Alex Tabarrok at the NY Time Room for Debate:
Carbon Taxes, by Alex Tabarrok: President Obama lost his cool last week when — sounding like the old president — he said he was looking for some “ass to kick.” He didn’t regain any lost cool in Tuesday’s oil speech, which also made him sound like his predecessor: “Make no mistake: we will fight this spill with everything we’ve got for as long it takes,” he said, emphasizing “We will make BP pay….” Call it President’s Obama’s war on error.
Turning to energy, the president called for innovation and hard choices but offered little new or courageous thinking of his own. ... Most important, nowhere did the president mention two hard ideas that the public must accept if we are to move to a cleaner energy future: nuclear power and carbon taxes. Nuclear power is among the cleanest sources of energy, power plants can be built when and where needed and the combination of nuclear-generated electricity and hydrogen can serve virtually all of our energy needs. Is nuclear power safe? Oil spills and coal-mine disasters should remind us that safety is always relative.
The oil spill isn’t really a new event. It’s simply another reminder that not all of the costs of oil are reflected in the price; whether it’s climate change, environmental disaster or the financing of anti-American governments, cheap oil is a lot more expensive than it appears at the pump. A tax on oil — and carbon more generally — would make the price of oil better reflect its true costs thus making our choices more realistic and rational. Moreover, a carbon tax would do more than any other policy to spur energy conservation and innovation.
No one likes taxes but Al Gore was right when he said we should tax burning not earning. A tax shift — not a tax increase — away from labor and toward carbon would increase the incentive to create jobs and to use less carbon. Both changes would be welcome at the present time.
We needed bold but unfortunately the president mostly gave us old.
I was on the fence before and not really sure whether to go with the seemingly emerging consensus that nuclear power is the answer to our energy needs, there were always nagging doubts, but the problems in the gulf make me hesitant to embrace nuclear power despite assurances that the risks are minuscule. Should nuclear power play a large role in the solution to our energy problems?