Benzinga - by Shanthi Rexaline, Benzinga Editor.
Tesla CEO Elon Musk‘s proposal for a “carbon tax” as a crucial measure against climate change faced criticism from short-seller Jim Chanos on Sunday.
Musk, in a post on Twitter (formerly known as X), asserted that a “carbon tax” is the sole action required to address climate change. This statement came in response to a video clip shared by a Tesla influencer, featuring Musk discussing actions needed to combat the climate crisis and expedite the transition away from fossil fuels.
The cost to society is not being paid, and the net result is the emission of 35 gigatons of carbon into the atmosphere, the Tesla CEO said. “We need to go from untaxed negative externality, which is effectively a carbon subsidy of enormous size — $5.3 trillion, according to the IMF, every year. We need to move away from this and have a carbon tax,” he said.
Chanos, who was known for his Tesla short positions, commented on Musk’s post. “The Subsidy King (and new darling of the Right) calls for a broad new tax,” he said.
The Subsidy King (and new darling of the Right) calls for a broad new tax. $TSLA https://t.co/wblHL0nW62— Diogenes (@WallStCynic) February 4, 2024
Chanos, recognized for his notable bets against Enron and Tesla, recently closed down his hedge fund Chanos & Co., originally founded as Kynikos Associates in 1985.
Why It Matters: Chanos’ reference to Musk as the “new darling of the Right” stems from Musk’s vocal criticisms of President Joe Biden‘s policies, particularly on Twitter, a platform owned by Musk.
Musk has recently been outspoken about illegal immigration, notably through border crossings.
A carbon tax, defined by the International Monetary Fund, is designed to “discourage the use of fossil fuels and encourage a shift to less-polluting fuels, thereby limiting the carbon dioxide (CO2) emissions that are by far the most prevalent greenhouse gas.”
Environmental and Economic Considerations: While Musk promotes Tesla’s electric vehicles and the company’s energy subsidiary as sustainable energy solutions, research indicates that the manufacturing of batteries used in electric vehicles and the electricity used for charging contribute to pollution, somewhat diminishing the green-energy appeal of EVs.
The iShares Global Clean Energy ETF (NASDAQ:ICLN) concluded Friday’s session down 1.89% at $13.98, according to data from Benzinga Pro.
Read Next: Elon Musk Says It’s ‘Crazy’ That Europe Subsidizes Pollution
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