If it costs $100 to remove, then that should set the price. If you can set a reasoned price on a externality then charging anything less is subsidizing the pollution.
I agree that creating an upper bound price is powerful, because it economically incentivizes those companies to figure out cheaper ways to save on that tax, like not emitting in the first place :p
Why not look at it as costing $10 of externalities plus $90 worth of steel bars that you’re preventing? That combination would make a $100 removal cost a good goal. Or at least something that includes both the positive (stuff is good, jobs are good) and negative externalities (carbon is bad).
The cost of emission certificates in the EU is currently at 63 EUR (72 USD) per ton. The carbon tax in Switzerland is 96 CHF (104 USD) per ton, soon to be increased to 120 CHF (131 USD).
Ok, you just killed the US steel industry and several others. Massive amounts of manufacturing have moved to other industries to avoid the tax. US economy is now significantly less competitive. What's the next move?
Great idea. Now US companies down the supply chain have a higher cost of goods sold too. US Steel is technically more competitive domestically, but is worse off internationally. You have successfully incentivized even more businesses to leave the United States and have lost millions of jobs. You have possibly violated several trade agreements too but let's ignore that.
So what now? We haven't accomplished much other than moving manufacturing to other countries. Are we just going to tax the finished goods coming into the country too because they were made with dirty fuels too? Because people are already pretty unhappy, including auto manufacturers, pretty much anyone who actually makes stuff, and also people who need to eat food. Especially people who just lost their jobs due to your earlier choices.
that's what things like COP26 should have been for - breaking the borders between our made up nations and agreeing to solve this problem together as global citizens
Ideally yes. That's the basic problem with international trade. If you try to do something that's better for the world, someone will eat your lunch, your people will suffer, and little will change.
