"A Quiet Market Revolution Called the Environmental Tax in a City Drenched in Subsidies"

"A Quiet Market Revolution Called the Environmental Tax in a City Drenched in Subsidies" Criticism of subsidy policies is framed in the text as the question: "Who decides what the right answer for the future is?" At first glance, hybrid vehicles, solar power generation, and the Eco-Points system appear to be environmentally friendly policies. However, the author points out that as long as the government determines the eligible recipients and the amount of funding, bureaucratic judgment and political agendas are bound to creep in. Subsidies are a policy that says, “This technology is good, so we’ll make it cheaper.” Environmental taxes, on the other hand, take the opposite approach. They tax fuels and products with high environmental impacts, aiming to embed a pricing structure in society where “damaging the environment comes at a high cost.” If electricity and gasoline prices rise, people will naturally begin to choose energy-efficient appliances and fuel-efficient vehicles. Companies, too, will start investing in energy-saving technologies to create marketable products, rather than waiting for subsidies. In Japan today, subsidy programs for electric vehicles and solar power continue. The government meticulously determines which technologies to support and to what extent, thereby promoting the adoption of renewable energy and decarbonization. However, this inevitably involves selecting which technologies to favor. At times, “technologies that are easier to obtain subsidies for” gain an advantage over those that are truly needed in the market. Of course, subsidies serve a purpose. New technologies often have high initial costs and struggle to gain traction through market forces alone. However, the author believes that changing prices across the entire market is more effective at stimulating innovation among people and businesses than having the government select and support specific products. Subsidy policies are policies in which the government selects the “right products.” In contrast, environmental taxes are policies that provide society with a single rule: “actions that harm the environment come at a high cost.”