Carbon taxes and food security

By Tomoko Hasgawa, et.al. in Nature:

Food insecurity can be directly exacerbated by climate change due to crop-production-related impacts of warmer and drier conditions that are expected in important agricultural regions. However, efforts to mitigate climate change through comprehensive, economy-wide GHG emissions reductions may also negatively affect food security, due to indirect impacts on prices and supplies of key agricultural commodities. Here we conduct a multiple model assessment on the combined effects of climate change and climate mitigation efforts on agricultural commodity prices, dietary energy availability and the population at risk of hunger. A robust finding is that by 2050, stringent climate mitigation policy, if implemented evenly across all sectors and regions, would have a greater negative impact on global hunger and food consumption than the direct impacts of climate change. The negative impacts would be most prevalent in vulnerable, low-income regions such as sub-Saharan Africa and South Asia, where food security problems are already acute.

In other words, one needs to be very careful with a carbon tax.  For the pointer, I thank Charles Klingman.

Comments

If a carbon tax accurately priced the negative externalities of carbon emission, then the resulting market equilibrium would be better than our current one, right? I guess this just says that if the price is too high, people get hurt too.

The impact of the tax is also a lot more predictable than the impact of a temperature rise. The earth has warmed by 1-1.5 degrees over the last century without a negative effect on food production, after all.

It would be more EFFICIENT (higher total surplus), but not necessarily more desirable if there are adverse effects on particularly poor individuals and society values equality. Of course, one can always direct the carbon tax revenue/other funds toward those individuals, and because the total surplus is higher, it should be possible to both compensate them and still have higher surplus for the rest. But such redistribution rarely happens in practice.

"If a carbon tax accurately priced the negative externalities of carbon emission, then the resulting market equilibrium would be better than our current one, right?"

No, assuming "global warming" theory is correct, it requires very, very high carbon taxes to have any measurable effect on temperatures while the "negative externalities" of higher temperatures, especially in the area of food supplies, are non-existent until temperatures are very, very high. At the same time, it is very unlikely, that even unmitigated global warming would cause temperatures to rise enough to have a net negative effects on food supplies. There is not any level of carbon tax which is high enough to affect temperatures but low enough to avoid net negative affects on food supplies.

But then in developed nations we have no problem with calorie deficits, our problems is far too many cheap, plentiful, calories far above what we burn in daily activity and consisting of cheap carbs and sugars. If the reaction to a modest carbon tax was that developed nations reduced their calorie consumption by 15% it seems like that would be the best of all worlds. Much more pleasant than reducing driving or air conditioning by 15% AND the only other negative externality is reduced sales of 'super plus size' clothes and slightly less money spent on heart and diabetic problems.

Interesting, but of course in real life one can only implement a tax in a single jurisdiction. The cost-benefit of this is even worse, since the costs of the tax are concentrated locally (for the most part), while the benefits are not.

One can extend one's policy reach via tariffs, as Western countries do with GMO products. "Use these expensive farming techniques (or avoid these cheaper ones), or else we won't buy from you." African countries need western markets far more than western countries need African agricultural products (particularly with food so cheap in the US), so they comply.

That's true to a certain extent, but there are limits to this influence. There is no way even a powerful entity like the U.S. or the E.U. could impose a costly carbon tax on all or most of the world.

Plus, there is a major enforcement problem. Agricultural imports can be inspected. Carbon emissions in other countries would be extremely difficult to measure to see if they are complying.

Perhaps the last sentence might have been revised to say...something like..These results highlight even more the need to include mitigation of distributional effects as part of the implementation of a carbon tax.

Biofuels in 2050? That seems unlikely if you look at the current price of electric vehicle battery packs, let alone 30 years down the line.

Biofuels still have a far, far greater fuel density than electric vehicles. We aren't close to being able to run a passenger jet from batteries, but it's trivial to do so with biofuels.

Biofuels would still need to be cheaper than other alternative liquid fuels. For example using oil plus playing the carbon price. If biofuels cost $100 per barrel of oil equivalent and the carbon price is $20 per barrel of oil then oil will be used as long as it is under $80 a barrel. With oil consumption mostly eliminated from ground transport I expect oil will be cheap. (Note: Figures used are for illustrative purposes only.)

" With oil consumption mostly eliminated from ground transport I expect oil will be cheap. "

Ok, that's a fair point. I expect will see the electrification of a lot of passenger vehicles and short mile delivery trucks as batteries get cheaper. So, it would seem likely that demand for oil will go down and the price will drop also.

I don't see a problem with air transportation using oil. The global aerial transportation sector used 246 million tons of oil in 2006, that generates about 700 million tons of Co2 which is only about 2% of the world's Co2 emissions. The other 98% are the problem while I see airlines could be using oil for the next century.

Yes, air transportation can be done with oil or biofuels. Automobiles can and will be done with batteries.

There's a positive synergistic effect of autonomous vehicles providing transportation-as-a-service and electric vehicles providing both demand to the grid when needed (e.g., when photovoltaics are boosting electrical supply above demand) and electric vehicles providing electricity to the grid when needed.

