Free Markets, Free People
How to start a trade war in one easy step
Decide, as the EU has, to unilaterally impose a carbon tax on airlines and watch what happens:
China has warned the European Union to abandon its controversial carbon tax on airlines or risk provoking a global trade war. Adding weight to the warning, an industry insider told the Financial Times that the Chinese government was seriously considering measures to hit back at the EU if it insists on charging international airlines for their carbon emissions. –Simon Rabinovitch, Financial Times, 22 December 2011
The US has threatened to take retaliatory action against the European Union unless Brussels drops its plan imminently to start charging any airline flying into the bloc for its carbon pollution. In a sharp escalation of tensions over Brussels’ move to bring aviation into its emissions trading system from January 1, Hilary Clinton, US Secretary of State, has written to her European Commission counterpart, Catherine Ashton, and other top commissioners, to “strongly urge” the EU to halt or suspend its plan. –Pilita Clark and Andrew Parker, Financial Times, 20 December 2011
The Indian government has asked the country’s airlines to refrain from submitting carbon emissions data to the European Union (EU) for a new tax that will become applicable from 1 January for flights to Europe, hardening its stand further against the imposition of the levy. — Tarun Shukla, Live Mint, 18 December 2011
The EU is already in financial trouble and now it wants to compound that problem by something as silly as a carbon tax to support a very specious premise concerning global warming. It’s all about agenda politics and its timing couldn’t be worse given the financial crisis in the EU. This is either EU stupidity or simply bureaucratic inertia, but in either case, the stances taken by the US, China and India are not particularly “mild”. The attempt to impose the tax on January 1st could cause quite an uproar and a suspension of flights into the EU until the outcry makes them back off. And, of course, it won’t be the airlines who pay the tax, will it? It will be their customers.
The EU has more problems than it can handle now. Starting a trade war over a carbon tax would be the cherry on top of the “stupid” sundae. But then, for years and contrary to logic, they thought “other people’s money” would never run out, didn’t they?