Nearly half of France’s gross domestic product is already eaten up by taxation. You might think that that frog has already been boiled, yet this environmentally inspired carbon tax proves otherwise. It is the straw that broke the camel’s back.
Police deployed over 5,000 tear gas grenades and water cannons against the protesters, who donned yellow jackets for the second weekend in a row.
As a recently released report from the U.S. government demonstrates, climate change does not only have the capacity to destroy the planet in the long term but also to wreck our economy. It’s a pressing and significant issue that both the country and the world will have to grapple with before it becomes catastrophic.
But the scenes of France on fire are good reminders that attempts to drive down energy use or drive up its cost tend to suffer from a lack of consent from the governed.
The best economic argument for a carbon tax is that the market price of goods and services resulting in carbon emissions fail to include the true social and environmental costs of carbon emissions. Carbon taxes can result in significant deadweight losses, but a good politician would mostly lean on the economics of a carbon tax to sell it to the people.
Or you might argue, as French President Emmanuel Macron does, that one should prefer the taxation of fuel over the taxation of labor, even though the former is regressive and affects the poor more than the rich.
Macron’s messaging is a masterclass in how not to sell climate policy. Almost 80 percent of the French people now support the protesters, whereas only a quarter have a favorable opinion of Macron. As it turns out, there are limits to what the French will accept from their president, as there always are in a republic.
Whether a fuel tax is good or bad is still up for debate, but there’s no question that forcing it down the public’s throats while they are struggling economically is a losing strategy. Given the rapid rate at which carbon-reducing technology is advancing, a carbon tax may be more trouble than its worth.