TT's Lost in Tokyo — by TokyoTom

[Update at bottom.]

Bob Murphy, Austrian economist and part-time consultant for Rob Bradley`s Institute for Energy Research, asserted in a recent blog post that “IER [has] Call[ed]  For End to All Energy Subsidies”.  I took a closer look at the recent commentary at IER that Bob pointed to as support for his position, and came away unimpressed.

I posted the following comments to Bob in response a week ago; since I have heard nothing further from Bob, I think it`s worth copying them here (with editorial comments in brackets):

Bob, I`m sorry, but where does IER (or MasterResource) actually CALL “for an end to all energy subsidies”? They certainly don`t do so expressly in this op-ed. I`d be thrilled if you could point the way to other places where Bradley`s various enterprises specifically call for an end to subsidies and other regulatory favors for coal.

By bashing WaPo`s inconsistent concerns about “clean coal” subsidies [in an interesting editorial about rent-seeking by coal firms that ignores other rent-seekers] – and bashing clean energy interests while refusing to criticize rent-seeking by coal – it seems fairly apparent that IER remains a friend of big coal, and of the big thumb that government has long placed on the scales in its favor.

“That would at least make them intellectually consistent. But it appears there is no room for logic and consistency when you have an agenda to advance.” [from Rob Bradley`s commentary]

Such apt words!

# posted by  TokyoTom : June 29, 2009 1:08 AM

I just stumbled into Bob Murphy`s June 8 post at the LvMI Daily site, and submitted a few comments.  As it looks like my links prevented my comments from posting, I`ve copied them here (with a few typo tweaks and links added):

Bob, I didn`t realize you had put a post up here.

Allow me first to copy here a few points that I made on your related post at MasterResource, but which freedom- and open-debate-loving Rob Bradley blocked (your truly has been banned there for the past few months):

“The below is copied from MasterResource, where I remain on permanent moderation – IOW, banned – even though Bob and the authors of various threads seem perfectly interested in engaging me.

“TokyoTom { 06.09.09 at 12:53 am }

A few comments, if I may (in the hope that springs eternal that even the “unclean” will be allowed to post): [Note to readers:  rest easy; that the final “I`ve been banned!” reference.]

1. “Cost/Benefit Analysis Cannot Justify Waxman-Markey’s Aggressive Targets”

Why this headline, which is completely unsupported in the post?

You do link to a prior post, where you try to draw the conclusion that “If the whole world adopted the stringent emission cutbacks in Waxman-Markey, then the costs to the global economy would far outweigh any reasonable estimate of the benefits (measured in avoided climate damage)”, but both there and here you fail to address Weitzman, much less more fundamental problems regarding the validity of CBA (aggregating preferences across persons situated vastly differently, ignoring the problems of frustrated preferences, enrtrenched rent-seeking and the continuing lack of property rights or other mechanisms to manage an important commons).

And far from “agree[ing] with you”, the RFF paper much more fairly illustrates some of the complexities in applying CBA to the moving ball of international negotiations.

2. “the costs to the global economy would far outweigh any reasonable estimate of the benefits (measured in avoided climate damage)”

“Yet mainstream models of the global economy and climate system show that worldwide adoption of Waxman-Markey would be foolish as well. It takes heroic assumptions both of lurking climate catastrophes and of international dipomacy to justify support for the current bill.”

Again, you offer conclusions not established here or elsewhere. You appear to acknowledge your overstatements when you say: “If proponents of aggressive government measures want to say the benefits justify such costs, fair enough; but let’s not kid ourselves that this is going to be cheap.”

3. “RFF study, which says the cumulative cost through 2050, expressed today in present-value terms, is up to $43 trillion worldwide.”

Actually, don`t the RFF authors make clear that this estimate is based on universal adoption worldwide and least-cost reductions – 70% of which would take place in developing countries – with a clear indication that such countries are not likely to act agressively for decades? Accordingly, the RFF study implies that global costs will fall below the straight estimate.

4. It is interesting to me that you ignore the dynamics of the international context of climate policy and negotiations. Why no comment on the observations in the RFF paper that likely “leakage” of carbon-heavy industry to developing countries and dampening Western demand for fossil fuels will constitute net subsidies that spur development in poorer parts of the globe?

Your comment is awaiting moderation.”

Thanks for putting these up at your own blog.

Further, let me note:

1.  Your criticism of W-M on conventional CBA grounds is limited to W-M, and doesn`t address the many CBA analyses that conclude (as Nordhaus has done weakly for decades) that carbon pricing mechanisms are now justified.  Economist Richard Tol last year summarized the economic literature as follows:

“Firstly, greenhouse gas emission reduction today is justified. Even the most conservative assumption lead to positive estimates of the social cost of carbon (cf. Table 1) and the Pigou tax is thus greater than zero. Yohe et al. (2007) argue that there is reason to reduce greenhouse gas emissions further than recommended by cost-benefit analysis. The median of … peer-reviewed estimates with a 3% pure rate of time preference and without equity weights, is $20/tC. …. The case for intensification of climate policy outside the EU can be made with conservative assumptions. … Secondly, the uncertainty is so large that a considerable risk premium is warranted. With the conservative assumptions above, the mean equals $23/tC and the certainty-equivalent $25/tC. More importantly, there is a 1% probability that the social cost of carbon is greater than $78/tC. This number rapidly increases if we use a lower discount rate—as may well be appropriate for a problem with such a long time horizon—and if we allow for the possibility that there is some truth in the scare-mongering of the gray literature.  Thirdly, more research is needed into the economic impacts of climate change—to eliminate that part of the uncertainty that is due to lack of study, and to separate the truly scary impacts from the scare-mongering.”

