Acton Institute Powerblog

Big Oil Advocacy for Carbon Taxes

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Coal power plant Datteln 2 Crop1Today at The Federalist I explore “Why Big Oil Wants A Carbon Tax.” Perhaps such advocacy isn’t just made out of a sense of global citizenship and environmental stewardship.

On the surface such advocacy may seem counter-intuitive. Why on earth, other than out of selfless benevolence, would a firm (or group of firms) advocate for higher taxes on their products? But on reflection, it makes some sense, and the reasoning is similar to why an online retailer like Amazon might be in favor of the collection of sales tax at the state level.

As Adam Smith famously put it, “People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices.”

Companies are often happy to raise prices if it hurts their competition or provides them with a competitive advantage. And in the case of carbon taxes, it’s important to recognize that not all fossil fuels are equally carbon-intensive, just as not all renewable sources are equally sustainable and resilient.

This is one of the economic realities that I wish Pope Francis had recognized more clearly in Laudato Si’, although I may have more to say about this later. For now, David Brooks expresses a similar desire in his column, “Fracking and the Franciscans.”

Jordan J. Ballor Jordan J. Ballor (Dr. theol., University of Zurich; Ph.D., Calvin Theological Seminary) is a senior research fellow and director of publishing at the Acton Institute for the Study of Religion & Liberty. He is also a postdoctoral researcher in theology and economics at the VU University Amsterdam as part of the "What Good Markets Are Good For" project. He is author of Get Your Hands Dirty: Essays on Christian Social Thought (and Action) (Wipf & Stock, 2013), Covenant, Causality, and Law: A Study in the Theology of Wolfgang Musculus (Vandenhoeck & Ruprecht, 2012) and Ecumenical Babel: Confusing Economic Ideology and the Church's Social Witness (Christian's Library Press, 2010), as well as editor of numerous works, including Abraham Kuyper Collected Works in Public Theology. Jordan is also associate director of the Junius Institute for Digital Reformation Research at Calvin Theological Seminary.

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