With electric vehicles providing transportation as a service, there will be no range anxiety, and the charging systems can be owned by the fleet owners. Fleet owners will have more clout with electric utilities, and will be able to schedule charging and "deposits" of electricity to the grid more efficiently than single vehicle owners.

~~~ "...one needs to be very careful with a carbon tax."

... rather, everybody needs to be very careful granting taxing powers to politicians

"Taxes" in a free society are only supposed to raise revenue for legitimate government services -- not to manipulate the economy and specific citizen behaviors.

a "carbon tax" is effectively a non-judicial punishment (punitive fine) imposed by legislators upon behavior they don't like. As such, it is a fundamental violation of citizen rights to due process... and a thoroughly corrupt practice of legislators.

(Bonus aspect here is that the 'theory'
of AGW & its supposed carbon basis ... is false, unscientific BS)

Is this specifically referring to carbon taxes? That would be like an increase in fuel prices, which would be directly reflected in prices.

There is far more involved. Methane reduction from animals, the change to natural refrigerants and I'm sure there are others are designed to shrink the industry.

A "negative impact on global hunger" sounds like a good thing at first blush, like "cans for cancer."

Poor phrasing. The author should have stuck with increasing global hunger and relied on his readers to figure out the rest.

The quality of academic writing is, in general, very bad. This is one example.

“Food insecurity can be directly exacerbated by climate change due to crop-production-related impacts of warmer and drier conditions that are expected in important agricultural regions.“

Of course it’s complete nonsense to say more CO2 will, on balance, negatively affect plant growth. The actual evidence is that the planet is getting greener as CO2 rises.

And the last time global CO2 levels were consistently above 400ppm was the Miocene, which is noted for its flora and, in particulsr, grasslands.

About 95% of the plants species around at the end of the Miocene are still around today.

Nobody has responded to your comment because they can't, if they admit that CO2 is plant food and that the planet is getting greener, perhaps all the doom and gloom scenarios are wrong and the money train will dry up. No grants in telling people that the world is getting more human friendly.

The poor people of color of the world are already suffering direly from the impediments to electrification erected by the climate hysteria pieties of rich whites and the sinister milking of the end of the little ice age by cretins greedy for money and power. Over 3.5 million preventable deaths a year from indoor air pollution resulting from continued rich nation resistance to fossil power generation in poor nations. See: https://www.project-syndicate.org/commentary/benefits-of-fossil-fuels-for-poor-people-by-bjorn-lomborg-2018-07

It is behind a paywall. My scientific instincts say not to believe the conclusion. What will happen to the agriculture of the poor is more dependent on what increasing CO2 induced climate change does to local weather. The models apparently indicate that the dry areas will become drier and the wet, wetter and that is very bad for non-high tech farmers.

With carbon taxes in large countries creating large innovation markets to avoid the taxes, many of the harms of CO2 reduction on agriculture support systems will go away. For example, ammonia production via fossil carbon may be counted as a harm with higher fossil carbon costs, but with ammonia production only requiring water, air (for N2) and energy it is possible to make medium size ammonia production units using excess "clean energy" to make H2 from water and N2 from the air. With the spot price of "alternative" energy sometimes going to zero, having a high demand system (making H2) that can create a variable demand may solve some of the dynamic problems with the electrical grid and alternative energy.

I can visualize too many technological ways that their conclusions will be wrong. Perhaps they have a valid argument that includes the dynamic effects of a carbon tax on innovation, perhaps they don't. With a paywall, most people won't know. I think I know enough not to bother paying for what will need a very valid proof.

"With the spot price of "alternative" energy sometimes going to zero, having a high demand system (making H2) that can create a variable demand may solve some of the dynamic problems with the electrical grid and alternative energy."

If renewable energy sources are forced to exist off of their own sales, they'll try hard to avoid going to zero. Currently their direct sales is only part of their revenue stream. Basically, the energy isn't "free" despite the claims that it is.

Instead of a carbon tax, we should raise a cuckold tax. This will bankrupt Trump voters like Trump Casino and Resorts.

Thanks for covering this. Since I usually carp about your not covering environmental and particularly climate issues, I should recognize it when you are.

I would be interested in Tyler's reaction to this article. The results hardly seem "robust." But tell us what you think.

Carbon taxes will increase the price of fuel for tractors in farms in developed countries. That will marginally increase the cost of production of food but it's impact on final price will be very, very small, in the order of 1-2%. And a marginal increase in food prices will have good consequences for countries with obesity issues like the US, UK and Germany. While agriculture in countries like Ethiopia, Bangladesh and India doesn't use a lot of fossil fuels. Besides, the per capita income of virtually all countries outside of Saharan Africa is already several times higher than minimum subsistence, even India's capita GDP now is about 9 times the level of minimum subsistence, hence a small increase in food prices will not theoretically be an issue, specially considering that India's per capita GDP will be much higher by 2050 than it is today.

"The negative impacts would be most prevalent in vulnerable, low-income regions such as sub-Saharan Africa and South Asia, where food security problems are already acute."

Areas predicted to experience the greatest impact from climate change itself.

The Economist has it that India plans to quadruple its coal usage in coming years.
Arguably, each person in the world should have the same carbon allowance e and if you go over that, you can justly be taxed. Americans have gone way over that budget. Yes, we’re one of the few countries whose co2 output is declining, but we started high...
Also arguably, adding a carbon tax in high income countries is not the same as doing so in developing countries. The former will not materially affect food security.
Developed countries ought to be thinking about how to remove their excess co2 from the air. Trees, carbon farming, fertilizing their oceans, etc. get on it!

"Also arguably, adding a carbon tax in high income countries is not the same as doing so in developing countries. The former will not materially affect food security."

It will also not have an appreciable effect on temperature.

Peter Dorman over at Econospeak points out a flaw in this "analysis". It implicitly assumes that none of the carbon tax revenues are used to reduce other taxes on the poor. OK Greg Mankiw wants these revenues to be used to slash taxes on capital income but that is certainly not the only option.

Yup, that was going to be my observation.

Impose a tax, any tax, on carbon or whatever, and of course there are going to be people who are worse off.

Every proposal for a carbon tax that I've seen slashes some other tax while raising taxes on carbon. Thereby making people in other markets better off (and potentially saving the planet in the process).

That's true to a certain extent, but there are limits to this influence. Thanks for sharing.

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