Carbon Tax: Still a Bad Idea

Nicolas Loris /


An anti-carbon tax amendment will likely be considered as the Senate attempts to pass its first budget in four years. While it has been made quite clear that passing a carbon tax would fail in both chambers of Congress, it is important to stress why enacting a carbon tax would be economically devastating and environmentally meaningless.

As Australia is currently experiencing, the adverse effects of a carbon tax will ripple through the economy. A majority of American’s energy needs come from carbon-emitting conventional fuels, so Americans would not just be impacted through higher energy bills but also higher prices for the goods and services they purchase. Low-income families that spend a disproportionately higher percentage of their budget on energy would be hardest hit.

Last year, the U.S. Energy Information Administration estimated that a carbon tax that starts at $25 and rises by 5 percent per year (after adjusting for inflation) would:

Proponents of a carbon tax may argue that’s a small price to pay to save the planet, but the reality is that it’s an exorbitant price to pay to not have any impact on climate change whatsoever. Unilaterally reducing greenhouse gases would not make a dent on global emissions and only moderate temperatures a few tenths of a degree Celsius over the next 85 years.

It is nothing more than wishful thinking to assume that if the U.S. enacts a carbon tax, the rest of the world would as well. Developing countries want access to cheap, reliable electricity; are building new coal-fired power plants faster than we can count; and have more pressing environmental needs like gaining access to clean drinking water and breathable air. Even if international consensus on enacting a carbon tax existed, the massive worldwide energy tax would be unwise.

Congress should categorically reject all ideas of a carbon tax and work to undo the backdoor carbon regulations imposed by the Environmental Protection Agency that are having similar crushing economic and miniscule environmental impacts.