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Peter Schiff says we should eliminate corporate and personal income taxes in favor of a national sales tax

March 29th, 2011 No comments

Here, in this March 28 interview at with Henry Blodget:

PETER SCHIFF: The US Should Abolish Corporate And Personal Income Taxes (jump to 3:15 if you’re in a rush)

Would an open discussion of Schiff’s proposal be a move towards sanity, or further away?

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Towards a productive libertarian approach on climate, energy and environmental issues

February 10th, 2010 No comments

[This is a work in progress and largely taken from previous posts, but readers might find some value in it in the meanwhile.]

1. Heated but vacuous climate wars

On environmental issues in general and climate in particular, find me someone (like George Will) ranting about “Malthusians” or “environazis” or somesuch, and I’ll show you someone who doesn’t understand – or refuses to acknowledge – the difference between:

(1) wealth-creating markets based on private property and/or voluntary interactions/contracts protected by law, and

(2) the tragedy of the commons situations that result when there are NO property rights (atmosphere, oceans), when the pressures of developed markets swamp indigenous hunter-gather community rules, in many cases where governments formally own and purport to manage “public” resources, and when governments absolve purportedly “private” actors from liability for harms to others (such as via grants of “limited liability“).

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 by a broad swath of society about climate have become a matter of an irrational, deluded “religious” faith, or that those raising their concerns are “misanthropes” or worse.

Such pigheadedness is met by those on the left likewise see libertarians and small-government conservatives as deluded and/or deliberate pawns of evil Earth-destroying corporations.

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 libertarian and others who profess to love markets 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 flawed institutional framework and have quite deliberately encouraged the current culture war.

2. Why the reflexive libertarian disengagement?

I have on numerous occasions tried to point out, to posters on the Mises Blog who have addressed climate issues, the stunning unproductivity of the approach that they have taken — that of focussing on science and dismissing motivations and preferences, rather than exploring root causes and middle ground, and have continued to scratch my head at the obstinacy and apparent lack of vision.

The following seem to be the chief factors at work in the general libertarian resistance to any government action on climate change:

– Many libertarians, as CEI’s Chris Horner has stated,  see “global warming [as] the bottomless well of excuses for the relentless growth of Big Government.”  Even libertarians who agree that is AGW is a serious problem are worried, for good reason, that government approaches to climate change will be a train wreck – in other words, that the government “cure” will be worse than the problem.

– Libertarians have in general drifted quite far from environmentalists (though there remain many productive free-market environmentalists/conservationists). Even though libertarians and environmentalists still share a mistrust of big government, environmentalists, on the one hand, generally have come to believe that MORE government is the answer, despite all of the problems associated with the socialized ownership of resources and/or inefficient bureaucratic management (witness the crashing of many managed fisheries in the US), the manipulation of such management to benefit bureaucratic interests, special interests and insiders (wildfire fighting budgets, fossil fuel and hard rock mining, etc.) and the resultant and inescapable politicization of all disputes due to the absence of private markets. On the other hand, many libertarians  reflexively favor business over “concerned citizens”, while other libertarians see that government “solutions” themselves tend to snowball into costly problems that work in favor of big business and create pressures for more government intervention. Thus, libertarians often see environmentalists as simply another group fighting to expand government, and are hostile as a result.

– Libertarians are as subject to reflexive, partisan position-taking as any one else. Because they are reflexively opposed to government action, they find it easier to operate from a position of skepticism in trying to bat down AGW scientific and economic arguments (and to slam the motives of those arguing that AGW must be addressed by government) than to open-mindedly review the evidence or consider ways that libertarian aims can be advanced by using the pressure from “enviro” goals.

This reflexive hostility – at times quite startingly vehement – is a shame (but human), because it blunts the libertarian message in explaining what libertarians understand very well – that environmental problems arise when property rights over resources are not clearly defined or enforceable, and when governments (mis)manage resources, and that there are various private steps and changes in government policy that would undo the previous government actions that are at the root of environmentalists’ frustrations.The reflexive hostility is also a shame because it has the effect, in my mind rather clearly, of rendering libertarians largely blind to the ways that large energy, power and certain manufacturing corporations continue to benefit from (and invest heavily in maintaining) the existing regulatory structure, in ways that shift large costs and risks to unconsenting third parties.

– There are some libertarians and others who profess to love free markets at AEI, CEI, Cato, IER, Master Resource and similar institutions that are partly in pay of fossil fuel interests, and so find it in their personal interests to challenge both climate science and policy proposals that would impose costs on their funders.

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. 

3. The whys of climate concerns and calls for “clean” energy

I want to get started with a list of policy changes that I think libertarians can and should be championing in response to the climate policy proposals of others.

The incessant calls for – and criticism of – government climate change policies and government subsidies and mandates for “green/clean power” both ignore root causes and potential common ground.  As a result, both sides of the debate are largely talking past each other, one talking about why there is a pressing need for government policy to address climate change concerns, while the other is concerned chiefly about the likelihood of heavy-handed mis-regulation and wasted resources. This leaves the middle ground unexplored.

There are plenty of root causes for the calls for legislative and regulatory mandates in favor of climate policies and clean / green / renewable power, such as:

  • concerns about apparent ongoing climate change, warnings by scientific bodies and apprehensions of increasing risk as China, India and other developing economies rapidly scale up their CO2, methane and other emissions,
  • the political deals in favor of environmentally dirty coal and older power plants under the Clean Air Act,
  • the enduring role of the federal and state governments in owning vast coal and oil & gas fields and relying on the royalties (which it does not share with citizens, but go into the General Pork Pool, with a relatively meager cut to states),
  • the unwillingness of state courts, in the face of the political power of the energy and power industries, to protect persons and private property from pollution and environmental disruption created by federally-licensed energy development and power projects,
  • the deep involvement of the government in developing, encouraging and regulating nuclear power, and
  • the frustration of consumer demand for green energy, and the inefficient and inaccurate pricing and supply of electricity, resulting from the grant by states of public utility monopolies and the regulation of the pricing and investments by utilities, which greatly restricts the freedom of power markets, from the ability of consumers to choose their provider, to the freedom of utilities to determine what infrastructure to invest in, to even simple information as to the cost of power as it varies by time of day and season, and the amount of electricity that consumers use by time of day or appliance.

4. Is a small-government, libertarian climate/green agenda possible and desirable?

So what is a good libertarian to suggest? This seems rather straight-forward, once one doffs his partisan, do-battle-with-evil-green-fascist-commies armor and puts on his thinking cap.

From my earlier comment to Stephan Kinsella:

As Rob Bradley once reluctantly acknowledged to me, in the halcyon days before he banned me from the “free-market” Master Resource blog, “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 unfortunately the wheels of this principled concern have never hit the ground at MR [my persistence in pointing this out it, and in questioning whether his blog was a front for fossil fuel interests, apparently earned me the boot].

As I have noted in a litany of posts at my blog, pro-freedom regulatory changes might include:

Other policy changes could also be put on the table, such as:

  • an insistence that government resource management be improved by requiring that half of all royalties from mineral and fossil fuel development be rebated to citizens (with a slice to the administering agency), and
  • reducing understandable NIMBY problems by (i) encouraging project planners to proactively compensate persons in affected areas and (ii) reducing fears of corporate abuses, by providing that corporate executives have personal liability for environmental torts (in recognition of the fact that the profound risk-shifting that limited liability corporations are capable of that often elicits strong public opposition and fuels regulatory pressure).

5. Other libertarian discussants

A fair number of libertarian commenters on climate appear to accept mainstream sciences, though there remain natural policy disagreements. Ron Bailey, science correspondence at Reason and Jonathan Adler, a resources law prof at Case Western, Lynne Kiesling at Knowledge Problem blog, and David Zetland, who blogs on water issues, come to mind.

I`m not the only one – other libertarian climate proposals are here:

  • Jonathan Adler at Case Western (2000); he has other useful commentary here, here,
  • Bruce Yandle, Professor Emeritus at Clemson University, Senior Fellow at PERC (the “free market” environmentalism think tank) and a respected thinker on common-law and free-market approaches to environmental problems, has in PERC’s Spring 2008 report specifically proposed a A No-Regrets Carbon Reduction Policy;
  • Iain Murray of CEI; and
  • Cato’s Jerry Taylor is a frequent commentator and Indur Goklany has advanced a specific climate change-targeted proposal.
  •  AEI’s Steven Hayward and Ken Green together have provided a number of detailed analyses (though with a distinct tendency to go lightly on fossil fuels).

Several libertarians recently urged constructive libertarian approaches to climate change:

There have been several open disputes, which indicate a shift from dismissal of science to a discussion of policy; the below exchanges of view are worthy of note:

  • The Cato Institute dedicated its entire August 2008 monthly issue of Cato Unbound, its online forum, to discussing policy responses to ongoing climate change.  The issue, entitled “Keeping Our Cool: What to Do about Global Warming“, contains essays from and several rounds of discussion between Jim Manzi, statistician and CEO of Applied Predictive Technologies, Cato Institute author Indur Goklany; climate scientist Joseph J. Romm, a Senior Fellow at the Center for American Progress; and Michael Shellenberger and Ted Nordhaus, the co-founders of The Breakthrough Institute.  My extended comments are here.
  • Reason Foundation, posted an exchange on Climate Change and Property Rights June 12th, 2008 (involving Reason’s Shikha Dalmia, Case Western Reserve University law professor Jonathan H. Adler, and author Indur Goklany); discussed by Ron Bailey of ReasonOnline here; here`s my take.
  • Debate at Reason, October 2007, Ron Bailey, Science Correspondent at Reason, Fred L. Smith, Jr., President and Founder of CEI, and Lynne Kiesling, Senior Lecturer in Economics at Northwestern University, and former director of economic policy at the Reason Foundation.
  • Reason Foundation, Global Warming and Potential Policy Solutions September 7th, 2006 (Reason’s Shikha Dalmia, George Mason University Department of Economics Chair Don Boudreaux, and the International Policy Network’s Julian Morris).


Finally, I have collected here some Austrian-based papers on environmental issues that are worthy of note:

Environmental Markets?  Links to Austrians

Ones such paper is the following: Terry L. Anderson and J. Bishop Grewell, Property Rights Solutions for the Global Commons: Bottom-Up or Top-Down?

Supreme Court, others confused about "speech" because they ignore (1) that corporations are not themselves persons, but creatures of the state

February 3rd, 2010 No comments

Further, virtually everyone has been ignoring (2) WHY it is that there is so much concern about corporations and their influence on (and vulnerability to) government: namely, states have allowed individuals (and now other corporations) to form separate, limited-liability legal entities that cut off their owners for any responsibility for the damages that such corporations may do to others.