[Cato`s Jerry Taylor has a good summary of Tol`s review here.]

2.  Granted that you focussed narrowly on W-M, but by doing so you completely fail (a) to acknowledge the atmosphere/climate system as an open-access commons under growing infuence by man, and (b) to put forward a “free market” agenda that would serve as a win-win response to the wide array of people, firms, institutions and nations that are concerned about man`s role in ongoing climate change and about the likelihood of future climate change stemming from the growing use of fossil fuels and other human activities.

Are you indeed interested in addressing people`s legitimate preferences regarding climate, and pushing for freer markets?  This is a question that I have asked Rob Bradley at his self-declared “free market” MasterResource blog any number of times.

Rob has stated there in response to me [before he banned me] that: “a free-market approach is not about “do nothing” but implementing a whole new energy approach to remove myriad regulation and subsidies that have built up over a century or more”, but he and his co-bloggers (including you) haven`t  seen fit yet to actually recommend ANY free market approaches to climate concerns!

Failing any effort to actually offer policy suggestions, is it unfair to wonder whether you guys are, consciously or not, simply providing cover for the rent-seekers who benefit most by generating pollution and other risks in the manner permitted by current regulations?  (Why did Exxon stop funding Rob`s Institute for Energy Research, BTW?) 

[It`s very clear that Joe Romm and others perceive you this way; are you not seeking to persuade them?]

Regards,

Tom

PS:  Your chief post doesn`t actually link to the comment thread, which readers have to search for.  You might want to fix that.

Apparently Rob Bradley`s self-proclaimed “free-market” energy blog, “MasterResource”, has experienced a recent increased flow of traffic, so Rob is busy patting himself on the back and spinning his blog to his new readers.

But what`s the reason for the increased traffic?  Is MasterResource finding more success at putting out a message of “free-market” energy and “principled entrepreneurship“?*

* This is a purportedly trademarked(!) phrase that encapsulates Bradley`s laudable professed beliefs that (i) “businesses, big or small, should not seek special favors from government but create private wealth via the economic means rather than the political means” and that (ii) “government activism, not consumer choice in a free society, is the major threat to energy sustainability”.

Far from it – in the face of the growing stream of unbalanced (pro-fossil fuels and “clean” coal), partisan, thinly argued, and some surprisingly not pro-free-market posts from MasterResource and its related sites, the Institute for Energy Research (of which Bradley is founder and CEO) and IER`s “independent grassroots affiliate”, the newly re-founded energy front group American Energy Alliance (which calls IER its “partner”), these groups and blogs have basically simply been earning negative attention from those they see as their opposition in a classic rent-seekers` battle over using government (via public opinion tools) to achieve economic and other ends.  IER has been busy pushing for greater energy production on “public” lands, while AEA, with the help of Burston-Marsteller, has created affliliates in every state, and is running a large “integrated education and advocacy campaign” against the Waxman-Markey cap and trade bill (which AEA prefers to misleadingly call simply an “energy tax bill”).

As I noted in another post and in comments regarding a puzzled reaction by Bob Murphy (who has found himself the target of attacks as a result of speaking on behalf of IER against Obama`s green jobs program), this is too bad, not only because one of the first casualties in a war of words is truth and reason.  MasterResource and the folks Bradley runs with at IER and AEA are assembling their own “Baptists and Bootleggers” coalition, where market principles are given lip service (along with patriotism, energy independence and the like), but the funders appear to all have rather more common-place and less lofty motives.  The descent into partisan bickering (while Bradley tries to maintain a lofty tone, it`s easily seen elsewhere by those who pick up posts from his blog, IER and AEA) is too bad, but the natural consequence when one acts as a spokesman for particular classes of rent-seekers.

That this state of affairs – professing the high ground while fronting for rent-seekers (or “political capitalists”, to use a term that Bradley prefers) – is what Rob Bradley actually desires, seems to be attested to:

– (1) by the alacrity by which Bradley has rushed to defend himself and IER against criticisms that were generated in response to commentary from Master Resource and IER, while deliberately obfuscating and refusing to correct the record about ExxonMobil`s fairly dramatic change in position – from opposition to government action on climate financial support to cutting off funding for IER and to actively supporting carbon taxes (Exxon CEO Rex Tillerson: “It is rare that a business lends its support to new taxes. But in this case, given the risk-management challenges we face and the alternatives under consideration, it is my judgment that a carbon tax is the best course of public policy action. And it is a judgment I hope others in the business community and beyond will come to share.”); and

– (2) of course, by the fact that, despite Bradley`s professed call to “Let the analysis and debate continue–and assume the best of intentions and civil discourse from all of us at MasterResource,” he banned me from the site, without explanation, and without the knowledge or consent of his “volunteer” co-bloggers in mid-conversations (Tom Tanton carried the conversation to my blog, while Chip Knappenberger responded by email, and I just discovered that Marlo Lewis, weeks after I was banned, posted a rejoinder).

