Clearly I’m really getting in to it and I apologize for harping on the subject, but the question remains, how would a carbon tax affect the economy and would a carbon tax create jobs? I’ve been trying to answer that question myself and keep coming up with reasonably good answers / explanations. James Conca at Forbes asked the very same question almost a year ago and his commentary is worth noting for his balanced answer. Yes, a carbon tax will create jobs, “so long as the revenue is spent wisely”.
There you go, excellent answer. Conca, its seems would favor a Carbon Tax that is levied against businesses then paid out as a “dividend” to individuals. The thought process here is that it recycles the money through the economy.
“Carbon pricing can come in the form of a Cap&Trade scheme, carbon tax credits, a revenue-neutral market-based carbon fee (Citizens Climate Lobby) or a straight carbon tax. These all have their benefits and disadvantages (CCL) but many studies on carbon pricing show more positive economic effects than negative (Brookings; REMI; CAP; MJ). This is especially true for those that are revenue-neutral, meaning that the tax goes back to the tax-payers, so the tax really isn’t a tax as much as a temporary fee.”
I’ll be writing more about this in the future, but keeping this for reference.