One of the chief direct consequences of the use of the state to create corporations, as I have discussed in many posts (as the Mises` resident radical enviro), has been massive risk-shifting to the public and cycles of public pressure to use government to rein in corporations. In this, the better organized, longer-lived  and deeper pocketed corporations always having a leg up on gaming the drafting and interpretation of laws and regulations, and using government to steal further from/shift risks to the public at large and to hobble competitors. Thus the indirect consequences of the grant of a limited liability corporate personhood include not simply the financial crisis, but the growing distrust of government, corporations, politicians and voters of a different political stripe and the ramp-up in reasons to fight over the wheel.

I think that the Supreme Court decision in Citizens United v. Federal Election Commission is wrong, chiefly because the First Amendment is about HUMAN speech, while corporations – though associations of humans – have a distinct legal identity and very different characteristics.

The decision is also wrong because the Roberts court fails to acknowledge that just as the state can create corporations, so also can it condition their existence on refraining from political speech (making political contributions, etc.), or regulate their speech via excise taxes or the like (just as the federal government so conditions the grant of income tax-free status to religious groups and non-profits on express restrictions on political speech). But far better to attack the problem at the root of incorporation (or at the Constitutional level) than by a host of federal-level laws and regulations – including those remaining on churches and NPOs.

I have commented on these points in a blog thread at the libertarian/right-leaning legal blog, The Volokh Conspiracy.

TokyoTom says:

Leo Mrvin: I haven’t given this much thought, but is it really inconceivable that if the First Amendment didn’t protect corporations, individuals who wanted to pool resources in mass media vehicles for political speech would do so without the benefit of limited liability?

Dilan EsperYou can make this argument, but it begs the question, because then the issue is simply re-stated as “can the government condition limited liability on individuals giving up their associational speech rights?”. 

In this case the question conflates the states which approve corporate status with the federal government, but why would such a question prove difficult? The federal government provides tax exemptions to religious and other groups on the express condition that they refrain from political speech.

It doesn‘t take much digging to see how profoundly the grant of limited liability to corporate shareholders has snowballed into the massive struggles for favor and regulation that we see today. Confused decisions that corporations (as opposed to those who own and staff them) have Constitutional rights has greatly contributed to this [- even as these decisions constantly acted to shift power from citizens and the states to the federal government] . (Likewise, the federal income tax has also perversely entangled the state in religious organizations and political speech.)

TokyoTom says:

If Congress can Constitutionally limit the speech of people who choose to associate as non-profit churches etc., why cannot it likewise limit the speech who choose to accept the favor of a state grant of limited liability?


John Dewey says:

The discussions about whether corporations have the rights of people and about whether the Founding Fathers could have considered corporations — is any of this relevant?

The First Amendment protects a citizen from a powerful government which would decide what speech the citizen would be allowed to read or hear. It’s not a right granted to a speaker, but a right granted to a listener or reader. As such, it makes no difference whether the speech being protected comes from a single person, a non-profit organization, a union. a church, or a corporation. It is not the speaker but rather the speech — and the right of the citizen to hear it — which is being protected.

TokyoTom says:

John, I disagree. The First Amendment is about the peoples‘ rights to gather and to speak privately and publicly, including reporting on government.

Corporations are not people — but legal fictions that are creatures of their owners and the State, which protects their owners by giving them a special grant of limited liability. Corporations may parrot the words of particular people with in the firm, but they [corporations], like parrots, are not people and do not “speak” themselves. (Actually, this is unfair to parrots and other animals, which deliberately attempt to convey meaning to others, and not as a sock puppet for another person/animal/entity.)

While I‘m no fan of corporate income taxes, just as the federal government can condition “non-profit” status on a waiver of political speech rights by churches and other forms of legal entities, so states condition the grant of corporate status on the owners‘ acceptance that they cannot use the corporation as a political mouthpiece (such a use could be made expressly ultra vires), and so should states and the federal government be able to limit or tax political speech by corporations.

Not only would this be good law, but in my view entirely good policy by doing much to slow rent-seeking via large corporations, by removing incentives for wealthy investors to influence public officials and public debate. Let the rich (and others) speak for themselves – anonymously if they choose – but we can and should stop the money-laundering of speech through corporations.

The Roberts court showed it didn‘t have the strength of its convictions by upholding the part of McCain-Feingold that mandates disclosure of who is funding speech — in my view, this is incorrect. Anonymous speech very much SHOULD be allowed – but only for individuals and organizations that have not been granted limited liability by the state.

The chief sticky side issue here is the political gagging of churches and NGOs arising from the desire for favorable tax treatment [on this, the solution lies both in ending limited liability and in ending corporate income taxes].

The Road Not Taken IV: My other hysterical comments on climate science & how Austrians hamstring themselves

November 2nd, 2009 2 comments

In my initial post, on how Austrians strive for a self-comforting irrelevancy on climate change, I copied my chief comment to Stephan Kinsella.

I copy below my other posts and some of the remarks I was responding to on Stephan`s thread, including the one that I was unable to post – for some reason I am trying to figure out (but that Stephan tells me was not a result of moderation by him; I note my full apology, as stated in my update to my preceding post):

  • TokyoTom

    fundamentalist: “I love the responses from the GW hysteria crowd.
    They have nothing to offer but ad hominem attacks and appeals to

    Am I excluded from the “hysteria” crowd, Roger? Because if I`m in,
    you seem to have entirely missed my post, and my point, as to the
    consistency of your arguments with Austrian principles and the
    effectiveness of approaches like yours in dealing with the rest of the
    world – including all of the deluded and others who are engaged in bad

    Published: October 30, 2009 9:44 AM

  • Stephan Kinsella
    [Note: this is the comment to which I responded with the remarks copied on my preceding post]

    “Tokyo” asked me to respond to his post but it’s so rambling I am
    not sure what to respond to. To me this is very simple. I think we are
    in an interglacial period. It’s going to start getting cooler
    eventually, unless by then we have enough technology and freedom (no
    offense, Tokyo) to stop it. If there is global warming maybe it can
    delay the coming ice age by a few centuries.

    If there were really global warming why not just use “nuclear
    winter” to cool things down? You don’t see the envirotards advocating that! 🙂 (see Greenpeace to advocate nuking the earth?)

    In any event as I see it there are several issues. Is it warming?
    Can we know it? Do we know it? Are we causing it? Can we stop it?
    Should we stop it?

    It seem to me we do not know that it’s warming; if it is, it’s
    probably not caused by Man; and if it is, there’s probably nothing we
    can do to stop it except effectively destroy mankind; there’s no reason
    to stop it since it won’t even be all bad, and in fact would be overall
    good. I do not trust the envirotards, who hate industrialism and love
    the state, and seek anything to stop capitalism and to give the state
    an excuse to increase regulations and taxes; why anyone thinks these
    watermelons really know what the temperature will be in 10, 100, 1000
    years, when we can’t even get accurate weather forecasts a week out, is
    beyond me.

    That said, I’ll take the watermelons seriously when they start
    advocating nuclear power. Until then, they reveal themselves to be
    anti-industry, anti-man, techo-illiterates. (See Green nukes; Nuclear spring?.)

    Published: October 30, 2009 10:03 AM

  • TokyoTom

    [my prior version ran off without my permission; this is a re-draft]

    It seems like I can lead a horse to water, but I can`t make him think,

    We all have our own maps of reality and our own calculus as to what
    government policies are desirable and when, but as for me, the status
    quo needs changing, and the desire of a wide range of people – be they
    deluded, evil, conniving or whatnot – to do something on the climate
    front seems like a great opportunity to get freedom-enhancing measures
    on the table and to achieve some of MY preferences, chiefly because
    they help to advance the professed green agenda. [To clarify, I didn`t mean that I want to advance “the green agenda”, but that the pro-freedom policy suggestions I have raised should be attainable because greens and others might see that they also serve THEIR agendas.]

    I see no reason to sit at home or simply scoff or fling poo from the
    sidelines, and let what I see as a bad situation get worse. There`s
    very little in that for practically anyone here – except of course
    those who like coal pollution, public utilities, corporate income
    taxes, big ag corporate welfare, political fights over government-owned
    resources, energy subsidies and over-regulation, etc. (and those folks
    aren`t sitting at home, believe me).

    I can keep on questioning everyone`s sanity or bona fides, or I can
    argue strongly for BETTER policies, that advance shared aims.

    Does Austrian thinking simply lack a practical political arm, other
    than those few who have signed up to support special interests?

    Ramblin` Tom

    Published: October 30, 2009 11:51 AM

  • TokyoTom

    Stephan, if I may, I am appalled and offended by your shallow and
    fundamentally dishonest engagement here. That there are a string of
    others who have preceded you in this regard is no excuse.

    You: (i) post without significant comment a one-page letter from a
    scientist – as if the letter itself is vindication, victory or a
    roadmap for how we should seek to engage the views and preferences of

    (ii) refuse to answer my straightforward questions (both above and
    at my cross-linked post, which you visited) on how we engage others in
    the very active ongoing political debate, in a manner that actually
    defends and advances our policy agenda, and (putting aside the
    insulting and disingenuous “Tokyo asked me to respond” and “it’s so
    rambling I am not sure what to respond to”); and

    (iii) then proceed to present your own view of the science, the
    motives and sanity “watermelons” (as if they`re running the show), a
    few helpful, free-market libertarian “solutions”, like open-air
    explosion of nuclear weapons to bring about a “nuclear winter” effect!

    And my attempt to bring your focus back to the question of how we
    actually deal with others in the POLITICAL bargaining that is, after
    all, underway is met with silence – other than your faithful report
    back from your trusty climate physicist expert policy guru friend about
    …. science (all being essentially irrelevant to my question, not
    merely the cute little folksy demonstration about how the troubling
    melting and thinning of Antarctic ice sheets actually now underway
    simply CAN`T be occurring, but also a further failure to address the
    very rapid ocean acidification our CO2 emissions are producing)!

    Maybe it`s me, but I find this type of insincere and shallow
    engagement on such a serious issue to be a shameful discredit to the
    Mises Blog (even if it does cater to those who prefer to think that the
    big to do about climate – which may very well result in a mass of
    ill-considered, costly and counterproductive
    legislation – is really groundless and so can simply be ignored, aside from a bit of internal fulminations here).

    If you are not actually interested in discussing policy on a serious issue, then consider refraining from posting on it.

    Maybe it`s not my position to expect better, but I do.



    Roy Cordato (linked at my name) said this:

    “The starting point for all Austrian welfare economics is the goal
    seeking individual and the ability of actors to formulate and execute
    plans within the context of their goals. … [S]ocial welfare or
    efficiency problems arise because of interpersonal conflict. [C] that
    similarly cannot be resolved by the market process, gives rise to
    catallactic inefficiency by preventing useful information from being
    captured by prices.”

    “Environmental problems are brought to light as striking at the
    heart of the efficiency problem as typically seen by Austrians, that
    is, they generate human conflict and disrupt inter- and intra-personal
    plan formulation and execution.”

    “The focus of the Austrian approach to environmental economics is
    conflict resolution. The purpose of focusing on issues related to
    property rights is to describe the source of the conflict and to
    identify possible ways of resolving it.”

