Are green taxes a good idea?

I am opposed to so called “green taxes” because any move to justify the government compulsorily taking your money is justifying theft. The idea that taxing something “bad” (pollution) is better than taxing something “good” (income) has a superficial appeal. From an environmental policy perspective, paying more to do something that has a negative impact (on who, you may ask) will reduce the incidence of that activity. So if you want to discourage people doing something then taxing them will certainly discourage, as long as demand for undertaking that activity is elastic.
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However, green taxes aren’t just about stopping people doing bad things. If something is bad enough (in that it infringes on people’s rights) then you ban them or give them the right to say no. Imagine, for example, taxing murder, or theft, or vandalism (it’s ok to spray paint that wall, just costs you $20 for the permit). In the case of localised pollution, it is a matter of granting property rights over airspace, for example. Ah, but greenhouse gases are not a local pollutant. So does that mean you should pay the government money for emitting them? Well no, it might mean that a carbon trading system, as has been much talked about, may be worthwhile – but you better have one that applies globally, allocates rights fairly (!) and enables rights to be traded according to demand and supply. Anyway, back to green taxes.
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Green taxes are a transfer from the public to the government, which then can spend the money on whatever it wishes. So the assumption still is that the government not only can spend your money better than you can, but that it has the right to do so.
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The incidental effect of reducing your willingness to undertake the “taxed” activity is beside the point.
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You see the same effect in other taxes. Income tax reduces incentives to earn income, but by and large the main effect is to transfer money from you to the government (notice the term “generate revenue” as if it is producing it rather than stealing it – imagine if a thief described burglary as “generating assets”). Sales taxes reduce the incentives to buy certain goods and services, but the main effect is to transfer money from you to the government.
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The effect of suppressing income or purchases comes when the tax becomes more and more oppressive. A 90% income tax will be avoided with alacrity or the person will leave the country. A 90% sales tax will have a similar effect. The existence of chronic congestion in much of the UK while fuel tax is one of the highest in the world (67% of the purchase price) demonstrates how little demand is suppressed through taxation (and how blunt it is).
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So as a tool for fixing the environment, green taxes don’t appear to take you far unless they are high – very high. That means that you have to tax something “bad” so much that it isn’t worthwhile for many people to do it – in other words driving has to be so expensive, people would rather choose to spend the money on something else rather than fund the government.
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You see this is the only positive side. If a government decided to be fully funded from environmental taxes, and low or zero polluting alternatives were accelerated onto the market (because of the massive disadvantage the existing technologies have), then government revenue would decrease – as pollution tax revenue decreased and the size of government would then have to decrease. Green taxes COULD be a long term strategy to move to less government because technology could make the taxes obsolete. Ridiculous notion? Well as cars have become more efficient, the revenue collected from fuel taxes has declined as traffic has increased (meaning the amount of pollution has been declining too), so governments have been moving to increase fuel taxes to make up that revenue.
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However, I doubt that will happen. I doubt green taxes will mean the reduction in government. Other taxes will remain. Besides that, it is far from a good idea to tax the hell out of fossil fuels, beyond the economic “cost” that economists may quantify, just to discourage pollution. The money collected is not about compensating people for damage caused by pollution – because those people can’t be identified, the appropriate compensation can’t be quantified, so it just becomes an excuse for government spending.
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Green taxes are instinctively appealing to the left because they are punishing what is “bad” about capitalism and modern civilisation – transport and energy. It punishes people for wasting energy, it punishes them for leaving on a light, or going on a Sunday drive or flying to their holiday destination. In other words, it punishes them for taking advantage of the delights of modern technology and civilisation. It is an exercise in masochism for those who support it – their guilt in “damaging the environment” assuaged by “paying the cost of carbon”. The right likes it because economists see it as paying for externalities – without identifying who it is paying (the government) and who suffers from the externalities (unidentifiable private individuals to varying degrees) . It uses an economic instrument (tax) to reduce demand for a bad thing (pollution), while ignoring what it does to the state (increases its role).
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Those who advocate new green taxes should be resisted for the statists they are. Those advocating green taxes as a revenue neutral replacement for other taxes should be thought of suspiciously, and asked what happens if less people pollute – what happens to those taxes? (probably increase). Most of all, ask those who advocate green taxes what they think the money collected should be spent on – I doubt it will be about compensating those who are “harmed” by the pollution, because they don’t actually know who those people are and how much they are harmed. This is because, green taxes are really just another excuse for the state to tax you more, but with more of a message of “punishment”.

Cheering the death of a dictator

PW Botha was elected, by 52% of 15% of the population of South Africa - so was he a dictator? Well by that measure yes and by the measures he took whilst Prime Minister and later President, most certainly.

