> It really depends on where the tipping point is, country X might have a slight advantage but measures like this can widen the gap, then secondary factors like economies of scale kick in.
For most markets with behaviors like that you're already doomed, because the other country will figure it out and borrow some money so they can operate temporarily at a loss or convince the government to provide temporary subsidies until they achieve the economies of scale. More likely a marginal cost increase would only result in a marginal reduction in demand.
Notice also that this is the exact argument used against anything that increases costs on local businesses. France might have some candidate regulations nearer to the front of the line than the carbon tax if they were actually interested in taking that seriously.
> Most international agreements are (rightfully) trying to give developing countries a reprieve and let the developed ones shoulder must of the short term burden for the renewable transition.
But then it's doing what it's supposed to do. Why volunteer for a burden and then complain when it comes?
> But it's happening at the same time that we're reducing tariffs and developing countries get a double advantage while the working class in developed nations get a kick in the guts.
Which is why all the money should be going to a UBI.
> I'm all for both, but using a carbon tax to fund UBI would invert the incentive, governments would want companies polluting more to fund their welfare commitments. We see the same with high cigarette taxes, the government gets dependent on them for general revenue.
This is a generic anti-tax argument. If the government collected tax revenues from American tech companies, they would become dependent on the money and become unwilling to resist their privacy invasions, therefore they should subject all those companies to no taxes.
The thing about that argument in this case is that it only applies as long as the carbon tax exists, which will make it continue to exist, which is good. Moreover, the easiest way for the government to placate recipients and give them more money isn't to get people to burn more oil (which is pretty hard if you're taxing it heavily), it's to raise the carbon tax rate. Which is also good.
At some point people will actually stop burning oil and the UBI would have to be funded some other way if you want to keep it, but so what? Having that problem implies having solved the original one. And having a population that has seen the benefits of a UBI and wants to continue having it seems like a pretty good problem to have too.