Guest essay by Eric Worrall
Even funnier, they also suggest the G20 demand that China match this level of carbon austerity.
Five things the G20 must do to tackle climate change
From demanding America change its carbon tax position to collaborative technologies research, progress must be made
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Consider, by way of example, the latest annual statistical review that emerged on Thursday from the energy group BP, an entity that is one of the first to promise to cut its dependency on fossil fuels. (I moderated a discussion with BP on Thursday as well as an event in Venice).
The review starts by outlining some welcome news (for climate change warriors, if not energy investors): carbon emissions fell more than 5 per cent in 2020, primarily due to collapsing oil consumption.
That is startling. But what is more stunning is that Spencer Dale, BP’s chief economist, reckons that “the rate of decline in carbon emissions observed last year is similar to what the world needs to average each and every year for the next 30 years” in order to hit the Paris climate goals of keeping global warming between 1.5C and 2C. This is crucial if we are to prevent irreversible damage to Venice and everywhere else.
Such a demand would require massive behavioural change, particularly given that last year’s decline only happened because of an enforced pandemic-related lockdown and economic slump. Indeed Dale reckons that the scale of drop was comparable to what would have happened if the world had a “scarily high” carbon price (ie tax) equivalent to $1,400 a tonne ($1,543 a tonne) — as opposed to the $2 a tonne price the IMF estimates was the world average before the pandemic.
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So what should the G20 do? Ideally, at least five things. First, the finance ministers must collectively embrace a steadily rising carbon price and tax. The EU is doing this. But Joe Biden’s administration is dragging its feet in a shameful way, seemingly because of domestic political concerns. The rest of the G20 should demand that America change its position.
Second, the G20 must also demand China backs away from coal, which provides the majority of its power (the country accounts for more than half of global consumption). The Beijing government has vaguely pledged to do this, and has expanded renewable energy use in an admirable manner. But it must be persuaded to cancel current plans to build yet more domestic coal plants — and stop financing those in its Belt and Road Initiative.
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Read more: https://www.ft.com/content/0e416145-7ce3-4cee-8fe0-2586c18689dc
Resources.org provides a handy carbon tax calculator, but it only goes up to $50. If we take resources.org’s calculation of $0.44 / gallon gasoline price rise for a $50 carbon tax, and scale it up to $1543, we get 0.44 / 50 x 1543 = $13.57 / gallon of gasoline price rise. Given Biden’s policies have already driven gasoline up to around $4 / gallon in some places, with no end to price rises in sight, if the recommended carbon taxes are imposed, you could be looking at $17 / gallon of gasoline and rising.
FT also suggests consumers should be “mobilised” to demand these gasoline price rises (or demand the carbon taxes which trigger the price rises), and other climate policies.
Shame on you Biden, for dragging your feet imposing $17 / gallon gasoline on the American people, because of “domestic political concerns”. And of course, this scale of price rise would also apply to natural gas, electricity, food transport, pretty much everything which depends on fossil fuel.
FT does not provide an explanation for why such draconian taxes are required to drive the adoption of renewables, given that organisations like the Aussie CSIRO claim renewables are the cheapest source of energy.
No doubt China will cave in to G20 pressure, and announce they are now charging $17 / gallon pump price for gasoline. Any day now.
Update (EW): Bob Tisdale pointed out I didn’t mention “FT” stands for the London based “Financial Times“, probably not what you were thinking…
In Switzerland we were already paying around 96$/Metric won, which is by far among the highest carbon taxes in the world. The proposed new energy law was rejected by the Swiss people mid-June despite massive propaganda with a 52% majority, so the Government will not be allowed to raise it indefinitely. But our Socialist Energy Minister decided to immediately increase the tax to 120$/Metric ton which is the maximal amount the current law allows, completely ignoring the popular vote. It’s not a carbon tax increase, that’s a revenge tax…
It is interesting how the tax is passed via a democratic process, however what it is spent on is nebulous. Clim/Enviro/Emissions taxes are a government bureaucrats dream for expanding their department…..
I suggest that FT go fork themselves.
$17 / gallon of gasoline
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Won’t be long before people discover that cars run just as well on 50/50 paint thinner mix.
Molecule per molecule, H2O is a stronger IR absorber than is CO2 so it would make more sense to have a hydrogen tax instead of a carbon tax. The combustion of fossil fuels produces not only CO2 but H2O as well.
A carbon tax benefits the rich simply because there are way more middle class people than rich so the majority of the tax revenue flowing into governments would come from the middle class.
This would result in the rich being off the hook from higher taxes to fund social programs and such. That is why I think most rich support a carbon tax.
$1,543 / tonne paid to whom? Who would collect these taxes, and what would be done with the money?
Global man-made CO2 emissions were about 33 gigatonnes in 2019. If this was “taxed” at $1,543 per tonne, this would result in a tax of nearly $51 TRILLION a year, which is about 2.5 times the GDP of the United States ($20.9T in 2020), and about 60% of the GDP of the entire world ($84.7T in 2020).
Whoever collected this tax would essentially control the economy of the entire world, with 40% of GDP left to share among the non-elite slaves of the Great Climate Change Warriors. Which is probably the true goal of the global warm-mongers–control the world economy and force everyone into poverty, and who cares whether the weather gets 2 degrees warmer.