Sure, Rob, let the “high-level” discourse continue, with nary an acknowledgement of the legitimacy of others`s preferences, of the role of government in frustrating such preferences so far, and of the firms and investors that continue to benefit from government interventions at the expense of consumers and the public weal. 

Heaven forbid anyone call for greater competition in power markets, for finding ways to rein in the mismanagement of the federal lands that your friends are itching to drill/mine, or for a frank acknowledgment that the world faces a number of “environmental” problems as a result of a lack of clear or enforceable private or communal property rights in important shared resources.

It`s the Austrian/libertarian/Objectivist way, after all.

Do actions speak louder than words?

Bob Murphy has recently noted that he is busy at work, doing yeoman`s work in fighting the good battle against stupid “green” or “clean” jobs that the Obama administration and some enviros are pushing.

This is fine as far as it goes, but in his struggle to be fair and even-handed, it seems to me that Bob has made a rather significant omission, as I noted in the following comment on his related blog post:

Bob, the comments you made on the Heritage panel were generally fine, but I`m surprised that you didn`t note that the clean/green jobs thing is to a large degree classic pork wrapped up in a nice moral package – and so differs very little from other government pork packages.

Was it because you prefer not to edge to close to the point that, if CO2 and soot really do create serious climate risks, then those who who produce fossil fuels (and their primary customers) have been getting a free ride off the back of the public for years, aided and abetted by both parties (but most noticeably recently by big government Republicans)?

This, of course, is the chief reason why greenies argue that the fossil fuel/auto/power industry has been buying political influence – not industry generally, as you asserted in your talk. Such rent-seeking is in fact undeniable, indeed readily apparent. 

A case in point is your own institution, IER. You should know this, but even Joe Romm has apparently also missed that IER is no longer funded by ExxonMobil, which deliberately cut off funding to IER after 2007, on the grounds that they had decided not to fund “several public-policy research groups whose position on climate change could divert attention from the important discussion about how the world will secure the energy required for economic growth in an environmentally responsible manner.”

ExxonMobil has now decided that climate risks – and the risk of bad policies – merit then public changing their stance to SUPPORT CARBON TAXES, as their CEO Rex Tillerson noted recently:

“It is rare that a business lends its support to new taxes. But in this case, given the risk-management challenges we face and the alternatives under consideration, it is my judgment that a carbon tax is the best course of public policy action. And it is a judgment I hope others in the business community and beyond will come to share.”

So who is left to fund IER, and Rob Bradley`s shiny new blog, Master Resource, which has collected luminary policy wonks like you, Marlo Lewis, and Ken Green? Inquiring minds want to know!

But it`s pretty clear that the only major fossil fuel funding left in the “skeptic” policy camp is coming from coal. 

And while Rob is now very diligently explaining why his Enron connection has nothing to do with the current stance of IER and MR, it`s a puzzling contrast to his unwillingness to acknowledge Exxon`s prominent change in position. 

In fact, in this regard his only dilgence has been expelling me from the blog, for pointing out what Tillerson now has to say, and for criticizing some of the bone-headed, non-libertarian positions some of the bloggers and visitors at Master Resource have taken:

Rot at the Core: Rob Bradley at “free market” MasterResource blog shows his true colors as a rent-seeker for fossil fuels (with links to the quotes above).

How good`s the Big Coal “death train” gravy train?

And when is Joe Romm going to note that Exxon is now his ally?

Here`s Bradley`s post, A Texas-Sized Energy Problem: Republicans, Democrats, and ‘Baptists & Bootleggers’ Running Wild in the Lone Star State (Obama sends his thanks).  I left a short note wondering how Bradley could have made it through a generally observant post without referring to all of the sweet deals that Boone Pickens managed to buy from the thoroughly Republican Texas legislature; it`s also a puzzle why he didn`t call for public utility deregulation.

Rob banned me from his blog 6 weeks back; I`m checking to see if he`s reconsidered.

Here`s the comment I left:

The Ludwig von Mises Institute (which kindly hosts these pages!) continues to outdo itself on providing empty climate posts, this time by bringing us a new author, Jason King (completely new to LvMI, and apparently with no prior internet-searchable commentary whatsoever).   How is it that LvMI is proving so singularly effective in telling us so little about Austrian perspectives on climate, climate politics and climate policy?

Mr. King presents us with “The Law of Intended Darkness”, a puzzlingly empty Mises Daily essay  that criticizes “Earth Hour” that – as a gesture to symbolize public support for political, corporate, community and personal action regarding climate change – was staged around the world last Saturday, March 28th, between 8:30 and 9:30 pm, with participating communities, firms and individuals shutting off non-essential lights for one hour.  

Mr. King’s chief points are (1) to criticize the Earth Hour for being likely ineffective, in and of itself, in affecting energy use over the course of an hour, and (2) so to conclude that participation in the Earth Hour must be intended to be symbolic.  Mr. King concludes with a triumphant report that the main sponsors of the event, the internationally well-regarded World Wildlife Fund, have themselves stressed that “The purpose of the event [is] not to save money or power. It’s a symbolic event”, but what Mr. King reveals instead is that he has completely failed to examine whether Earth Hour might be effective on its intended terms of symbolic speech. 

