FOUR WAYS OF LOOKING AT GLOBAL WARMING POLICY
July 2, 2008
Assume man-made global warming is a big problem, says Reason. What should we do about it?
The four general policies currently in play are (1) cap-and-trade; (2) carbon taxes; (3) encourage economic growth and allow richer future generations to deal with any problems; and (4) massive government-funded low carbon energy research.
These policies all involve the invention and deployment of new low-carbon energy technologies, says Reason:
- The first two proposals do it by raising the price of carbon-based energy relative to low-carbon energy technologies.
- The third one implicitly melds the two-century-long trend toward progressive decarbonization of our energy supplies with a strategy of adaptation.
- The fourth one aims to accelerate technological innovation by stimulating the research and engineering pipeline.
Cap-and-trade is a rent-seeking disaster, carbon taxes are a political pipe dream, and furthering economic growth and adaptation doesn't require any specific global warming policy, says Reason. After excluding those three proposals, that leaves us with low carbon energy research.
Michael Shellenberger and Ted Nordhaus, authors of "Break Through: From the Death of Environmentalism to the Politics of Possibility," want to dedicate the revenues from a modest carbon tax to funding their low carbon energy research scheme.
As an alternative, H. Sterling Burnett, a senior fellow with the National Center for Policy Analysis, has proposed a twofer -- would Shellenberger and Nordhaus support oil drilling on the outer continental shelves? Drilling could supply energy in the short to medium term while leasehold monies and royalties could be committed to low carbon energy research.
Which of the four policies is likely to be adopted? Given that both John McCain and Barack Obama favor cap-and-trade, get ready for an orgy of rent-seeking on Capitol Hill in 2009, says Reason.
Source: Ronald Bailey, "Four Ways of Looking at Global Warming Policy," Reason, July 1, 2008.
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