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I Oppose Further Government-orchestrated Efforts to Reduce Carbon Emissions

Posted: 22 Jun 2022 01:55 PM PDT
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(Don Boudreaux)




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Commenting on this recent EconLog post by Scott Sumner, Thomas Lee
Hutcheson writes:

The point of a carbon tax (tax on net emissions of CO2 and methane) is that
is is exactly as large as it needs to be (requiring the least amount of
lifestyle changes) to minimize those future costs. If future costs are not
large, neither will be the tax on net emissions of CO2 and methane. The
idea is to minimize the sacrifice.

In response to Mr. Hutchesons comment, I wrote (and posted as a reply at
EconLog) the following (here slightly amended):

Mr. Hutcheson: Who will determine in practice what is the optimal carbon
tax “to minimize those future costs.” And how will this determination in
practice be made? We already tax carbon fuels, and we’ve done so for a long
time. How do you know that the current array of taxes – include those on
retail gasoline sales – aren’t optimal? Perhaps these taxes are now even
super-optimal. There is no way to know.

We can, of course, draw graphs on whiteboards and create models with
specified parameters and reaction functions. The former are analytical
tools that only enable us to understand and describe some general, abstract
features of optimally set taxes. The latter the models unavoidably are
infused with many assumptions – some explicit, some implicit – the realism
of many of which we cannot really know. Our knowledge is especially meager
if the modelers purport to make predictions for decades out.

Of course, we can’t know future-generations’ preferences. But this fact is
minor. More importantly, we can’t know what discoveries and innovations
will happen in the future. To truly know what is the optimal level of
taxation of carbon we’d have to know the different kinds of discoveries and
innovations that would emerge under each of the countless different
possible alternative levels and systems of carbon taxation. We cannot begin
to know any such thing.

The fact that humanity continues to emit carbon does not tell us that the
current level of emissions is too high. Nor is such information given to us
by fact that the earth continues to warm (even if, as I willingly grant,
all of this warming is the product of human activity). We do not know and
we cannot know.

In the face of such inescapable ignorance, a perfectly legitimate course of
action is to do nothing – or nothing further – to tax or regulate with the
aim of reducing carbon emissions. Indeed, I believe that this course of
(government in)action is the best one available, at least until god chooses
to share with us its detailed knowledge about such matters. I hold this
belief with reinforced confidence because of the fact that carbon fuels
themselves have overwhelmingly powered (and continue to power) the
countless innovations that have made human existence safer and more
comfortable.

Do the following mental experiment. Suppose you could go back in time to
circa 1900 and prevent the introduction and use of air-conditioning.
Suppose further that you know that if you chose to prevent air
conditioning, the world in 2022 would have less carbon in its atmosphere.
That result would indeed be an advantage. But not an advantage without cost.

How much less carbon in the atmosphere in 2022 would you think is minimally
necessary to justify a world without air conditioning? How much less carbon
in the atmosphere today would you think is minimally necessary to justify a
world with 50 percent less air conditioning? With ten percent less air
conditioning? How could someone in 1900 have known such a thing?

Now do the same mental experiment, not with air conditioning, but instead
with automobiles.

All one can do in such mental experiments is to guess, and to guess rather
wildly at that. And, frankly, thats all one can do when attempting today to
calculate the optimal carbon tax.

I believe to be preposterous the widespread presumption that we possess, or
can come to possess, sufficient knowledge to inform us what will be the
likely full consequences of further raising carbon taxes. In practice, we
cannot know if any increase in such taxes will move us closer to or further
from optimality. In the blinding light of this inescapable ignorance, I say
that we at least avoid further artificially raising the cost of carbon
fuels – fuels which were a major source of power for the industrial
revolution and continue today to be the major source of power to produce
the standard of living that affords rich-world denizens the luxury to fret
about climate change.




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Pittsburgh Tribune-Review: "James M. Buchanan, R.I.P."

Posted: 22 Jun 2022 06:30 AM PDT
[link removed]

(Don Boudreaux)




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In my column for the January 23rd, 2013, edition of the Pittsburgh
Tribune-Review I remembered my Nobel-laureate colleague Jim Buchanan, who
at the age of 93 died two weeks earlier. You can read my tribute to Jim
beneath the fold (link newly added).

Note that the James Buchanan who I remembered was a real person, unlike the
James Buchanan that a Duke University historian (so called) and her poorly
informed, or ideologically blinkered, apologists portray in their fictional
works masquerading as factual works.

(more)




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Some Links

Posted: 22 Jun 2022 05:34 AM PDT
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(Don Boudreaux)




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George Will warns that stakeholder capitalism is parasitic progressivism.
Two slices:

Semantic infiltration is the tactic by which political objectives are
smuggled into discourse that is ostensibly, but not actually, politically
neutral. People who adopt a political faction’s vocabulary also adopt —
perhaps inadvertently, but inevitably — the faction’s agenda. So, everyone
who values economic dynamism, and the freedom that enables this, should
recoil from the toxic noun “stakeholder.”

The Oxford Reference definition is “all those with interests in an
organization,” including “shareholders, employees, suppliers, customers, or
members of the wider community (who could be affected by environmental
consequences of an organization’s activities).” Which means: everyone.
“All” in the “wider community” who claim an “interest.” Anyone can make
such claims; no one can refute them.

..

In a dynamic society, resources are efficiently disposed by corporate
managements whose primary duty, which other corporate activities do not
compromise, is to maximize shareholder value by profitably supplying the
demand for goods and services. Furthermore, in a congenial society,
boundaries are respected: Most people say about most things, “this is none
of my business.”

