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Have economists led the world’s environmental policies astray?

66 points by pingou 5y ago

kkfx 5y ago
My own raw and personal opinion, after having read books from Green New Deal, Great Reset promoters like "Covid-19: The Great Reset", by Klaus Schwab (head of World Economic Forum) and Thierry Malleret or Value(s): Building a Better World for All by Mark Carney (former head of UK central bank) I read the "environmental policies" as nothing really environmental, by points: - the western world is in decline, mostly for self-inflicted damage, since the actual situation is irrecoverable, the game is lost, a new global war like WWI or WWII can't be done, then overturn the table creating a new society forcing others who still depend on western tech to follow is a way to "reset" the game; - to do so an excuse is needed and seen the actual climate changes and level of pollution it's easy to choose that as an excuse, a true fact, depicted as solvable in a way that do not really solve anything but sound credible to public eyes; - since the French Revolution the world instead of being led by classic aristocracy (witch means by who detain the military power) is led by economy so by economist. Why the green new deal is not green in the sense of spring grass green but more in the sense of dollar-green and stereotypical toxic waste spills from rusty barrels? Because all publicized today, from the ONU New Urban Agenda to the Green Deal itself is partially and marginally about the environment and much more about a Chinese-like society, smart cities, drone delivery of industrial ultra-processed food, no travels except for very few, only public transportation, ... just read the classic https://www.forbes.com/sites/worldeconomicforum/2016/11/10/shopping-i-cant-really-remember-what-that-is-or-how-differently-well-live-in-2030/ https://www.forbes.com/sites/worldeconomicforum/2016/11/10/s... and try to see what emerge. EVs? it's clear and clearly stated here and there that they can't be like actual cars, only few will get EVs like actual cars, most will get "glorified golf carts" [1] most others will live in "smart cities" designed like SK Goshiwon or JP Capsule Hotels, depending on public services because they'll can't afford the price of a "new" real car but "fun and be distracting enough" to keep those mass of population calm. Heat pumps? Ok, for new homes they are effective to reduce night/no/not-enough p.v. production time for heating a house or producing hot water, with p.v. productions they are needed mostly only to cool a home, without modern home + p.v. are just ways to consume less electricity at a significant price and peoples aren't much pushed for environmental reasons but for artificially skyrocketed prices by speculation of the same people who publicly sell the Green New Deal. To be clear: - politically I'm on the left side of the spectrum, the REAL left side - I'm an environmentalist concerned by actual climate change - I've built my new well-insulated home, with domestic p.v. - I do not own an e.v. simply because it's not green at all, and economically it's still more expensive than modern EU diesel, in the future when diesel here will be a 4 euros per liter than will be cheap and I hope it can be integrated in the house micro-grid so I'll buy an e.v. Just remember a thing: economist like those who drive our countries these days are the new generation of the same who have laid the foundations of devastating II half of 1800 wars and WWI and WWII. How "environmentally concerned" they can be? [1] https://www.vice.com/en/article/y3vny5/glorified-electric-golf-carts-for-all https://www.vice.com/en/article/y3vny5/glorified-electric-go... https://www.motorious.com/articles/features-3/uk-eliminating-car-ownership/ https://www.motorious.com/articles/features-3/uk-eliminating... various trends toward cars-as-a-service, leasing etc
mistrial9 5y ago
paywall "Already have an account? Log in" short answer is "yes"
- wing-_-nuts 5y ago
  I just disable javascript via ublock whenever I hit that sort of thing. 90% of the time things are hidden client side and that stops it. The other 10% I have to decide if i really want to go find an archive link to use.
  - deleted 5y ago
    [deleted]
vsareto 5y ago
https://archive.ph/1HeyE https://archive.ph/1HeyE
Biologist123 5y ago
As a counter argument to the piece in the Economist, this article by Steve Keen (University College London professor) explains the gross errors made by economists in their modeling of climate damages, how those errors arose and their implications. TL;DR: Nobel prize-winning economist, William Nordhaus, willfully or negligently underestimated climate damages. https://www.tandfonline.com/doi/full/10.1080/14747731.2020.1807856 https://www.tandfonline.com/doi/full/10.1080/14747731.2020.1...
- AtlasBarfed 5y ago
