MIT academics propose carbon tax as the solution to America's deficit problems

Compared to the fiscal cliff, a carbon tax would boost growth while cutting emissions.

The Washington Post's Brad Plumer reports on a paper from the MIT Global Change Institute which argues that a carbon tax could, and should, replace the Bush tax cuts in the US.


The authors model what would happen if, this December, Congress enacted a small fee on carbon emissions to fend off a portion of the tax hikes and spending cuts that are scheduled to occur. The carbon tax would be levied directly on fossil fuels—on coal that comes out of the mine, say, or oil that’s shipped in from overseas—and would start at $20 per ton of carbon in 2013, rising 4 percent each year thereafter.

The authors, Sebastian Rausch and John M. Reilly, estimate that this tax would raise $1.5 trillion over the next 10 years.

To advocates of a carbon tax, this paper ought to be a mixed blessing.

On the one hand, the framing of the tax in terms of sensible deficit reduction is one of the better ways to get it in the debate. In both Britain and America, there is – for good or ill – an agreement that high deficits are a major problem which needs to be dealt with, and so hitching any policy to that cause is a far better recipe for success than pointing out its efficacy at fighting climate change.

On the other, the purpose of the tax could get muddled if this is how the debate is to proceed. Look, for example, at debates over the Robin Hood tax. No-one can agree whether it is being implemented to raise revenues, cut down on practices like high-frequency trading, or some undefined mixture of the two.

With a Robin Hood tax, that may be an acceptable confusion, but with a carbon tax, it is undoubtedly introduced to reduce carbon emissions. To think otherwise would be dangerous indeed. And so yoking a deficit reduction program to the tax creates some perverse incentives on the part of lawmakers. For if the tax does succeed in reducing carbon emissions – which the authors of the MIT paper suggest it will, though not by nearly enough to single-handedly solve the problem for the US – then the revenues gathered by it will drop accordingly.

Even so, having a carbon tax is still better than not having one, and the choke point the authors identify – the US fiscal cliff, and all the uncertainty it brings with it – could well be a time for introducing novel legislation of all stripes to the house.

A protest placard from Australia, where the carbon tax is rather unpopular. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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Did Titantic do more for climate change than Leonardo DiCaprio’s new documentary?

Sex, icebergs and individual plight: the actor’s earlier outing teaches us more about vast disasters than his new docufilm about global warming’s impact, Before the Flood.

“Now you know there was a man named Jack Dawson and that he saved me . . . in every way that a person can be saved.” Or did he? For Titanic actor Leonardo DiCaprio, there is one way in which Jack never did rescue Rose: from the threat of climate catastrophe. 

Over the last 15 years, DiCaprio has made the issue a personal mission. Yet even in his role as UN climate ambassador, he stills feels far from heroic:

“If the UN really knew how I feel, how pessimistic I am about our future . . . I mean to be honest, they may have picked the wrong guy.”

So begins his new documentary, Before the Flood. A quest for answers on climate change, the film sees Leo racing around the world, marvelling at the sound of endangered whales, despairing at the destruction caused by tar-sands – “it looks like Mordor” – and interviewing a series of concerned experts, from professors to Barack Obama to the Pope.

There are plenty of naysayers to stand in his way and put him down. “Who better to educate world leaders on made-up climate change and a crisis that doesn't exist, than an actor with zero years of scientific training?” mocks one commentator from Fox News.

But if DiCaprio can gather enough evidence to believe in himself – AND believe that there are viable solutions out there – then so can we. Or so the story arc promises. His journey thus stands as a guide for our own; a self-education that will lead to salvation for all. 

It's all a little messianic. The film is even named after a biblical painting. And will those who don't already know who DiCaprio is even care? 

The sad fact is that, while DiCaprio’s lasting popularity still owes so much Titanic, the 1997 box-office smash that made his name, his new documentary fails to recapture the dramatic wisdom that put him there. It doesn’t even quip about the icebergs.

This is an oversight. Titanic didn’t win 11 academy awards for nothing. As well as a must-see rite of passage (pun intended) and soundtrack for infinite school discos, it taught me something invaluable about storytelling. Though I was not initially a DiCaprio fan, over the years I’ve come to accept that my lasting love of the film is inseparable from my emotional investment in Leo, or at least in his character, Jack. What Titanic showed so brilliantly was that the fastest way to empathise with suffering on a vast scale – be it a sinking ship or a sinking planet – is to learn to care for the fate of one or two individuals involved.

Every part of Jack and Rose's story is thus intimately linked with the story of the ship. Even that famed sex scene gains its erotic force not from the characters alone, but from their race through the blazing engine room (situated as it is between the foreplay of the naked portrait and the famous post-coital ending in the back of the cab).

And such carefully crafted storytelling isn't only essential to great entertainment but to great activism too. It can literally inspire action – as evidenced by fans’ desperate attempts to prove that both Jack and Rose could have climbed to safety aboard the floating piece of wood.

So would Before the Flood have been better if it had been a little bit more like Titanic and less like An Inconvenient Truth? Yes. And does that mean we should make climate films about epic polar bear love stories instead? Not exactly. 

There are many powerful documentaries out there that make you emotionally invested in the lives of those experiencing the consequences of our indirect (fossil fuel-burning) actions. Take Virunga, a heart-wrenching insight into the struggle of those protecting eastern Congo’s national park.

Sadly, Before the Flood is not one of them. Its examples of climate change – from Beijing air pollution to coral reef destruction – are over-familiar and under-explored. Instead of interviewing a Chinese official with a graph on his iPad, I would have preferred visiting a solar-panel factory worker and meeting their family, who are perhaps suffering from the effects of the smog in a way I can't yet imagine.

If you want a whistlestop tour of all things climate change then this necessary and urgent film is the movie for you. But those hoping it will give new depth to climate activism will be disappointed.

DiCaprio's distant relationship with the effects of climate change leave him stranded at the level of a narrator. He makes for a great elderly Rose, but we need a Jack.

Before The Flood is in limited theatres from 21 October and will be shown on National Geographic on Sunday 30 October.

India Bourke is an environment writer and editorial assistant at the New Statesman.