Elon Musk says Biden administration called a carbon tax ‘too politically difficult’

Elon Musk says he has talked to the Biden administration about introducing a carbon tax to reduce emissions but that they deemed it “too politically difficult”. 

The billionaire made the comment last week on the Joe Rogan Experience podcast as they discussed how to tackle the climate crisis.

“My top recommendation, honestly, would be just add a carbon tax,” Musk told listeners. “The economy works great. Prices and money are just information. If the price is wrong, the economy doesn’t do the right thing.”

Rogan asked the Tesla CEO if the focus should be on specific industries which contribute to CO2 emissions.

Musk suggested that the tax be “at the point of consumption” for “electricity and gasoline”, adding there could be a tax rebate for low-income people. 

But he said that the idea gained little traction with the Biden team when he raised it. “I talked to the Biden Administration, incoming administration, and they were like ‘well, this seems too politically difficult,’” he said.  

He added: “I think the Biden administration should take a strong stance on the situation. It’s like at least half the reason they got elected.”

The Independent has contacted the White House for comment.

The general idea of a carbon tax is to levy a charge on the burning of coal, oil and natural gas which produce planet-heating emissions. 

The fossil fuel industry would likely pass the tax cost along to consumers, presumably giving a price advantage to energy that isn’t subject to the tax like renewables.

It could also benefit the electric vehicle market. Musk is the found of the electric vehicle company Tesla. 

Musk also told Rogan that he was against “demonizing” the oil and gas industry but warned that they should stop lobbying against a carbon tax.

“The smartest thing the oil and gas industry could do is to say let’s do a carbon tax,” he said.

The billionaire said that SpaceX, his rocket company aiming to take humans to Mars, would also be committed to paying a carbon tax.

While President Biden’s climate action plan includes a pledge to end subsidies for fossil fuels, it does not include a carbon tax.

However Treasury Secretary Janet Yellen indicated during questioning by the Senate Finance Committee last month that she supported a carbon pricing strategy, which could mean a tax or other financing mechanisms.

“We cannot solve the climate crisis without effective carbon pricing,” Secretary Yellen wrote. “The President supports an enforcement mechanism that requires polluters to bear the full cost of the carbon pollution they are emitting. 

“I am deeply engaged on this issue and, if confirmed, will continually discuss my views and thinking with the President and our entire team. President Biden has amassed a phenomenal team including some of the most informed thinkers on this issue. We are all committed to doing everything we can to solve this crisis.”

President Biden signed a number of executive orders to tackle the crisis on taking office last month and rejoined the Paris Agreement to reduce global emissions. 

Musk also told the podcast that the Paris Accord is “just a piece of paper unless you do something about it”.