Thomas Friedman outlines what he would do first to attack climate change
Well, the first thing we would do is actually slash income taxes and corporate taxes and replace them with a carbon tax so we actually encourage people to stop doing what we don't want, which is emitting carbon, and start doing what we do want, which is hiring more workers and getting corporations to invest more in America.
Friedman is a bit disingenuous here, as he proposes this in a way that implies that deniers (and probably evil Republicans and libertarians) oppose this common sense approach. Some may, but I would observe that no one on the alarmist side or the Left side of the aisle is actually proposing a carbon tax that 1:1 reduces other taxes. The only person I know who has proposed this is Republican Jeff Flake, who proposed a carbon tax that would 1:1 reduce payroll taxes.
As I said back then, I am not a big fan of taxes and think that the alarm for global warming is overblown, but I could easily get behind such a plan. Payroll taxes are consumption taxes on labor. I can't think of anything much more detrimental to employment and economic health. So Flake's proposed shift from a consumption tax on labor to a consumption tax on carbon-based energy sources is something I could get behind. I probably would do the same for Friedman's idea of shifting taxes from income to carbon. But again, no one is proposing that for real in Congress. The only plan that came close to a vote was a cap and trade system where the incremental payments would go into essentially a crony slush fund, not reduce other taxes.
Of course, since this is Friedman, he can't get away without saying the government should invest more in infrastructure
the federal government would borrow money at almost 0 percent and invest it in infrastructure to make our cities not only more resilient, but more efficient.
In TARP and the stimulus and various other clean energy bills, the government borrowed almost a trillion dollars at 0% interest. How much good infrastructure got done? About zero. Most of it just went to feed government bureaucrats and planning studies or ended up as crony payments to well-protected entities (Solyndra, anyone?). The issues with government infrastructure investments, which Friedman has never addressed despite zillions of articles on infrastructure, are not the borrowing rate but
- The incentive and information problems the government has in making investments of any sort.
- The vast environmental, licensing, and NIMBY factors that make it virtually impossible to do infrastructure projects any more, at least in any reasonable time frame.