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Minnesota Introduces World's First Carbon Tariff
hollywoodb writes "The first carbon tax to reduce the greenhouse gases from imports comes not between two nations, but between two states. Minnesota has passed a measure to stop carbon at its border with North Dakota. To encourage the switch to clean, renewable energy, Minnesota plans to add a carbon fee of between $4 and $34 per ton of carbon dioxide emissions to the cost of coal-fired electricity, to begin in 2012 ... Minnesota has been generally pushing for cleaner power within its borders, but the utility companies that operate in MN have, over the past decades, sited a lot of coal power plants on the relatively cheap and open land of North Dakota, which is preparing a legal battle against Minnesota over the tariff."
Minnesota's attempt to do this dates back nearly 20 years, long before the current global-warming political debate, so interesting to see it finally passing. I believe the first bill was proposed in 1992, which would've imposed a $6 per ton tax; here's a 1994 report by a MN environmental group as well. Major attempts seemed to happen every 3-5 years.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
No state may regulate interstate commerce. One can find that written in the U.S. Constitution. The legislature in Minnesota needs an education in civics.
The reverends of Church of Climatology will now ADDRESS YOU!!!!!
Not having a "tax" on environmental damage causes everyone who is effected by damage to the environment to subsidize industry that damages the environment.
While it is hard to put a monetary value on environmental damage, its obviously not $0. If an industry is making money damaging the environment, that may be fine, but some of the money really should go to everyone living in the damaged environment.
Its also nice to see individual states take the lead in issues like this.
Morpheus, God of Dreams.
This will, of course, ultimately be passed on to the customers. Ultimately, this is a way to raise taxes to force a change in private industry. The government keeps the money, and we the people pay the taxes. It won't hurt the companies in this case because there is no choice in electricity providers. You can't switch electric companies like you can cell phone companies.
How, exactly, will this force "cleaner" electricity generation?
What will be done with the money from these tariffs? Will it only be used for environmental concerns, or will it just go into the general budget?
What's unconstitutional about it?
At the risk of getting flamed and shot down, I have to admit that I actually favor actions like this. Will it hold up in a legal sense? Like the Queen's ass, that remains to be seen. However, I have long though that those things which are blatantly harmful to human beings, and the planet in general, should have enough economic disincentives as to make them all but beyond the ability of anyone to procure. Oh, I think you should be free to buy whatever you wish, but I think that freedom should include the freedom to have to spend all of your money on the stupid, inefficient, and harmful things if you so desire them. I'm frankly tired of seeing the economic incentives of "cheap" and "profitable" driving harmful things. It's time the tables turned, in my opinion.
Randimal: AT-CG-CG-AT-CG-AT-AT-CG-CG-AT-AT-CG-AT-CG-CG-AT-CG-AT-AT-CG-AT-CG-CG-AT-AT-CG-CG-AT-CG-AT-AT-CG
Just the vibe of the thing...
Science advances one funeral at a time- Max Planck
To live in Minnesota!
Interstate trade is regulated by Congress, according to the constitution. Courts have held that all taxes on trade between states are an unconstitutional restraint on trade. The only exception is alcohol, which is granted an exception by the 21st amendment.
Those are all certainly good points but it's not nearly cut and dried unconstitutional as people are making it out to be. For example, I believe states can rightfully burden interstate commerce in the name of health and safety. Take an example from 1890 where states had different laws on the quality and inspection of meat that could be sold within their borders for human consumption. In the name of public safety, Minnesota was allowed to burden interstate commerce on foods not inspected within its borders after someone distributed rank meat acquired from Illinois and not certified by a Minnesota inspector.
Now, this requires Minnesota to prove that the coal generated electricity is a threat to health and or safety of its citizens. That's going to be hard to do. But as your other post pointed out, they've been going about this for quite sometime but I'm sure every year they feel closer to being able to prove this is legal on account of public safety.
My work here is dung.
This isn''t a tax on trade between states. It's a tax on carbon. It's perfectly neutral in theory -- no matter where your carbon-based energy comes from, it gets hit with the tax. Now, it's true that much of MN's coal-based energy comes from ND, so the law will impact imported power more than local power, but a luxury tax on high-priced wines is not unconstitutional because more wine is grown in California and imported to Minnesota rather than grown in Minnesota. This is no different. There's nothing unconsitutional going on here, it's a spurious argument being raised by people who oppose a carbon tax in principle.
"Convictions are more dangerous enemies of truth than lies."
This will not likely reduce carbon, what will likely happen is coal plants in other states to will increase capacity while the ones in Minnesota will likely shut down. This is the same thing that is happening with the US and China. Companies in the US can't afford to meet all the environmental regulations, so they move to China, and continue to pollute. The end result is the same amount of pollution, and increased unemployment in the state/city/country with the strict regulations.