    “If a pollution problem exists then its solution must be found in
    either a clearer definition of property rights to the relevant
    resources or in the stricter enforcement of rights that already exist.
    This has been the approach taken to environmental problems by nearly
    all Austrians who have addressed these kinds of issues (see Mises 1998;
    Rothbard 1982; Lewin 1982; Cordato 1997). This shifts the perspective
    on pollution from one of “market failure” where the free market is seen
    as failing to generate an efficient outcome, to legal failure where the
    market process is prevented from proceeding efficiently because the
    necessary institutional framework, clearly defined and enforced
    property rights, is not in place.”

    Published: October 31, 2009 1:00 PM

  • TokyoTom


    “Did rising temperatures cause an increase in atmospheric carbon-dioxide concentration”.

    This is a great, basic question; I`d love to answer it (actually, I
    already did, though a bit indirectly), but you see, I`m one of the
    nasty obfuscating members of the socialist hysterical crowd, so I
    really should defer to others here who have better ideological and
    scientific stature here (and who hate ad hominems and love reason),
    such as fundamentalist, or perhaps even our confident lead poster,
    Stephan Kinsella (who has nothing to offer on the question of how
    libertarians should engage with others on the political front), or even
    our humble physicist climate system authority, Dr. Hayden.

    Gentlemen, take it away.

    Published: October 31, 2009 11:31 AM

  • TokyoTom

    I`m sorry I don`t have time now to respond in more detail to those
    who have commented in response to mine, but let me note that not one of
    you has troubled to actually respond to my challenge, which was based
    on Austrian concepts of conflict resolution, understanding of
    rent-seeking embedded in the status quo, and the recognition that the
    present debate on climate, energy and environmental issues presents
    opportunities to actually advance an Austrian agenda.

    In my view, we can either try to improve our lot, by seeking items
    such as those I laid out previously or condemn ourselves to irrelevancy
    by standing by and letting the big boys and the Baptists in their
    coalition hammer out something worse from our Congresscritters.

    For this, the correctness of our own views of climate science
    matters little – nothing, in fact, unless we are willing to DO
    something about it, by engaging with OTHERS who have DIFFERENT views.

    For those who have too much trouble remembering the legal/regulatory changes that I suggested, here they are:

    [pro-freedom regulatory changes might include:

    * accelerating cleaner power investments by eliminating corporate
    income taxes or allowing immediate amortization of capital investment,
    * eliminating antitrust immunity for public utility monopolies (to
    allow consumer choice, peak pricing and “smart metering” that will
    rapidly push efficiency gains),
    * ending Clean Air Act handouts to the worst utilities (or otherwise
    unwinding burdensome regulations and moving to lighter and more
    common-law dependent approaches),
    * ending energy subsidies generally (including federal liability caps for nuclear power (and allowing states to license),
    * speeding economic growth and adaptation in the poorer countries most
    threatened by climate change by rolling back domestic agricultural
    corporate welfare programs (ethanol and sugar), and
    * if there is to be any type of carbon pricing at all, insisting that
    it is a per capita, fully-rebated carbon tax (puts the revenues in the
    hands of those with the best claim to it, eliminates regressive impact
    and price volatility, least new bureaucracy, most transparent, and
    least susceptible to pork).

    Other policy changes could also be put on the table, such as an
    insistence that government resource management be improved by requiring
    that half of all royalties be rebated to citizens (with a slice to the
    administering agency).]

    Many others come to mind.

    Well, what`s it going to be? Relevancy, or a tribal exercise in disengaged and smug self-satisfaction?

    Published: October 31, 2009 12:37 PM

  • TokyoTom

    1. Christopher and mpolzkill:

    Thanks for the favor of your comments.

    I was asking if Austrians never seek to practically engage others on
    questions of policy; the first of you brings up Ron Paul, but one man
    is not a policy, nor are his sole efforts a policy program; the other
    of you suggests succession from the U, which is hardly an effort at
    pragmatic engagement with anybody over a particular issue. (BTW, here
    is Ron Paul`s climate program.)

    I can see some engagement by libertarians on this issue, but such
    seeds either (i) die when they fall on the rocky ground of the Mises
    Blog or (ii) represent work by people paid to criticize one side of the
    debate, and consistently ignore problems with the definitely
    non-libertarian status quo.

    Why libertarians do not see any opportunity here for a positive
    agenda? Do they prefer to be taken as implicit supporters of the
    government interventions that underlie most enviros` complaints?

    2. fundamentalist:

    “I don’t see anyone doing that except the GW hysterical crowd.
    Honest scientists like Hayden try to present evidence and reason so
    that we can have a real debate, and the hysterical crowd flings poo
    from the sidelines.”

    Thanks for your direct comment (even as you lace it and others with
    ad homs), but can`t you see you also are missing my point? Are you NOT
    interested in trying to cut deals that would, say:

    * accelerate cleaner power investments by eliminating corporate
    income taxes or allowing immediate amortization of capital investment,
    * eliminate antitrust immunity for public utility monopolies (to allow
    consumer choice, peak pricing and “smart metering” that will rapidly
    push efficiency gains),
    * end Clean Air Act handouts to the worst utilities (or otherwise
    unwinding burdensome regulations and moving to lighter and more
    common-law dependent approaches),
    * end energy subsidies generally (including federal liability caps for nuclear power (and allowing states to license),
    * speed economic growth and adaptation in the poorer countries most
    threatened by climate change by rolling back domestic agricultural
    corporate welfare programs (ethanol and sugar),
    * insist that government resource management be improved by requiring that half of all royalties be rebated to citizens,
    * end federal subsidies to development on barrier islands, etc. or
    * improve adaptability by deregulating and privatizing roads and other “public” infrastructure?

    Or is it more productive to NOT deal with those whom you hate, and
    stand by while special interests cut deals that widen and deepen the
    federal trough?


    Published: November 1, 2009 2:21 AM

  • TokyoTom

    Allow me to outline here a few responses to the arguments raised by
    Dr. Hayden, even as I do not pretend to be an expert (and, to be
    pedantic, even though they are largely irrelevant to the question of
    whether Austrians wish to take advantage of the opportunity presented
    by the many scientists and others who have differing views, to roll
    back alot of costly, counterproductive and unfair regulation).

    1. Models: Dr. Hayden disingenuously casts aside what modern physics
    tells us about how God plays dice with the universe (via random,
    unpredictible behavior throughout the universe), and the limits of
    human knowledge (including the ability to measure all inputs affecting
    climate, including all of our own), and essentially asks us to wait
    until our knowledge is perfect, and our ability to capture and
    number-crunch all information relevant to the Earth`s climate
    (including changing solar and cosmic ray inputs and ocean behavior)
    before any of us, or our imperfect governments, can take any action on

    Physical and practical impossibility aside, is this how any human or
    any human organization structures its decisions? Narrowly, Dr. Hayden
    is of course right that “the science is not settled”, but so what?

    2. Was there a tipping point 300 million years ago (or whenever it was when CO2 levels reached 8000 ppm) ?
    Dr. Hayden plays with language, suggesting that a “tipping point” means
    something irreversible over hundreds of millions of years, when it`s
    very clear that there have in the past been numerous abrupt changes in
    climate (some taking place in as little as a few years, with a general
    return to prior values sometimes taking very long periods of time) and
    that scientists today are talking about tipping points that may be reached in human lifetimes.
    Will we lose all mountain glaciers? Will the Arctic become ice-free in
    winter? Will thawing release sufficient methane from tundras and seabed
    clathrates to push the climate even more forcibly than CO2? Are we set
    to lose glaciers in Greenland and Antarctica, regardless of what we do?
    Will we dry out the Amazon basin, and interrupt the Asian monsoon?
    There is plenty of concern and evidence that these things are real

    3. “Global-warming alarmists tell us that the rising CO2 concentration is (A) anthropogenic and (B) leading to global warming.”

    But you never tell us whether you, too, Dr. Hayden, are an
    “alarmist”. Further down you acknowledge that “Nobody doubts that CO2
    has some greenhouse effect” admitting (B) (though not that it may be
    the chief factor), but as far as (A) goes, you only acknowledge that
    “CO2 concentration is increasing”. Care to make yourself an alarmist by
    admitting what cannot be denied – that man is responsible for rising
    CO2 concentrations? Or you prefer play with laymen`s ignorance by
    irresponsibly suggesting that rising CO2 is now due to warming oceans
    and not man`s activities?

    – “CO2 concentration has risen and fallen in the past with no help from mankind.”

    Yes, but what relevance is this now, when man is undeniably not simply “helping” but clearly responsible?

    – “The present rise began in the 1700s, long before humans could have made a meaningful contribution.”

    So? Does the fact that CO2 fluctuates naturally do to things other
    than man`s activities mean humans` massive releases of CO2 have NOT
    made a “meaningful contribution”? It`s very clear that the Industrial Revolution caused a dramatic rise in CO2. Surely you don`t disagree?

    – “Alarmists have failed to ask, let alone answer, what the CO2
    level would be today if we had never burned any fuels. They simply
    assume that it would be the “pre-industrial” value.”

    “Alarmists” of course is simply an unhelpful ad hom; and as for the rest, concerned scientists and laymen clearly note how CO2 has fluctuated prior to the Industrial Revolution.

    There undoubtedly many clueless laymen, just as there are some
    clueless scientists, so your sweeping statement may be narrowly

    But in the big picture, it is clear that man has had a drastic
    impact on CO2 levels – so what, precisely, is your point, except to
    confuse the issue?

    – “The solubility of CO2 in water decreases as water warms, and
    increases as water cools. The warming of the earth since the Little Ice
    Age has thus caused the oceans to emit CO2 into the atmosphere.”

    Sure, but this doesn`t mean man hasn`t been the dominant contributor to atmospheric CO2.

    Further, of course, warming oceans CEASED to release CO2 at the
    point that atmospheric CO2 started to make the oceans more acidic.

    – “The historical record shows that climate changes precede CO2
    changes. How, then, can one conclude that CO2 is responsible for the
    current warming?”

    The lag in the historical record BEFORE man simply shows that CO2,
    which has an acknowledged warming effect, was a warming reinforcer and
    not an initiator. This does NOT, of course, suggest that massive CO2
    releases by man magically have NO effect.

    4. Assuming that we ARE changing climate, is that a bad thing?

    – “A warmer world is a better world.” Maybe, but are there NO costs,
    losses or damages in moving to one? And do those people and communities
    who bear these costs or kinda like things as they are have any choice,
    much less defendable property rights?

    – “The higher the CO2 levels, the more vibrant is the biosphere, as
    numerous experiments in greenhouses have shown. … Those huge
    dinosaurs could not exist anywhere on the earth today because the land
    is not productive enough. CO2 is plant food, pure and simple.”

    I see; this is not a question of fossil fuel interests homesteading
    the sky (or being given license by govt) and so being entitled to shift
    risks and costs on us, but them beneficiently bestowing gifts on
    mankind – or dinosaurs, as Dr. Hayden may prefer! Wonderful gifts that
    cannot be returned for centuries or millenia! Yippee!

