[dougweltman]

That a carbon tax is a source of information about the highest leverage areas we can change is a great framing.

Unfortunately, the main barrier to implementing a carbon tax is how we treat imports, which is the key to getting the whole thing to work. Failing to solve this means importers deindustrialize in favor of countries with more lenient carbon pricing regimes.

“Do I have to spell it out for you? Just implement a border-adjusted carbon tax!” they’ll retort: “that will cause exporters to harmonize their standards with the markets they sell to.”

I can see how this works for plastics (producing PTFE in <Exporter> would have a carbon tax of $2/ton), but what about complex, assembled goods like cars with complex supply chains, like a Hyundai assembled in S Korea with parts from more than 60 countries? The Americans need to trust the S Koreans to tax that, and the S Koreans need to trust the Chinese, Indians, Canadians and Japanese to be implementing theirs properly. Every major component in an assembled good becomes a problem.

Carbon tax works when all countries implement it, but what’s the equilibrium given current starting conditions?

[ajb]

Then you also need to tax the uncertainty...

[fuoqi]

And of course no one will exaggerate this "uncertainty" as a cover for protectionism. /s

[UncleMeat]

Perfect can't be the enemy of good. We are on a clock. Something has to be done.