Everything is defined as interstate commerce now, at least when the Feds want it to be. Allow me to cite two Supreme Court cases:
Gonzales v. Raich - A woman in California grew medical marijuana (legal in CA) and gave it away for free, solely within California. This was defined as interstate commerce in the decision.
US v. Stewart - Stewart personally designed and built his own homebrew machine guns, not for sale. After he was busted by the feds, he lost the case but won on appeal. The government appealed the case to the Supreme Court. It was remanded by the Supreme Court back to the appellate court for reconsideration "in light of" Raich. This means that the Supreme Court considers Stewart's actions to be interstate commerce too.
In conclusion, "interstate commerce" is now de facto defined as "anything the Federal government wants to regulate, even if there is no commercial or interstate aspect". Naturally, I imagine that this flexible definition is reserved for the Feds use only--no doubt states will have to continue to use the actual definition (ie. what the Constitution actually means).
Why do governments so often fail to consider the effects of disincentives? For example, when raising taxes, they calculate expected increases in revenue while underestimating changes in the behavior of the taxed. They always act surprised when the expected additional revenues don't materialize, or indeed revenues fall.
Perhaps it has something to do with most elected officials being lawyers and not businessmen, engineers, etc.
This will, of course, ultimately be passed on to the customers. Ultimately, this is a way to raise taxes to force a change in private industry. The government keeps the money, and we the people pay the taxes. It won't hurt the companies in this case because there is no choice in electricity providers. You can't switch electric companies like you can cell phone companies. How, exactly, will this force "cleaner" electricity generation? What will be done with the money from these tariffs? Will it only be used for environmental concerns, or will it just go into the general budget?
Minnesota has grown to be fourth in Wind Power generation. And if you look at time lapse growth they're really pushing that. The weird thing about it is that they're not even one of the prime wind resource states although I will testify that the wind gets ridiculous out there. Now, you probably already know this but Tim Pawlenty (Republican) is the governor of Minnesota and of course is going to try to get a bid for the presidential run in 2012. On his about page:
implementing a plan to Americanize our energy sources by generating 25% of the state's electricity from renewable sources by 2025
As a moderate Democrat, I was kind of afraid when he almost got a bid in 2008 ... because he's actually not that bad of a candidate. He doesn't talk like a moron and he's got his head in a lot of the right places. If he would cut the Christian God talk out of his speeches, I'd probably be on board. Sorry to get offtopic but I'm trying to say that this tariff would probably be a huge in road for him to moderates if he could pull it off. I'm certain he's not the prime motivator behind this but I would bet that they'd take the taxes from this and dump it into wind incentives. They're racing against Iowa in the wind department. California and Texas are too big and too prime locations to take on for Megawatt generation from wind power.
That is where I bet they would take this money: incentives to corporations for wind power.
My work here is dung.
-- what's next? A fat tax? If so, Minnesota might just tax itself into oblivion.
It's not specifically a tariff, because they charge all electricity sold in MN the same cost, whether generated in- or out-of-state. That makes it more of a sales tax, which is constitutional.
10 PRINT CHR$(205.5+RND(1)); : GOTO 10
The tax is a Tariff, which by definition, is a tax on imports. Minnesota can tax consumers directly for the carbon they use if they so choose, but they may not tax imports of coal into their state. They can tax the use of coal by utilities in their state, but not the importation of coal into their state. If indeed this is a tax on imports of anything (except alcoholic beverages) from North Dakota, then the courts would strike that down in a preliminary hearing.
This has nothing to do with your political leanings; it's pure constitutional law as I (I'm not a lawyer) understand it.
A quick grep of the constitution shows no references to vibes.
It's kind of funny the Scientific American article says "that this would unfairly discourage coal-powered electricity sales in favor of renewably powered electricity". I'd hardly call this unfair. More poignantly, I'd say that's the purpose of the bill, and if North Dakota is suing my state, it's because the bill will work.
Yes, this may marginally increase the cost of manufacturing some kinds of goods but the overall impact will largely affect the utilities.
You can't legislate goodness. Let each to his own destiny, by will of his freely made choices.
There are multiple interpretations of the Interstate Commerce Clause. By some interpretations, States do have limited rights to regulate commerce with other states. Also, there seem to be additional interpretations of the law for state-owned services (See the paragraph on "In United Haulers Assoc. v Oneida-Herkimer Solid Waste Management Authority (2007)".
