Last updated on: 10/5/2020 | Author:

Should the United States Enact a Carbon Tax to Reduce Greenhouse Gases?

General Reference (not clearly pro or con)

Tax Policy Center, in chapter, “What Is a Carbon Tax?,” of the 2020 Tax Policy Briefing Book, available at, stated:

“Emissions of carbon dioxide and other greenhouse gases are changing the climate. A carbon tax puts a price on those emissions, encouraging people, businesses, and governments to produce less of them. A carbon tax’s burden would fall most heavily on energy-intensive industries and lower-income households. Policymakers could use the resulting revenue to offset those impacts, lower individual and corporate taxes, reduce the budget deficit, invest in clean energy and climate adaptation, or for other uses.”


PRO (yes)


Jeffrey Miron, PhD, Senior Lecturer on Economics, and Laura Nicolae, U.S. Macro Research Analyst at Goldman Sachs, in a Feb. 24, 2019 article, “Why the US Can’t Afford a Green New Deal,” available at, stated:

“Instead of the Green New Deal, the federal government could adopt a revenue-neutral carbon tax to decrease emissions without exacerbating the fiscal imbalance. Economists from across the political spectrum support carbon taxation as the most cost-effective way to address climate change. And a carbon tax would be most effective if uniformly adopted by other countries, too.”

Feb. 24, 2019


Carbon Tax Center, in an article accessed on Oct. 5, 2020, “Why a Carbon Tax?,” available at, stated:

“A robust tax on carbon pollution will create powerful incentives inducing policy-makers and individuals to reduce carbon emissions through conservation, substitution and innovation.

Currently, the prices of electricity, gasoline and other fuels reflect little or none of the long-term costs from climate change or even the near-term health costs of burning fossil fuels. This immense “market failure” suppresses incentives to develop and deploy carbon-reducing measures such as energy efficiency (e.g., high-mileage cars and high-efficiency air conditioners), renewable energy (e.g., wind turbines, solar panels), low-carbon fuels (e.g., biofuels from high-cellulose plants), and conservation-based behavior such as bicycling, recycling and overall mindfulness toward energy consumption.

Taxing fuels according to their carbon content will infuse these incentives at every link in the chain of decision and action — from individuals’ choices and uses of vehicles, appliances, and housing, to businesses’ choices of new product design, capital investment and facilities location, and governments’ choices in regulatory policy, land use and taxation.”

Oct. 5, 2020


Union of Concerned Scientists, in a July 17, 2009 article, “Carbon Pricing 101: When Carbon Emissions Cost Money, We Produce Less of Them,” available at, stated:

“With a carbon tax, laws or regulations are enacted that establish a fee per ton of carbon emissions from a sector or the whole economy. Owners of emissions sources subject to the tax would be required to pay taxes equivalent to the per-ton fee times their total emissions. Those who can cut emissions cost-effectively would reduce their tax payments. Those subject to the tax would have an incentive to lower their emissions, by transitioning to cleaner energy and using energy more efficiently. A rising carbon tax would help ensure a decline in emissions over time.”

July 17, 2009


Alex Brill, resident fellow at the American Enterprise Institute, in a Jan. 31, 2019 article, “Costs of the Green New Deal,” available at, stated:

“Fortunately, there is a better approach [than the Green New Deal] of using a carbon tax to impose an explicit price that reflects the burden imposed by emissions. That would have the advantage of harnessing market forces, not political will, to achieve desired outcomes. By increasing the return on investment from clean energy sources and low energy technologies, a free market strategy would drive new investment in existing green energy technologies while also encouraging innovative technologies to come to market. An added advantage is that a carbon tax will not increase the deficit but will instead raise revenue that could be used to reduce other more distortionary taxes.

Green New Deal advocates refuse to accept advantages of this approach, recently writing that they ‘will vigorously oppose any legislation’ with market mechanisms. Americans should not allow ideological fixation to stand in the way of addressing environmental challenges. Experts from across the spectrum recognize the need for policymakers to address climate change. As lawmakers move toward action, they must understand the importance of building the right program design. An approach that incentivizes energy consumers and producers to advance societal goals is far superior to a framework in which politicians make ‘better’ choices than the market and force a less than efficient plan on the economy.”

Jan. 31, 2019


Marilyn A Brown, PhD, Professor of Sustainable Systems, and Majid Ahmadi, Ph.D. student, both at Georgia Institute of Technology’s School of Public Policy, in a Dec. 17, 2019 article, “Would a Green New Deal Add or Kill Jobs?,” available at, stated:

“Our analysis indicates that a cleaner-energy approach motivated by carbon taxes would promote innovation, open up new markets and produce an economy with more jobs—a greener economy worth investing in.

Today clean-energy technologies in the U.S. struggle to compete because fossil energy is so “inexpensive.” Low prices make it difficult for such alternatives to flourish. Our analysis shows that raising energy prices would empower the transition to efficiency, renewables and other low-carbon resources. Indeed, a carbon tax of either $25 or $60 would cut carbon emissions significantly, but the higher tax would produce quicker and deeper reductions. On the other hand, while both tax levels would grow jobs, the $25 tax would provide more employment growth than the $60 one. Thus, as with most policies, the optimum is a trade-off between competing priorities.

By using the clean technologies that carbon taxes would promote, Americans would not have to travel less, freeze in the winter, take cold showers or cut the output of their manufacturing plants to reduce the U.S.’s carbon emissions. Our independent analysis, along with a growing body of research, suggests that a low-carbon economy is likely to be a stronger and more secure economy that also provides climate solutions.”

