Climate Panic: Economics, Ignorance and Mental Illness

Speaking at the One Young World conference in London on Wednesday, BP chief executive Bob Dudley said:

“unless you put a price on something, you can’t control how it’s consumed.” He then called for a “united effort to put a price on carbon. “One of the things we talk most about doesn’t have a price,” he said. “There’s got to be a united effort to put a price on carbon, so when you click a switch on the wall for electricity you’re going to pay a higher price.” “Getting a price on carbon,” he said, will “change the (emissions) situation more than ... four-year outlooks from politicians.” The outgoing BP boss noted that while emissions were stagnating in Europe and North America, other parts of the world were falling behind in addressing the climate crisis. “There are big coal-fired power plants opening in other parts of the world” he said “and that’s the epicenter of the problem.”

But carbon taxes are seriously harmful if applied only on a local basis. They handicap local industry by promoting the transfer of carbon-intensive industries to jurisdictions without a carbon tax.

The solution?

A countervailing import tariff on goods and services from jurisdictions without a carbon tax.

In Canada, where the re-elected Liberal Government plans the introduction of a carbon tax, the countervailing duty is absent, which is one reason that Canadian oil and gas companies are moving south of the Canada:US border — to avoid the million dollars in carbon tax on the diesel fuel consumed in drilling a gas or oil well.

The same incentive to off-shore or out-source to carbon-tax-free jurisdictions will undermine the Canadian steel, lumber, mining and manufacturing industries, which are precisely the industries where Canada has comparative advantage relative to her trading partners.

But apparently such simplistic logic is beyond the grasp of our rulers, let alone the majority of the public for whom Climate Panic seems more closely akin to neurotic illness than an environmental  problem requiring a rational solution (cf, E. Michael Jones: The Religion of Greta Thunberg).