Rather than considering whether the event has been or is likely to be effective – from the point of the sponsors and participants – in gathering support and galvanizing action, what Mr. King has done is to wasted our time with his own essentially idle and rather poor speculations as to whether Earth Hour might be effective in reducing energy use for an hour – a goal that the organizers have expressly said is not their primary purpose.   As a result, Mr. King has in effect told us nothing. Mr. King argues that, since “the effects of Earth Hour boil down to dim rhetoric,” “as much attention should be placed on humanity’s hot air footprint as its carbon one.”  Cute, but this time the dim rhetoric and the hot air all Mr. King’s own.

Too bad – one wonders not only about whether Earth Hour might be effective on its own terms, but what are the aims of the project and its many corporate, municipal and individual participants, whether such aims are consistent with liberty or Austrian principles, or, if, not, what approaches are preferable for dealing with conflicting preferences regarding open-access resources in which there are no effective property rights.  Should citizens be seeking particular actions from their governments to deal with a collective problem that cannot be solved purely by private transactions and that requires international action?  All of this beef seems simply too much for LvMI and its readers to chew.

To tip my own hand, I noted last year Gene Callahan’s point that, with respect to climate change as much as for other matters,  public moral pressure is a perfectly appropriate way by which concerned citizens, acting in the market of public opinion, can influence behavior that generates externalities.  Further, given the nature of the atmosphere, any effective approach to climate change requires multilateral action (and as no single government can force a solution on others, this looks like Coasean bargaining, not Pigovian rule-making), and I hardly expect that we can expect to address global issues such as climate change without involving our governments (which don’t appear anxious to step out of the way in any event).

The inquiring reader – hardly in evidence on the related blog thread – is forced to do his own research about this, the third annual  “Earth Hour”, which was apparently a fairly strong success.   Earth Hour began in Sydney in 2007, when 2.2 million homes and businesses switched off their lights for one hour.  In 2008 some 53 million people and 371 cities in 35 countries switched off their lights, including global landmarks such as the Golden Gate Bridge, Rome’s Colosseum, the Sydney Opera House and the Coca Cola billboard in Times Square.  WWF reports that participation grew strongly in 2009, to hundreds of millions of people in over 4,000 cities and towns in 88 countries.  Many more landmark buildings around the world switched off this year, including the Empire State Building, the Las Vegas strip, Niagara Falls, the Eiffel Tower, Rio de Janiero’s statue of “Christ the Redeemer,” Athens’s Acropolis, Egypt’s Great Pyramids, Table Mountain in Cape Town, the Merlion in Singapore, Hong Kong’s Symphony of Lights, the Shanghai Hong Kong New World Tower, and the London Eye.

Those interested in who participated and why might take a further look at the Earth Hour site linked above and here and here.

And as for thoughtful engagement regarding climate on the front pages of Mises Daily and the Mises Economic Blog?  Hope springs eternal.  At least LvMI and its editor, Jeffrey Tucker, allow an open discussion and are not running a corporate-funded spin site like Rob Bradley‘s “Master Resource” blog, which bans dissenters and refuses to acknowledge Exxon’s explicit support for carbon taxes.

Roger Pielke, Jr., a political scientist who rather persistently blames politically naive climate scientists for the very natural fact that there is a politicized debate over climate policy,  posted last week at his Prometheus website a guest commentary by Michael Zimmerman, Professor and Director, Center for the Humanities and Arts at the University of Colorado.  Zimmerman’s post, “Coal Trains, Death Camps, and Recent Anti-Modernism,” which only recently came to my attention, apparently addressed politically-oriented remarks and actions by climate scientist Jim Hansen.  “Apparently”, I say, because the essay itself has been taken down by the author in light of factual errors and other criticism made of it, both at Prometheus and around the blogosphere (which sometimes does not lap so strongly at my distant shores).

But having finally been drawn toward Roger’s site by the fuss and taking a look through comments, I felt compelled to make a few comments, despite my inability to read the actual post.  I felt particularly struck by the commonness of a refrain we are hearing from various pundits who prefer to question the good will or sanity of environmentalists over the harder work of engaging in a good faith examination and discussion of the underlying institutional problem of ALL “environmental” disputes:  namely, a lack of property rights and/or a means to enforce them. 

We can see this not only in George Will‘s recent piece about sea ice, but also in the ongoing series of posts by the supposedly “free market” libertarian Rob Bradley and his co-bloggers at MasterResource.

With that as background, here is what I posted at Roger’s (emphasis added):

I’m sorry I missed the fun; did anyone happen to archive Mr. Zimmerman’s work, apparently so flawed that it required a withdrawal rather than an update or two?

Roger, I note the criticisms of you and Mr. Zimmerman at Things Break, and have to say I agree with them: http://thingsbreak.wordpress.com/2009/03/03/honest-broker-at-prometheus-attacks-hansen-over-claim-he-never-makes/. Perhaps Mr. Zimmerman has never carefully read the man whom he attacks in his piece, but you have, and it’s crystal clear that Hansen has ALWAYS been talking about coal’s relationship to species extinctions, not coal’s impact on humans. I’m surprised that you would post such an obvious misreading of Hansen.

