Global Warming Is For Real. What Should We Do About It?

Although the threat of global warming is vastly overhyped, it is happening nonetheless.  Perhaps the best single indication of this is the shrinking of the north-pole ice cap.  The New York Times reported just a few days ago, “Large Companies Prepared to Pay Price on Carbon”, that at least 29 major companies “are incorporating a price on carbon into their long-range financial plans.”  This includes five big oil companies ExxonMobil, ConocoPhillips, Chevron, BP and Shell.  Specifically, these major companies have all come to accept the reality of global warming and are preparing for a carbon tax to be levied before long.
The Congressional Budget Office has recently released a report “Effects of a Carbon Tax on the Economy and the Environment”, which concludes that a tax of $20 to emit a ton of CO2 would raise a total of $1.2 trillion over a decade.  Such a tax would, for example, raise the price of gasoline by 10 to 15 cents per gallon.
Once we admit that global warming is for real, and that we need to address it in a serious way, a carbon tax is almost certainly the most efficient, and least economically harmful, way to do it.  A tax on carbon output would do many things.  It would give a big boost to renewable energy (solar and wind) with, or without, special subsidies for renewables.  It would speed up the transformation from the use of coal to natural gas, since natural gas only contains half as much carbon as coal does.  And it would create an economic incentive to speed up the development of carbon capture in order to make the burning of coal more cost competitive.
Of course, a new $120 billion per year carbon tax will affect the economy.  But it will do the least damage if the proceeds are used entirely for deficit reduction.  So we can address a serious environmental problem which effects life on earth and can do so in a way which also addresses a very serious fiscal problem.
I believe that the American people are up to making a sacrifice like this if the consequences of inaction are clearly explained to them.

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