Tuesday, June 24, 2014

A conservative case for carbon tax

A strong case was made by former US secretary of the Treasury, Henry Paulson, for carbon tax in a StarTribune editorial by Henry Paulson, Next crisis calls for action: We paid for dallying on the housing bubble. The climate crash will be much worse.

He draws similarities to the housing bubble, and how we narrowly avoided catastrophic consequences by not acting until it was almost too late. "Back then, we narrowly avoided an economic catastrophe at the last minute by rescuing a collapsing financial system through government action. But climate change is more intractable. The carbon dioxide we're sending into the atmosphere remains there for centuries, heating up the planet."

Mr. Paulson further notes that taking a "cautiously conservative stance - that is, waiting for more information before action - is actually taking a very radical risk. We'll never know enough to resolve all of the uncertanties. But we know enough to recognize that we must act now. "

He recommends we have a carbon tax, which will allow the free markets to figure out the most cost effective solutions to reducing carbon emissions.  Makes sense to me!

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