    [This is only scratching the surface of the letter, but I`m afraid I need to run for now.]

    Published: November 1, 2009 4:51 AM

  • TokyoTom [Note: my original post contained some bolding that went haywire and bolded most of the post; I`ve fixed that.]

    Okay, here`s a few more unconsidered thoughts to show how hysterical
    I am, am hooked on religion, hate mankind, [want to] return us to the Middle Ages
    and otherwise take over the world:

    – “Look at weather-related death rates in winter and in summer, and the case is overwhelming that warmer is better.”

    Sure, for If only it were so simple. The increase in AVERAGE global
    temps that we`ve experienced so far has meant little warming of the
    oceans (a vast thermal sink), and has shown up at higher latitudes,
    where we have seen a very marked warming and ongoing thawing, a shift
    of tropic zones away from the equator, disruption of rainfall patterns
    and stress on tropical ecosystems; all of this is considered to be just
    the beginning of a wide range of climate effects that have not yet been
    fully manifested for GHG and albedo changes so far,. much less to
    further increases in GHGs.

    – “CO2 is plant food, pure and simple.”

    It IS a “pure and simple” plant food, but your rhetoric implies much
    more – essentially that CO2 is NOTHING BUT plant food, and large
    releases of it have no effect on climate. And this, as you well know,
    is NOT a “pure and simple” matter.

    – “CO2 is not pollution by any reasonable definition.”

    You mean not by your reasonable definition, or under
    historical standards. But what IS “pollution”, but a social construct
    to describe the outputs of human activity that some of us have found to
    be damaging to our persons, property or other things that we value?
    Were CFCs released by refrigeration equipment “pollution” before we
    discovered that they damage the ozone layer?

    Scientists may be qualified to measure particular outputs and their
    consequences, but otherwise have no special insights into what others

    – “A warmer world begets more precipitation.”

    Sure, as warmer air generally holds more water – which in turn has a
    warming effect, let`s not forget. But as for the water itself, climate
    change leads to more severe rain events in some places but to droughts
    in others. And let`s not forget that a warmer world means that mountain
    snows don`t last until spring and summer as they once did, leaving
    streams and forests drier, and adversely affecting agriculture that
    relies on such water.

    – “All computer models predict a smaller temperature gradient
    between the poles and the equator. Necessarily, this would mean fewer
    and less violent storms.”

    Not so fast; this doesn`t hold for rain events or tornadoes.
    Further, independent paths of research indicate that while the North
    Atlantic may end up with fewer hurricanes, warming is likely to make them more intense.

    – How, pray, will a putative few degrees of warming melt all the ice
    and inundate Florida, as is claimed by the warming alarmists?

    First, note again the Dr.`s use of a strawman; no one is expect an
    imminent melt of “ALL” the ice. But significant melting and thinning of
    coastal ice IS occurring, and not merely on the West Antactic
    peninsula, which the good Dr. would realize if he`d trouble himself to
    compare his simple mental model, of reality with FACTS. As previously
    noted, coast ice sheets are plugs that slow the flow of glaciers from
    the interior. As these plugs are removed, the glaciers flow more
    quickly, via that exotic phenomenon we call “gravity”. I`ve already
    addressed this above, with links.

    – “If the waters around it warm up, they create more precipitation.”

    Yes, but does the new precipitation balance the ice being melted?
    Actual, detailed observations tell us that, despite your absolute
    certainty, that we are seeing increasing net mass losses far inland,
    not merely in Greenland but also in Antarctica. Your religious-like
    faith in your own superior understanding doesn`t make the facts go away.

    – “The ocean’s pH is not rising. It is falling, ever so slightly.
    Obviously your respondent has not the faintest clue as to how pH is
    defined. (BTW, the oceans are basic, not acidic.)”

    Yes, the good Dr. catches my mistake – pH is falling rather
    remarkably (from basic towards acidic) – but he too hastily skates past
    the main point, which is that this is due to increased atmospheric
    levels of CO2, which prove that the oceans are NOT actually releasing
    CO2 (or they`d be becoming more basic).

    I provided links in this last year here:

    Here`s more:

    From the Plymouth Marine Laboratory (UK) :

    “Until recently, it was believed that the oceans contained so much
    disolved carbonate and bicarbonate ions that any extra would have
    little effect. In fact this absorbtion was generally acknowledged a
    valuable process in protecting the planet from the worst effects of
    rising temperatures and climate change. However, in 2003 a paper was
    published in Nature (vol 425) which suggested that the increases in
    atmospheric CO2, occurring over the last 200 years, has actually
    increased the acidity of the oceans by 0.1 of a pH unit.The pH scale is logarithmic and this change represents a 30% increase in the concentration of H+ ions.

    “However, atmospheric concentrations of CO2 have been
    higher during previous times in Earths history and these high CO2
    periods didn’t cause ocean pH to change. The difference now is that the
    rate at which CO2 concentrations are increasing, is 100 times greater
    than the natural fluctuations seen over recent millennia. Consequently,
    the processes that ultimately balance the carbon cycle are unable to
    react quickly enough and ocean pH is affected. About half of all
    released CO2 is absorbed by the oceans but even if we stop all
    emmissions today, the CO2 already in the atmosphere has been predicted
    to decrease ocean pH by a further 0.5 unit.”


    “Dissolving CO2 in seawater also increases the hydrogen ion (H+)
    concentration in the ocean, and thus decreases ocean pH. Caldeira and
    Wickett (2003)[1] placed the rate and magnitude of modern ocean
    acidification changes in the context of probable historical changes
    during the last 300 million years.

    Since the industrial revolution began, it is estimated that
    surface ocean pH has dropped by slightly less than 0.1 units (on the
    logarithmic scale of pH; approximately a 25% increase in H+), and it is
    estimated that it will drop by a further 0.3 to 0.5 units by 2100 as
    the oceans absorb more anthropogenic CO2.[1][2][9] These changes are
    predicted to continue rapidly as the oceans take up more anthropogenic
    CO2 from the atmosphere, the degree of change to ocean chemistry, for
    example ocean pH, will depend on the mitigation and emissions pathways
    society takes.[10] Note that, although the ocean is acidifying, its pH
    is still greater than 7 (that of neutral water), so the ocean could
    also be described as becoming less basic.”

    “The term global warming has given way to the term climate
    change, because the former is not supported by the data. The latter
    term, climate change, admits of all kinds of illogical attributions. If
    it warms up, that’s climate change. If it cools down, ditto. Any change
    whatsoever can be said by alarmists to be proof of climate change.”

    Wonderful observation, except for the fact that IT`S WRONG; the
    change instead being deliberately led by Republicans; leading
    Republican pollster/ spinmeister Frank Luntz in 2002 pushed Republicans
    to move the public discussion away from “global warming” to “climate
    change”, because, as Luntz wrote,

    “’Climate change’ is less frightening than ‘global warming.’
    … While global warming has catastrophic connotations attached to it,
    climate change suggests a more controllable and less emotional

    Of course there IS the inconvenient fact that “climate change” is
    actually more accurate than simple “global warming”, but who cares
    about accuracy anyway, right Dr.?

    – “the earth has handily survived many millions of years when CO2
    levels were MUCH higher than at present, without passing the dreaded
    tipping point.”

    I already addressed above the point that while the Dr. seems to
    what to recreate the Cretaceous, the better for dinosaurs, most of us
    seem rather to like the Earth that we actually inherited and that the
    rest of current Creation is adapted for. He is obviously a physicist
    and not a biologist, and doesn`t seem to give any thought to the
    rapidity of the scale at which we are conducting our little
    terraforming experiment, and te challenges the pace of those changes
    are posing to ecosystems.

    – “To put it fairly but bluntly, the global-warming alarmists
    have relied on a pathetic version of science in which computer models
    take precedence over data, and numerical averages of computer outputs
    are believed to be able to predict the future climate. It would be a
    travesty if the EPA were to countenance such nonsense.”

    To put it bluntly, this is largely rubbish; there is a tremendous
    and growing amount of climate change DATA. You just make it your habit
    not to let facts get in the way of your own opinions. I would be a
    travesty if we continue to countenance posts such as yours, questions
    of relevance to Austrian purposes aside.

    – “I don’t do politics”

    Fine; I can see why that would not be your forte. But what`s very
    puzzling is that you seem to think that climate science IS your forte,
    when all you`ve show is a shocking level of arrogant ignorance.

    – “I don’t pretend to be an economic theorist.”

    And on a blog dedicated to Austrian economists, just why, one
    wonders, do the “giants” in our Mises world keep filling the Blog pages
    with post such as this, which are, on their very face, IRRELEVANT, to
    the question of how Austrians wish to address the preferences of other,
    the misuses of government and the management of unowned common

    – “he only difference between the Republicans and the Democrats
    is, in practical terms, their rhetoric. I don’t pretend to be an
    economic theorist.

    – “But the notion that we can run an industrialized giant on
    chicken manure and sunbeams doesn’t even pass the giggle test. Except
    in Washington.”

    At long last, you say something something intelligible. Except
    Washington spends trillions on nonsense at the drop of a hat, if you
    haven`t noticed recent events.

    Published: November 1, 2009 10:02 AM

  • TokyoTom

    Sorry if I`ve been a bit intemperate; that I`m rushed doesn`t excuse it.

    Dr. Hayden, you are entirely welcome to your own opinion and your
    own mental map of reality, but not to your own facts. As to your
    opinion and mental map, they are by your own admittance uninformed as
    to matters of economics and political science, but I must confess that
    I find your understanding of climate science to be seriously wanting.

    Given these, I fail to see what you offer here, other than a
    convenient, if very thin, cover for others here who don`t want to
    think, or to fight to make the world (or our own government) better.



    Published: November 1, 2009 10:11 AM

  • TokyoTom

    Bala, I appreciate your polite persistence; I`m sorry I haven`t responded yet, but I`ll get to you.

    Please note that my time is both limited and my own (though indeed
    others have claims on it), and I have no obligation to spend any of it
    responding to your importunings regarding climate science, which are
    now shading into impertinence.

    Feel free to draw whatever conclusions you wish, but a fair reader might note that:

    – my priorities may (unsurprisingly) differ from yours,
    – my chief points (and Austrian principles as to how to engage with others) have nothing to do with climate science per se,
    – I explicitly make no pretense of being a scientist or climate expert, and
    – in any case, there is no simple course to understanding reality; we
    are all forced to make decisions as to how much energy to devote to
    puzzling things out on our own (and overcoming what we know of our own
    subconscious cognitive filters) versus outsourcing this effort to
    others (by accepting things without deliberation, “on faith” as it

    Others who have been around longer will know that I`ve also devoted
    what they might consider an unreasonable amount of my time over the
    past few years, “hysterical” trying to help others work through climate
    science (and policy) issues.


    Published: November 1, 2009 8:46 PM

  • TokyoTom


    – “Tom, believing you live in a Republic with 300,000,000 people is a delusion which heads off all actual pragmatism.”

