[throwaway894345]

I’m not arguing that we should subsidize China at all. Frankly we subsidize them too much already, but that’s a separate topic. My only point is that we taxing carbon doesn’t preclude subsidizing them to whatever extent we choose. It seems like you’re arguing that if we pass a carbon tax it will hurt China’s economy because business will move to greener countries (countries who are now competitive after adjusting for pollution, which is what a carbon tax aims to do), and that the US has a moral obligation to reimburse them (China) for that lost business. If I’m misunderstanding, I apologize and perhaps you could clarify; however, if I understand correctly, then I strongly disagree. The West in general and the US specifically has already made China’s economy world class and that at the expense of the environment and arguable to our own economic troubles (particularly inequality). We have no moral obligation to China, IMHO.

[acituan]

I guess I don't quite get what you suggest we should subsidize. China and India are two of the big, emerging polluters, and their exports only account for roughly 20% of their GDP. So a good 80% chunk will run on non-green energy even if we devised the perfect policy to make the remaining 20% of the entirety of their exports green. (US imports only a portion of that but let's assume entire world cooperated).

This is not accounting for the havoc it would wreak in international trade obviously, hurting China's exports is never hurting them alone, because trades not only go both ways, but also through; meaning depending on a lot of Chinese intermediary goods that we export affects US's GDP, and also worlds GDP. If I am understanding suggestion correctly, for example a carbon tax on iPhone's manufacturing would reduce how many iPhones are sold in the entire world, not just US, and ultimately would impact US's economic power in the form of a reduction, which also reduces the ability of "writing checks" for other interventions.

This is why policy design is tricky.

[throwaway894345]

I don’t think we should subsidize anyone, neither China nor India, but only pointing out that a carbon tax doesn’t prevent us from doing so if we wanted to.

Ultimately I still don’t understand why you’re claiming that we depend on China and India to implement their own carbon taxes in order for us to be successful. If all wealthy countries implement a carbon tax with a border adjustment, China and India will either have to invest in greener tech and practices to compete in the wealthy first world market or be content in a less valuable market where pollution is allowed to be externalized.

> This is not accounting for the havoc it would wreak in international trade obviously, hurting China's exports is never hurting them alone, because trades not only go both ways, but also through; meaning depending on a lot of Chinese intermediary goods that we export affects US's GDP, and also worlds GDP.

Of course it’s going to hurt our economy. We’ve been living partly off of unsustainable environmental debt, and the whole point of a carbon tax is to reckon with that. Economic pain drives us toward greener solutions so we can enjoy a sustainable economy. The only “trick” to a carbon tax is deciding what the carbon tax rate should be at any moment in time to balance economic pain with necessary environmental goals. We should want to avoid an abruptly high carbon tax rate and prefer an initially low rate that rises gradually to allow our economies some time to invest in and implement green technologies, but waiting longer to implement the tax means the carbon tax rate will have to grow more steeply which translates to greater economic hardship.