Elemental Cities

Cui bono? - Megan McArdle

I don't often agree with McArdle as she seems to take a more hardline capitalist approach to things, but she does make a good point here on the supposed low-carbon aspect of urban areas. While most urbanites tend to expend less carbon than those in the suburbs, that happens for the most part because urbanites export their carbon to other areas. Power stations, particularly coal-fired ones, are not built near cities, yet produce a great amount of carbon emissions.
Still, McArdle does mention how, despite the exporting effect, urban areas do maintain a lower carbon output than suburbs. And, more to the point, a carbon tax would encourage urban living as the power suburban homes draw, along with the attendant travel to and from those homes, would feel the effects of the tax the most. I'm a proponent of a carbon tax, as it would let the market to its thing with the least amount of government interference. If you'd like to make a moral issue out of it, you could say that a carbon tax is a sin tax much like the taxes on cigarettes and alcohol are. I'm not opposed to government interference with the economy, but when a nudge could do more than a shove, I think that is the better route to take.