Sentences to ponder

The EU, Canada, and Japan are in the aggregate much more significant trade partners than China/Mexico/Brazil. And the case for them charging us carbon tariffs seems about as good as the case for us charging the Chinese.

That is Matt Yglesias.  Here is more, including a good chart on which countries are our largest trading partners.

Comments

Do tell us who has actually studied the viability and efficiency (and has accumulated the supporting metrics) of imposing a point-of-purchase carbon tax. Utilities, energy companies, et al., may not want such a scheme implemented if it were to lead to less actual consumption of electricity or gasoline, but wouldn't such a tax plainly result in lower carbon emissions worldwide?

Sounds like a good way to start a trade war that collapses the global economy.

The case for carbon tariffs arises not from the size of trade volumes, but from the asymmetry of regulation and the risk of regulatory arbitrage. There is no such asymmetry with the EU, which already has a cap-and-trade emissions trading scheme with CO2 prices higher than those that would apply in any proposed US programme. Canada is developing an ETS; Japan, admittedly, is dragging its feet, but is making the first moves under the new government.

None of this changes the fact that carbon tariffs on Chinese imports is a terrible idea at very high risk of both abuse and retaliation.

Delicious, delicious protectionism under the guise of environmentalism. This is smoot-Hawley for the 21st century. I wonder how badly this will trash the global economy this time around.

Facing this potential problem is a good time to be reading Elinor Ostrom.

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