3 ms·
Better for who?
by akie 8y ago
Better for who?
- AnimalMuppet 8y agoFor the economy as a whole, which means for most people. For those employed by the inefficient business that will no longer be subsidized, well, it may not be better for them, at least not in the short run.
- hannasanarion 8y agoOnly if you define "better" as having the lowest price. Free mariets don't magically remove the disconnect between individual interests and collective interests (tragedy of the commons). The economic optimum is not guaranteed to coincide with social, moral, qnd political optimums
- AnimalMuppet 8y agoWell, I don't define "better" as having the higher price. From the point of view of the economy as a whole, efficient is better than inefficient, because it can produce more outputs for the same inputs. This isn't just abstract - people can use those outputs. Tragedy of the commons is an issue, but subsidizing a coal mine doesn't seem much like a tragedy of the commons issue to me. It seems more like your last words: a "political optimum", that is, something that produced votes, because the mine owners and workers want the subsidies much more strongly than the taxpayers want to not have to pay. That may be politically optimum, but it's not morally, socially, or economically optimum.
- programmarchy 8y agoSo you disagree with solar energy subsidies, then? Nations have other motives than economic efficiency. The state should lead the market to meet national goals like clean energy infrastructure. Coal subsidies are a way to increase military strength, or at least they used to be. War needs steel needs coal. That may no longer be the case with more advanced ways of creating steel without coal.
- AnimalMuppet 8y agoI deny you the right to put words in my mouth. I also despise the "You said X, so you must support/oppose Y, then" argument schtick. In a parallel comment (https://news.ycombinator.com/item?id=18736465 https://news.ycombinator.com/item?id=18736465), I said that giving money to those unable to compete "seems almost certain to be wasteful". I chose those words very carefully. I was thinking about food security rather than steel for war, but I was very deliberately leaving an escape hatch that, yes, sometimes you actually do want the inefficiency for other reasons.
- programmarchy 8y agoTo overgeneralize that subsidies make the "economy as a whole... most people" less better off is to make a false statement. Market efficiency is too narrow a view to constitute coherent policy. In the face of an existential threat, it's inconsequential.
- AnimalMuppet 8y agoAnd how much of policy is determined by an existential threat? I would assert: not much. Food/agriculture, defense, energy, but not much else. And therefore as a generalization, yes, "subsidies make the economy as a whole, and most people, less well off" is in fact a reasonable statement.
- gaius 8y agoEnergy is strategic, you have to maintain an indigenous capability just in case you ever need it, same with steel production, shipbuilding, etc.