https://www.cbo.gov/sites/default/files/113th-congress-2013-2014/reports/Carbon_One-Column.

pdf
http://www.heritage.org/research/testimony/2014/11/the-impacts-of-carbon-taxes-on-the-us-economy
http://www.energyindependentvt.org/wp-content/uploads/2015/04/REMI_Final.pdf
http://object.cato.org/sites/cato.org/files/pubs/pdf/cato-working-paper-33.pdf
http://www.paulsoninstitute.org/wp-content/uploads/2015/04/Carbon-Tax-English_Liu.pdf
http://www.rff.org/research/collection/considering-us-carbon-tax-economic-analysis-and-dialogue-carbon-pricingoptions

Background
As of August 31, 2015, 39 national and 23 subnational jurisdictions are putting a price on carbon through ETSs and taxes (Box 1
and Figure 4). Together, these carbon pricing instruments cover some 7 GtCO2 e, about 12 percent of the annual global GHG
emissions.9 This represents significant progress: the number of carbon pricing instruments has expanded by 90 percent since 2012.
More specifically, since January 1, 2012, the number of carbon pricing instruments implemented and scheduled has increased from
20 to 38. In addition, the share of global emissions under a carbon pricing instrument has increased threefold over the past decade
(Figure 5).10
Prices currently range from about US$1 to US$130/tCO2 e (Figure 6) and have shown little movement in absolute terms over the
past year.13 Despite this relatively wide range, 99 percent of emissions are priced at less than US$30/tCO2 e and 85 percent are
priced at less than US$10/tCO2 e (Figure 7). Most scenario analyses indicate a global average carbon price of between
US$80/tCO2 e and US$120/tCO2 e in 2030 would be consistent with the goal of limiting the global warming to 2C.14 While these
carbon prices, calculated by large-scale climate-economy models, do not necessarily have to be an explicit carbon tax rate or
allowance price, the difference between this range and the prices currently observed gives an indication of the scale of the
challenge lying ahead. The global value of the regional, national, and subnational carbon pricing instruments in 2015 is estimated at
just under US$50 billion.15

We affirm Resolved: The United States Federal Government should adopt a

carbon tax.
Observation: Adopting a carbon tax does not exclude one from participating in
other forms of carbon pricing.
World Bank Sept. 2015:
[http://www.worldbank.org/content/dam/Worldbank/document/Climate/State-and-Trend-Report-2015.pdf]

*Carbon tax could be used in conjunction with other carbon pricing plans such as ETS

European Union countries, France, Sweden, and Portugal, while a part of the EUs
Emission Trading System (ETS) all have separate carbon taxes in place to cover what the
ETS does not.
EU countries are using a carbon tax to cover what the EU ETS does not.
- Frances carbon tax came into effect on April 1, 2014, putting a carbon tax of 7/tCO2 e
(US$8/tCO2 e) on the use of fossil fuels not covered by the EU ETS. The carbon tax rate increased to 14.5/tCO2 e (US$16/tCO2 e)
in 2015 and will rise to 22/tCO2 e (US$24/tCO2 e) in 2016. On July 22, 2015, France formally adopted its Law on the Energy Transition to Green Growth. This
law sets a trajectory for the countrys carbon tax level to rise to 56/tCO2 e (US$61/tCO2e) in 2020, and 100/tCO2 e (US$110/tCO2 e) in 2030.112 This
augmentation in the carbon tax rate will be revenue-neutral, as other taxes will be lowered.113 The aforementioned law also sets the objective to reduce GHG
emissions by 40 percent with respect to 1990 levels by 2030,

consistent with the EU target.

