmental
regulation by pretending that financial and market measures will suffice. But
it is promoted as something that is very simple and easy, unlike its fellow
market measure, cap and trade, which is complex and with a thousand
loopholes. But the only reason that the carbon tax seems simple is that it
hasn't yet been implemented on a large scale or high-enough level. Cap and
trade was also promoted as something easy and flexible, something that
avoided the dread complexities of regulation and the horrible specter of
"command and control" (as the neo-liberals refer to regulation), prior to cap
and trade being implemented. But cap and trade turned out to be immensely
complex, to involve a big bureaucracy, and to be opague. Its flexibility was
flexibiility in finding ways to avoid doing the environmentally proper thing.
As soon as the carbon tax beings serious implementation on a wide scale, it
will also pick up one complexity after another.
-- Joseph Green
[email protected]
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