B) protects US companies from international trade

Second, the history of U.S. tariff policy raises serious concerns that a carbon tariff would not be administered in a sound and impartial manner. Instead, these tariffs would simply be a vehicle for rote protectionism. A prime example of such protectionism is the steel tariffs imposed or maintained under the Bush II, Trump, and Biden administrations, which had political motivations far exceeding any economic ones. At the same time, U.S. trade remedies (antidumping and countervailing duties (AD/​CVDs)) law utilizes a process to calculate dumping or subsidization of imports that “injures” domestic industry but can be “remedied” by imposing duties (tariffs). Similar calculations are likely to be used for carbon intensity. However, AD/​CVDs law is notorious for being strongly biased against imports and American consumers. Even worse, in reality, the law is used as a way to deliver protectionist rents to a handful of well‐​connected companies (including, again, steel).

Indeed, some already propose that the CVD law—the remedy for U.S. industry alleged to be injured by unfairly subsidized imports—could be used to impose carbon tariffs and thus avoid the need for new legislation. Doing so, however, would subject carbon tariffs to the same problems—regulatory capture, rent‐​seeking, etc.—that already afflict U.S. trade remedies proceedings, and worse, invite abuse in similar proceedings determining carbon tariffs. For example, one major problem with AD/CVDs law is the discretion they give to the government when data is missing: if the Commerce Department deems information provided by a foreign company during an investigation to be unreliable or insufficient during an AD/CVD investigation, the agency will use various methodologies to fill it in, inevitably resulting in import duties that unreasonably favor the U.S. companies who lobbied for relief. If Commerce followed similar procedures for carbon intensity, similarly biased results are sure to emerge. In other words, the U.S. government could easily make foreign businesses look like they emit more carbon or GHGs than they truly emit, resulting in high tariffs on foreign products in the name of climate change that really serves to protect American businesses from competition.