  Oh very nice. I rant to an annoying degree (sorry everyone) about the fundamental pro-business cultural bias of economics-the-profession, and how this has failed the human race to a frightening degree. Considering economics-the-profession is usually the first source of academic approval/opinion on government policy (because science sure as shit isn't. What makes it most annoying is that "externalities" is largely a bolt-on. And even worse, Economics-the-culture is averse to things they can't measure in some way (even though I'd say their measurements of EVERYTHING they do rely is is pretty bad). How does Economics price the "externality" of global warming? The lost value of displaced and dead people, maybe a broad stroke. Extinct species and habitat loss? How does one nihilistically price if we head outside of phytoplankton's ability to create oxygen? At best, a vast underestimate, especially given the pro-business bias. To me the shining failure of modern economics environmentally is the inability to enact a carbon tax in the last 30 years, a very basic and effective mechanism. Instead, easily arbitraged and gamed carbon markets. Secondarily, what is the economic value of any wetland or natural habitat? Vague tourism at best. The best economic use of a habitat is to drain it and pave it. Economics cannot measure how diversity of the species web is critical to our long term survival, because it can't even see one month into the future.
  - Biologist123 5y ago
    It is impossible to price fossil fuel externalities. A point made by Steve Keen elsewhere.
    - 5y ago
Veedrac 5y ago
> The authors are not kind to economists, who typically want to put a price on emissions and then let markets do the work. Economists have, the authors allege, skipped a chapter in the textbooks. They have focused on externalities, the damage done to society when carbon is emitted. But they do not think about the elasticity of demand—the extent to which prices change behaviour. This completely misunderstands the point of setting a tax precisely at the rate of the externality. If a good is taxed at its true, global, long-term rate of externality, then the externality, the damage being done, is precisely being paid for. There is now no longer a net externality. If the tax means demand switches to a product without that externality, then good, problem solved, and if instead people still prefer that good to the alternatives, then they can just go ahead and pay for that good plus the tax that pays for the externality. If this isn't good enough for you then probably the problem is you think the price is being estimated wrong, in which case you shouldn't be complaining about there being a tax, you should complain that the rate it is set at is incorrect. I also think the inelasticity of demand claim is mostly bogus; it's inelastic on short timescales but there is plenty of momentum to switch to electric cars and renewable energy even at undiscounted price points. Electricity generation in particular is extremely price sensitive; it's just that with cost trends that cover literal orders of magnitude the crossover point was always going to seem like a sudden event.
- usednet 5y ago
  I agree, and I think that what you said about the rate being incorrect is right. Pigovian taxes are great in models but extraordinarily difficult to implement. Measuring externalities, especially of something like carbon production, is a monumental task that economists in my opinion have been failing at. Another commenter linked a great analysis on how economists are drastically underestimating the economic effect of climate change (assuming 90% of GDP won’t be affected because its indoors!). On the second point I somewhat disagree. The current inelasticity of demand is extremely important as climate change will become uncontrollable at longer timeframes. The current trend is not enough and not fast enough. I agree with the authors that Pigovian subsidies for renewables worldwide are necessary as soon as possible.
  - 5y ago
wing-_-nuts 5y ago
I think the best way to kill carbon emissions are with a revenue neutral 'vat' style tax. Give the money you took for co2 back on the income tax, and people will spend it decarbonizing in an attempt to dodge the tax. Having said that, I have zero faith that we will ever do anything substantial to stop climate change while the billionaire class funds grover norquist style hit men to terrify conservatives at the mere mention of the T-word.
- wonderwonder 5y ago
  I dont think anyone is going to go for a new tax especially if it hits the middle class and poor. Even if one political administration implemented it, the next would revoke it. Carbon neutral technologies just need to be able to compete on price and appeal. Tesla has proven its possible in transportation and other car companies are following suit. Need a couple of high profile competitive examples in other industries, especially power. They also need really good lobbyists.
  - wing-_-nuts 5y ago
    The problem is that carbon intensive technologies do not pay for the damage they're doing to the environment. The tax I suggested was revenue neutral, which means the average poor person would get back as much in income taxes on their paycheck as they paid in carbon taxes. Technically, this doesn't 'hit' anyone and it benefits those willing to change. I think you're right though that this is politically infeasible simply due to short-sightedness and cowardice.
    - jeromegv 5y ago
      Ontario has the carbon tax setup. 90% is revenue neutral. You get a standard amount on your tax return every year, if you happened to pollute little (not spending much on gaz) then you're net positive. If you're average, you get back what you spent. If you're a big polluter, then you spent more on tax than what you got back. Issue is that most people don't understand those taxes. I tried to explain to a few friend that the increased in gas cost was offset by the carbon tax return, but they just don't understand it. They see the gas being more expensive as "bad" and they think they lost money. They don't understand likely because they don't do their own tax return.