    This is not a delusion I have, but in any case it`s not at all clear
    that this or any other delusion “heads off all actual pragmatism”.

    – “Until there is actual representation, everything said by we
    proles is literally hot air (unless it’s happens to coincide with
    whatever benefits the regime).”

    I use “our government” simply as shorthand for what you call “the
    regime”, but perhaps may be more accurately described as a multicentric

    In any case, the painstaking efforts of LVMI to grow the Mises
    website, and the welcome reception of and contribution to those efforts
    by everyone here – yourself included – belies both your near-nihilistic
    cynicism and your conclusion, as to virtually every topic discussed
    here. Words are deeds, though they be more or less frivolous, weighty,
    insightful or consequential.

    If the other Mises bloggers agreed with you as to the possible
    efficacy of their words, either generally or on this particular topic,
    they simply wouldn`t bother to post.

    However, I share your concern about efficiacy, which is why I
    criticize posts such these (whether by Stephan, George Reisman, Sean
    Corrigan, Walter Block, or Jeffrey Tucker), which are, by and large,
    more of a circle jerk than an effort to engage.

    – “thank you for being respectful”

    My pleasure, but you hardly need to thank me; this is a community, after all.

    – “even though you mistakenly think I’m a nut.

    In this case, it is you who are mistaken (not that you ARE a nut, but that you think I think you are).


    Published: November 1, 2009 9:35 PM


This is last version of the comment that I tried to post several times:

method fan:

[my first attempt apparently failed to post, so apologies if this shows up twice]

– “You are insofar wrong, that not only this “data” is analysed but it is also used to “predict” the future of reality by using it in simulations!”

You miss my criticism of Dr. Hayden`s refusal to examine facts about ongoing melting in Antarctica, but of course I do NOT disagree with you that current and paleo data can be used to “predict” the future.

But of course a scientific understanding of the world, and information – in this case, both about the past and current trends of climate inputs – certainly can give us useful information about what the future may hold in store for us.

“There is no sound experimental proof that human activity-emitted carbon dioxide is the cause for some sort of global warming.”

Nicely phrased; there of course plenty of experimental proof that carbon dioxide is an atmospheric warming agent, but no experimental proof that it is “the” cause for any global warming.

While we are now running such a global experiment – one that started centuries ago and will not be played out for centuries hence and is, for all intents and purposes irreversible – and thus cannot, in the Popperian sense, even be considered an “experiment”.

Whether our ramping up of the experiment is prudent or principled are entirely different questions, and properly the subject of much discussion.

– “These guesses remind one of the idea that rain dances are the cause for rain.”

I`m tempted to make a comeback, but surely you realize your flip comparison is entirely inapropos.

Here`s hoping for more sincere discourse.


The Road Not Taken II: Austrians strive for a self-comforting irrelevancy on climate change, the greatest commons problem / rent-seeking game of our age

October 30th, 2009 3 comments

[Update: Readers may wish to note the latest developments, as I note in these follow-up posts.]

Stephan Kinsella – whom I have engaged before on the ramifications of the decidedly non-libertarian state grant of limited liabiility to corporations – has a new post up on the Mises Blog on global warming;  his first on this subject, as far as I know.

The post is surprisingly short, and consists of a simple introduction by Stephan a copy of letter to the EPA (which he has appended) that one Howard Hayden, a retired physicist, one whom Stephan assures us is “a staunch advocate of sound energy policy” – whatever that means (hey, me too!) – submitted in connection with the EPA`s Supreme Court-mandated consideration of whether to regulate CO2 and other greenhouse gases. Stephan also refers to Dr. Hayden`s letter as a “one-letter disproof of global warming claims.”

I welcome Stephan to this discussion, which has taken place at the Mises Blog in fits and starts over the past few years. However, the absence of any commentary by Stephan leaves me scratching my head. Where`s the beef? Are this person`s scientific views on climate so convincing or obviously correct, and are the policy implication so straightforward, and correct, that we should all “get it” and agree, without any commentary by Stephan? Or Is Stephan simply playing with our credulity, and his own?

In any case, given both (1) the focus of Austrian economics on productively addressing conflicts between people with conflicting preferences (and the frequently negative role that governments play in resource tussles, generally to the benefit of entrenched insiders and to government itself) and (2) the recent Nobel prize award to Elinor Ostrom regarding the ways that humans work together successfully or not) to address common resources, I am simply disappointed. Is this all that Stephan has to offer?

Observing that Stephan fits within a grand tradition at Mises of shallow thought on climate and other “environmental” issues, I felt compelled to post a few thoughts at Stephan`s post, which I copy below:



Thanks for bringing your post to my attention.

My short response? Remember “Thank you, Prof. Block, for feeding our confirmation biases“?

But since I can`t resist doing what nobody else seems inclined to – I suppose it is, after all, why you invited me to this feast – let me make a few comments on matters that would apparently not otherwise occur to you or to the rest of the community.

The fact that most of the contents of Dr. Hayden`s letter is confused twaddle that has been explained in detail countless times (and personally by me, ad nauseum, to the extreme annoyance of most of the blog over the years 2006-2008) aside, it puzzles me that you and others prefer to treat the pages of the Mises Blog as a forum to dismiss – through drive-by postings like this (a la Walter Block) of a particular piece of “skepticism” that caught your fancy – extremely widespread scientific views (held by EVERY major national academy of science, including China and India), rather than engaging in a discussion of preferences, institutions and policies.

As I`ve asked Jeffrey Tucker previously, is science the forte of the Mises Blog, or its readers?

Even if those who believe that man`s rising emissions of CO2 have nothing to do with an observably rapidly changing world and pose no threat whatsoever – and that those who disagree are all deluded and/or evil – turn out, after we play our little massive and irreversible game with the Earth for another few centuries, to be absolutely right, is engaging with them by dismissing their concerns an approach that holds even the slightest prospect of success?

It`s as if Austrians were determined to ignore their own principles, stampede themselves into irrelevancy, and to make sure that we get the WORST policy outcomes possible.

Why not, if you think others all wrong, deluded or evil, play along with their game, and actually seek policy changes that might not only address the expressed concerns of others in a meaningful way, while also advancing a libertarian, freedom-seeking agenda?

As I have noted in a litany of posts at my blog, most recently one addressed to Bob Murphy, such pro-freedom regulatory changes might include:

  • accelerating cleaner power investments by eliminating corporate income taxes or allowing immediate amortization of capital investment,
  • eliminating antitrust immunity for public utility monopolies (to allow consumer choice, peak pricing and “smart metering” that will rapidly push efficiency gains),
  • ending Clean Air Act handouts to the worst utilities (or otherwise unwinding burdensome regulations and moving to lighter and more common-law dependent approaches),
  • ending energy subsidies generally (including federal liability caps for nuclear power (and allowing states to license),
  • speeding economic growth and adaptation in the poorer countries most threatened by climate change by rolling back domestic agricultural corporate welfare programs (ethanol and sugar), and
  • if there is to be any type of carbon pricing at all, insisting that it is a per capita, fully-rebated carbon tax (puts the revenues in the hands of those with the best claim to it, eliminates regressive impact and price volatility, least new bureaucracy, most transparent, and least susceptible to pork).

Other policy changes could also be put on the table, such as an insistence that government resource management be improved by requiring that half of all royalties be rebated to citizens (with a slice to the administering agency).

As Rob Bradley once reluctantly acknowledged to me (in the halcyon days before he banned me from the “free-market” Master Resource blog), “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 unfortunately the wheels of this principled concern have never hit the ground at MR [persistently pointing this out it, and questioning whether his blog was a front for fossil fuel interests, appears to be what earned me the boot].

There have been occasional   libertarian  climate  proposals floated over the past few years, but they have never graced the Mises Blog, instead falling gently to the ground unnoticed – apparently, except for me – like the proverbial unstrained koala tea of Mercy.

Austrians seem to act as if the love of reason requires a surrender of it in favor of the comforting distraction of a self-satisfied echo chamber of a type that would warm the cockles of any like-minded religious “alarmist” cult.

Then of course, we have our own  home-grown libertarians who are happy to participate actively in the debate (with many excellent points, naturally), but carefully skirt for the purposes of maximum effectiveness (and felicitously, for their own consciences) the fact that their views are funded by the dirtiest class of rent-seekers. Plus we have a few who are happy to regurgitate for us “heroic” “grassroots” efforts that are transparent corporate PR ploys.

Finally, since no one else seems to be remotely interesting in scratching the surface of Dr. Hayden`s letter, here is what a little due diligence turns up:

– sure, the solubility of CO2 in water decreases as water warms, and increases as water cools. Some skeptics use this to suggest that rising atmospheric CO2 concentrations are due not to man, but to a naturally warming. That`s why it`s so interesting that, despite a warming ocean, ocean pH is rising [oops, I meant pH is “falling”, as I`ve noted in a previous comment about rapidly changing ocean pH]  because dissolved CO2 is also rising (because man`s CO2 emissions are forcing more CO2 to be dissolved in water).

– You ask sarcastically, if the melting point of ice is 0 ºC in Antarctica, just as it is everywhere else, how will a putative few degrees of warming melt all the ice and inundate Florida, as is claimed by the warming alarmists? The answer is, simply, that (1) the warming oceans melt and undermine the coastal ice, and (2) as coastal buttresses are removed, gravity brings the continental ice down more rapidly. This process is well underway and apparently accelerating, as described in a study just published in Nature. Note also that not all of Antarctica lies precisely at the South Pole, and that some parts are melting directly as the atmosphere warms.

– finally, not all men are dinosaurs, nor is the rest of extant Creation (save birds, of course). Why should we feel comforted by the fact that we may, in the blink of an eye in geologic time (decades/centuries), be terra-forming the Earth for creatures that no longer exist, while stressing it for the rest of Creation? Do we have no right of preference in climate or in the life we share the Earth with, or have the investors in fossil fuel firms homesteaded the right to modify environmental matters willy nilly, come what may?

Thanks for providing the soapbox, Stephan.


I note that Stephan closes his introduction to Dr. Hayden`s letter with the following:

“I love Hayden’s email sign-off, “People will do anything to save the world … except take a course in science.””

Would that problems of governance of shared resources were so easy as taking a science course! Then ALL of us Austrians, and not merely our leading lights at the Mises Blog, could simply pack up and go home, and leave everything to a few philosopher-king scientists!

[update] Bob Murphy, Rob Bradley and the Austrian Road Not Taken on Climate by two fossil-fuels gunslingers

October 28th, 2009 No comments

[Update: I copy at bottom a follow-up exchange I had on Bob`s thread with another reader – radio silence from Bob.]

Bob Murphy has a new post up at his blog, “CBO Testimony Misleads on Cost of Cap-and-Trade“, that draws attention to a new blog post at the Institute of Energy Research that Bob says he “had a lot to do with”.

The IER post rightly criticizes some of the numbers that the Congressional Budget Office has released, but the IER is playing games itself.

