Raising cattle causes negative externalities in the form of gas and manure produced by cows, which contains methane, a greenhouse gas that causes climate change. Suppose the government is developing a policy to counteract this externality. Which of the following is a policy that directly targets the externality?
1) Implementing a carbon tax on cattle farmers
2) Providing subsidies to cattle farmers
3) Promoting the consumption of beef
4) Encouraging the use of fossil fuels