I think I can agree with tomfid and Len Ornstein without the benefit of reading Zimmerman’s piece. It’s clear that we have no ability to instantly replace coal, but it’s also clear that even without the climate change issue, coal is not even now bearing its environmental costs – witness the roughly $1 billion TVA flyash spill, the 25,000 or so annual deaths that the American Lung Assn attributes to coal, etc – w/o even getting to China and India. Investors make profits, while losses are shifted to others. There’s hardly anything conservative or socially beneficial in that business model.

It’s also very clear that, far from wanting to return to a golden age, environmentalists (largely a well-to-do/wealthy slice of America) have quite legitimate concerns about the future, and about our uncontrolled, widespread and large-scale experiments with our planet. Find me someone ranting about “Malthusians” or somesuch, and I’ll show you someone who doesn’t understand – or refuses to acknowledge – the difference between wealth-creating markets based on private property / contracts protected by law, and the tragedy of the commons situations that result when there are NO property rights (atmosphere, oceans) or when the pressures of markets swamp indigenous hunter-gather community rules.

Just look at how the oceans are being trashed and strip-mined of fish, for an alternate example. It is a first order priority of mankind to grapple with the problem of managing our commons, before we irreversibly impoverish them. For the atmosphere, the handwriting has long been on the wall, though those who profit by externalizing risks have done a pretty good job of scribbling all over it.

Of course, while on the one hand the “skeptics” manage to so completely ignore their supposedly much greater understanding of markets, on the other hand, we hear very little talk about markets from most of the enviro pundits.   Even if scientists have a right to be worried, that doesn’t really tell us what we should do. 

So what’s the deal?  Here’s a perfect opportunity for skeptics to educate the supposedly market ignorant, but they refuse, preferring to focus instead on why concerned scientists must be wrong, how concerns about climate have become a matter of an irrational “religious” faith, or that those raising their concerns are “misanthropes” or worse.

Both sides, it seems, prefer to fight – and to see themselves as right and the “others” as evil – rather than to reason. 

While we should not regret that we cannot really constrain human nature very well, at least Austrians (a breed of libertarian-linked economists, for any visitors not already familiar with these pages or the great LvMI organization that hosts them) ought to be paying attention to the inadequate institutional framework that is not only poisoning the political atmosphere, but posing risks to important globally and regionally shared open-access commons like the atmosphere and oceans (which are probably are in much more immediate and grave threat than the climate).  And they also ought to recognize that there are important economic interests that profit from the current institutional framework and have quite deliberately encouraged the current culture war.

(One such economically interested party, Exxon, has recently stopped funding one culture war outfit, Rob Bradley‘s climate “skeptic” shop – “MasterResource” – which remains dedicated to trumpeting relentlessly pro-coal talking points – e.g., civilization will collapse if we try to substitute nuclear, gas or other technologies for coal, or try to make coal investors pay for the climate and other environmental risks that they shift to society as a whole!)

[Update:  I`ve added more background on Exxon, “Malthusians” and productive engagement.]

How has Rob Bradley showed his hand?  By shutting down reasoned (if challenging) debate at his blog, in the face of comments that were certainly more “free market” than displayed by Rob himself and his co-bloggers.

In a series of posts here and in comments at his blog, I have been critical of a number of obviously skewed and uninformative posts at MasterResource, the self-proclaimed “free market” energy blog of Rob Bradley‘s Institute for Energy Research, that downplay climate risks, cheer on coal and fossil fuels and point out problems with alternatives, while disappointingly show little evidence of a commitment to or understanding of free markets, much less a commitment to libertarian principles.  

Rob has fairly consistently simply ignored difficult questions from me on his posts, but what does he do when his guest bloggers (in particular, (a) Tom Tanton of  Pacific Research Institute, who jumped in on a post by Rob on drawbacks to wind that ignores the external costs of coal, and (b) climate scientist/paid policy consultant Chip Knappenberger) have no good answers to my comments and questions?  Even when I am just responding to his guest bloggers and others on the thread, he simply stops posting my remarks.  I am now blocked (“on moderation”) on all threads.  Granted, both Tanton and Knappenberger were in difficulty, but rather than allowing all (including other readers) to learn by having an open conversation, he apparently decided that open discourse with someone who can hold their own isn`t worth the potential embarrassment and distraction from the “mission”.  Tanton, to his credit, though he shows little understanding of market principles, at least chased me back to my linked blog post to throw in a few more parting words.

Of course the blog his plaything – or that of whoever funds it for him – so it’s entirely his right to decide whom he allows to comment.  But by deciding that hard questions and critical comments from a fundamentally libertarian, market perspective were too inconvenient, he’s tipped his hand that his interest is not in promoting “free markets” in energy, but in protecting the interests of his fossil fuel funders.  I noted on a previous post by Rob that boosted coal while bashing the “Malthusian anti-energy crusade” that:

I haven’t concluded here that Rob’s a rent-seeker; more evidence would be needed, but it’s fair to inquire and to wonder.

