To use the most over used word in the global climate change discussions, the growing consensus regarding the contribution of greenhouse gases (GHG) from human activities is leading to many bold proposals, both in the relatively near term (2020) and the longer term (2050), to reduce dramatically these emissions. One push back is the economic growth consequences of these proposals.
Is there a way to achieve both economic growth and reduce GHG? By taxing the emission of GHG and at the same time lowering taxes that hamper economic growth, policymakers can shift the economy away from economic activities that emit GHG to economic activities that do not. Of course, those industries and stakeholders involved in high GHG emission activities will resist because the likely costs of a carbon tax would exceed the corresponding reduction in other taxes for them. But any major shift in our economy will result in resistance.
This idea is certainly not new among economists, but it does not seem to have gained the attention that it deserves. Perhaps it involves too many "bank shots" or policymakers do not normally think of tax policy as a means to both achieve simultaneously economic and environmental policy. In any event, it is worth further consideration.