Carbon leakage is bad, a trade war would be worse

Environmental Economics articulates the best argument I've heard for carbon tariffs:

The economics here are simple: If the U.S. prices carbon domestically (through Cap and Trade), then imports have to be priced accordingly, or the world price for similar products will be lower than the domestic price. The result will be more domestic purchases of foreign produced carbon intensive products and potentially leakage of U.S. industry to non-carbon pricing nations who potentially produce similar products with lower carbon efficiency than domestic manufacturers currently use. This has been the U.S.'s stance in international carbon negotiations all along and the primary reason the U.S. never signed onto Kyoto. Now, domestic carbon policy without border price adjustments puts domestic producers at a competitive disadvantage and will likely result in more imports of carbon intesive products and potentially higher carbon emissions globally.

All true... but it doesn't change that a global trade war would be disastrous. I continue to believe our best hope is the quaint idea that American "leadership" can inspire other countries to follow with their own climate change policies. The stick of carbon tariffs is too dangerous.