slibhb 5y ago
> The authors argue that getting people to make the big leaps needed to decarbonise, such as buying an electric car or installing a domestic heat pump, instead requires “extreme positive incentives for change” (epics). Seems like a recipe to lose elections.
- sofixa 5y ago
  By saying there will be a government programme funding/giving a tax credit/interest free loan/whatever other incentive to retrofit your house with more efficient heating or better insulate it or upgrade to a more efficient vehicle? I really think it's the opposite, those kinds of things are popular with voters.
  - slibhb 5y ago
    Maybe you're right but I think Republicans would have a field day with the term "extreme positive incentives for change".
    - colinmhayes 5y ago
      Politicians wouldn't use that term.
- cinntaile 5y ago
  Positive incentives are when you receive money as opposed to negative incentives such as fines where you have to pay money. So this is unlikely to cause a political party to lose elections, people like to receive money.
- AtlasBarfed 5y ago
  Taxes and regulations are the recipe to lose elections, too easily used to swing "undecided" voters. Incentives are giveaways, which even the most devout Big-R voters will jump on, because money is money.
- hardtke 5y ago
  There are microeconomic concepts I learned in college that make decarbonization nearly impossible. First the FREE RIDER principle. Since CO2 (and methane) affects temperature globally, every nation (and individual) is incentivized to free ride off the decarbonization expenses of others. Second, the PRISONER'S DILEMMA. Most political systems have two main parties competing for power. Although both parties broadly agree that climate change is bad, policies that kick the can down the road are electorally advantageous (less taxes now always beats a better future). Thus the NASH EQUILIBRIUM is for political parties to always promise to undo any costly changes the other party is proposing.
zwieback 5y ago
Any article that uses Norway as a positive example needs to also mention that that country is a large exporter of oil. How much of the incentives of e-cars come from oil profit?
- breakyerself 5y ago
  Isn't using oil profits to fund a transition to renewable the ideal use for those funds?
  - zwieback 5y ago
    Not the worst use, for sure, but instead of incrementally improving the climate situation Norway is making it worse until suddenly much better, when everything is converted.
    - thoughtstheseus 5y ago
      No. Norway is taking an existing economic function with huge negative externalities and using its profits to move toward a sustainable future. Profits that otherwise would not be spent in such a manner. They’re far faster and move with more precision on this topic than nearly every other major O&G producing country.
  - usrusr 5y ago
    Norway actively took a bet that long term, oil lying under their shelf might not appreciate in value quite as much as most would expect and opted for faster extraction than others. They might have had a certain hunch that scarcity might not be the only possible end game for oil?
deleted 5y ago
[deleted]
nonrandomstring 5y ago
Lots of talk about taxing this or repaying that but in Meadows's taxonomy of leverage points these amount to changes between level 10 and 7. What the article is kinda saying is that these "extreme positive incentives for change" (EPICs) that are labelled political/structural instruments lie outside monetary economics and so hint towards level 5 and 4 changes, to system rules and to self-organisational motives. I still don't get, if so, how? And if so, why not apply both? But ultimately changing system goals away from consumerism might be the gift everyone wants. I know many bored people who want to feel like they're part of big change, what Alexis De Tocqueville called "restive fervour" in early America - in British parlance being "up for it". If economists exacerbate climate problems it is by the tepidity of their vision. I think we have forgotten as a society truly grand ambition. The Panama canal. The Hoover Dam. The dykes of Nederlands. US post-war Apollo Project. The Channel Tunnel. Imagine human action at scale, not as ungrateful entitled protest, but coordinated and purposeful action in the face of climate change. What would that look like? If we can't even imagine it then we're truly lost. In the shadow of the pandemic and Russo-Ukraine war I think we'll have an opportunity, and to avoid unrest maybe a necessity, for bold, crazy-ass projects whose ROI can just be written off to posterity - what William James called the "Moral Equivalent of War", not as mere National Service, but as Global Service. Literally pay people salaries to fight climate change. Of course that would require a strategy backed up by good science. But realising that monetary economics and "markets" isn't the only way out would be a good step. The Economist article hints and plays with that, and then backs off.
- mattcwilson 5y ago
