There is overwhelming evidence of anthropogenic climate change. However, there is some disagreement over what if anything, needs to be done to combat it. Simply knowing that 97% of climate scientists support the view that “human influence has been the dominant cause of the observed warming since the mid-20th century” does not lead to change. Fortunately, there are solutions to this pressing problem. The best policy to combat climate change is to impose a carbon tax on the U.S. economy.
The tax would have a minimal economic impact. A report published by Energy and Environmental Economics, Inc estimates that a carbon tax would only cost the U.S. economy roughly 0.8% of our GDP in 2050. Alternatively, the current DICE (Dynamic Integrated model of Climate and the Economy) model from Proceedings of the National Academy of Sciences estimates that if climate change remains unaddressed, we can expect a world economic loss of 3.6% world GDP. However, the majority of published economists believe in an even larger loss of 5-10% of world GDP is possible.
The carbon tax—a market-based solution—will be more efficient at addressing climate change than government regulation. According to Jerry Taylor, president of the Niskanen Center, “Market actors are far more likely to find the right answers to those questions [climate change] through experimentation, tested by profit and loss, than are politicians and/or regulators informed by energy technocrats.” Imposing market costs on carbon output will be the most effective way of eliminating climate change because the market will be forced to bear the cost.
Furthermore, this tax has the strong support of economists. In a survey conducted by the Institute for Policy Integrity, 75% of economists surveyed thought that the best way for the government to address climate is “market-based mechanisms coordinated at a regional or national level” Another survey by the IGM Economic Forum found that 95% of surveyed economists viewed a carbon tax as a less expensive way to reduce carbon output than government regulations.
The short-term economic harms of a carbon tax are minimal compared to the coming long term economics harms of climate change. Utilizing carbon tax is one way that governments can protect not only the environment but their economies, making it a viable option for addressing climate change. While many will feel there is nothing we can do, there is a Chinese proverb that goes: “The best time to plant a tree was 20 years ago. The second best time is now.”