Tax Corporate Pollution

Recently, both Obama and McCain have batted around the idea of taxing corporate gas emmisions. This is when the government charges corporations depending on how much pollution they emit. I was wondering what people thought of this and if they could explain to me why this would be a good idea.

i hope you don't mind i'm taking all your debates.

taxing them is a good idea because....
the earth belongs to everyone. it's common law that your right to swing your fist end where my face begins, and this is analogous to polluting our waters and air. they are hurting us if too much occurs. given that what they do affects us all, we are justified being concerned with them and singling them out somewhat. this could be said for many industries that use and abuse resources, to a degree.

the power to tax is the power to destroy, they say. of course, we don't want to destroy the industries, but by taxing them, we entice them to create controls that make pollution less, like scrubbers in smoke stacks. this is more efficient way of controlling that sort of situation, cause before they had no incentive to do the technologies they very well could do. any laws that were passed were like hitting the corporations on the head with a blunt object and using expensive enforcement measures. taxes on the pollution makes self regulation because it's tax effective.

when you add taxes with the conservative idea of cap and trade, then you have the ultimate system created to self control pollution. if a company wants to buy pollution credits, they can. they might have to be taxed on the pollution though. it's all going to be in what's the best interest of the company within the limits defined by the government.

of course, all these limits can't be over burdensome. there has to be the right balance, as there has to be in everything.

I agree pollution is bad. People and corporations shouldn't pollute.

Still, is taxing emissions the best option? We all know firms will just pass the cost on to consumers. Why would companies take the tax hit or pay to renovate when they could just as easily pass the burden on to the consumer? Thats Econ 101.

It doesn't make any sense. We need to cap pollution sure. But, taxing emissions wouldn't reduce pollution, just raise costs for consumers. So, with emissions taxes, consumers (us) get polluted and robbed. Score!

so what if they just pass the cost on to us? if we want to reduce getting polluted out, then we might have to put our money where our mouth is. plus, it's not like companies won't compete and reduce prices when they have that varibale of a tax on them. that's also econ 101 as you facetioiusly said.
it's not provn or even that clear that we'd get an increased cost, but eve nif it was, then that's the way life has to be if we want fairly clean air and water etc.

you simply assert that taxing polution won't reduce pollution. think, if you're a company who doesn'tuse scrubbers, which area viable technicology, only cause you dn't have to, and you're taxed for how much pollution you have.... it's cost effective to use the scrubbers, if the tax is done right. you simply dodged that point and made a blanket and unfounded assertion for your favor.

and you simply assert again that putting caps on them, which implies gov monitoring enforcement costs, and didn't respond to the advantage that using tax incentives would do. again, a blanket avoidance.

when pollution occurs, there's good effects, and then as economicsts call it, externalities or pollution. basic econ theory says you tax to compenssate for those externatlities.
even conservatives who will conserve think it's the best option.
unless you have a better idea than economists and what the parties can for a big part agree on, but that remains to be seen/

If they pass the tax on to us they are just dodging the tax all together. We are not reducing emissions at all. They are not going to pay to renovate when they can just make us pay instead. So, the government is indirectly slapping a tax on consumers and not stopping pollution at all.

Why would new taxes breed competition? That doesn't make any sense. If anything the opposite is true. Taxes slow the market. New taxes make prices go up because companies compensate for the new charge.

If I'm a company who is getting taxed for pollution, why would I spend money to solve the problem when I could just raise prices to make up the difference without any lose to me. Again, Econ 101.

How would caps solve the problem? I'll just pollute all I need to, take the tax hit and pass it on to the buyer with higher prices.

Who taxes externalities? Thats a terrible idea. The market is already inefficient, so lets regulate it and cripple it some more?

The fact is, taxing emissions just leads to higher prices for buyers and doesn't solve the pollution problem.

if company A raises prices, and company B can keep prices down by using scrubbers instead, company B wins. that's basic economics, econ 101. competition in the marketplace. this is the flaw in your argument.

your bashing of taxing externalities is amusing. you from your arm chair economist, which no grasp of the real world, or economics. this is a well documented phenomenon.

http://en.wikipedia.org...
here is google scholar for scholarly articles... i recommend you actually read a book or two, or study some:
http://scholar.google.com...