Dec. 17, 2019

CON (no)


Wenonah Hauter, founder and Executive Director of Food & Water Watch, in a Nov. 26, 2018 article, “Anticipated House Carbon Tax Bill Is Climate Denial, Not Climate Action,” available at, stated:

“[C]arbon pricing schemes like this one are false solutions to climate change, and they provide a dangerous distraction from the bold policies required to avoid the worst effects of climate chaos in decades to come.

This carbon tax bill amounts to climate denial, not climate action. Emissions pricing schemes like this one are actually supported by the world’s largest oil and gas corporations because they do nothing more than entrench the status quo – an economy dependent on polluting fossil fuels. This particular bill is potentially even more egregious, as it would reportedly roll back existing environmental regulations on carbon emissions, amounting to a shameful, self-defeating giveaway to the industry.

[I]t is imperative that they flatly reject carbon pricing schemes that increase costs for consumers while cementing a future of fossil fuel business-as-usual… The only legitimate path to moving off fossil fuels is to move off fossil fuels – now.”

Nov. 26, 2018


Kevin Drum, political blogger for Mother Jones in a Sep. 2, 2019 article, “Here’s Why I’m No Longer Thrilled by Carbon Tax Plans,” available at, stated:

“This is where I start: a smallish carbon tax would generate a lot of opposition—from anti-taxers, from advocates for the poor, from states that are hardest hit—but wouldn’t produce a big effect. It’s not clear that it’s worth it.

So maybe we make it bigger? How about $400 per ton? That would add three or four dollars to the price of gasoline and would increase the price of electricity by 10x or more. That would have an effect. Needless to say, it would also generate massive opposition. This is probably not the hill we want to die on, because die we would.

But wait. How about a middle approach? [Andrew] Yang proposes that we impose a carbon tax but then give back some of the money. He’s vague on how this would be done, but presumably the money would be doled out mostly to low-income families. Maybe some would also be earmarked for regions that pay an especially high price.

But now you have a different problem. The whole point of a carbon tax is to make energy more expensive so that people will use less of it. But if you just give the money back, it means people can use their dividend to partially offset that higher cost. They can go on using the same amount of energy as always with minimal pain…

So that’s where I am with carbon taxes. From a white-paper point of view, they’re great, but from a real-world point of view they just don’t cut it.”

Sep. 2, 2019


Jordan McGillis, Deputy Director of Policy for the Institute for Energy Research, in Apr. 2019 report to the Congressional Ways and Means Committee, “The Case against a Carbon Tax,” available at, stated:

“A carbon tax is unjustified and it is unwise. Carbon taxes have demonstrated themselves to be both costly and incapable of constraining governments from implementing and maintaining other burdensome regulations and taxes. The U.S. is better off without one. Rather than stifling economic exchange with a government-imposed artificial price, the best path forward in the face of global warming and other perceived threats is to facilitate opportunity, technological progress, and wealth maximization by freeing markets of energy mandates, caps, and taxes.”

Apr. 2019


Marlo Lewis, PhD, Senior Fellow at the Competitive Enterprise Institute, in a June 5, 2019 news release, “CEI Releases New Video Explaining How a Carbon Tax Would Punish American Families,” available at, stated:

“A carbon tax is a pernicious idea because it can dramatically increase costs for Americans on a range of necessities without presenting them with a tax bill. In addition to higher costs for energy, businesses that consume energy—like shipping companies, travel services, agriculture and more—will also pass increased costs onto consumers. Some carbon tax proposals attempt to soften the blow for consumers by proposing a ‘rebate,’ but those unfair plans would give people living in cities the same rebate as Americans living in more rural areas, who use more energy. The bottom line is a carbon tax is a bad idea that would harm our economy and punish American consumers…

A carbon tax is a tax on carbon dioxide emissions from energy sources like coal, oil, and natural gas. In fact, 80 percent of all the energy Americans use emits carbon dioxide into the atmosphere. Although energy producers would initially pay most of the tax, who do you think the added cost of the tax gets passed onto? You guessed it, consumers.”

June 5, 2019


Nicolas Loris, Deputy Director of the Thomas A. Roe Institute, and Laura Williamson, Summer 2019 member of the Young Leaders Program at The Heritage Foundation, in a July 30, 2019 article, “Why the Carbon Tax Would Backfire on America,” available at, stated:

“Families would pay more at the meter and the pump. Approximately 80% of America’s energy needs are met by natural gas, oil, and coal, which means the costs would be economy-wide. It would cost more to manufacture, which would drive up the price of manufactured goods. And it would cost more to farm, which would drive up the costs of food…

[A] carbon tax would cause:

  • A peak employment shortfall of more than 1.4 million jobs.
  • A total income loss of more than $40,000 for a family of four.
  • An aggregate gross domestic product loss of more than $3.9 trillion.
  • Increases in household electricity expenditures of 12% to 124%.

Even worse, the burden would be heaviest on low-income families who spend a higher portion of their budget on energy costs. Some carbon tax proposals acknowledge this and offer rebates from the tax revenue collected…

Carbon taxes are a cure worse than the alleged disease: They have a minimal impact on emissions and will do next to nothing to affect climate change. In the end, they hurt the very citizens they are intended to help.”

July 30, 2019