  > what William James called the "Moral Equivalent of War", not as mere National Service, but as Global Service. Literally pay people salaries to fight climate change. I see what you’re going for with this, and I imagine I could be persuaded to a more workable version of this. What’s hanging me up is - how do you avoid these salaried people being captured by incentives to sustain their salary rather than be incentivized to ultimately solve the problem? We’ve tried this with the war on drugs, war on terror, war on homelessness... haven’t we? Is your suggestion different somehow?
  - 5y ago
gtvwill 5y ago
Articles paywalled. But the irony of an economist trying to explain why they aren't wrong using the failed quasi science that is economics is lulzy as hell. Economics isn't a science it's a collection of hypotheticals which rarely maintains consistency in results. To place such weight on these hypotheticals as we do, well we reap what we sow as they say.
- colinmhayes 5y ago
  This is just a strawman. No one is claiming economics is a science with ground truth. That being said, people on the aggregate do generally act rationally, and they absolutely respond to incentives, which is pretty much all you need for economics to be useful.
  - gtvwill 5y ago
    Actually mate they try pass economics of as a science so regularly they use it to influence policy. Which if the title of this article is correct. It's been part of the reason our environmental policiea globally have been so woeful ("you can't do that you'll ruin the economy"). It's the case here in aus and most of the western world, your telling yourself porky pies if you think it's not happening. Economics places be all and end all weight on growth and dollars. When for the most of us that results in detrimental outcomes. For example as I write this I'm currently in a motel because my house is flooded out by a 1 in 100 year flood, the 2nd time this month....
    - colinmhayes 5y ago
      > Actually mate they try pass economics of as a science so regularly they use it to influence policy. I don't see how economics influencing policy means people think econ is a physical science. What I do know is that "you can't do that you'll ruin the economy" is not something economists ever say. That's something politicians say. Economists widely support policy that may have negative short term effects in order to achieve long term gains, but these policies aren't politically viable, so they are ignored. The idea that climate change is in some way caused by economics is misguided. Climate change is caused by human nature. People are extremely unwilling to make sacrifices when they aren't sure they'll see the results. That's why our environmental policies have been so woeful, not because economists object.
ohNoz3 5y ago
alephnan 5y ago
How well respected is The Economist when it comes to covering the global economy truthfully ? I’ve noticed there is a growing anti China sentiment from The Economist in recent years.
- jker 5y ago
  And The Guardian has growing anti-American sentiment. Yet they both publish excellent reporting.
geysersam 5y ago
What is most fair? Every person on the planets gets the same portion of the remaining global carbon budget. Or, it is divided proportional to current wealth. A carbon tax is the latter.
wolverine876 5y ago
> And that is without counting the returns on the investment. British officials reckon that three-quarters of the total cost of the transition to net zero will be offset by benefits such as more efficient transport, and that the state may need to spend only 0.4% of gdp a year over three decades. That also omits by far the largest return on investment, which is frequently omitted: Preventing the costs of climate change. People who criticize actions to prevent climate change often talk about the economic impact of those actions. The economic impact of not preventing climate change - in addition to the impact on human life - is usually far greater. The question is not, 'how much does this change cost?', but 'what are the outcomes of our various options?'.
- s1artibartfast 5y ago
  >People who criticize actions to prevent climate change often talk about the economic impact of those actions. The economic impact of not preventing climate change - in addition to the impact on human life - is usually far greater. I think public discourse avoids this topic because the benefits and costs of climate policy are not uniform. There are there are nations, groups, and individuals for which climate policy is a simply negative. Talking about net benefit risks bringing up this topic, which is largely unsolved. proactive climate policy has clear winners and losers. While net zero carbon may be relatively cheap and have net benefit for Brittan, for some poor developing countries, avoiding cheap carbon energy means more people in poverty with all the downsides that come along with that.
  - wolverine876 5y ago
    > There are there are nations, groups, and individuals for which climate policy is a simply negative. Talking about net benefit risks bringing up this topic, which is largely unsolved. proactive climate policy has clear winners and losers. What basis do you have for these claims? If FUD is the basis for stopping us, we should never do anything; we never operate in certainty, and we never operate in a situation where people can't create FUD. Climate change is possibly the most studied issue in the history of the world; we don't need to know more. How much longer will you try to delay action?
tmitchel2 5y ago
Donut economics book by Kate Raworth - I read this recently and would highly recommend it.

