Just as the World Bank put out a report on increased trade protectionism in the world, U.S. Energy Secretary Steven Chu came out in favor of using carbon tariffs as a “weapon” against countries that aren’t taking steps to reduce their carbon emissions and as a way to protect U.S. manufacturers.
He seemed not to notice that the day before China’s top climate change official Li Gao had warned that carbon tariffs imposed on developing countries would be a “disaster” and perhaps start a trade war.
Li had suggested too that maybe those rich countries that import goods from China might themselves pay for offsetting the emissions in their production.
We are at the low end of the production line for the global economy. We produce products and these products are consumed by other countries, especially the developed countries. This share of emissions should be taken by the consumers but not the producers.
Chu also doesn’t seem to remember that the European Union likes the idea of carbon tariffs against such countries as – gasp – the U.S.
Smoot and Hawley ain’t seen nothing yet if carbon tariffs play out.