- [Sweden] The Swedish government is considering changes to the Swedish carbon tax. Under
current rules, the carbon tax covers all fossil fuels used for heating that are not covered
by the EU ETS and motor fuels. However, non-EU ETS installations, as well as the agriculture and forestry sectors receive tax rebates for
their use of fossil heating fuels.122 Under the new rules considered for introduction in the 2016 Budget Bill, to be presented on September 21, 2015, the
aforementioned tax rebates would be abolished as of January 1, 2016. The Swedish government argues that the removal of these tax rebates would better align its
policy with the polluter pays principle, lead to a more cost-effective instrument, and improve the transparency of the taxation system.123

- [In Portugal] A carbon tax of 5/tCO2 e (US$5/tCO2 e) was approved in November

2014, as part of a wider package on green tax reform. The carbon tax entered into force on January
1, 2015. It applies to all energy products used in non-EU ETS sectors and covers approximately a
quarter of the countrys GHG emissions. The tax rate will be determined annually, based on the average EU allowance auction clearing

The
full green tax reform package aims to be fiscally neutral and the revenues from the carbon
tax and other taxes will be redistributed in the form of income tax relief to lower-income
families.
price in the preceding years. The 2015 tax rate of 5/tCO2 e (US$5/tCO2 e) is expected to yield approximately 95 million (US$104 million) in revenue.

In addition, In February 2014, the Mexican Ministry of Energy announced the possible
development of an ETS in the energy sector. This [which] would complement Mexicos tax
on fossil fuel sales, excluding natural gas, which went into effect on January 1, 2014.

Contention 1: Carbon taxes lead to a push toward cleaner energy sources

Subpoint A: Increased innovation
[Kennedy, K., M. Obeiter, and N. Kaufman. 2015. Putting a Price on Carbon: A Handbook for U.S. Policymakers.
Working Paper. Washington, DC: World Resources Institute.
http://www.wri.org/sites/default/files/carbonpricing_april_2015.pdf ]
The economic impacts of a carbon price (in terms of economic growth, employment, etc.) are highly contingent on how the
revenue is spent. Economists have found that maximizing economic growth requires using the revenue to remove preexisting distortions in the economy that serve to hinder growth. 8 For

example, economic studies have shown

that lower income tax rates (corporate and personal) would cause individuals to work more and
corporations to create more jobs. Revenue can also be used to achieve many other objectives, such as investing in
technologies that spur low carbon innovation and climate change adaptation, or providing transitional assistance to sectors, regions,
and individuals that are most vulnerable to the higher prices and lower demand for carbon intensive goods. Recent studies have
shown that neither the distributional consequences,9 the regional disparities,10 nor the effects on the competitiveness of U.S.
industry 11 are as large as some have feared. Still, using a portion of the revenues to address either the actual or perceived losers
from a carbon price may increase the fairness and political viability of the policy.

By reflecting the cost of carbon in the prices for fuels and goods, a carbon price can
send an economic signal that helps spur investment and innovation in energy sources
and new technologies that are less carbon intensive.
This is supported by
[Climate change policy, innovation and growth. Antoine Dechezleprtre, Ralf Martin, Samuela Bassi. Jan. 2016.
http://www.progressivepolicy.org/wp-content/uploads/2015/03/2015.03-Freeman_A-Bottom-Up-Approach-to-Reducing-US-Carbon-Emissions.pdf ]

Many studies find that public policies are a crucial driver for the adoption of low-carbon
technologies, particularly in the heavily regulated and policy-driven energy sector
(especially electricity). Examples include Kerr and Newell (2003) on the removal of lead from gasoline in the
US, Kemp (1998) on the effect of effluent charges on biological treatment of wastewater, Snyder et al. (2003) on the
diffusion of membrane-cell technology in the chlorine manufacturing industry, and Popp (2009) on NOX pollution
control technologies at power plants.
The change in relative prices due to climate change regulation spurs so-called induced innovation (Acemoglu, 2002;

Because research and development (R&D) is a profitmotivated investment activity, inventors respond to the expected increased diffusion of
environmental technologies induced by regulations by developing low-carbon
technologies. This finding is supported by a large body of evidence (for recent surveys of
relevant literature see Popp et al., 2010; Popp, 2010; and Ambec et al., 2013
http://www.rff.org/files/sharepoint/WorkImages/Download/RFF-DP-11-01.pdf ).
Acemoglu et al., 2012; Hicks, 1932).