66 points by pingou 5y ago

kkfx 5y ago

My own raw and personal opinion, after having read books from Green New Deal, Great Reset promoters like "Covid-19: The Great Reset", by Klaus Schwab (head of World Economic Forum) and Thierry Malleret or Value(s): Building a Better World for All by Mark Carney (former head of UK central bank) I read the "environmental policies" as nothing really environmental, by points: - the western world is in decline, mostly for self-inflicted damage, since the actual situation is irrecoverable, the game is lost, a new global war like WWI or WWII can't be done, then overturn the table creating a new society forcing others who still depend on western tech to follow is a way to "reset" the game; - to do so an excuse is needed and seen the actual climate changes and level of pollution it's easy to choose that as an excuse, a true fact, depicted as solvable in a way that do not really solve anything but sound credible to public eyes; - since the French Revolution the world instead of being led by classic aristocracy (witch means by who detain the military power) is led by economy so by economist. Why the green new deal is not green in the sense of spring grass green but more in the sense of dollar-green and stereotypical toxic waste spills from rusty barrels? Because all publicized today, from the ONU New Urban Agenda to the Green Deal itself is partially and marginally about the environment and much more about a Chinese-like society, smart cities, drone delivery of industrial ultra-processed food, no travels except for very few, only public transportation, ... just read the classic https://www.forbes.com/sites/worldeconomicforum/2016/11/10/shopping-i-cant-really-remember-what-that-is-or-how-differently-well-live-in-2030/ https://www.forbes.com/sites/worldeconomicforum/2016/11/10/s... and try to see what emerge. EVs? it's clear and clearly stated here and there that they can't be like actual cars, only few will get EVs like actual cars, most will get "glorified golf carts" [1] most others will live in "smart cities" designed like SK Goshiwon or JP Capsule Hotels, depending on public services because they'll can't afford the price of a "new" real car but "fun and be distracting enough" to keep those mass of population calm. Heat pumps? Ok, for new homes they are effective to reduce night/no/not-enough p.v. production time for heating a house or producing hot water, with p.v. productions they are needed mostly only to cool a home, without modern home + p.v. are just ways to consume less electricity at a significant price and peoples aren't much pushed for environmental reasons but for artificially skyrocketed prices by speculation of the same people who publicly sell the Green New Deal. To be clear: - politically I'm on the left side of the spectrum, the REAL left side - I'm an environmentalist concerned by actual climate change - I've built my new well-insulated home, with domestic p.v. - I do not own an e.v. simply because it's not green at all, and economically it's still more expensive than modern EU diesel, in the future when diesel here will be a 4 euros per liter than will be cheap and I hope it can be integrated in the house micro-grid so I'll buy an e.v. Just remember a thing: economist like those who drive our countries these days are the new generation of the same who have laid the foundations of devastating II half of 1800 wars and WWI and WWII. How "environmentally concerned" they can be? [1] https://www.vice.com/en/article/y3vny5/glorified-electric-golf-carts-for-all https://www.vice.com/en/article/y3vny5/glorified-electric-go... https://www.motorious.com/articles/features-3/uk-eliminating-car-ownership/ https://www.motorious.com/articles/features-3/uk-eliminating... various trends toward cars-as-a-service, leasing etc

mistrial9 5y ago

paywall "Already have an account? Log in" short answer is "yes"

wing-_-nuts 5y ago
I just disable javascript via ublock whenever I hit that sort of thing. 90% of the time things are hidden client side and that stops it. The other 10% I have to decide if i really want to go find an archive link to use.
- deleted 5y ago
  [deleted]

vsareto 5y ago

https://archive.ph/1HeyE https://archive.ph/1HeyE

Biologist123 5y ago

As a counter argument to the piece in the Economist, this article by Steve Keen (University College London professor) explains the gross errors made by economists in their modeling of climate damages, how those errors arose and their implications. TL;DR: Nobel prize-winning economist, William Nordhaus, willfully or negligently underestimated climate damages. https://www.tandfonline.com/doi/full/10.1080/14747731.2020.1807856 https://www.tandfonline.com/doi/full/10.1080/14747731.2020.1...