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The death of Botha, one of South Africa’s more ardent defenders of apartheid and authoritarian rule should be a cause for celebration. Whilst he claimed to be fighting against communism (which, to be fair was real but only strong in South Africa in opposition to apartheid in its later years), he himself solidified fascism in South Africa. Not only was South Africa undemocratic in that 85% of the population was governed by 15%, but it was a fascist state with limited freedom of speech while bullying those who opposed it, and those who had no civil rights in respect of the government..
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Botha promoted the artificial ghettoisation of Black South Africans through the “homelands” concept, whereby less desirable parts of the country would be granted “independence” whilst black cronies would have powers of governance. The idea being to move apartheid from separate development within South Africa to effectively balkanising the population. Black South Africans would be encouraged to move to the “Bantustans”, by a combination of incentives and disincentives (not being a citizen in the rest of South Africa being one). A policy that would not have been out of place in Nazi Germany or the USSR (with Stalin’s Jewish autonomous oblasts in Siberia where Jews were “encouraged” to move to). People shifting to the “Bantustans” would lose their South African citizenship and passports.
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Botha was responsible for starting South Africa’s nuclear weapon’s programme, its trump card in response to calls from Western governments (US and UK) to abolish apartheid and reform the government. Botha wanted the security protection of NATO powers against Soviet backed Angola, Mozambique, Zambia and Zimbabwe – but developed nuclear weapons to encourage the West not to fully isolate the regime and to ultimately deter any Soviet backed invasion from its northern neighbours in the event of a world war. South Africa’s nuclear arsenal has since been abolished.
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Botha increased the power of executive government, whereby there was little parliamentary scrutiny of foreign affairs and race relations. Laws suppressing criticism of government policies were perhaps the most insidious, whereby arrest and detention could be applied to anyone, of any race, for criticising the government. He used “states of emergency” to suppress dissent and the media was banned from reporting on any aspects of that “state of emergency” while state media was a mouthpiece for the regime.
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On the other side, his blundering attempts to introduce parliaments for “coloured” and “Indian” South Africans (which would pass laws applying to their communities only) did little to integrate communities under one law, and inflamed black majority anger that they were, still, effectively under authoritarian rule that they could not challenge or hold accountable. His continued endorsement of the idea that citizens had different rights according to race, and that somehow people could co-exist with different laws applying to them was a revolting destructive influence on the spirit of South Africans. His support for removing a handful of laws (such as those prohibiting racial intermarriage) was a tiny step in the right direction, whilst he used the security forces to suppress dissent. He denied the use of torture, although there is plenty of evidence that the security forces used violence with impunity in putting down protests and arresting those it saw as a threat.
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He was succeeded by FW De Klerk, who dismantled apartheid, lifted free speech restrictions and made enormous strides towards freeing South Africa. As such, Botha will be remembered as the last dinosaur, the last South African President to still believe that the black African majority deserved little more than to be relocated and told to shut up.

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and you wonder why I cheer the death of anyone? People died because of Botha, in their thousands. He ruined the lives of thousands of people, and did nothing to bridge the divide across South Africa. He could have taken steps to abolish apartheid, instead of separate racial parliaments, he could have integrated "coloured" and "indian" citizens with the white minority politically as a first step - he didn't - he was racist, irrational and a fascist bully. There is no reason to give his memory any respect.

The US mid term elections

I'm just glad I don't have to choose.... but it isn't simple.

Democrats = socialism, big government, moral relativist cultural relativist political correctness

Republicans = big government, theocracy

Libertarian Party (US) = isolationism and moral relativism

so I wont be cheering either way. The USA faces three major threats. These are:

1. Islamist terrorism;

2. New left environmental/socialist activism;

3. Evangelical fundamentalist theocracy.

The first has struck, several times and claimed lives. The second has been growing for the last couple of decades and has a new lease on life, but hasn't directly claimed lives. The third has also been growing in the last 20 years, and it has directly claimed (a handful of) lives.

In the next two years the USA will not become an outpost of environmental lunacy - remember the Senate voted 95-0 against the Kyoto treaty several years ago. In the next two years the USA will not become a theocracy - serious attempts to do so will split the Republicans in two. However, in the next two years the USA will remain the number one target for stone age Islamists.

Which party understands this the best? Which party offers any chance for philosophical redemption in the next two years?

It isn't the Democrats.

Greens fisk ignorant UK Labour MP

Stephen Byers is a UK Labour MP. It is his political advisor who sent out an email on September 11 2001 suggesting it was “a very good day to get out anything we want to bury”. She wasn't fired on the spot. So he is hardly in the club of the moral politicians. He is also in the club of the idiots for suggesting that there be a tax based on the distance food has travelled to get to the UK. Besides being WTO inconsistent (it is resoundingly a trade barrier) it has no bearing on environmental reality. A point made by none other than the NZ Green Party!
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Yes, they are spot on with this. The Greens are writing to the British Greens to make the point that imported dairy and lamb products from New Zealand are better for the environment than ones produced in the UK. I’ll be interested to see the reaction of the British Greens, because it will go against their adolescent girl like simple arguments – local good, foreign baaad. Good for Russel Norman for pointing this out. I’ve been commenting on UK forums about this since the Lincoln University report came out.
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The Greens will find themselves confronting the UK agricultural lobby, the European Commission and many others who wont want to listen – but it is time to make this point only too clear. In fact, economics isn’t a bad proxy for the environmental impacts. After all, if the UK was efficient at agricultural production, it wouldn’t need a combination of subsidies and protection from imports.

