University of Guelph economist Ross McKitrick is probably best know in the climate change arena as a critic of the Mann et al “hockey stick” global temperature record derived from proxy data.
I have no idea if McKitrick’s proposal would work technically — that is, that the level of carbon tax “equal to 20 times the three-year moving average of the RSS and UAH estimates of the mean tropical tropospheric temperature anomaly” would be both timely and effective. But it is a novel idea worthy of debate. If it has flaws perhaps it will provoke other innovative proposals that would ease political passage of an effective revenue-neutral carbon tax.
UPDATE: Unfortunately McKitrick’s proposal will not work — please see Will Howard’s critique in the comments.
…I would like to propose a thought experiment about a climate policy that could, in principle, get equal support from all sides.
The approach is based on two points of expert consensus. First, most economists who have written on carbon-dioxide emissions have concluded that an emissions tax is preferable to a cap-and-trade system. The reason is that, while emission-abatement costs vary a lot, based on the target, the social damages from a tonne of carbon-dioxide emissions are roughly constant. The first ton of carbon dioxide imposes the same social cost as the last ton.
In this case, it is better for policy-makers to guess the right price for emissions rather than the right cap. Most studies that have looked at that the global cost per tonne of carbon dioxide have found it is likely to be rather low, less than US$10 per tonne. We don’t know what the right emissions cap is, but, if we put a low charge on each unit of emissions, the market will find the (roughly) correct emissions cap.
Second, climate models predict that, if greenhouse gases are driving climate change, there will be a unique fingerprint in the form of a strong warming trend in the tropical troposphere, the region of the atmosphere up to 15 kilometres in altitude, over the tropics, from 20? North to 20? South. The Intergovernmental Panel on Climate Change (IPCC) states that this will be an early and strong signal of anthropogenic warming. Climate changes due to solar variability or other natural factors will not yield this pattern: only sustained greenhouse warming will do it.
Temperatures in the tropical troposphere are measured every day using weather satellites. The data are analyzed by several teams, including one at the University of Alabama-Huntsville (UAH) and one at Remote Sensing Systems (RSS) in California. According to the UAH team, the mean tropical tropospheric temperature anomaly (its departure from the 1979-98 average) over the past three years is 0.18C. The corresponding RSS estimate is 0.29C.
Now put those two ideas together. Suppose each country implements something called the T3 tax, whose U.S. dollar rate is set equal to 20 times the three-year moving average of the RSS and UAH estimates of the mean tropical tropospheric temperature anomaly, assessed per tonne of carbon dioxide, updated annually. Based on current data, the tax would be US$4.70 per ton, which is about the median mainstream carbon-dioxide-damage estimate from a major survey published in 2005 by economist Richard Tol. The tax would be implemented on all domestic carbon-dioxide emissions, all the revenues would be recycled into domestic income tax cuts to maintain fiscal neutrality, and there would be no cap on total emissions.
This tax rate is low, and would yield very little emissions abatement. Global-warming skeptics and opponents of greenhouse-abatement policy will like that. But would global-warming activists? They should — because according to them, the tax will climb rapidly in the years ahead.
The IPCC predicts a warming rate in the tropical troposphere of about double that at the surface, implying about 0.2C to 1.2C per decade in the tropical troposphere under greenhouse-forcing scenarios. That implies the tax will climb by $4 to $24 per tonne per decade, a much more aggressive schedule of emission fee increases than most current proposals. At the upper end of warming forecasts, the tax could reach $200 per tonne of CO2 by 2100, forcing major carbon-emission reductions and a global shift to non-carbon energy sources.
Global-warming activists would like this. But so would skeptics, because they believe the models are exaggerating the warming forecasts. After all, the averaged UAH/ RSS tropical troposphere series went up only about 0.08C over the past decade, and has been going down since 2002. Some solar scientists even expect pronounced cooling to begin in a decade. If they are right, the T3 tax will fall below zero within two decades, turning into a subsidy for carbon emissions.
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RTWT.
Bad idea. Reasons:
1) Three years is too short a time window. For example, we know there are several interannual quasi-periodic oscillations that affect temperature trends. El Nino (aka ENSO) is the most prominent of these. An ENSO cycle could easily mask an increase in net infrared forcing.
2) The problem of attribution - even if there were cooling over a 3-year interval it would be impossible to attribute all of it to emissions reductions any more than we can attribute every bit of warming to CO2 emissions.
3) Related to (1), the residence time of anthropogenic CO2 in the atmosphere is long (at least decades possibly centuries) so any warming effects will tend to be cumulative. Similarly the residence time of the excess heat is also long and cumulative, e.g. that already in the upper layers of the oceans and the heat budget of large ice sheets.
I think we need to move our political/social/economic time horizon from years/decades to decades/centuries, bite the bullet, and begin to limit carbon emissions as a risk-mitigation strategy.
Such a bad idea I need to edit the post to point to your comment. Your points 1 & 2 are clear [once explained]. If I understand correctly, your point 3 says that the integration time constant is so long that no policy feedback like McKitrick envisions could possibly work.
I think we need to move our political/social/economic time horizon from years/decades to decades/centuries, bite the bullet, and begin to limit carbon emissions as a risk-mitigation strategy.
Yes - it’s time to discuss what the costs are for our policy options, and to the degree sensible, what are the benefits. Costs are comparatively easy — the benefits of cutting radiative forcing are more challenging to quantify. Have you any guidance on what the goals should be?
How much is it worth in additional GDP losses to reach by 2050 say 3.4 watts/m2 vs. 4.7 watts/m2 [which I understand correspond to stabilizing CO2 concentrations of approximately 450 ppmv and 550 ppmv]?
Will, any comments you have on the AEI/Brookings paper “Managing the Transition to Climate Stabilization” would be appreciated.
Just a quick point after a brief glance at the AEI/Brookings paper. It’s interesting that some of us in the scientific community have been talking about moving from characterizing the environmental responses stemming from “doing nothing” about CO2 emissions (i.e. gone on as we have been with fossil fuel emissions). We have not explored in detail the climate responses of stabilization scenarios, e.g. 450 ppm versus 550 ppm. Because only then could we begin the (very difficult) process of cost/benefit analysis.
I think policymakers have now accepted the scientific conclusion that anthropogenic CO2 emissions are causing at least some of the observed climate change, and that the risk of adverse consequences is great enough to warrant mitigation. But how much mitigation?
It’s also important to bear in mind that there are environmental impacts from CO2 emissions that are independent of their radiative effects, e.g. the acidification of the oceans. To the extent we want to mitigate this impact, benchmark’s like McKitrick’s “fingerprint” monitoring would be irrelevant. (he’s correct by the way about the importance of that spatial fingerprint to distinguishing GHG forcing from other climate drivers like solar variability).