AtlasBarfed 5y ago
Oh very nice. I rant to an annoying degree (sorry everyone) about the fundamental pro-business cultural bias of economics-the-profession, and how this has failed the human race to a frightening degree. Considering economics-the-profession is usually the first source of academic approval/opinion on government policy (because science sure as shit isn't. What makes it most annoying is that "externalities" is largely a bolt-on. And even worse, Economics-the-culture is averse to things they can't measure in some way (even though I'd say their measurements of EVERYTHING they do rely is is pretty bad). How does Economics price the "externality" of global warming? The lost value of displaced and dead people, maybe a broad stroke. Extinct species and habitat loss? How does one nihilistically price if we head outside of phytoplankton's ability to create oxygen? At best, a vast underestimate, especially given the pro-business bias. To me the shining failure of modern economics environmentally is the inability to enact a carbon tax in the last 30 years, a very basic and effective mechanism. Instead, easily arbitraged and gamed carbon markets. Secondarily, what is the economic value of any wetland or natural habitat? Vague tourism at best. The best economic use of a habitat is to drain it and pave it. Economics cannot measure how diversity of the species web is critical to our long term survival, because it can't even see one month into the future.
- Biologist123 5y ago
  It is impossible to price fossil fuel externalities. A point made by Steve Keen elsewhere.
  - 5y ago

Veedrac 5y ago

> The authors are not kind to economists, who typically want to put a price on emissions and then let markets do the work. Economists have, the authors allege, skipped a chapter in the textbooks. They have focused on externalities, the damage done to society when carbon is emitted. But they do not think about the elasticity of demand—the extent to which prices change behaviour. This completely misunderstands the point of setting a tax precisely at the rate of the externality. If a good is taxed at its true, global, long-term rate of externality, then the externality, the damage being done, is precisely being paid for. There is now no longer a net externality. If the tax means demand switches to a product without that externality, then good, problem solved, and if instead people still prefer that good to the alternatives, then they can just go ahead and pay for that good plus the tax that pays for the externality. If this isn't good enough for you then probably the problem is you think the price is being estimated wrong, in which case you shouldn't be complaining about there being a tax, you should complain that the rate it is set at is incorrect. I also think the inelasticity of demand claim is mostly bogus; it's inelastic on short timescales but there is plenty of momentum to switch to electric cars and renewable energy even at undiscounted price points. Electricity generation in particular is extremely price sensitive; it's just that with cost trends that cover literal orders of magnitude the crossover point was always going to seem like a sudden event.

usednet 5y ago
I agree, and I think that what you said about the rate being incorrect is right. Pigovian taxes are great in models but extraordinarily difficult to implement. Measuring externalities, especially of something like carbon production, is a monumental task that economists in my opinion have been failing at. Another commenter linked a great analysis on how economists are drastically underestimating the economic effect of climate change (assuming 90% of GDP won’t be affected because its indoors!). On the second point I somewhat disagree. The current inelasticity of demand is extremely important as climate change will become uncontrollable at longer timeframes. The current trend is not enough and not fast enough. I agree with the authors that Pigovian subsidies for renewables worldwide are necessary as soon as possible.
- 5y ago

wing-_-nuts 5y ago

I think the best way to kill carbon emissions are with a revenue neutral 'vat' style tax. Give the money you took for co2 back on the income tax, and people will spend it decarbonizing in an attempt to dodge the tax. Having said that, I have zero faith that we will ever do anything substantial to stop climate change while the billionaire class funds grover norquist style hit men to terrify conservatives at the mere mention of the T-word.

wonderwonder 5y ago
I dont think anyone is going to go for a new tax especially if it hits the middle class and poor. Even if one political administration implemented it, the next would revoke it. Carbon neutral technologies just need to be able to compete on price and appeal. Tesla has proven its possible in transportation and other car companies are following suit. Need a couple of high profile competitive examples in other industries, especially power. They also need really good lobbyists.
- wing-_-nuts 5y ago
  The problem is that carbon intensive technologies do not pay for the damage they're doing to the environment. The tax I suggested was revenue neutral, which means the average poor person would get back as much in income taxes on their paycheck as they paid in carbon taxes. Technically, this doesn't 'hit' anyone and it benefits those willing to change. I think you're right though that this is politically infeasible simply due to short-sightedness and cowardice.
  - jeromegv 5y ago
    Ontario has the carbon tax setup. 90% is revenue neutral. You get a standard amount on your tax return every year, if you happened to pollute little (not spending much on gaz) then you're net positive. If you're average, you get back what you spent. If you're a big polluter, then you spent more on tax than what you got back. Issue is that most people don't understand those taxes. I tried to explain to a few friend that the increased in gas cost was offset by the carbon tax return, but they just don't understand it. They see the gas being more expensive as "bad" and they think they lost money. They don't understand likely because they don't do their own tax return.

