From: tpalm@nada.kth.se (Thomas Palm)
Subject: Re: The Criterion for Ecocentrism
Organization: Royal Institute of Technology, Stockholm, Sweden
Date: Wed, 18 Nov 1992 09:35:20 GMT

In article <Yf2M8Nq00iV3888JQW@andrew.cmu.edu>, Stephen Sorensen <ss9o+@andrew.cmu.edu> writes:
|> In article <1992Nov17.163951.24163@kth.se>, tpalm@nada.kth.se (Thomas
|> Palm) writes:
|> 
|> > Unless you can define an owner to the air your grand market
|> >scheme fails miserably. The air is, whatever you claim, effectively collective
|> >property today, and whoever should suddenly claim to own it would
|> >get my vote for being the biggest thief ever.
|> 
|> There have already been assignment of atmospheric rights to a degree.
|> The US has recognized its use of Canada's air; Sweden and Germany are
|> trying to get Poland to stop using up their clean air. Certainly, it
|> would be absurd to take this assignment of rights all the way down to
|> the individual, but whay not at least to the country level ? Or in the
|> US to the state level.  

Unfortunately there is no good legal framwork for handling environmental 
conflicts between countries today. In principle countries should pay for the 
bad air they export, but there just isn't any way of enforcing it today :-(
The level at which pollution should be handled also depends a great deal on the
substance: CO2 is a global problem, and, if possible, should be handled globally,
while CO mostly is a health problem in cities, and thus can be handled locally.

|> 
|> >4. It thus seems natural to use pollution taxes. This would allow other taxes
|> >   to be reduced thus distributing the money among the population. As these 
|> >   taxes are often income related (in Sweden at least) it would reduce 
|> >   employment costs, thus hopefully increasing employment, more than
|> compensati
|> >ng 
|> >   for the lost jobs due to extra costs for the industry.
|> 
|> I don't understand how these taxes are levied and how they could
|> increase employment. If the government is still collecting the same
|> amount of revenue, then you have to show that the pollution tax is
|> somehow less distorting than current taxes. The only possibility for a
|> net gain is if the reduction in the external costs of pollution are
|> greater than the increase in prices due to the taxes on polluters. 

In some cases, such as CO2 from fossile fuels, it is easy to add a tax at the
producer/importer level. In other cases such as NOX, it is hard to measure the 
pollution directly, i.e. you can't put advanced analyzing equipment on every 
lawn mower.  Here you might have to settle for some average tax on the mower or 
on the fuel. I have not seen any scheme of reducing pollution that does not run
into similar problems; at least when it comes to taxes you might expect some 
government ingenuity in enforcment.

In general if you put a tax on something then it is put at a relative
disadvantage. Most societies wants high employment and low pollution.
Currently taxes on labor tends to favor automation and consumption
of goods rather than services, thus adding extra costs due to pollution and
unemployment.

  I would change your last statement to:
 The only possibility for a net gain is if the reduction in the external costs 
 of pollution and gains from lower labor cost are greater than the increase in 
              -------------------------------
 prices due to the taxes on polluters. 

If you remove taxes whose only justification are that the government needs the 
money, and replaces them with taxes on activities that cause damage to 
society, I would call it a reduction in distortion.

A serious question is if this can be done by an individual nation or if production
will then just move abroad. These environmental concerns ought to be discussed at
the GATT negotiations.

-- 
"Good planets are hard to find."    Thomas Palm
				     Department of Microwave Engineering
				     Royal Institute of Technology
				     S-100 44 Stockholm, Sweden
				     tpalm@mvt.kth.se
Newsgroups: sci.environment