We didn’t set a price on lead emissions, we banned leaded gas and lead paint.
Carbon permits are a failed policy; they will make somebody rich, who will feed back 1% of the profits to politicians to maintain their privilege.
Personally, I advocate for a "carbon market" type system, where any company, is required to buy carbon credits equal to the amount of carbon they produce. You can't grandfather companies into a given amount of carbon credits, every carbon credit must be created by another entity capturing and storing carbon.
This carbon market should find the correct price for carbon, and create growth in the carbon offset industry. Some industries might decide the correct solution is reducing their emissions to zero, others might decide it's cheaper to just buy carbon credits.
The government also gets a useful knob to force market into carbon negative territory, by forcing companies to buy 1.1 carbon credits for every unit of carbon they emit.
And if we actually want to reverse some of the damage we have already caused, we need to go massively net-negative.
I'm not a fan of tax+spend either, which is why I support a carbon market solution.
But it doesn't follow that we need to e.g. reduce petrol consumption to zero.
Squeezing out that last one or two percent is going to be much harder than just moving on and looking for gains elsewhere.
The trouble is that we don't know the true cost of the externalities of carbon emissions until it's far to late.
If carbon leads to climate feed backs that ultimately lead to an extinction event on the scale of the End-Permian (which is a real possibility) then it's clear that the "price" of carbon, factoring in all it's externalities, should make using hydrocarbons so expernsive we never would have propped our civilization (and species) up with them.
If climate change and the other externalities of carbon emissions only mean the collapse of industrial civilization, we would find an equally prohibitive price.
I'm in agreement with GP that this is mostly a failed policy. Until we see carbon emissions drop fairly dramatically this will just be shuffling around money to different people while we watch the planet heat up.
When mass casualty events become common by 2030, political and financial elites will face angry crowds and death over this failed policy.
It's never too early to start doing the right hing.
You would have to bootstrap the system by inserting a large number of 'phantom offsets' into the market at the start. These fake offsets will be retired on a schedule or formula so that companies deciding to enter the carbon offset industry have a good idea about demand during their planning stages.
Whenever possible, the carbon market will encourage industries to produce less, it should always be the cheaper option. But reducing carbon emissions is harder in some industries, and the carbon market gives those industries an alternative option.
Also, it's impossible to reach net-zero emissions by just emitting less. Plus, the latest papers make it clear that we are far past the point were we can limit damage by simply going net-zero. We need to go massively net-negative.
If we want to go net-negative, we need a robust carbon offset industry, and a carbon market is one way of encouraging growth in that industry.
Besides, as far as the global environment is concerned, there is zero difference between not emitting CO2 and emitting CO2 in one place and sequestering it in another.
Put carbon in the soil or trees and it is just a fire away from being released again.
Crush olvine on the the beach and you will never know how much carbon was captured, if any.
If you compress it to 1500 psi and inject it underground you can measure it going in the same way you measured oil and gas coming out. That's real, but it is a lot more expensive. Nobody should be paying for any of the other things.
Then comes the political reality where one party will propose enough money for all that, then it gets wheedled down to half, then half of that goes to pork and then a half of the remainder is overhead, so consultants get that 1/8 to draw up an estimate and the budget's gone
Turns out: capital markets don't incentivse >>50y investments.
Because there was an alternative. There is no current good enough alternative to burning fuel. We want to motivate people to come up with some, and you do that with money.
Imagine if you could actually ban all fuel burning starting tomorrow - think about the results: Country wide blackouts (so no electric cars), no fuel, so no gas cars either.
All food deliveries stop, water pumps stop, and people die.
So, how sure are you that you want to ban CO2?