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Reaffirming the Case for a Briskly Rising Carbon Tax

Citing leading economists’ recommendations of best practices for design of effective carbon pricing policies, BTI implies that only an optimally-designed carbon pricing system will have decisive advantages over other, non-price-based climate policies. Without considering whether suboptimally-designed carbon taxes can confer substantial beneficial effects in the real world, BTI leaps to the sweeping conclusion that the “broad based consensus” among economists for carbon emissions pricing (especially carbon taxes) as the “silver bullet” of effective climate policy is mistaken and naïve. Because, in BTI’s view, it is highly unlikely that all four requisite conditions can be fully met, carbon pricing is likely to be “a good deal more costly and less effective than proponents imagine.”