On this day 51 years ago the idea of – gasp – putting a tax on something that was causing environmental damage (cuh-razy communist idea) was kicked around within the Nixon administration.
We know this thanks to a really great book called Behind the Curve, by Joshua Howe, which looks at the climate issue before it became famous (see review in Environmental Politics here [paywalled]).
“As early as 1970 the Nixon administration considered levying a tax on SO2 tied to energy production from coal.”
(Howe, 2014:148)
And the footnote has it – John C. Whitaker to Ken Cole, memorandum, Jan 6 1971 “Sulfur Dioxide Emissions Charge,” memo for John B. Connally [sic] Jr. secretary of treasury, Nov. 11 1971. The tax was never implemented, in part because the Office of Management and Budget showed that it would work too well, taxing SO2 emissions out of existence before the program could generate enough revenue to meet Nixon’s pro-business political goals. (Howe, 2014:244)
Why this matters – we are told that this is all impossible to do anything about – over-emphasised complexification, as part of the predatory delay. Of course, climate is a much bigger/wider issue than acid rain, and carbon (in the form of fossil fuels) is far harder to replace in the production chain than CFCs or sulfur. But the basic point – that you can put up taxes on things you are trying to discourage, as long as you think about/do something serious about the distributional effects on the poorest and most vulnerable – should be entirely uncontroversial. As we will see, this has not been the case.
What happened next?
It would be another 20 years before anything substantive got done about sulphur in the US, with the 1990 Clean Air Act. The question of whether emissions trading mattered, or whether technological developments independent of a price-on-sulphur has given academics, activists and policymakers something to write and talk about too.
Further reading
Bohr, J. (2016) The ‘climatism’ cartel: why climate change deniers oppose market-based mitigation policy. Environmental Politics, Vol. 25, 5. https://doi.org/10.1080/09644016.2016.1156106
Brigham Daniels, Andrew P. Follett, and Joshua Davis, The Making of the Clean Air Act, 71 HASTINGS L.J. 901 (2020). Available at: https://repository.uchastings.edu/hastings_law_journal/vol71/iss4/3
Gabriel Chan, Robert Stavins, Robert Stowe, and Richard Sweeney (2012) THE SO2 ALLOWANCE-TRADING SYSTEM AND THE CLEAN AIR ACT AMENDMENTS OF 1990: REFLECTIONS ON 20 YEARS OF POLICY INNOVATION. National Tax Journal, 65 (2), 419–452
Lohmann, L. 2006. Carry On Polluting: Comment and analysis in New Scientist. The Cornerhouse, 2 December.