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UPDATE - Classically Liberal has an excellent post on how businesses use environmentalists to do their protectionist bidding.

Taxes don't clean the environment

If you simply watched BBC, ITV and Channel 4 news here in the UK you might be mistaken for thinking that the Stern report is a manifesto for the future. Most of the media have responded to the “jump” in the Stern report by asking “how high and when”. At best, the main questioning of the report’s conclusions has been whether it is wise for the UK to go first – given it is responsible for only 2% of greenhouse gases. Nevertheless, Blair and Cameron have both said that there needs to be action – who said that there isn’t choice is politics??!!
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PC has some excellent posts on this, one summarising some of the reactions and another being Tim Worstall’s fisking of the report, which is well worth a read. I doubt the journalists for the BBC or the Independent (Britain's leading doom and gloom rag as you can see) will read it.
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Fortunately there is some commonsense from the Daily Telegraph. In its editorial it makes an excellent point:

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“It is a pity that all three main parties have bought into the idea that state regulation is the answer. Market mechanisms have proved highly effective at delivering green goals. Extending property rights to cover air and water quality, and allowing citizens to sue polluters, is a surer way of securing a clean environment than relying on government inspectors. Privatising rainforests gives owners an immediate stake in their protection. Treating endangered species as the property of those on whose land they roam encourages locals to treat them as a renewable resource.”

Funnily enough this is exactly the sort of policies Libertarianz have been talking about for years.
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You see the problem with the Stern report is that its apocalyptic vision appeals to two political instincts.
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The left loves it because it “proves” how bad business is, how bad individualism is (reflected in the private car and tourism – ignoring that in London, for example, 70% of greenhouse gas emissions come from buildings). It means it can rally support around the need for “central action” by the state, and that the problem is because “nobody did anything” and that if people are left to their own devices the world will come to an end. Have no doubt about it – the central thesis behind this view is that individual choice is the problem. People make choices that are bad for other people, and they must be regulated, compelled, taxed or subsidised to make good choices. In short, the left thinks this proves that the free market doesn’t work.

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The element on the right which likes Armageddon comes from what can best be described as a protestant guilt ethic about “living” and how the government has a role in helping you be good. It is a similar moralistic bent as the left, but from a different angle. “You can’t possibly leave people to do as they wish, they don’t know what’s good for them”. It is the same ethic that likes restricting alcohol, drugs and censoring “naughty films”. It is almost a school prefect approach which says patronisingly that the masses don’t really know what is good for them, we do and why don’t we be good chaps and realise our businesses really need to go along with it – “take one for the team”.
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Both are insidious and wrong. The free market works but does not operate, in particular, to address pollution because property rights are limited. Assume for now that there is a climate change problem propagated by growth in greenhouse gas emissions (I’m sceptical but let’s err on the side of caution). The sectors which are the biggest contributors to this are energy, transport and agriculture. All of these are subject to enormous levels of government interference.
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The energy sector in most countries is government owned and/or regulated. On the one hand governments have assisted and subsidised the development and operation of electricity generation, oil exploration, coal mines, on the other government’s regulate energy prices so that power companies, oil companies and the like can’t charge too much. Yet, somehow, people are using too much energy!!! Take some measures that are no doubt economically efficient and environmentally positive (as a spinoff), like Thatcher closing the UK’s inefficient coal mines. The left opposed this vigorously, but subsidising a very dirty source of energy is hardly good for the environment is it? Another is subsidies for energy use by people on low incomes or capping electricity charges – this underprices energy use, and keeps consumption high, so why not get out of the way and let energy companies charge as they see fit. The price might go up (or down) and they would then have money they may invest in future technologies to produce energy more efficiently – and energy conservation would become more worthwhile as people seek ways to save on energy bills.
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That’s energy. Transport is worse, as roads are run with Soviet-style central planning with the idea of pricing road use being alien to all, except those wanting to do so to penalise driving. Governments subsidise some transport modes and tax others, with little regard for the effects. Agriculture is also particularly bad, partially because energy and transport to rural areas is subsidised, but mainly because the European Union, Japan and the USA prop up inefficient producers.
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Would removing government interference in those areas and instituting property rights in water and airspace be enough to "address the economic cost of climate change"? Maybe. Maybe not. However it is clear that such measures would help by removing enormous economic distortions that mean that economic choices are poor – and resources poorly allocated as a result. That is the main benefit, a secondary benefit is that by reducing waste, it reduces negative environmental impact.
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However, you wont hear that solution from Blair, Cameron, Clark, Al Gore or Nick Smith. You’ll hear about subsidies for “clean energy” and public transport, you’ll hear about taxes on driving, flying and “dirty energy”, in other words you’ll hear about the state taking more of your money and giving it to others. It wont be about you making better choices, it will be about central planners doing it. The image will be of a tax being a punishment for you being bad, and that you paying the tax “makes things all better”. It doesn’t – it just gives the government your money to play with – that tax doesn’t “plant a tree” or “suck up the pollution” you caused. It is money to pay a bureaucrat’s salary, to subsidise a business or individual.