[cherdano]

It is just a basic chemistry fact that the amount of CO2 produced is proportional to the amount of gas consumed.

[y66]

Just tax fuel so many cents per kg and get rid of all the other bureaucracy?

Yup. It's that simple.

[jtfanclub]

cherdano, on Nov 11 2008, 10:01 AM, said:

It is just a basic chemistry fact that the amount of CO2 produced is proportional to the amount of gas consumed.

There are some exceptions (such as if you have a failed catalytic converter) but in high-pollution areas in this country you're required to get your car tested every couple of years to ensure that the emission controls are working properly.

Otherwise, as far as I know, you're right. A gallon of gasoline produces the same amount of pollution whether it was put into a hybrid or a Humvee.

[cherdano]

jtfanclub, on Nov 11 2008, 11:46 AM, said:

cherdano, on Nov 11 2008, 10:01 AM, said:

It is just a basic chemistry fact that the amount of CO2 produced is proportional to the amount of gas consumed.

There are some exceptions (such as if you have a failed catalytic converter) but in high-pollution areas in this country you're required to get your car tested every couple of years to ensure that the emission controls are working properly.

Otherwise, as far as I know, you're right. A gallon of gasoline produces the same amount of pollution whether it was put into a hybrid or a Humvee.

I was careful in talking about CO2 only. Pollution with other toxic gases depends a lot on the burning process and your catalyst converter etc.

I am a little surprised, did you all not have chemistry in high school?

[helene_t]

As I read the comments here I think everyone remembers high-school chemistry (maybe expect for Phil who said he would challenge that emission is roughly proportional to fuel usage, but maybe he was referring to pollution in general and not to CO2 specifically).

It's just to be pedantic some of us mention incomplete combustion.

[TimG]

cherdano, on Nov 11 2008, 01:01 PM, said:

I am a little surprised, did you all not have chemistry in high school?

High school chemistry in the US is probably not what it is in many other developed countries.

I suspect strongly that an overwhelming majority of US citizens have no idea what the chemical reaction is in even the simplest examples of combustion.

[jeffford76]

Now that the cost of gas has come down, the airline fuel surcharges and extra bag fees will surely go away, right?

[jdonn]

jeffford76, on Nov 11 2008, 01:41 PM, said:

Now that the cost of gas has come down, the airline fuel surcharges and extra bag fees will surely go away, right?

I strongly expect they will never go away. I heard the liquid restrictions will be relaxed sometime next year though.

[mike777]

I am not quite sure how this carbon tax works, if cars burn the carbon don't we tax the car? If people's houses use more from the power plant don't we tax the house?

If a business uses more carbon then the customer pays the tax or the business goes bankrupt and out of business.

For instance if a bank or GM or F or C or an airline use more carbon, the customer pays the tax for it or they go bankrupt if the customer is not willing to pay for it. Or I suppose the central government then bails them out so the taxpayer ends up paying the carbon tax it seems.

[jikl]

Virgin has already cut fuel surcharges in Australia. Apparently they also held back in July when the price went right up (the others increased it). Our other airlines have not followed suit yet.

Sean

[Al_U_Card]

I like the idea of "feebates".

The SUV buyer pays X+y% for his registration while the hybrid owner pay X-y% for his. Revenue neutral, makes the guilty pay.

Ideally we can get the slowpokes in the auto industry to design something other than hatchbacks and tailfins.....

[mike777]

I do not know that much about Hybrid Cars but I assume to build and maintain them means burning alot of Carbon. I assume if they run on batteries that the juice burns some carbon, not to mention building and maintaining the roads they ride on.

[mycroft]

To take a shot at the original question:
1) more travel occurs in the summer - that's supply and demand.
2) gas companies got hosed by the shutdown in refining after Katrina, and with evil nasty hurricanes predicted to hit the rest of the refining area in Texas, people decided to hedge their bets with the refined gasoline they had.
3) They managed to totally blow away the CA$1/litre barrier - it will never be a problem for them again.

To the companies' credit, it is coming down, quite dramatically (the CA$1/litre barrier didn't seem to hold much going the other way, either), as they say, following the price of crude oil by about the 6-8 weeks the oil companies say it takes to do the refining and processing. And I noticed the rise was (with the exception of 2)) similar.