I left the following note at Bob`s (now substantially goosed up for the benefit of readers):

TokyoTom said…

IER? Isn`t that the “free-market” blog that bans libertarians who are not on their pro-coal, pro-pollution wagon? [Oops, I confused this with Rob Bradley`s MasterResource blog; IER is different, in that IER is – much more clearly than MR – an active rent-seeking front for fossil fuel interests, which Exxon made clear last year when it publicly announced that it would no longer fund IER`s “unproductive”, climate-skeptic position.]

But while we`re on the subject, let`s not forget:

– Austrians` fundamental objections to cost-benefit analysis;

that the mining, transport and combustion of coal, in addition to whatever climate “cost” it
might have to various people whose preferences can`t be measured, have
very real and significant costs in terms of damage to persons and property;

that federal law authorizes this (via the “Clean Air Act”, surface mining laws and ownership of the TVA), and grandfathers the very worst
midwestern utilities, the oldest 10% of which (41 or so) are  estimated to be responsible for 43% of the
$62 billion in annual  damages (not including damages from harm to ecosystems, effects of some air pollutants such as mercury, or climate change)(according
to the latest NAS report on the indirect costs of fossil fuels);

– that our federal government and states own most of the coal deposits and are otherwise addicted to the royalty revenues and complicit in turning a blind eye to damages;

– the future “costs” that the IER analysis refers to (in 2050) are not discounted to present value;

that alternative policies – such as

are never advanced, much less their costs weighed [that is, no attempt is ever made to engage opponents in good faith or to seek mutual gains by working to resolve underlying problems];

– the costs/consequences/risks and equities of “do-nothing” policies are hardly considered, and when so are heavily discounted;

– that deliberate “geo-engineering” holds no promise as a panacea, and itself is fraught with issues about statism, preferences, risks and liaibility;

the need for investment in infrastructure and change in laws to adapt
(and foster adaptation) to very real ongoing climate changes are never
discussed; and

– no one at IER ever seems to question the
unstated presumption that utilities and our transportation industries
have somehow homesteaded an ownership right over the global atmosphere – or the massive role that our federal government and states play as coal and other energy resource owners),
so that it`s perfectly okay to dismiss the preferences of those who
have concerns at home [those “religious” nuts like Exxon, and our Academies of Science] and those abroad in the least developed countries
that are most vulnerable to damages (much less to suggest how those
injured should be aided).

In other words, those defending the
status quo seem to have abandoned any Austrian training (or to have no
familiarity with its concern for problem-solving and awareness that
[as Block points out] common law protection of private property rights was hijacked a century
ago, with massive pollution and rent-seeking problems being the result

ought to post a few of these thoughts over at IER; Rob Bradley somehow
finds comments of this type over fundamental principles to be “ad hominem” arguments [of the kind that very quickly tested his patience and got me banned, without any word to his co-bloggers, who found my comments worthy of considered response].

Sure, we should fight over policy, but let`s not ignore principles or put our heads in the sand.

October 28, 2009 10:10 AM

*  From the NAS report:

Coal accounts for about half the electricity produced in the U.S.  In
2005 the total annual external damages from sulfur dioxide, nitrogen
oxides, and particulate matter created by burning coal at 406
coal-fired power plants, which produce 95 percent of the nation’s
coal-generated electricity, were about $62 billion; these nonclimate
damages average about 3.2 cents for every kilowatt-hour (kwh)
of energy
produced.  A relatively small number of plants — 10 percent of the total number — accounted for 43 percent of the damages.  By 2030, nonclimate damages are estimated to fall to 1.7 cents per kwh.


Supporters of cap and trade always turn to the
argument that opponents are burying their heads in the sand. It’s not
true. This legislation won’t do anything to help the environment. It is
merely a front so that the administration and the Democrats can say
they did “something.” We don’t need legislation that is going to cost
every single American household and won’t even be able to achieve its
stated goals. Write your Congressmen at

[A], you`re missing my higher -level poinht, which is that IER is
rather apparently UNINTERESTED in engaging productively or on a
principled basis on this issue; rather, they are simply sniping (though
they make excellent points) at the cap-and-traders).

of course, from the view of those financing them, this form of
engagement may very well be “productive”, if it delays any action that
will lower returns to coal, rail or utility investors.

regrettable is that this obfuscation, which has been going on for
decades, is what is likely to saddle us with extremely costly, porky
and ineffective “climate change” policies.

Henry Payne/NRO and the Deal Not Taken: He’s shocked, shocked that Dems won’t end CAFE mileage standards

February 19th, 2009 2 comments

Henry Payne (cartoonist at the Detroit News and commentator at NRO) has a interesting post up on Feb. 18 at NRO’s enviro-bashing “Planet Gore” website: “Obama’s Washington Is the Enemy of Auto-Industry Reform“.  In it, Payne does a remarkable job of side-stepping the long history of the auto mess (poor governance, intransigent labor, counterproductive Washington meddling and competition from foreign automakers) and focussing on the blame that the Obama administration and “Washington Democrats” are likely to earn from further counterproductive policy.  In particular, he seems exercised that Dems are unlikely to eliminate the inefficient and costly CAFE standards.

Well, this seemed a little more myopic than I could stand, so I sent Mr. Payne the following note:

Henry, what did you expect to happen?  You can blame Dems for the mistakes that they will make, but Republicans are no better at governing, and it’s the car cos and the unions that are responsible for their current predicaments and unwillingness to budge.

“there will be no elimination of costly CAFE laws. It is shocking, in fact, that Washington Democrats are unwilling to even consider this fundamental, multi-billion-dollar reform. “

As for this, you are probably right – not the least because the Bush administration failed to act on climate change so enviro won the Supreme Court case that Jon Adler says essentially forces the EPA to do more of the same – but is anyone actually making a proposal that would include eliminating CAFE? 

But in this vein, back in the Bush heyday when Republicans had both houses of Congress, I’m sure Dems/enviros would have loved to trade away CAFE for rebated carbon taxes, or for improving power competition/smart grid a la Paul Joskow/Lynne Kiesling.  They might have even given up corporate income taxes entirely for such alternate revenues.  It is shocking, in fact, that Washington Republicans were unwilling to even consider this fundamental, multi-billion-dollar reform, that would have eliminated CAFE and avoided C&T pork and subsidies of the type that Obama and guys like Pickens wants.

But instead of even-handedness and looking for win-win deals, you can keep bashing Dems.  Good luck with that now, after Bush strong-armed Greenspan into creating this bubble, did a bunch of other nonsense and thus empowered Dems to finish off the job wrecking the economy – in order to “save” it.

While thinking creatively might not be easy, it’s a start at actually succeeding.



Good stuff: Ron Bailey, Fred Smith and Lynne Kiesling debate climate change policy at

June 22nd, 2008 No comments

I highly recommend that readers view the debate (or the transcript) between the above participants that Reason held last October but has just given renewed prominence at Reasononline and in their July 2008 print edition. 

Ron Bailey is the Science Correspondent at Reason and is the author of ECOSCAM: The False Prophets of Ecological Apocalypse (1993) and the editor of Global Warming and Other Eco-Myths: How the Environmental Movement Uses False Science to Scare Us to Death (2002), Earth Report 2000: Revisiting The True State of The Planet (1999), and The True State of the Planet (The Free Press, 1995).  Remarkably, Ron now shills FOR government policy to address climate change.

Fred L. Smith, Jr. is the President and Founder of the Competitive Enterprise Institute (which published Bailey’s 2002 Global Warming and Other Eco-Myth book).

Lynne Kiesling is an expert on the regulation of electric power generation and distribution, Senior Lecturer in Economics at Northwestern University, and former director of economic policy at the Reason Foundation.


Below I excerpt what I consider the key remarks of each participant:

Lynne Kiesling:

From an economic perspective, the problem of climate change is twofold. First, there are incomplete and uncertain property rights in the air. It’s ludicrous to imagine us each walking around with a bubble over our heads so that we can only breathe and use the privatized air sphere around us. Second, there’s a large number of affected parties … some would argue the entire planet is affected.

When a common-pool resource is shared by millions of diverse individuals, defining the use rights over that resource is really hard and costly. This is the kind of situation in which decentralized market processes have trouble even emerging. In this imperfect world, we’re considering two imperfect alternative policies: a carbon tax and cap and trade.

Our experience with common-pool resources, ranging from agreements to share the team of oxen in the medieval village to the development of the sulfur dioxide acid rain program in the 1990s, tells us that effective policy focuses on reducing transaction costs and better defining property rights so that private parties can engage in mutually beneficial exchange. That’s the logic behind the carbon cap-and-trade policy.

Like all policies in such a complex area, it’s got problems itself. How do you allocate carbon permits? There’s the knowledge problem: How do we know how many carbon permits is the right number? Also, as a policy instrument, it’s prone to political manipulation. Electric utilities are already seriously jockeying to make sure they’re playing a part in getting the rules written and that they’re involved in determining the allocation mechanisms if such a policy comes into place.

Another problem is that unlike with sulfur dioxide, the likely participants are really heterogeneous. When we were dealing with sulfur dioxide, it was mostly large-scale central-generation power plants, a pretty homogeneous bunch.

A carbon tax is also prone to some of these problems, particularly the knowledge problem and the political manipulation problem. The benefits to a permit market that have been shown in other situations are that defining property rights and reducing transaction costs does a better job of taking advantage of diffuse private knowledge. It’s also more likely to induce the process that’s at the foundation of economic growth, which is innovation. So I tend to come down on the side of cap and trade, although it’s not a ringing endorsement.

Finally, I think most people fail to realize that the abysmal job we do of pricing electricity contributes substantially to our energy use. The only resources that are priced as badly as electricity in our economy are highways and water.

Retail competition and choice for consumers would increase the offering of time-differentiated dynamic pricing, which shifts resource and electricity use across time. Research shows that this promotes conservation and more efficient use of electricity, increases offerings of green power to consumers who want to choose a green power option, and increases the incentives to develop and adopt technologies, such as price-responsive appliances, that enable private individuals to control their own energy use.

So the message from me is this: It’s a complicated, imperfect world, and the policies we can adopt that induce innovation and harness diffuse private knowledge will be the most effective for this long-term problem.

Ronald Bailey:

Before we began this session, Fred Smith asked me would it be all right if he referred to me as a commie symp. …  I stand before you as somebody who’s been reporting and writing on environmental issues for over 20 years. To the extent that I’m known at all, I’ve been known as someone very skeptical of all kinds of environmentalist dooms. My first book was called Ecoscam: The False Prophets of Ecological Apocalypse. It pains me to have concluded, following the scientific data, that one of the dooms is a real problem.

As Lynne very ably pointed out, one of the problems with global warming is that it exists in a commons—that means the atmosphere is very hard to divide up and make into private property.

When you have an environmental commons, we typically have two ways of handling that problem. One is that we privatize it. In many environmental issues, we’re moving in that direction. Fisheries, for example, are being privatized. Forests are being privatized. Water resources can be privatized as well.