However, Austrians are problem solvers, not trying to win government
favor for a particular industry or bashing those with different views
for the benefit of clients. It doesn’t looking like Rob is trying very
hard to be even-handed.

I think it’s fair to question what precisely are the objectives and
who is funding Rob, “Master Resources”, the Institute for Energy
Research, the American Energy Alliance and affiliated
institutions/personages. My understanding is that fossil fuel firms are
the principal funders, and it looks like the funding is rather generous.

So the jury is now in.

Too bad, as it’s just another manifestation of how powerful corporate interests work to manipulate the public debate (of course the wealthy citizens and corporations that fund enviros also deserve mention).  Further, it`s a turning away from principled and productive engagement over resource problems and the role of government in providing, facilitating or getting in the way of solutions to them. 

I queried Rob about his methods of engagement in response to a post by him entitled “Long Live King Coal?” in which he said that “coal looks to remain a mainstay in the domestic energy mix and bodes to help defeat the Malthusian anti-energy crusade.”  My comment?:

TokyoTom { 02.05.09 at 2:50 am }

Rob,
are the John Badens, Terry Andersons, Bruce Yandles, Elinor Ostroms and
others who want to find ways to manage our commons better – by
improving ownership, incentives and pricing signals – also part of a
“Malthusian crusade”?

I just wanna make sure I know who to hate.

As for that big fly ash breach/spill in Tennessee, I’m glad that you
didn’t point out how this was a result of government ownership of TVA,
with the added benefit that costs will be borne not only by direct and
indirect victims, but by taxpayers as well. No sense in pointing out
how government is so often in the way, particularly if it detracts from
our “we hate enviros!” message. Last thing we ever want to do is to
reach a shared understanding with enviros of the institutional
underpinnings of problems, since that means our funders might lose some
of their fairly purchased, government-given special privileges.

Interestingly, though, apparently ExxonMobil – a well-run firm that Rob Bradley praises – has decided to actively promote carbon taxes. As I pointed out in a recent post, Exxon CEO Rex Tillerson,in a speech on February 17 at the Stanford University-centered Global Climate and Energy Project (the world`s largest, and internationally collaborative research prject focussed on clean energy), which Exxon commenced funding six years ago and has committed $100 million over ten years to, specifically endorsed carbon taxes AND pointed out its support as an effort to persuade others:

“It
is rare that a business lends its support to new taxes. But in this
case, given the risk-management challenges we face and the alternatives
under consideration, it is my judgment that a carbon tax is the best
course of public policy action. And it is a judgment I hope others in
the business community and beyond will come to share.”

This must pain Rob to no end, as IER was once funded by Exxon; Exxon cut off funding last year to IER and certain other climate change denial groups.  An Exxon spokesman noted:

“We discontinued contributions to several public-policy research groups whose position on climate change could divert attention
from the important discussion about how the world will secure the
energy required for economic growth in an environmentally responsible
manner.”

Rob`s skewed data flow and perhaps even his own denial on climate science, investments and politics could be seen on his recent post in which he highlights comments from Exxon`s Tillerson about Exxon`s unwillingness to invest in renewables due to the unreliability of the government-provided incentives.  When I managed to get in a comment that pointed out Tillerson`s explicit endorsement  of carbon taxes, Rob responded that Exxon had not endorsed carbon taxes, but had argued that carbon taxes were simply preferrable to cap and trade.  Rob`s parsing of Exxon is ridiculous, as Exxon has clearing been signalling for the past few years that it believes that coordinated government action on climate change is merited.  But on top of that, I responded to Rob with a link to Tillerson`s Stanford speech, which clearly shows that Exxon HAS endorsed carbon taxes and that Rob is wrong.  But Rob won`t post this correction (which I made in earlier “moderated” comments as well), obviously preferring to continue to mislead his readers (with the statement that “ExxonMobil has not come out in favor of a carbon tax or pricing carbon
per se; they favor a tax over cap-and-trade. Two different things.”).

If Rob doesn’t want to let me in over there (I’m hoping he’ll change his mind), I guess I’ll just have to start an “anti-MasterResource” thread here.  Maybe I’ll see if I can get funding from Exxon!

Marlo Lewis of CEI has a rather schizophrenic post up at Rob Bradley‘s MasterResource blog – one of my favorite “free market” fossil-fuel industry-funded sites (unlike the NRO’s “Planet Gore”, MasterResource actually allows comments!) – regarding the proposal by leading “alarmist” climate scientist Dr. James Hansen (of NASA and Columbia U.’s Earth Institute) that the federal government adopt a “tax and dividend” climate policy instead of a “cap and trade” approach.

Lewis notes that Hansen recently testified in front of the U.S. House Ways and Means Committee about Hansen’s “tax and dividend” proposal, but while Lewis calls Hansen’s per capita rebated carbon tax proposal “clever”, Lewis puzzlingly fails to compare Hansen’s proposal with the cap and trade alternative that the Obama administration supports and that Congress (and industry) appears to favor.  Instead we get some poorly grounded speculation about the effects of a carbon tax and complaints about the political viability of a transparent carbon tax – all of which points not only ignore the more opaque, rent-seeking prone and heavy-handed cap and trade alternative, but by implication suggests that those who prefer an opaque and back-room deal prone cap and trade approach have made the correct political calculation.

