Carbon taxes and the affordability of gasoline

Although new taxes can seem like a third rail in American politics, taxing carbon seems to be an approach that is slowly gaining ground in public discussions of ways to tackle global warming.

We recently explored what a carbon tax would mean for how U.S. consumers feel about the affordability of gasoline. It turns out that for over 90% of Americans, a $40 per ton carbon tax -- which translates to an extra 36 cents per gallon -- would still leave them a gasoline price range that they consider affordable.

Of course, consumers' views on the issue depend on their household incomes, with lower income households expressing a lower price threshold for "pain at the pump," so to speak.

Further details on these survey findings can be found in the article on "A carbon tax: how much would be too much?" at the University of Michigan Energy Survey website, where the full report is also posted.