See the following site a good summary of some of the debates.
http://www.law.umkc.edu/faculty/projects/ftrials/conlaw/statecommerce.htm
"The Commerce Clause is a grant of power to Congress, not an express limitation on the power of the states to regulate the economy. At least four possible interpretations of the Commerce Clause have been proposed. First, it has been suggested that the Clause gives Congress the exclusive power to regulate commerce. Under this interpretation, states are divested of all power to regulate interstate commerce. Second, it has been suggested that the Clause gives Congress and the states concurrent power to regulate commerce. Under this view, state regulation of commerce is invalid only when it is preempted by federal law. Third, it has been suggested that the Clause assumes that Congress and the states each have their own mutually exclusive zones of regulatory power. Under this interpretation, it becomes the job of the courts to determine whether one sovereign has invaded the exclusive regulatory zone of the other. Finally, it has been suggested that the Clause by its own force divests states of the power to regulate commerce in certain ways, but the states and Congress retain concurrent power to regulate commerce in many other ways. This fourth interpretation, a complicated hybrid of two others, turns out to be the approach taken by the Court in its decisions interpreting the Commerce Clause."
"Can of worms? The can is open... the worms are everywhere."
Except that it is a case of an interstate tariff. My prediction is that it will be overturned by the courts.
I'm sure it won't be, precisely because it's not an interstate tariff, no matter how badly the Dakotas wish it was. The motives may be ultimately the same as a protectionist tariff, but the action itself is perfectly normal case of taxation. You can't overturn a cheese tax just because a lot of cheese gets imported from Wisconsin, you can't overturn a wine tax just because a lot of wine comes from California, and they won't overturn a carbon-tax just because a lot of coal-generated electricity comes from the Dakotas.
"Convictions are more dangerous enemies of truth than lies."
because they are taxing people within their state, for consuming things within their state?
Wow, sent an e-mail as suggested when clicking on "use classic" banner, and got a fast response that addressed my msg
Well, that makes you a raving lunatic teabagger because anyone who questions the noble purpose of carbon reduction is obviously insane and/or mentally deficient. A pox on your "constitution".
I have mod points. The reign of terror begins now.
Article I Section 10 States can't create Tariffs.
Personally, this is my most hated part of the Constitution- it prevents economic experimentation and competition between the States.
SJW: a person who perceives an injustice, and while correcting it, commits a greater injustice.
So in 2012 someone might think about taxing CO2 emissions. Not cutting them, taxing them. Too late.
What we need is action now. Action like massive taxes on the construction of fossil fuel-powered power plants, so that the CO2 absorbtion systems (i.e. trees) can be ready at approximately the same time as new emissions start, and alternatives can be financed before new power plant starts emitting.
Vik :v)
This isn''t a tax on trade between states. It's a tax on carbon. It's perfectly neutral in theory -- no matter where your carbon-based energy comes from, it gets hit with the tax. Now, it's true that much of MN's coal-based energy comes from ND, so the law will impact imported power more than local power, but a luxury tax on high-priced wines is not unconstitutional because more wine is grown in California and imported to Minnesota rather than grown in Minnesota. This is no different. There's nothing unconsitutional going on here, it's a spurious argument being raised by people who oppose a carbon tax in principle.
Except that this isn't a tax on carbon, it is a tax on electricity based on how that electricity is generated. If that electricity is not generated in Minnesota, Minnesota is not constitutionally allowed to regulate how it is generated. Electricity generated using coal is indistinguishable from electricity generated by any other means.
Minnesota cannot legally tax carbon that is released in another state.
The truth is that all men having power ought to be mistrusted. James Madison
Article I Section 10 States can't create Tariffs.
Personally, this is my most hated part of the Constitution- it prevents economic experimentation and competition between the States.
I take it that you haven't read any early American history.
The tariff wars between New York and New Jersey were legendary, and were an explicit reason for this clause being put into the Constitution in the first place. For the few brief years after the Battle of Yorktown and before the U.S. Constitution was ratified, New York and New Jersey engaged in a trade war the likes of which have only been seen between England and France... perhaps even worse. Much of this centered on Manhattan and New York City, where goods in transit across the Hudson River were heavily regulated and there were bands of pirates/smugglers and other kinds of incredible headaches for all involved. Taxes of over 100% and even up to 1000% on some goods were imposed just to cross the Hudson River. It nearly started an all out war between those two states, where both armies and navies were being assembled for just that very purpose, and some shots were exchanged between uniformed military forces of both states.
There is a good reason why this clause was put into the Constitution in the first place, and a damn good reason why it should be respected and not tampered with for even a well meaning cause like "global warming".
Basically you can grow wheat, grind it up into meal, and then feed it to your chickens. All of this can happen and it never leaves your farm but it's still interstate commerce. (Don't ask me how this can possibly make sense since there's nothing being sold and nothing being transported between states.) I'm thinking the 2 you found probably referenced this one. http://en.wikipedia.org/wiki/Wickard_v._Filburn
Did you know 80 to 90% of the moderators on slashdot wouldn't recognize a troll even if one dragged them under a bridge.
I'll bet it will be overturned just like all those state cigarette taxes have been overturned.
--Jeremy
Jesus was a liberal