Comment by bryanlarsen
2 days ago
It would change behaviour more, not less.
If you set the carbon tax at about $1/gallon of gasoline, the corresponding carbon rebate would be about $1000 per family per year.
That wouldn't affect rich people much; neither the $1/gallon nor the $1000 extra income is significant. But many rich people get rich by being penny-wise, so many would change behaviour, by buying an EV or similar.
But for poor people both $1/gallon and $1000 per year is significant. If gas was $1/gallon more expensive, poor people definitely would drive less.
The real hardship for the poor here is they cannot float that $1/gallon for a year before getting the $1000
The same thing happened with electric car purchase incentives in New Zealand. The poor cannot afford to buy a new car - so only the well off received the efficient car discount incentives.
The trickle down as those cars depreciated in value was years away.
That doesn’t really sound like the worst thing?
Someone has to buy them for full price before they show up on the used market 5-10 years later.
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The rebate can be paid out more frequently than annually.
Having a carbon tax seems to be the most fair way to combat climate change; unfortunately in practice it is political suicide. Australia had a carbon tax in 2011 and was quickly repealed in 2014. Likewise Canada also implemented such a tax in 2019 and was repealed this year prior to their election. People like to say that they want to help the environment, but when it comes time to vote they vote against such policies.
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You can give the rebate based on prior year or estimated usage at the start of the year, and then repay at the end of the year if it was too much, like with healthcare subsidies.
The rebate is a fixed amount, no need for estimation.
Are you sure? Gas consumption is notoriously inelastic. West coast gasoline is already a dollar or more than it costs on the east coast. Do poor people drive less in California than in Florida?
Gas consumption is inelastic in the short term, but everything is elastic in the long term.
If you want proof of this, just look at what happens to sales of large vs small cars when the price of gas changes.
I think everyone drives less in California than in Florida. (Google says ~14,500 miles annually per licensed driver in Florida, versus ~12,500 miles in California.) Gas prices are a factor in this.