In almost every case I will generally oppose new taxes and higher taxes. I generally oppose taxes for the purpose of initiating social change, such as “sin taxes” on cigarettes and booze.

But I am a member of the aforementioned Greg Mankiw’s “Pigou Club,” supporting higher gasoline taxes. And here is why:

I don’t know if global warming is real or not. I don’t know if it’s man-made or not. I am not a climate scientist and I lack the time and resources to understand the complexities of their conflicting research. I am an economist and an expert in insurance-risk issues.

I know that the chances of your house catching fire is relatively small, but everyone has homeowners insurance in case it actually does. You sacrifice a small portion of your income to protect against that rather calamitous outcome.

I think the same should be said for global warming issues. Even if it isn’t happening or isn’t man-made, the possible negative outcomes are so bad that we should at least sacrifice a little bit to take steps we feel reasonable certain will prevent them. No, I don’t think we should all give up our cars and live on the prairie. I said a little bit.

That being said, I think there sufficient external costs imposed by burning fossil fuels that we should begin to internalize some of those costs… AS LONG AS those costs go directly to abating the problem itself.

If you were to impose a carbon tax and use the money for some other purpose, it fails the test of a Pigouvian Tax. If you use the money as an insurance plan against future negative events associated with the burning of carbon-intensive fuels, I think it’s a fair trade-off.

Let the bashing begin. I am fully prepared.