Carbon tax, Cap and Trade
What are the pros and cons of the carbon tax, cap and trade?
Group 2
Ocean acidification is important because it impacts biodiversity. A falling ph level has detrimental impacts on species that build shells or skeleton based on carbonate. For example, tropical corals. Hence ocean acidification destroys ecosystems, resulting in the ultimate disappearance of certain species. The computer generated evidence predicts that if the carbon dioxide emissions continue to rise exponentially, this will result in the drastic increase in the ocean ph level. The levels of PH are predicted to rise as much as they have in the past 300 million years in the next 1000 years. The computer models used past historical and geographical evidence to see what the natural rise would be and compared it to the rate at which ph levels are rising today. It would be difficult for nature to compensate for these damages. Consequently, resulting in further reduction on the marine biodiversity, specifically, coral reefs. Aidan Coco Grace Miske Jingyi Li Ling Zheng
Group 3:
ReplyDeleteThere are many pros and cons to both carbon taxes and cap and trade:
One con to carbon taxes is that big companies might be willing to pay regardless of how high the tax is, reducing its effectiveness. Another con is that there are loopholes to get out of paying taxes, such as moving operations to another country without a tax. A pro of carbon taxes is that you are forced to pay for the carbon you use, which could be a deterrent depending on how high the rate is.
A con to cap and trade is that companies can buy and trade caps and get around the imposed limits. A pro to cap and trade is that there is a limit for the collective that you can't exceed.
Although these policies are valid in theory, countries still need to do more in order to combat climate change.
The pros of a carbon tax are that they assign responsibility of pollution to the main polluters, instead of making environmentally conscious actors take on that burden. It also provides an incentive for both the private and public sector to pursue alternatives to fossil fuels in order to avoid paying the tax, which can be economically beneficial in terms of innovation. Overall, the economic incentive will also help mitigate the amount of pollution. Cons of a carbon tax include enforcement and arguments over what the amount and limits of the tax and emissions should be. These discussions could last for years. Outsourcing is also a common practice among private firms; if a country has a high carbon tax within the country, they could just build a factory elsewhere and essentially evade the tax.
ReplyDeleteThe pros of cap and trade is that is it an economically efficient way to cut emissions, because it eliminates the need for a tax and maintains consumer choices in the economy. If a country puts out a significantly higher level of carbon emissions, they have the option to auction emissions and bring in additional revenue. It is also proven in areas like the EU to decrease greenhouse gas emissions. The cons of cap and trade is that it evades the values of protecting the environment in favor of what's economically efficient. There is also not a solidified idea of where the cap on pollution should be universally, which could inhibit the process. Companies can find ways to cheat the system by falsely reporting, so enforcement would be difficult. It is also costly to the government to enforce cap and trade systems.
GROUP 5:
ReplyDeleteCap and Trade:
Pros:
-Fast cuts in pollution
-Aggressive Climate Change goals
-Increases certainty of maintaining emissions goals
-Agencies can purchase credits to retire them
Cons:
-Doesn't encourage any actual change in industry behavior
-Allows companies to cheat the system
-Leniency in the system. Gov't can give many exceptions
Carbon Tax:
Pros:
-Offers stable carbon prices. Prevents fluctuation that would hider budget making.
-Causes companies to search for conservation strategies.
-Social responsibility increase
-Reduces environmental cost associated with carbon emissions
Cons:
-May encourage tax evasion
-Can discourage investment
Group 4
ReplyDeleteSome pros of the carbon tax are that it reduces carbon emissions by incentivizing cleaner fuel options. It increases the price of fossil fuels, encouraging people to find other alternatives. The carbon tax is easier and quicker for the government to enact.
Some cons of a carbon tax are that it raises the price of fossil fuels, which may make it more difficult for low-income families to afford fuel. It provides certainty about the price of emission reductions, but there is little certainty about the actual amount of emission reductions.
Some pros of cap and trade are that the cap can be increased and decreased over the years, whereas the carbon tax is fixed and serves as more of a penalty. It cuts pollution faster because companies search for cleaner solutions more quickly. This rewards innovation, because companies can save money by advancing their technology.
Some cons of cap and trade are that the wealthiest and most polluting industries do not need to clean up their energy sources, because they can afford a higher cap on the pollution they put out. Cap and trade also does not encourage any reduction of carbon emissions below the cap, whereas the carbon tax encourages a maximum reduction of carbon emissions. Under cap and trade, it is difficult to predict the price of having high pollution levels, whereas the carbon tax is set.
Carbon Tax
ReplyDeleteThe Pros:
-Create alternative means of production that encourage cleaner energy.
-More money in circulation to combat the adverse effects of climate change and support prevention.
The Cons:
-Businesses are incentivized to evade taxes and pollute in more discrete ways.
-Businesses are motivated to move their production out of the country in order to find a cheaper environment.
Cap and Trade
The Pros:
-A ceiling for carbon emissions makes it illegal to exceed a certain level. This will eventually lead to a control/reduction of carbon emissions.
-Allowances are able to put businesses on a path that leads to a gradual decrease of carbon emissions.
-This system allows for a more immediate impact on the reduction of carbon emissions.
The Cons:
-It doesn't promote a change of behavior among businesses because they are able to purchase the ability to pollute from other businesses.
-The government has the complete power to decide how allowances are determined.
This is Group 1's
DeleteGreenhouse gas emissions cause huge environmental threats and potential economic problems. A carbon tax can let those who benefit from burning fossil fuels pay for the environmental damage. This means carbon tax shows more of its social cost by raising the price of energy consumption.
ReplyDeleteThe raising prices also decrease the using of fossil fuels. People who don’t want to pay for high tax would look for other replacement for fossil fuels. Also, lead to less emissions of greenhouse gas.
However, the tax would fall more heavily response on workers and investors in carbon-intensive industries. Rather than people who decide to use fossil fuels.For people who are low-income households consume, a carbon tax would be regressive.
Link：https://www.taxpolicycenter.org/briefing-book/what-carbon-tax
Major pros of cap and trade: increase the efficiency of reducing emission, win-win situation for both the firm and the government since a company can sell unused credits to other companies and government can use the revenue received from businesses for infrastructural needs, social programs, and etc.
Major cons of cap and trade: not encouraging some industries to change their behavior since they can purchase credits from other companies, potential cheating issues- companies trying to cheat the monitoring system
https://vittana.org/20-cap-and-trade-system-pros-and-cons
We think that the cap and trade system is better because it has proven to be effective as evident by the acid rain program. Hence, we will be certain that emissions will be reduced. In addition, we think that it is the best available solution that allows for both government and corporations to prosper.
Ling Zheng and Jingyi Li