Consulting by RPM || Free Advice Blog

My Response to R Street’s Appeal to Conservatives to Support Carbon Tax

I was unusually saucy in this IER piece. Some excerpts:

Rather than reiterating our list of technical objections, let me in this post instead simply step back and ask: What is the point of studies such as the R Street proposal? It’s not as if President Obama or Gina McCarthy are making a substantive offer here. Rather, R Street’s proposal (and others like it) are fantasy land bargains from people with no political power in order to get conservatives and libertarians to abandon their opposition to a massive new tax. What is the point of this exercise?

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Allow me to let Catrina Rorke and Greg Ip in on a dirty little secret: The typical progressive activist, and the typical administrator at the EPA, do not share their general admiration for the market economy. It is not as if the people of Greenpeace toss and turn at night, lamenting the Pareto inefficiencies in our economy and the fact that industry produces a bit above the “optimal” level of pollution. No, these people do not like capitalism, period, and think Americans are consuming too much.

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In this context, it’s an irrelevant academic point of whether a new carbon tax, with all funds directed to tax breaks for corporations and capitalists, plus the elimination of all other federal regulations on emissions, would be economically beneficial on net. When I read studies like R Street’s, I feel like I’m a bank teller looking at guys storming in with shotguns and ski masks, and my colleague says, “Let’s offer them free checking.”