Nor does Lewis make any mention of all of the support that carbon taxes have received, not only from economists, but from a wide range of others, including Exxon`s Rex Tillerson and various neocons, conservatives and libertarians (George Will, Congressman Bob Inglis, Jon Adler, Barbara Thoring, etc.), at least in comparison to cap and trade.

As a result, one is forced to wonder just whati it is that Lewis is trying to achieve – is he trying to sabotage a government-lite carbon policy, so that government-heavy policy is more likely to prevail?  If so, why?  Or does he really think that opposing EVERY carbon pricing policy is the most effective way to delay and/or influence ultimate policy outcomes?  I for one am confused.

My more extensive (and less high-level) comments to Marlo Lewis on his comment thread are copied below:

Marlo,
first, I’m afraid I don’t follow you on the science. We can’t stop our
still growing GHG releases on a dime, much less the short- to
medium-term feedbacks from water, methane and albedo changes, and
long-term will persist for centuries, and the water cycles, the oceans’
pH and world’s biota are changing noticeably and fairly rapidly, even
without significant further increases during the past decade – yet what
is it, precisely, about our ability to change our influence on the
system or to control responses that gives you comfort? Why do you seem
to think it is “conservative” for our nation and others to do nothing
in light of our remarkable and uncontrolled global climate experiment?

BTW, surely you are aware that Hansen has earlier offered extensive
information that paleoclimate records indicate that long-range climate
rsponse to a CO2 doubling is on the scale of 3 degrees C. Did you miss
that? Or were you more eager to say that Hansen’s reference to more
recent studies about facts some how implies that Hansen is “dissing”
models? What’s the point anyway, other than point-scoring – if facts
appear to indicate that long-term sensitivity is relatively high,
should we be ignoring that and placing our faith in models instead?
Should facts not further inform models, or policy-makers?

Second, while you note Hansen’s attack on cap & trade and his
“tax and dividend” proposal “quite clever”, you fail to offer any
opinion on the realative merits of these quite different proposals.
Instead, you offer some sniping criticisms of tax and dividend, as if
you are hoping that the consequence will be that the Obama
administration, Dems and rent-seekers generally will turn away from
climate policy altogether. But isn’t that nothing but wishful thinking,
and shouldn’t libertarians and others who prefer to avoid the
monstrosity of cap & trade be trying to encourage the efforts of
those whose proposals would be much less economically damaging? Isn’t
Hansen’s proposal far preferable over cap & trade, and the kind of
industrial planning that Jon Adler says is inevitable from the EPA
under EPA vs. Massachusetts without legislative action?

Exxon and a host of others (as noted at the blog posts linked at my
name) have come clearly down in favor of carbon taxes over cap &
trade; perhaps you may at some point care to favor us with your own
comparative views.

It seems to me that Hansen’s proposal is clearly preferable; it
could be easily implemented and monitored, would not involve large new
bureaucracies, would be much more transparent and less susceptible to
rent-seeking, would provide market signals on GHGs while having no
fiscal impact, would be grounded in the principle that the atmosphere
is owned by citizens and not government (or by corporations that are
given or purchase rights to emit GHGs), and, by being refunded per
capita to citizens would be generally progressive.

Third, as for your criticisms of Hansen’s proposal:

– carbon taxes will hit coal use more heavily than petroluem or
natural gas, so focussing first on “pain at the pump” smacks of
pandering, especially as revenue recycling may eliminate the pain
completely;

– older, dirtier coal plants are already uneconomic and generate
tremendous costs to health and property that are not costed to
producers or consumers; taxing carbon is a great way to end some of the
nonsense incentivized by the CAA. Your speculation about power supply
and electricity prices is nothing more than speculation, but oil and
gas-fired plants could be brought on line relatively quickly;

– as for the “green stimulus” effect, it is ironic that you fail to
see that the fact that “There is no guarantee people will use their
dividends to buy hybrid cars, energy-efficient appliances, or green
energy” is in fact an argument IN FAVOR of rebated carbon taxes as
opposed to cap and trade, as the first allows much greater economic
freedom and is thus more conducive to wealth creation. Further, not
only is dividending the tax proceeds a great way to make sure that the
government doesn’t have an even larger pot to dole out mandates,
subsidies and other goodies to favored industries, but the right could
trade its acceptance for such a tax for elimination of existing
subsidies to ethanol and solar.

– your point about labor productivity is fair, but it ignores the
social cost of carbon. Has forcing polluting industries for the ’60s on
benefitted society and improved productivity as a whole the whole? Or
is it simply more important to allow certain classes of producers and
consumers to profit while continuing to shift costs to others?

– as for “massive” transfers, this is all “would” and “could”
without any backing, and it completely ignores all of the massive
wealth transfers involved in the way we presently regulate power
generation and energy (and have refused to regulate GHGs). I’m happy to
have more information, but let’s not forget that the whole purpose is
to have a closer alignment between profits/benefits and social costs.