If company A dodges the tax by raising prices, company B will raise bost by using scrubbers and thereby still have to compensate by raising the price. The hike by A is just more direct. They get taxed $5 and raise accordingly. Instead of being taxed, company B spends $5 on scrubbers and raises accordingly. Competition remains the same, but now the tax induces an inherent $5 cost. The consumer always pays the brunt of corporate tax.

We have had four debates and I think you have managed to sling personal insults in every one. What makes me any more of an armchair economist than you? Scholars dispute issues. Just because someone writes it in a book doesn't make it fact. Also, the wiki article you site disagrees with your stance. See the negative Pegovian tax section. It will tell you all about how subsidies, not taxes, take care of externalities while maintaining economic efficiency. This is something your taxation doesn't do. You cost the consumer and disrupt economic balance. Even your articles show this.

Also, this type of tax has two more issues. First, it relies on the tax revenue being at least partially dedicated to mitigating the effect of externality. In this case, it would mean the government would just retool the revenue from the tax into more regulation, which your own articles and past experience both show us is bad for the economy. Second, a tax like this relies on accurate government interpretation of the market. If the government taxes to high, they cripple the market, to low and the tax bears no weight. I think we can all agree the government rarely gets these things right.

So, this tax has many built in problems, as well as better alternatives that YOUR articles cite. The tax is simply passed on to the consumer, no matter what (unless companies just want to take the tax hit, which is unnatural and idealistic), the companies just pass cost on to the buyer. Also, taxing externalities is bad. It relies on accurate government implication (rare) and requires we pump the revenue from the tax back into regulation, which kills the market. Finally, subsidizing is infinitely better as it helps the pollution problem by making companies want to solve it instead of trying to make them, and keeping the market at economic efficiency.

You should read your own evidence before you post it. This is at least the second time I have had to show you that your own citations work against your point. Also, please don't throw any ad homs at me in the last round. They don't bother me and it doesn't seem as if any of the voters buy it. Thanks.

i only post semi hostile when people start it with me. maybe you hadn't meant it, but saying things like implying that i didn't understand basic econ.

here is the flaw in what you've been saying: "we should do what makes sense even if it costs us to bring down solution. taxing pollution doesn't bring down solution and only costs us money. oh wait, taxing i guess does bring down pollution (as you said right here)

"If company A dodges the tax by raising prices, company B will raise bost by using scrubbers and thereby still have to compensate by raising the price. The hike by A is just more direct. They get taxed $5 and raise accordingly. Instead of being taxed, company B spends $5 on scrubbers and raises accordingly. Competition remains the same, but now the tax induces an inherent $5 cost. The consumer always pays the brunt of corporate tax."

so... wait a minute. if i said we should be willing to spend money, and the only reason i was hesitant is because it didn't bring down pollution. but, now i see that it does bring down pollution, then my initial premise was flawed that i'd be against it.

now... you may have an argument in something else.. but your initial argument was flawed for all to see. (also the fact you wantto subsidize again shows your willingness to pay from the consumer) and the next argument is smoke and mirrors in avoiding that.
aside from perhaps the inefficiencies of gov action in taxes, your initial point has been refuted.

you push subsidies. the problem with this is that both cause the consumer to have to pay, even still... which is what you were against to begin with and so this is not the problem.
this also spreads the costs on to people through taxes who have nothing to do with the product.
this also has the same inefficiencies that a gov would have to do in determining the taxes. all the gov has to do is determine what they'd pay for scrubber and tax accordingly in a proportional way.
if the private sector does it, they'd have more incentive to do it better than if the government does as they have a money incentive to do it optimally and without reserve, even innovating new technolgies to avoid the tax.

so... even your argument involves taxes on the consumer. you're for regulating the pollution in some way. so you have nothing to be against. the only thing you could be against now, is not what you were aginst in the beginning... ie at now its how we should do it, not whether taxes would work in reducing pollution as it was before.. but i think i've made the case that even your new argument isn't as strong as mine.