Other studies provide evidence on how innovation reacts to higher energy prices resulting from various policies.
Newell et al. (1999) show that the energy efficiency of air conditioners and gas water heaters in 1993 would have

been one-quarter to one-half lower if energy prices had stayed at their 1973 levels, rather than rising along their
historical path. Similarly, both Popp (2002) and Verdolini and Galeotti (2011) find that a 10 per cent increase in energy
prices raises energy patenting in the long run by around 4 per cent. Aghion et al. (2016) examine innovation
activity in the car industry and show that firms tend to innovate more in low-carbon technologies (i.e.
electric, hybrid and hydrogen cars) and less in high-carbon technologies (i.e. internal combustion engines)
when they face higher fuel prices. A 10

per cent higher fuel price is associated with about 10

per cent more low-carbon patents and 7 per cent less high-carbon patents.
To sum up, there is ample empirical evidence that climate change regulations, either directly or through their impact on
energy prices, encourage the diffusion of environmentally-friendly technologies and drive innovation activity further up
the technology supply chain, favouring R&D in low-carbon technologies.

The impact on innovation appears

both large and rapid. Thus, climate change regulations can help economies break away from a polluting economic
trajectory and move to a low-carbon one.

This increase in investment and innovation has two major impacts

1) The economy
2) The environment
Which brings me to
Subpoint B: The Economy
In 2007, Fankhauser, Sehlleier, and Stern of the London School of Economics found that
https://www.researchgate.net/profile/Samuel_Fankhauser/publication/228989456_Climate_change_innovation_and_jobs/links/02e7
e525eb84542bfd000000.pdf
Table 1 suggests that renewables are more labour-intensive than conventional energy, both in terms of manufacture and, to a lesser
extent, the operation of facilities.

A switch to low-carbon technologies should thus lead to net job

creation. The table essentially shows comparative static results, comparing the jobs available in a renewable
energy installation with those in a fossil fuel plant, once all adjustments have taken place. Note that these
adjustments involve capital, energy and materials as well as labour. So if the demand for labour relative to other
factors is to rise, the new technologies have to raise the labourcapital ratio, and not just the labouroutput ratio. Only
in the very short term can we assume the fixed capital stock to be fixed.
In the longer term, climate change policy will unleash a wave of innovation as firms reposition themselves and seek to

Jobs will be created in research and the development of lowcarbon technologies. Over time, the results of this research will generate new investment
and further job opportunities.What these will be and how this would differ from what would have happened
exploit carbon opportunities.

without these policies is hard to predict. What is not in doubt, however, is the powerful effect that innovation and
technical change can have on productivity and economic growth. Growth theory has long identified technical change
and innovation as a major source of economic growth. Skill-biased technical change is a major factor in explaining
labour market developments over the last few decades in both Europe and the USA including changes in wage
income (through productivity growth), job creation (through expansion) but also wage inequality (since some lowproductivity jobs remain).

Rick McGahey, teaches economics and public policy at the Milano School of International Affairs,
2014 (served as executive director of the Congressional Joint Economic Committee, A carbon tax will create jobs for Americans, 10/3/14,
http://www.cnn.com/2014/10/03/opinion/mcgahey-climate-change/, accessed 1/18/16, CD - Savon)

Business leaders and economists said in a report that new technologies can spur both economic growth and
better climate outcome. Finance experts at the International Monetary Fund -- hardly a bunch of tree-huggers -- made
a similar point. In their paper about carbon pricing, they concluded that higher carbon prices can benefit individual

countries even if others don't match them. And economist Robert Pollin and his colleagues have shown that for every $1
million of investment in clean energy, the U.S. can create 16.7 jobs compared with only 5.3 jobs from fossil
fuel investments. Overall, green energy investments combined with carbon taxes can create 2.7 million jobs
in areas such as renewable energy, construction, manufacturing, transportation, new technologies and
services -- even taking into account the transitional job loss from fossil fuel industries . We should pay attention
to these ideas. American energy policy is backwards. Federal and state governments give out over $20 billion in