The problem with air pollution—and global warming is a form of air pollution—is that I don’t see a good, easy way to privatize it. The transaction costs are too large. And if you can’t privatize it, you have to regulate it. So now the question is: What’s the least bad way to regulate? And that is why I’ve come out in favor of a carbon tax.

As a good libertarian, I thought I would like cap and trade. The problem is I’ve been watching the European attempt to do this, and it’s a complete disaster. The governments, not surprisingly, cheat constantly. Their carbon market collapsed a year ago because the governments allocated more permits for carbon emissions than were necessary to cover what was being emitted, so naturally the price went to zero. And if the Europeans can’t pull this off, how could you expect the world to pull this off?

I understand the diffuse knowledge problem—how markets can and, in fact, do marshal that kind of information in very good ways. The problem is that there’s no baseline for the rest of the world.  …  So I come out in favor of the tax because you have a baseline. You have a way of internationally monitoring that. The baseline is a zero tax and from that, you can build up. You could start the tax low and, as you gain more information about what the atmosphere is likely to do, you could adjust the tax over that time.

For consumers, for inventors, for innovators, a tax offers price stability in a way that the cap-and-trade markets don’t.  …

I, against my values, have decided that this is a problem. I would really like to be persuaded that classical liberalism and markets and so forth have a way of solving this problem. I’m still waiting for Fred’s proposal. I don’t think it can be done voluntarily around the world. The voluntary carbon markets are tiny— … And if you don’t have an economic incentive to participate in those carbon markets, like a tax or like a cap-and-trade permit, most people aren’t going to do it. Why would they? Why would they spend money that they don’t have to spend? …

Basically it would be a globally harmonized tax, but the money would be collected by each country and spent by the governments in each country.  In the ideal world, you would recycle that money by reducing other taxes, so the overall tax level in the country would not increase. What you would be doing is incentivizing people to conserve energy but also incentivizing people to innovate, to find new ways to produce energy that people would want using low-carbon technologies or carbon-sequestering technologies. …

Government does not innovate. So by creating a carbon tax you would encourage private people to marshal the information in response. So carbon tax is a price, to figure out better ways to make energy, low-carbon energy. I don’t know what those energies will be. I’m sure the government doesn’t know either, and I don’t want them wasting the money doing it.

Fred L. Smith:

What’s the best way of addressing whatever risks there are in global warming? Should the risk of catastrophic global warming justify abandoning our general preference for freedom over coercion? Should we free market advocates champion carbon taxes or carbon rationing, some form of suppressing energy use, or should we favor economic liberalization?

There is evidence that there has been some warming, moderate amounts, but the idea that we’re facing imminent catastrophe has weakened. Our ability to do anything about CO2 increases for the next half-century is now obviously nonexistent. And the tensions we could create by pushing the world into some form of energy rationing, I think, are underestimated. Recall that in World War II, one of the incidents that pushed the war party into power in Japan was an energy boycott on that Asian nation. We are going to do that again with China. It doesn’t make a lot of sense to me.

Shouldn’t we be asking whether the risks of global warming are more or less than the risk of global warming policies?

The costs of energy rationing are not trivial. Energy is what makes it possible to have mobility, to have labor-saving technology, to have lives that are comfortable, to have hope for the future. Energy rationing would lead to slower economic and technological growth, a darker, less human-friendly world. The trillions we’re talking about spending over the next generations on global warming could go to much better causes, could save lives and inspire hopes today.

But we’ve been told—we’ve heard it from Ron, at least—that we must do something. Perhaps. But why must that something be the expansion of state power over our lives? Why do we limit ourselves to taxes or rationing? There are other alternatives out there.

We could do some more R&D. We could mitigate. What about mirrors in space? What about fertilizing the oceans? Those of us who have looked at NASA and so forth are not overly enamored with government’s ability to underwrite those kind of policies, but we should be equally optimistic about government’s attempt to tax in this academic-blackboard economic way.

Resiliency is what we should be talking about. Not whether taxes or quotas are the better way to suppress freedom, but how we can use the global warming concerns to advance an agenda of freedom. How do we find ways of accelerating economic and technological progress? How do we liberalize the economies of the world? How do we expand the institutions of liberty even into the air sheds?

We can free biotechnology. I’m sure Ron and I both agree with that. If the world is hotter, colder, wetter, drier, we’re going to need the ability to modify our crops much more than we have today. Freeing biotechnology from the regulatory straitjacket it’s in today would be a way of doing that.

As Lynne said, we could complete the job of freeing our electricity system, not just for pricing electricity but also for incentivizing the grid to be smarter and more robust so we can free the trapped electricity that sits idle throughout America. Move fire, storm, and other insurance out of the government subsidy range and put it back into the private sector so we can guide people away from living in high-risk areas.

Unilateral free trade. Extend property rights to water. Liberalize energy exploration. Cuba can drill off the coast of Florida; why can’t America? Where is nuclear power? Certainly Al Gore hasn’t mentioned it. Eliminate the corporate income tax. Accelerate the turnover of capital goods and equipment. That would mean a much more efficient world to live in. …

Today, fears about global warming are pushing the world towards disaster. This time the threat is not just to the lamps of Europe but to the lamps of the world. Energy suppression, if it happens, might last for many lifetimes. …

I have one strong procedural difference with both Ron and Lynne on this. The argument is that when you have a common property resource, your choices are either to privatize that resource, move towards institutions of liberty, or politicize it in some enlightened way as Lynne and Ron have talked about. But Ronald Coase said there’s always a third option, that the costs of transaction in that area are much higher than the failure to have transaction in that area and therefore we should allow evolution to proceed and see what creative solutions emerge. That is basically what we should be doing in the global warming area.

Bailey: So, Fred, are you saying that human beings are not clever enough to come up with low-carbon energy?

: I’m saying that technocratic social engineering projects aren’t the best way to free the creative energies of mankind.

: Unfortunately, Fred, you haven’t shown a path for evolution to this. I’m sorry. I realize that you believe that somehow the invisible hand will take care of a commons problem always, but commons problems are solved by creating property.

: Government.

: And the government helps create property, defends property. It’s an institution.  It’s not a great institution. Right now all the big emitters are coming to Washington and begging for free permits so they can get tons of money, basically, and extract it from our pockets—which is another reason I don’t like cap-and-trade systems. They want the government to create an asset for them worth hundreds of billions of dollars.

Bruce Yandle on "no regrets", free-market approaches to climate change policy

April 4th, 2008 No comments

Bruce Yandle, Professor of Economics Emeritus at Clemson University and Senior Fellow at PERC (the “free market” environmentalism think tank founded by John Baden and now headed by Terry Anderson), has an article in PERC’ latest monthly report, in which he offers his thoughts on climate policy in the US: “A No-Regrets Carbon Reduction Policy”,  Yandle is a respected thinker on common-law and free-market approaches to environmental problems.

I present here the “TT Notes” precis of Yandle-sensei’s article.

Yandle first notes that “most of our wealth-producing engines exhale carbon. Population growth and longer life expectancies mean more carbon dioxide emissions. More gross domestic product (GDP), translates into more carbon emissions. Proposals for dramatic, short-run reductions are not just costly in dollars, they are draconian in terms of human well-being.”

Notwithstanding the costs of GHG-control efforts, Yandle specifically notes that many economic actors are already quite active in this endeavor (in a manner that indicates they obviously consider the science sufficiently convincing and the costs merited by potential gains):

“There are a vast number of carbon reduction activities taking place in the developed world, with many involving major U.S. firms. … There is a developing regional trading community composed of 10 northeastern states. … Carbon offsets produced by Iowa farmers who modify how they plow fields are purchased by Canadian industrial firms.”

But aside from ongoing private efforts – including those in response to regulatory approaches adopted elsewhere – what public policy approaches might be most efficacious domestically? Yandle asks,

“Can free market environmentalism (FME) provide guidance as to which policies might best promote human well-being? Consider these principles:

• Incentives matter.

• Property rights that reward asset managers improve environmental outcomes.

• Competition among suppliers of goods desired by consumers generates a larger yield.

• Decentralization increases experimentation, leading to more innovation and environmental quality at lower costs.”

Yandle suggests that policy makers should consider at least four important policy considerations (aside from being careful not to cater only to special interests):

“1. To what extent is the United States a net carbon dioxide emitter, and are we as a nation equipped to determine when and how much progress is made in reducing emissions? Should we establish procedures to evaluate legislative actions in terms of their carbon emission impact?  [Yandle doesn’t discuss the baseline efforts that have been underway for years.]

2. What about actions that might be taken to hasten the adoption of lower carbon-emitting processes? Is it possible to adopt a “no regrets” policy — one that will generate net benefits even if Americans later reduce their concern about climate change?

3. Simultaneously, if climate change is occurring, what are the actions that might be taken to encourage human adaptation? Can these be framed as “no regrets”?

4. Why have a one-suit-fits-all climate change policy that applies nationwide, if not worldwide? Why not encourage experimentation across the United States?”

With respect to possible “no-regrets” policies, Yandle indicates that, so far, “Less attention has focused on longer-term decisions that will support targeted research and development, increase capital turnover, encourage new technologies, and hasten the expansion of safer nuclear power plants that eliminate carbon emissions entirely. These actions could form a “no regrets” bundle.”

“Taking an FME-based, no-regrets approach to carbon reduction will recognize that:

Deeply rooted technologies and energy sources can and will be replaced by alternate technologies and non-carbon emitting energy sources;

Rapid depreciation of existing capital and reductions in capital gains and corporate taxes will hasten adaptation; and

Subsidies and regulations that distort energy consumption and investment decisions and increase carbon emissions should be eliminated.”

In particular, Yandle argues that “Higher corporate taxes of all forms discourage formation of new capital, which delays the introduction of cleaner technologies. Eliminating capital gains taxes, reducing corporate income taxes, and accelerating depreciation would get the incentives right for replacing high carbon emitting machines and activities with cleaner processes. Doing so would also increase U.S. GDP and employment growth—a “no regrets” outcome.”

Yandle also argues that nuclear power should be encouraged: “Nuclear power produces no carbon emissions but it does come with some risks. To protect community property rights, the current liability cap provided to utility companies by Congress should be reevaluated in terms of experience and preferences for risk reduction. Property rights should be protected with a meaningful liability rule. Yes, there is nuclear waste to deal with, but this too can and should be addressed by the federal government. Developing an expedited nuclear power plant approval process and eliminating the nuclear waste bottleneck would contribute to a long-run reduction in carbon emissions—another “no regrets” policy.”

Query to Austrians – is Yandle right by implicitly concluding that concerns about climate change present opportunities?  Or do such concerns only present costs and risks, to be avoided at all costs?

Yandle’s other work is described here:




Categories: climate change, no regrets, PERC, yandle Tags:

Gonzalo Lira is a shrill conservative who loudly supports the "Occupy" Movement

December 10th, 2011 No comments

Allow me to shill for Gonzalo Lira, a Chilean-American novelist, filmmaker, founder of the Strategic Planning Group, and an economic blogger who contributes  to Zero Hedge, naked capitalism, Seeking Alpha and Business Insider.

