"As Congress and the Administration begin to consider a variety of efforts that amount to little more than a thinly-veiled carbon tax, we must first recognize the potential consequences of a carbon tax scheme - both economically and environmentally - before resorting to such drastic measures," said Vitter. "It is no secret that Australia's controversial carbon tax isn't delivering the promised improvements. One obvious misstep in Australia was that there was no full cost-benefit analysis conducted before implementation. And as a result, electricity prices increased, unemployment rose significantly, and there hasn't even been any reduction in the level of domestically-produced CO2 emissions. We can add Australia as an example to the growing list of failed carbon policies that are becoming so abundant in Europe."
Vitter has been pushing the Administration to show their work on a potential carbon tax, but the Treasury Department has been wholly unresponsive. In January 2013, Vitter asked, for a second time, Treasury Secretary Timothy Geithner who has largely been non-responsive for answers to his department's involvement in developing a carbon tax. In the Administration's continued efforts to avoid transparency required under the Freedom of Information Act, Treasury has for more than a year now worked veraciously to avoid disclosing their work on a carbon tax.
The IER report shows Australia's carbon tax is more effective at reducing its national energy production and undermining the competitiveness of its exports than at addressing climate issues. It also charts higher electricity prices for the average Australian household, increased CO2 emissions, and the expected fiscal impact of the tax.
Click here to read IER's report, "Australia's Carbon Tax: An Economic Evaluation."