Oct 2, 2019

Study suggests a new structure for a carbon tax

Ben Geman, author of Generate

Photo: Florian Gaertner/Photothek via Getty Images)

A new peer-reviewed paper cuts against the grain by concluding that the most effective carbon tax structure should start high and decline over time.

Why it matters: It breaks with carbon tax bills floating around Congress and other proposals that begin modestly and then escalate.

What they found: The paper in the Proceedings of the National Academy of Sciences journal offers several reasons for flipping the script.

  • Uncertainty around just how bad damage from climate change could be makes strong near-term steps vital.
  • The high costs of delaying action.
  • Falling costs of cutting emissions over time as technology improves.

The big picture: The paper's modeling suggests an optimal price would begin at well over $100-per-ton (or even much higher), rise for a few years, and then fall.

"[P]roperly taking climate uncertainty into account leads to the conclusion that we need to take stronger action today to give us breathing room in the event that the planet turns out to be more fragile than current models predict."
— Kent Daniel, lead author and professor at Columbia Business School, per statement

Where it stands: It's very different than what's out there now.

  • The nonprofit Climate Leadership Council, which includes Big Oil backers, is circulating a plan that starts at $40-per-ton of CO2 and rises annually.
  • A Columbia University energy think tank has a helpful tally of Capitol Hill plans that all start with far lower CO2 prices than the PNAS paper suggests.

But, but, but: "Treat carbon in the atmosphere like an asset (with negative payoffs) and apply Financial Economics 101, and its price appears to jump by quite a bit over typically modeled prices," PNAS co-author Gernot Wagner tells me.

Go deeper: Carbon tax campaign unveils new details and backers

Go deeper

Updated 11 hours ago - Politics & Policy

In photos: Protesters clash with police nationwide over George Floyd

Police officers grapple with protesters in Atlanta. Photo: Elijah Nouvelage/Getty Images

Police used tear gas, rubber bullets and pepper spray as the protests sparked by the killing of George Floyd spread nationwide on Friday evening and continued into Saturday.

The big picture: Police responded over the weekend in force, in cities ranging from Salt Lake City to Atlanta to Des Moines, Houston to Detroit, Milwaukee to Washington, D.C., Denver and Louisville. Large crowds gathered in Minneapolis on Saturday for the fourth day in a row.

Updated 38 mins ago - Politics & Policy

George Floyd protests: What you need to know

Photo: David Dee Delgado/Getty Images

Clashes erupted between police and protesters in several major U.S. cities Saturday night as demonstrations over the death of George Floyd and other police-related killings of black men spread across the country.

The big picture: Floyd's death in Minneapolis police custody is the latest reminder of the disparities between black and white communities in the U.S. and comes as African Americans grapple with higher death rates from the coronavirus and higher unemployment from trying to stem its spread.

Massive demonstrations put police response to unrest in the spotlight

Washington State Police use tear gas to disperse a crowd in Seattle during a demonstration protesting the death of George Floyd. Photo: Jason Redmond/AFP via Getty Images

The response of some officers during demonstrations against police brutality in the U.S. has been criticized for being excessive by some officials and Black Lives Matter leaders.

Why it matters: The situation is tense across the U.S., with reports of protesters looting and burning buildings. While some police have responded with restraint and by monitoring the protests, others have used batons, tear gas, rubber bullets and other devices to disperse protesters and, in some cases, journalists.