slibhb 5y ago

> The authors argue that getting people to make the big leaps needed to decarbonise, such as buying an electric car or installing a domestic heat pump, instead requires “extreme positive incentives for change” (epics). Seems like a recipe to lose elections.

sofixa 5y ago
By saying there will be a government programme funding/giving a tax credit/interest free loan/whatever other incentive to retrofit your house with more efficient heating or better insulate it or upgrade to a more efficient vehicle? I really think it's the opposite, those kinds of things are popular with voters.
- slibhb 5y ago
  Maybe you're right but I think Republicans would have a field day with the term "extreme positive incentives for change".
  - colinmhayes 5y ago
    Politicians wouldn't use that term.
cinntaile 5y ago
Positive incentives are when you receive money as opposed to negative incentives such as fines where you have to pay money. So this is unlikely to cause a political party to lose elections, people like to receive money.
AtlasBarfed 5y ago
Taxes and regulations are the recipe to lose elections, too easily used to swing "undecided" voters. Incentives are giveaways, which even the most devout Big-R voters will jump on, because money is money.
hardtke 5y ago
There are microeconomic concepts I learned in college that make decarbonization nearly impossible. First the FREE RIDER principle. Since CO2 (and methane) affects temperature globally, every nation (and individual) is incentivized to free ride off the decarbonization expenses of others. Second, the PRISONER'S DILEMMA. Most political systems have two main parties competing for power. Although both parties broadly agree that climate change is bad, policies that kick the can down the road are electorally advantageous (less taxes now always beats a better future). Thus the NASH EQUILIBRIUM is for political parties to always promise to undo any costly changes the other party is proposing.

zwieback 5y ago

Any article that uses Norway as a positive example needs to also mention that that country is a large exporter of oil. How much of the incentives of e-cars come from oil profit?

breakyerself 5y ago
Isn't using oil profits to fund a transition to renewable the ideal use for those funds?
- zwieback 5y ago
  Not the worst use, for sure, but instead of incrementally improving the climate situation Norway is making it worse until suddenly much better, when everything is converted.
  - thoughtstheseus 5y ago
    No. Norway is taking an existing economic function with huge negative externalities and using its profits to move toward a sustainable future. Profits that otherwise would not be spent in such a manner. They’re far faster and move with more precision on this topic than nearly every other major O&G producing country.
- usrusr 5y ago
  Norway actively took a bet that long term, oil lying under their shelf might not appreciate in value quite as much as most would expect and opted for faster extraction than others. They might have had a certain hunch that scarcity might not be the only possible end game for oil?

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nonrandomstring 5y ago

Lots of talk about taxing this or repaying that but in Meadows's taxonomy of leverage points these amount to changes between level 10 and 7. What the article is kinda saying is that these "extreme positive incentives for change" (EPICs) that are labelled political/structural instruments lie outside monetary economics and so hint towards level 5 and 4 changes, to system rules and to self-organisational motives. I still don't get, if so, how? And if so, why not apply both? But ultimately changing system goals away from consumerism might be the gift everyone wants. I know many bored people who want to feel like they're part of big change, what Alexis De Tocqueville called "restive fervour" in early America - in British parlance being "up for it". If economists exacerbate climate problems it is by the tepidity of their vision. I think we have forgotten as a society truly grand ambition. The Panama canal. The Hoover Dam. The dykes of Nederlands. US post-war Apollo Project. The Channel Tunnel. Imagine human action at scale, not as ungrateful entitled protest, but coordinated and purposeful action in the face of climate change. What would that look like? If we can't even imagine it then we're truly lost. In the shadow of the pandemic and Russo-Ukraine war I think we'll have an opportunity, and to avoid unrest maybe a necessity, for bold, crazy-ass projects whose ROI can just be written off to posterity - what William James called the "Moral Equivalent of War", not as mere National Service, but as Global Service. Literally pay people salaries to fight climate change. Of course that would require a strategy backed up by good science. But realising that monetary economics and "markets" isn't the only way out would be a good step. The Economist article hints and plays with that, and then backs off.

