Wednesday, September 4, 2013

A case for pollution tax, at point of entry.

Who will pay for your asthma or cancer treatment if a fracking well pops up down the street?  Who pays for the landfills heaped like mountains at the edge of our cities?  Who will pay for global warming causing rising sea levels flooding beach front homes and towns?  Who pays for crop losses caused by ever more frequent extreme weather events?   We do through our rising health care costs, higher insurance costs, higher food price, earlier death, tidal flood walls and pumps.  The cost is already thought to be in the dozens of billions yearly in the US, many trillions around the globe.

Regulations against pollution and laws governing factories and cars farm chemicals and activities are hard fought, take years to implement, but they seem to work, though it is hit and miss, fixing one thing exempting another, yet new products and processes come in among us and it takes decades to knock down the bad ones.  It works, a little.

Cap and trade, and carbon credits and carbon markets also work, sort of, but not always and not everywhere.

The easiest and most democratic would be a pollution or carbon fee at the point of entry.  Slap a fee on every ton of coal, puff of gas, gallon of oil, ton of ore.  Thats the end of it.  The cost will find it's way into every product proportionally.  Companies will pass the cost on from the coal miners shovel and from the well head.  This will make some products more expensive, a few a lot more expensive.  Manufacturers who find a way to transport products and make and package products with less of this taxed oil or lead in it will have a decisive market advantage.  The innovation to get off these highly taxed raw products will clean up the planet.  Products imported from nations not using this system will be taxed to compensate as if they had.

The tax collected will be used for two things, part of it will be issued as a payment as Alaska does with oil profits, yearly everyone gets the same check, same value.  This will level the field for low income people to purchase goods that at least in the first few years may be high priced.  The rest will be used to clean up pollution in the worst areas.

The fee on fossil fuels and pollutants at their point of entry into the economy along with rebate will prime the market to cure much of this problem.  Manufacturers will lower their cost by cleaning up their products, consumers will migrate their purchasing to those products of lower price due to the lower content of harmful and wasteful products.  Markets cannot fix themselves, they are imperfect, biased to profit and market share, not for any other purpose.  With these two modifications, a re-purposing, the market will for the near future fix our problem.  Later on, it will find a way to subvert it, but for now, this could work.

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