Self-proclaimed stakeholders, parasitic off others’ labor and accumulation,
assert that everything is their business. Actually, although everyone has a
right to advocate progressivism, no one has a right to insist on a stake in
deploying others’ property for the stakeholders’ political ends.

Heres a thought that Ryan Grims essay on wokism sparked in Arnold Kling.

Speaking of the insanity of wokism, recent Stanford graduate Ginevra Davis
decries what has become of her alma mater.

Colleen Hroncich and Solomon Chen reflect on yesterdays U.S. Supreme Court
ruling in Carson v. Makin. A slice:

Carson v. Makin is centered on Maine’s tuition assistance program, one of
the oldest school choice programs in the nation. Created in 1873, the
program funds students from a town without a public school to attend a
school of their parents’ choice—whether private or public, in‐​state, or
out‐​of‐​state. For more than a century, parents could direct these funds
towards religious schools. In 1980, Maine Attorney General Richard S. Cohen
released an opinion that said funding a child to attend a school with a
“pervasively religious atmosphere” would be unconstitutional. In response,
the legislature changed the law to prohibit families from using the tuition
assistance at religious schools.

The Institute for Justice filed a federal lawsuit in 2018 on behalf of
three sets of parents—Alan and Judy Gillis, David and Amy Carson, and Troy
and Angela Nelson—whose children qualified for the program but were
prevented from directing funds towards the schools they preferred because
those schools provided religious instruction. The district court initially
found for the state and the First Circuit affirmed on appeal. Last July,
the Supreme Court agreed to hear the case.

In today’s ruling, as it did previously in Espinoza v. Montana Department
of Revenue, the Court flatly rejected the respondent’s claims that allowing
religious schools to receive the tuition funds violates the first amendment.

The Wall Street Journals Editorial Board rightly criticizes Bidens
endorsement of a bill, newly passed by the House, that would require the
Federal Reserve to include among its goals greater racial equity. A slice:

Now House Democrats want to codify racial equity as part of the Fed’s
mandate. Their bill would require the Board of Governors and FOMC to
“exercise all duties and functions in a manner that fosters the elimination
of disparities across racial and ethnic groups with respect to employment,
income, wealth, and access to affordable credit.”

The bill directs the Fed to include race in monetary policy, the operation
of payment systems, and the supervision of banks and non-banks deemed by
the Financial Stability Oversight Council to be systemically important.

Central bankers have a hard enough time balancing full employment with
stable prices. Adding a racial equity mandate could cause their models to
go catawampus. How small would the black-white unemployment gap have to be,
and how high would prices have to climb, before the Fed considers raising
interest rates?

My George Mason University Econ colleague Vincent Geloso describes the very
real, if often delayed, damaging ripples of government intervention.

Whod a-thunk that the outcome reported here by Eric Boehm about covid
funding would ever occur?

For more on the grotesque waste uncorked by covid hysteria, see this piece
by Peter Suderman.

Aaron Kheriaty warns of the dangers of the attempt in California to punish
dissent by physicians from the official position on covid vaccines. (DBx:
Every reasonable person, regardless of his or her position on the efficacy
and safety of covid vaccines, should be appalled by this attempt.)

Ian Miller explains that vaccinating toddlers against covid is unwise.

Marty Makary, Vinay Prasad, and Neeraj Sood are among the many physicians
who signed a letter, addressed to top U.S. government covidocrats, urging
elimination of many remaining covidocratic diktats. (HT Jay Bhattacharya) A
slice from the letter:

Many European countries, U.S. states and Canadian provinces have already
updated their COVID-19 policies to reflect that vaccines and
infection-acquired immunity have reduced the risk of a severe COVID-19
outcome for youth, and to acknowledge that all mitigation measures have
unintended consequences. Massachusetts, the United Kingdom, Denmark,
Norway, British Columbia and elsewhere have recommended an end to routine
screening testing and mandatory isolation periods for children. Most have
also eliminated any COVID-19 vaccine requirements for children to fully
participate in public life.

The CDC’s COVID-19 school guidelines continue to cause significant
disruption to children’s education and to working parents, while providing
no demonstrable public health benefit in limiting COVID-19 spread. These
policies have serious unintended consequences–-such as school closures,
increasing school absences, forcing parents to miss work, and the expense
and time of testing. At this point, nearly all U.S. adults and children are
protected by either vaccination or infection-acquired immunity, and the
U.S. is seeing far lower hospitalization and mortality rates than in prior
surges.




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Quotation of the Day

Posted: 22 Jun 2022 01:30 AM PDT
[link removed]

(Don Boudreaux)




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is from page 15 of Edwin Cannan’s splendid November 13th, 1931, Sidney
Ball Lecture – a lecture titled “Balance of Trade Delusions“:

The easiest and least thankless method of dealing with a very large income
is to invest a large proportion of it, and even with moderate incomes the
rule is that the bigger they are the larger is the proportion likely to be
saved. Redistribute net income in the direction of taking from the rich and
giving to the poor, and you are pretty certain to diminish savings.

DBx: Yes. And diminished savings brings about diminished production and
improvement of capital goods and services that is, diminished production
of capital goods as well as diminished improvement and maintenance of
existing capital goods. Compared to what they would otherwise have, workers
have fewer and worse tools and infrastructure with which to work. In turn,
diminished production and improvement of capital goods and services ensures
that worker pay will be lower than it would have been without such a
diminution of savings.




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