I was randomly surfing the internet when I happened across this little gem 1. I read it and immediately thought of something that Mankiw 2 has been espousing for quite a few years, pigovian taxes 3. From the arm of my chair I commented on the article:
"One of the first, and definitely not the last example of a pigovian tax. Essentially, an attempt to offset the cost of goods that have negative externalities - with taxes. Unfortunately, this one was poorly marketed but that doesn't mean it's any less necessary."
The responses to which, as you can see on the page itself (link below), were quite negative and riddled with a mixture of political punditry. But what I can say for the responses is that it did get me thinking.
"Wether you pay the tax upfront when you buy the item, or you pay the tax afterwards through your provincial/property taxes when the local municipal dump is overflowing with toxic waste is somewhat less than relevant. The real cost of some of our purchases, is higher than the price tag we see on the shelf for many of these goods. Sure you're covering (maybe) some of the true economic cost of production, but what about disposal? It's not a socialist experiment. It's a reality that we all have to come to grips with. Especially in a day and age where environmentalism is fashionable for politicians. Just because the implementation (haha, marketing) was wrong doesn't mean that taxes like this are going to go away or stop coming. Actually, I think retailers are doing those who give a damn a favor by showing consumers which products have a cost beyond what they're paying. Perhaps it could even cause a reduction in toxic waste as consumers turn to substitutes in the face of increasing prices or even simple awareness. It's easy to focus on the underlying politics (Lib vs. Con vs. NDP vs. The World) and not the economics (econutics?). But it leaves one ignorant of the the big picture - you pay for it in the end either way wether it's hidden in your lump of provincial tax payments while you're unaware or it's in your face on the bill telling you which products create toxic waste."
I didn't realize the national post had such an intensely anti-liberal readership, even the article itself is a bit suggestive with Lisa MacLoed's statement as a conclusion. Is it that close to election time already? Note: I bought your book, Greg, and it really is the best economics book out there. A nice balance between Keynesian and Classical