annual subsidies for fossil fuel exploration and production , which benefit highly profitable companies such
as Exxon Mobil, Shell and BP. But if the U.S. implements even a modest federal carbon tax, we could
generate $170 billion by 2030 to create jobs and build bridges, roads and schools, reduce budget deficits,
and cut taxes to spur private investment. Without carbon taxes, we treat our environment -- air, oceans and fresh water -as a garbage dump where we fill up excess carbon. But the garbage can is overflowing because carbon emitters don't pay the full
price for carbon emissions.

http://2014.newclimateeconomy.report/

According to The New Climate Report, 2014

http://2014.newclimateeconomy.report/wp-content/uploads/2014/08/NCE_Chapter7_Innovation.pdf

In the last 10 years, we have seen a number of materials related advancements that lower GHG
emissions. New and improved materials have driven down the cost and improved the performance
of wind and solar energy. In the US, more than 30% of new electricity generation capacity added in
20102013 involved solar and wind power, up from less than 2% in 20002003. Advances in materials
have facilitated large improvements in the efficiency of lighting and appliances, including the rapid emergence of lightemitting diodes (LEDs). They have enabled a broad array of technologies that improve the energy efficiency of the
building envelope, and they have enabled continual improvements in the fuel efficiency of vehicles.
Looking ahead, the potential remains large. New advances in materials will continue to drive

improvements in renewable energy, and energy efficiency across the transport, buildings and
industrial sectors. By 2020, it is estimated that the US corporate sector could save $120 billion in
annual costs, and reduce annual emissions by 890 million tonnes of CO2e, by utilising renewable
energy and energy efficiency technologies,9 most of which rely on improved materials. Advances in
materials are also critical to improving energy storage, and carbon capture, use and storage. This
will include incremental improvements in existing materials, as well as the application of more advanced materials,
such as nanomaterials.

Subpoint C: The Environment and Global Warming

Nader 13 founder of modern consumer protection, author of Unsafe at Any Speed,
political activity who helped make cars safer, food healthier, air and water cleaner and work
environments safer for more than four decades (Ralph Nader, 1-4-2013, The best solution for climate
change is a carbon tax, http://blogs.reuters.com/great-debate/2013/01/04/the-best-solution-for-climate-change-is-a-carbon-tax/,
CD malia, 1/12/15)

A carbon tax would place a fee on polluters that emit GHGs like carbon dioxide, methane,
and nitrous oxide. It should be applied at major sources of GHG emissions: coal-fired
power plants, petroleum refineries and importers, natural gas processors, and cement,
steel, and GHG-intensive chemical plants. This tax would prod us away from dirty fossil fuels
and toward clean energy alternatives to avert global warming while raising considerable
revenue. / Global warming is happening, whether or not lawmakers on Capitol Hill want to acknowledge it.
Unfortunately for the rest of us, the consequences of ignoring it are dire. / Given the already lackluster recovery,
the future economic devastation from global warming looms many times larger than any
fiscal cliff. A 2006 report from British economist Nicholas Stern estimated that if global

temperatures increase 2-3 degrees Celsius in the next 50 years we risk losing up to 20
percent of global GDP a loss similar to that of the Great Depression. / But global warming wont
just affect our pocketbooks. According to a report from DARA, an international humanitarian organization, if we do
nothing, over 100 million lives will be lost by 2030 from our reliance on fossil fuels and
the effects of global warming, including hunger, the spread of disease, air pollution, and
cancer.
The potential for utter devastation in loss of life, fertile
farmland, and infrastructure if climate deniers are wrong is too high to ignore. And like insurance, there are
Think about global warming in the same way:

deterrence benefits to a carbon tax beyond the mitigation of economic risk. Spending part of the revenues from a carbon tax on
incentives for displacement by clean energy, we

would stimulate the economy, create jobs, and improve

peoples overall health through reducing the pollution they and their children have to
breathe.