> Their prices are completely made-up since we don’t have the technology to remove carbon

All prices are made-up. We pay in currency which lacks intrinsic value, and simultaneously multiplying or dividing all the numbers by ten wouldn't effectively change anything.

Moreover, we aren't really "pricing carbon" in the first place; we're placing a Pigouvian tax on polluting. It's not as if someone will pay (or be paid) to take the carbon off the producer's hands. In fact, as you highlight, there is no consumer who could do so.

Moreover, "technology to remove carbon" is completely irrelevant to setting the level. Determining the right level is the same kind of optimization problem as price discovery, but it's neither based on supply-and-demand for the carbon itself, nor on compensating anyone for dealing with the carbon. It's based on figuring out what keeps the economy going while moving the world towards net zero.

(Although we do have such "technology" — for example, the trees that people are planting to get these credits. The credit is paid for an action that demonstrably removes CO2 from the air, and is scaled according to the expected removal and how much would be charged for polluting that much.)

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tbrownaw 4 hours ago | parent [-]

> All prices are made-up.

Nope. Most prices are in large part dictated by market forces. Including the price of money.

	▲	zahlman 3 hours ago \| parent [-]
		> in large part dictated by market forces. Yes. As long as currency exists, that's making it up. Because there's no intrinsic reason for the notes to be worth what they are. Which is to say, market forces can drive a ratio like, say, (GDP / M2) according to current level of trust in government or the level of economic activity etc., but when we measure the numerator and denominator in "US dollars"[0], there's no intrinsic reason for that unit to be the size that it is. A simpler way to see this is to note that we could just as easily measure both in "US cents". Or in "Lincolns" (a unit equal to 5 USD)[0]. Or whatever, as long as we're consistent. We just don't. [0] I'm Canadian actually; this is an attempt to make the post more relatable to a larger number of HN readers.