mattcwilson 5y ago
> what William James called the "Moral Equivalent of War", not as mere National Service, but as Global Service. Literally pay people salaries to fight climate change. I see what you’re going for with this, and I imagine I could be persuaded to a more workable version of this. What’s hanging me up is - how do you avoid these salaried people being captured by incentives to sustain their salary rather than be incentivized to ultimately solve the problem? We’ve tried this with the war on drugs, war on terror, war on homelessness... haven’t we? Is your suggestion different somehow?
- 5y ago

gtvwill 5y ago

Articles paywalled. But the irony of an economist trying to explain why they aren't wrong using the failed quasi science that is economics is lulzy as hell. Economics isn't a science it's a collection of hypotheticals which rarely maintains consistency in results. To place such weight on these hypotheticals as we do, well we reap what we sow as they say.

colinmhayes 5y ago
This is just a strawman. No one is claiming economics is a science with ground truth. That being said, people on the aggregate do generally act rationally, and they absolutely respond to incentives, which is pretty much all you need for economics to be useful.
- gtvwill 5y ago
  Actually mate they try pass economics of as a science so regularly they use it to influence policy. Which if the title of this article is correct. It's been part of the reason our environmental policiea globally have been so woeful ("you can't do that you'll ruin the economy"). It's the case here in aus and most of the western world, your telling yourself porky pies if you think it's not happening. Economics places be all and end all weight on growth and dollars. When for the most of us that results in detrimental outcomes. For example as I write this I'm currently in a motel because my house is flooded out by a 1 in 100 year flood, the 2nd time this month....
  - colinmhayes 5y ago
    > Actually mate they try pass economics of as a science so regularly they use it to influence policy. I don't see how economics influencing policy means people think econ is a physical science. What I do know is that "you can't do that you'll ruin the economy" is not something economists ever say. That's something politicians say. Economists widely support policy that may have negative short term effects in order to achieve long term gains, but these policies aren't politically viable, so they are ignored. The idea that climate change is in some way caused by economics is misguided. Climate change is caused by human nature. People are extremely unwilling to make sacrifices when they aren't sure they'll see the results. That's why our environmental policies have been so woeful, not because economists object.

ohNoz3 5y ago

alephnan 5y ago

How well respected is The Economist when it comes to covering the global economy truthfully ? I’ve noticed there is a growing anti China sentiment from The Economist in recent years.

jker 5y ago
And The Guardian has growing anti-American sentiment. Yet they both publish excellent reporting.

geysersam 5y ago

What is most fair? Every person on the planets gets the same portion of the remaining global carbon budget. Or, it is divided proportional to current wealth. A carbon tax is the latter.

wolverine876 5y ago

> And that is without counting the returns on the investment. British officials reckon that three-quarters of the total cost of the transition to net zero will be offset by benefits such as more efficient transport, and that the state may need to spend only 0.4% of gdp a year over three decades. That also omits by far the largest return on investment, which is frequently omitted: Preventing the costs of climate change. People who criticize actions to prevent climate change often talk about the economic impact of those actions. The economic impact of not preventing climate change - in addition to the impact on human life - is usually far greater. The question is not, 'how much does this change cost?', but 'what are the outcomes of our various options?'.

s1artibartfast 5y ago
>People who criticize actions to prevent climate change often talk about the economic impact of those actions. The economic impact of not preventing climate change - in addition to the impact on human life - is usually far greater. I think public discourse avoids this topic because the benefits and costs of climate policy are not uniform. There are there are nations, groups, and individuals for which climate policy is a simply negative. Talking about net benefit risks bringing up this topic, which is largely unsolved. proactive climate policy has clear winners and losers. While net zero carbon may be relatively cheap and have net benefit for Brittan, for some poor developing countries, avoiding cheap carbon energy means more people in poverty with all the downsides that come along with that.
- wolverine876 5y ago
  > There are there are nations, groups, and individuals for which climate policy is a simply negative. Talking about net benefit risks bringing up this topic, which is largely unsolved. proactive climate policy has clear winners and losers. What basis do you have for these claims? If FUD is the basis for stopping us, we should never do anything; we never operate in certainty, and we never operate in a situation where people can't create FUD. Climate change is possibly the most studied issue in the history of the world; we don't need to know more. How much longer will you try to delay action?

tmitchel2 5y ago

Donut economics book by Kate Raworth - I read this recently and would highly recommend it.