In a series of posts at the self-declared “free market” blog of the fossil-fuel energy industry funded Institute for Energy Research, energy expert  Rob Bradley (former Ken Lay speechwriter and Enron policy wonk) explores his dark forebodings that the “Malthusian wing” of the Obama administration and the environmentalist Left are actually enjoying and welcoming the present economic predicament.  Says Bradley, putting words in the mouth of his Malthusian stalking strawman:

“The economic recession/depression is good, not bad. It lowers our carbon footprint in countless ways. It saves resources. It throttles back industrial society to sustainable levels that were exceeded long ago. Let the downturn continue to get us out of the growth mentality. Let rising expectations fall! Less is more!”

[From: The Malthusian Wing of the Party in Power: When Will They Speak Up?; see also Beware of the New “Limits to Growth” (and looking for ReaganVision to CarterVision).]  Bradley will apparently be transported by paroxyms of self-satisfied delight/misery if a lefty, particularly one inside the Administration, ventures to say something like this.

Bradley may very well prove to be right that someone on the left may assert that an end to the “growth is good” mentality may be a silver lining in our recession.  But in his focus on prognosticating what plots the “Malthusians” may be hatching, Bradley simply refuses to actually engage the “Malthusians” on either their premises or their proposed solutions – namely, that there are real and serious problems that our societies must address and that more government is needed.  Indeed, Bradley doesn’t even venture to explain why he considers the Malthusians to be wrong, apparently assuming that this is self-evident. 

But as I have noted any number of times, there is indeed a wide range of very real and serious issues to be discussed, both as to problems AND to proposed “solutions”, such as I have noted in these two posts:

Too Many or Too Few People? Does the market provide an answer?

Food shortages: Ron Bailey takes up the cry, are Malthus and “Green fascism” on the march?

As a result, Bradley does not appear to be interested in the slightest in engaging productively with the Obama administration or the Left, and so in effect uses the term “Malthusian” as a type of shibboleth (or even an article of faith?) among supposedly “right-minded” people, and as an ad hom against the left.  In this, Bradley echoes others such as George Will who, in a recent editorial about climate change, warned of “dark green doomsayers”.

While I do not agree with the Left that more government is always the right solution, those on the right cannot win these arguments simply by name-calling or by trotting out – as George Will did in his editorial – the 1980 bet that Paul Ehrlich and others lost to Julian Simon over the future prices of minerals and commodities.   But the Ehrich-Simon bet was well-known; why not use it?   Because those who do so have ignored the reason why the Simon triumphed and Ehrlich lost, which was that because people own mineral resources, markets functioned to both to change demand and to provide incentives for future supply (and Ehrlich was no economist).  But none of this logic holds true for unowned or “public”, open-access resources – like the acidifying oceans, tropical forests and the global atmosphere and the climate it modulates – for which there simply are no effective property rights or functioning markets.  Instead, we continue to see see destructive exploitation (and kleptocracy in the countries where powerful elites elevate their interests over those of citizens). 

So, in the context of the issues that the “Malthusians” are now raising – in this case, the atmosphere – the Simon-Ehrlich bet stands for a propositions whose conditions clearly at present are not fulfilled, and which will not be fulfilled without hard work.  Until that hard work of establishing property rights or other effective governance institutionsis completed, people with legitimate preferences as to such resources and who are concerned about the effects of modern market demands on them have little ways of expressing those preferences other than through pressure on policy makers and attempts at moral suasion.

As an aside, let me note that nowhere does Bradley acknowledge that the Obama administration and Left inherited our economic shambles from freedom- and market-loving Greenspan/Bush/Bernanke/Paulson and the Right.  In this, Bradley resembles NRO commentator Henry Payne, who recently was so quick to lay all of the woes of the US automakers at the foot of the Obama administration and Washington Dems.  It’s sad that what may otherwise be legitimate commentary is so skewed by such transparent partisan bias and inconsistency.  Such reflexive partisanship also ignores not merely the responsibility of the Right, but also ignores what appear to be fairly significantly weaknesses in the structure of Western capitalism, which have been commented on by Michael Lewis, Joe Nocera and James Glassman and William Nolan at the WSJ; viz., weaknesses stemming from the weak governance and moral hazard (and strong rent-seeking) that is encouraged by the state grant of limited liaibility to corporate shareholders.

In other words, there are lots of real issues to discuss, from difficult resource issues that require collective action to address to public choice problems inherent in the use of government.

Those who profess a love of reason should turn to it, and not hobble themselves by a reliance on facile assumption and shallow ad homs.  Unless, of course, the aim is not to resolve underlying issues of appropriate institutions, but either to “win” the argument by wresting control of policy (and of related rents) from perceived competitors or, if winning is not likely, to at least satisfy emotional needs by railing at foes while surrendering the field (and the selection of policies) to them.

Let me close with a note of one small irony:  while Bradley is expecting that the Left will embrace the recession as a way to deliberately slow growth, Bradley’s own associate at IER, Austrian economist Bob Murphy has just put up on his personal blog a “wonderful clip” by comedian Loius C.K., who comments:

“Those were simpler times, I think; I just feel that we may be going back to that, by the way.  In a way, good; because when I read things like, “the foundations of capitalism are shattering,” I’m like, maybe we need that; maybe we need some time where we are walking around with a donkey with pots clanging on the sides.  … Yeah, because everything is amazing right now, and nobody’s happy.”

Seems like even Malthusian-haters will only be happy if we’re all more miserable!