I ran across an interesting blog post by Lira that, in contrast with other pieces on LvMI (such as George Reisman‘s), expresses strong support for the “Occupy” movement. 

Lira kindly gave me permission to cross-post his piece. (I note that I seem to be more of a classic liberal and skeptic of government than Lira, and so I don’t fully endorse his ‘conservative’ positions.)

Why I Support The Occupy Movement (emphasis added)

I am a Conservative—and proud of it.

I am against abortion, including in the case of rape or incest. I don’t believe in any form of entitlement program, much less the concept of a welfare state. I am opposed to progressive income taxes—and in fact am against using the tax code as a vehicle to foment or discourage any social goal, as I think it inevitably leads to the tax code being gamed by interested parties (as has indeed happened with the U.S. tax code, beholden to paid lobbyists who have carved out so many loopholes that it looks more like a sieve than a tax code). Thus I’m in favor of a flat tax: Zero-percent for citizens, 20% for corporations.

I am in favor of a reduced government, a reduced military presence, compulsory military service, and a compulsory national guard system requiring 100% citizen participation, similar to the Swiss model. I am completely against foreign military adventurism, foreign military bases, and foreign military aid.

I believe that the government should be the enforcer of the law, and of a regulatory framework which—when it comes to issues affecting the common good—is strict to the point of anal.

For instance, food regulation, financial regulation, building code regulation—all of these regulations obviously serve the common good, and protect us all from unscrupulous people seeking to get an advantage by poisoning or otherwise hurting us all. Thus the government should have a tough regulatory framework—think of it like traffic laws: Tough government regulations that are simple, transparent, and which protect us all from each other, while making our interactions smooth, convenient and graceful.

I don’t have a problem with some people making boatloads of money, while others are homeless. I don’t believe it is the State’s or society’s or the government’s responsibility to take care of you in your old age—it is your responsibility.

Gun rights—yes. Gay rights—no. States’ rights—yes. Affirmative Action—no.

There are only three issues on which I don’t toe the Hard Right line: The death penalty, the war on drugs, and health care.

I am against the death penalty—not because I think that the State and society do not have the right to execute one of its members: They do, to my way of thinking, if the citizen has committed an especially heinous act. But the death penalty is permanent: You can’t take it back if you screw up. And since no justice system made by fallible men is infallible, mistakes are inevitable. So I am of the opinion that it’s better to have 1,000 murderers sit in jail at society’s expense, than allow one innocent man be put to death. Because you can free an innocent man after twenty years in jail for a crime he didn’t commit—but you can’t bring back the dead.

I am against the War On Drugs: First of all because it doesn’t stop the consumption (and thus flow) of illegal recreational drugs; second because I believe recreational drugs (up to and including cocaine, heroin, meth and acid) ought to be legalized and taxed, like booze, and its production regulated for safety standards, again like booze; third, because the “War On Drugs” has created a huge penal class—citizens who have spent time in jail for non-violent offenses, and thus are marginalized from general society because of this stigma on their record—which hurts people who have committed non-violent infractions, and enriches people who thrive on building and staffing more and more needless prisons.

I am in favor of trashing the current American health care system, and making it either entirely private, or entirely socialist: This hybrid system the United States has not only does not work, it is extraordinarily expensive. The fact that the French of all people spend less of their gross domestic product on their socialist health care system, yet have a lower infant mortality rate and a longer median and average lifespan than people in America, is a wake-up call: If the full-Commie Frenchie system is better and cheaper than the American one, then literally any health care system is better than the one that exists in the United States.

But all in all, I’m a good Conservative. (Though certainly not a Republican—a political party dominated by Neo-Conservatives, who are not Conservative at all, but rather, Corporatists.)

I believe that America should be the land of opportunity and risk: You can fly high—but you can also crash and burn. A society that eliminates risk—that tries to somehow torque risk down with “safety nets” and “systemic protections”—is begging for a Mommy Dictatorship when all is said and done.

Now, why do I go into all this detail about my political beliefs and ideas? Because I want to make clear where I stand, before I come out and say that I am in favor of, and fully support, the Occupy Movement.

The Occupy Movement is inarticulate—but not because of it nonsensical: The protestors are against the travesty that has become the American Republic. And though its origins are on the political Left, it should not be considered a “Leftist” movement.

Rather, it is an anti-Corporatist movement.

It’s core issue is the One-Percenters: As we have currently organized the American Republic, everything seems geared to protecting and enriching the top 1% of the population—to the detriment of the 99% of the population.

The One-Percenters have made huge gains in income over the last 30 years, compared to any other tranche of the population—while the standard of living of the middle and lower classes has actually gone down.

There is less opportunity for the 99%—but more opportunities for the One-Percenters to enrich themselves at the public expense, by way of manipulating the law, the tax code, or the regulatory framework.

There is a revolving door between One-Percenters in the government and the private sector—so the former government employees make it a point to “help” the private sector One-Percenters, at the expense of the public good. Think of the Obama health care “reform”—which helped no one, save Big Pharma and Big Med.

There is zero chance that a One-Percenters who breaks the law will go to prison. He can put toxic substances in food production, inject toxins into groundwater to get at some oil, bankrupt a pension fund, steal and cheat people out of their homes—and there’ll be no consequences insofar as the law is concerned.

The things he might have done might be immoral—they might be despicable—they might even be outright wicked and evil: But they are not “illegal”—because the One-Percenters change the laws by way of their bought-and-paid-for politicians, and thus never do anything “illegal”. They only do things which are immoral, and wrong—and thus not subject to legal punishment.

Yet any member of the 99% caught smoking a little weed will go to jail for 90 days—and have a permanent black mark on his record, severely curtailing his ability to find employment, get a bank account, or otherwise participate in civil society.

How bad is this lawless among the One-Percenters? To give an example: The bankers. Not one banker has been charged with fraud, for the Robo-Signing scandal; for the fraudulent securitization scandal that led to the 2008 Global Financial Crisis; or indeed, for any of the heinous acts of financial terrorism which has essentially held us all hostage, while the banksters have raped and pillaged from us all, by way of bailouts.

How did they rape and pillage our society? By telling us through their bought-and-paid for politicians and media shills, “You better bail us out—or we’ll crash the economy by the bankruptcy of our financial institutions, and put you all out of work.” So we give them literally trillions of dollars to bail them out in 2008 and after—

—and once we bail them out, do they pay us back?

No!—don’t be naive! They don’t pay us back! Instead, they use the bailout monies to pay themselves huge bonuses. After all, as is public record, in 2009, the banks paid their executives more and bigger bonuses than ever before—even though they would have been bankrupt had it not been for the lifeline that we paid for!

Are any of these bastards cooling their heels in jail? No they are not. In other words, we pay—and the banksters get a tan in Tahiti.

And this same pattern happens in every other industry and sector of our economy—in every other area and concern of our society: The One-Percenters get all the breaks, the government “of the people, by the people and for the people” bending over backwards to give this oligarchy all these phenomenal breaks—while the rest of us in the 99% pay. And pay in spades.

This is what the Occupy Movement is against.

As far as I’m concerned, the people currently protesting are a bunch of Lefty, bongo-banging hippie-dippy metro-sexual turds—but that doesn’t make their protest wrong.

And in this case, those Lefty fools are actually right.

And we on the Right should join them.

As Al Gore accurately put it (and trust me, my skin is literally trying to crawl off my flesh as the reptilian part of my brain reacts to me praising something that Al Gore, of all people, has said), the Occupy Wall Street movement is basically a primal scream of democracy.

It is a primal democratic scream that we all feel—Lefties and Righties.

Those Lefty granola-munchers have a putatively granola-munching Lefty in the White House—but they’re out on the street anyway. Why? Because Obama might munch on granola, but he’s about as Lefty as Herbert Hoover.

Don’t get me wrong—Obama ain’t on my team. He’s about as Righty as Adlai Stevenson. No, what Obama is is corporatist—as are all the Democratic politicians. That’s why the Unions and the blacks and the other “approved” Left wing interest groups haven’t been able to co-opt the Occupy Wall Street movement:

The Occupy Movement instinctively—perhaps even inarticulately but accurately—realizes that the traditional “Left” politicians aren’t politicians of principles.

Rather, they are the best politicans money can buy: Corporate politicans bought with coporate money, via K Street lobbyists, and the revolving door between corporate interests and political power.

Just look at Michael Chertoff, the former head of Homeland Security, whom I wrote about here (a piece which by the way earned me my own HSA agent, who dilligently monitors me).

Chertoff headed the HSA under George W. Bush—so he ought to be on my team, Team Right. But he’s not—he’s Team Corporate. He’s a One-Percenter.

Chertoff served as director of Homeland Security, then left for the private sector, where he formed “The Chertoff Group”—which promptly went into business with RapiScan Systems, purveyors of airport bodyscanners.

And so what did Chertoff do? He hit every talk show and media outlet, peddling the bodyscanners.

The corporate media was happy to have him—and not once did they point out that his fear-mongering would make him wealthier. Not once did the corporate media portray Chertoff as what he was—a corporate shill. Not once did the corporate media do its job of informing the citizenry of Chertoff’s conflict of interest.

Instead, the corporate media gave Chertoff a platform, from where he could sell us all on the full-body scanners—lying and saying that they were for “our protection against the terrorists”.

Were the body scanners necessary? No—they have yet to catch a single terrorist. Do they work? No—a determined terrorist can easily defeat them, as has been demonstrated. Are they safe? No—they likely cause cancer, though no one is really sure, because safety testing of the scanners has been proscribed.

Ah, but do the body-scanners pay Chertoff a big phat fee, every time one of those $100,000 machines ($100,000 each!) is deployed in an American airport?


Someone like Chertoff isn’t on the “Right” or on the “Left”—someone like Chertoff, or Obama, is on the side of One-Percenters: The interests of the One-Percenters are their interests—versus you and me in the 99%—because they are the One-Percent. They have more in common with each other, than with any paltry political “Left/Right” difference.

Chertoff and Obama certainly have more in common with one another, than either one of them has with us, the people whom they are supposed to serve.

Now, if I have put this issue in terms of class-warfare, it sure makes it sound Marxist—which ordinarily would make me dismiss it. After all, Marx claimed that everything that was bad in a society was the result of “class warfare”—which is bullshit, as far as I’m concerned.

But a broken clock is right twice a day. To my way of seeing things, our society has fallen into an oligarchic trap: We have confused the health and welfare of the top of the social pyramid with the health and welfare of the entire pyramid—and that of course is a mistake. The top can be just fine and dandy—while the rest of society rots, crumbles, and collapses.

This, in a nutshell, is what is happening. This is what the Occupy Movement is protesting. This is something that I support. Because the health and welfare of our society as a whole should never be confused with the health and welfare of the richest 1%.


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