[hrothgar]

mike777, on Nov 12 2008, 01:24 AM, said:

I am not quite sure how this carbon tax works, if cars burn the carbon don't we tax the car? If people's houses use more from the power plant don't we tax the house?

If a business uses more carbon then the customer pays the tax or the business goes bankrupt and out of business.

For instance if a bank or GM or F or C or an airline use more carbon, the customer pays the tax for it or they go bankrupt if the customer is not willing to pay for it. Or I suppose the central government then bails them out so the taxpayer ends up paying the carbon tax it seems.

I'm probably going to regret bringing this up, however, someone claimed that folks were ignorant about the axioms of classic Marxism... Can't let something like that go unchallenged

Marx had a notion of crystalized labor. In much the same fashion, we can consider the crystalized carbon embedded in different good.

Goods that are produced in a multi-stage production process would have an embedded carbon tax that is proportional to the carbon emissions associated with each stage of that process. Ceteris paribus goods that have a more energy intensive production process would have higher tax carbon taxes.

In the case of your car examples, there are two separate carbon taxes that need to be considered: The carbon tax to cover the producttion cost of the car and the carbon tax to cover the operation of the car.

I'm going to make a vain attempt to ward off the inevitable idiocy by saying:

1. I don't believe that a carbon tax is in any way Marxist, Socialist, or communist and I suspect that most mainstream economsits would agree. (I took economics classes at the University of Chicago and using tax structures to deal with externalities was consider mainstream)

2. While this may sound complicated, its not any worse than a VAT...

[Lobowolf]

hrothgar, on Nov 11 2008, 10:06 PM, said:

(I took economics classes at the University of Chicago and using tax structures to deal with externalities was consider mainstream)

How long ago? Did you have any classes with Austan Goolsbee?

[mike777]

Using the car example I think I am bit worried a carbon tax would lead to job losses for USA car makers, and create jobs for nonUSAcar makers. I have the same worry with other industries be it a refinery, toy maker or textiles. In good economic times perhaps many will be willing to pay extra, in poorer economic times people may just not buy the product. I assume a VAT tax would have the same issues.


I do not know any countries that impose a carbon tax but it would be interesting to see if it helped or hurt jobs.

I know there is an article, NBER Working Paper 13264 by Christina and David Romer that investigates macroeconomic effects of tax changes. The authors argue that exogenous tax increase of 1% of GDP lowers real GDP by about 2-3 percent and the effect is highly persistant.

I just worry that a carbon tax would hurt jobs and GDP growth.

[cherdano]

I think the argument in favor of carbon tax, while reducing, say, VAT, is very easy:
Carbon tax generates income for the state while discouraging production of CO2.
VAT generates income for the state while discouraging consumption in general.

It is really incredibly silly to make a huge ideological argument out of this question. Marxism???

[helene_t]

mike777, on Nov 11 2008, 11:41 PM, said:

I do not know that much about Hybrid Cars but I assume to build and maintain them means burning alot of Carbon.

True but irrelevant. If you want to tax CO2 emission, you just raise the taxes on coal, gasoline, diesel etc. according to their carbon content. Doesn't matter if it's a consumer or a car manufacturer or an airline who buys the fuel. Doesn't matter if you use a liter of gasoline to drive 5 km in your SUV or to drive 50 km in your hybrid. Or if you use it to light your bbq. The emission is the same in all cases so there is no reason the government would care.

hrothgar said:

While this may sound complicated, its not any worse than a VAT...

It is much simpler than VAT. To charge VAT, the government needs to find out how much money was charged for a commodity. Gas taxes are just so many cents per liter. The government doesn't care what the price is.

[hrothgar]

Lobowolf, on Nov 12 2008, 07:29 AM, said:

hrothgar, on Nov 11 2008, 10:06 PM, said:

(I took economics classes at the University of Chicago and using tax structures to deal with externalities was consider mainstream)

How long ago? Did you have any classes with Austan Goolsbee?

This was back in 1987.

The only prof who made a real impression was Roman Weil, and that was accounting rather than economics

[luke warm]

do those of you who support raising taxes (or implementing new taxes) think it would be even slightly idiotic right now?