grantnw "It's fairly basic economics that increasing the price of something decreases demand." (this is the Garnault gambit I assume you're alluding to?)

really?

So how do you explain the housing market in Australia, cigarette smokers, petrol users, private schools, SUVs .. motor cars generally, airfares, public transport prices?

So merely increasing the price of something .. makes it go away, become unpopular, people will change their behavior?

How simplistic, no other factors?

..like choice? You can choose, to adapt .. like you can choose to adapt to the changing climate, unfortunately for us, we have a nanny state where the government has decided to hold the world's temperature where it is, from a room in Canberra .. folly.

Nothing put aside for adaption, everything on 17 Black, roll for the CO2 reduction to hold the temperature.

This is why economists should stay out of science, and don't get me started on human nature!

"If the author is convinced emissions have nothing to do with warming, "there is NO statistically significant relationship between the undoubted rising level of the atmospheric concentration of CO2 and the very slight observed rises in global or regional temperatures...", then he should put up his argument in a scientific journal for peer review instead of trying it on as an opinion piece here."

Luciferase, it is up to the proponents of the hypothesis that anthropogenic CO2 emissions cause dangerous global warming to prove their case. To date no one has tabled a scientific paper that contains compelling scientific evidence that proves that such emissions have caused measurable global warming.

Luciferase
Its for you to go back to your own reference and look at the material and follow up the bits and pieces they cite with an open mind. Clearly it isn't happening. Lets take China. There has been a report it may impose a carbon tax in 2012. This is a proposal in a country where, until recently, it was possible to operate illegial coal mines. If they ever did impose such a tax it would be simply seen as a way for officials to line their own pockets.
Note the entry for the US in the piece of agit-prop you cite. Even it admits there is widespread opposition to the tax.
India has imposed a token per-tonne tax on coal (called a carbon tax) to raise revenue for a green fund. So what?

None of that even begins to add-up to a global attack on carbon, nor is there any sign of those countries going any further. Yet activists still cite this half-baked nonsense as definite proof of a trend.

As for the price signals, you are the one who did not understand. Prepare for the big switch to gas. Google the term "fracking" (fracture cracking) and start reading. A carbon tax will not affect any of it. In this area, in particular, the activists have shown themselves to be entirely divorced from reality.

Now that's it. Leave it with you.

I am grateful for the 26 responses so far to my piece “The Sun God of the Carbon Tax”. Here are my responses to the first few, more later.
Taswegian: I agree with most of what you said (13th at 9.14 am) but not when you disregard the importance of cheap energy, which has been the necessary condition for all economic growth worldwide since 1750. Moreover there is no evidence that “oil is running out” – if it was there would be no need for the carbon dioxide tax! The latest BP Energy Statistics shows that proved oil reserves actually increased once again in 2010, such that even if not a single barrel is found ever again, these reserves would last until 2057 at the 2010 level of consumption.
Luciferase: That brings me to your comment on my verified statement "there is NO statistically significant relationship between the undoubted rising level of the atmospheric concentration of CO2 and the very slight observed rises in global or regional temperatures...", that I “should put up his argument in a scientific journal for peer review instead of trying it on as an opinion piece here”. I have done just that, but still await acceptance or rejection, the full version of the paper as presented at the Economic Society of Australia Conference at ANU last July is at my website www.timcurtin.com and also at the Conference site (www.ace2011.org.au).

Also I don’t think you are right when you say that taxing carbon as the energy base of our economy is a desirable tax reform, as it makes no sense at all. Coal mines and power stations already pay myriad taxes, including royalties (coal mines) and company tax (privatised power generators).
Services Economist: You said – “Establishing a price for carbon no matter how small creates an additional incentive for business investment aimed at lowering carbon emissions.”

There is nothing wrong with carbon dioxide emissions as they are a valuable addition to the rather limited atmospheric CO2 feedstock for the photosynthesis that is the essential sine qua non for all food production

Services Economist also said “The final point is that a carbon tax is an efficient tax. As it costs less to collect than many other taxes, it can replace less efficient taxes to net benefit for Australia.” Really? That remains to be seen. My prediction is that it will require an even larger army of collectors and inspectors than the ATO, read the legislation.

Curmudgeon said “In fact the tax only makes sense as a political move to keep the greens with the Gillard government. To suggest that it might actually be of use in reducing global emissions by anything other than trivial amounts is absurd”. Spot on!

BJelly at 12:14:48 PM said “The plus side to the carbon tax is that it will be used to make necessary changes for the national good, not go to ever inflating corporate salaries and dividends for a few.” Hardly – it does involve a shift in income distribution from the 10-20% of households who will not benefit from the changes to the tax and benefit system to the 80-90% who will, and also from the former to the armies of public servants and academics who will administer the total package, no wonder they are all salivating!

Luciferase again (13 September 2011 12:38) asks “Will Labor get wiped out as a consequence?” No, the implication of my article is that as the tax will be passed on to consumers who will almost all be more than compensated through the tax-benefit system, it will have minimal effects on voting intentions in 2013. If the tax was really meant to shift energy supply from coal to renewables, it would have to be at least $76 as I showed, and only then might voters get cross. That is why the tax is only $23 to start with.

sterndavidi, (13 September 2011 1:06 PM) said “I agree that a carbon tax of $23 likely won't have much effect in terms of reducing emissions in Australia. That's what my research shows too (http://econpapers.repec.org/paper/eenccepwp/1111.htm). But the Australian government is planning on two things:

1. Their renewable energy target and other complementary measures, which raises the real cost of climate policy but would reduce the remaining emissions that need to be cut.

2. That most of the reductions will be met by forestry schemes in Indonesia etc.”

I am not sure about the efficacy in practice of Stern’s (1), both economically and electorally. As the hidden subsidies of the renewable energy target (RET, eg roof panels) will probably raise energy prices more than the carbon dioxide tax does, and these increases are not included in the compensation package, they are more likely than the tax itself to generate voter backlash. The RET is unlikely to be achieved as coal stations have to be kept running and emitting to cover for the inability of the renewables to provide base load on windless days and sunfree nights.

As for his (2), the AusAid REDD schemes in Indonesia are inherently dishonest theory and wholly fraudulent in practice, as the whole of AusAid’s budget (and Norway’s) would not be enough to compensate Indonesian farmers and foresters for desisting from oil palm and forestry.