TT's Lost in Tokyo — by TokyoTom

I`ve done a bit of blogging over the past few weeks regarding the “The tragedy of climate commons” post by climate scientist Gavin Schmidt and ensuing discussion at the RealClimate website.  Schmidt wrote the post in response to the implied suggestion by Chip Knappenberger at the MasterResource blog that, since unilateral policy action by the US would by itself be unlikely to significantly affect future climate (given the the rapid growth in CO2 emissions by China, India etc.), the wisest course for the US would be to do nothing.  

Knappenberger has now responded to Schmidt, this time with a parable of his own.  Knappenberger has good points, but he and Schmidt are talking past each other.  Since Rob Bradley, CEO of the Institute for Energy Research (BTW, no longer funded by pro-carbon-tax Exxon, all of you Exxon-haters out there) and founder/manager of MasterResource, won`t let me post at his self-proclaimed “free-market energy blog”, I put up a few thoughts at RealClimate, which I copy below (one typo fixed and link added below):

Allow me to stir the pot a bit, as it doesn`t appear that anyone has noticed Chip Knappenberger`s response to Gavin, in tbe form of his own climate parable, using the “Emperor`s new clothes” theme.

http://masterresource.org/?p=2751

Waxman-Markey appears as the new clothes, with Chip apparently taking on the role of the bright and persistent voice of the insufficiently jaded little boy who can`t help but to see the truth, and bravely refuses to be cowed.

Some of the criticisms of W-M seem fair to me – after all, they manifest precisely the reasons that Jim Hansen has taken a strong stance in favor of more transparent and rebated carbon taxes over the pork and bureaucracy that comes with cap and trade.

1. But Chip is still failing to address the main premise of Gavin`s tragedy of the commons fisheries analogy: there is a commons problem that requires coordinated action (a multi-player, repeated Prisoner’s Dilemma), and the only way out requires initial measures at trust-building, with more effective measures to follow when the parties can agree on burden sharing and enforcement.

Thus Chip is simply perpetuating the problem that I have noted here:

“Unfortunately, what passes for discussion on climate change (and other environmental issues) is too often people talking past each other (frequently with all of the hallmarks of a tribal battle): some correctly see a looming commons problem that requires government regulation but ignore the risks of pork, partiality and wasted resources in the policies themselves, while others, not anxious for government to expand its regulatory purview, downplay or dismiss the resource problem and focus on the downsides of government action or the motives of those calling for government action (while ignoring those invested heavily in a status quo that is replete with moral hazard).

Capitalism, the destructive exploitation of the Amazon and the tragedy of the government-owned commons

2. Further, while Chip has good reason to criticize all of the pork that is loaded into the W-M hairshirt – there certain ARE plenty of corporate interests seeking to use climate policy to get sweet deals from government – it`s more than a bit coy of him to paint the critics of W-M as relative innocent truth-tellers, while somehow failing to note all of the sweet deals built into the status quo that fossil fuel firms, utilities, automakers and their investors have long enjoyed. (Not to mention that these interests have hardly been turned away from the W-M and other pork troughs.)

Chip`s convenient oversight might have something to do with the fact that the public advocacy firm he shares with Pat Michaels is funded by coal interests, as Marion Delgado points out in #677, and as I have previously discussed directly with Chip: Pat Michaels – scientist AND paid advocate. Correspondence with Chip Knappenberger.

It doesn`t end there, unfortunately, as Chip is posting on the “MasterResource” blog run by Rob Bradley, who is CEO of the coal-industry-funded Institute for Energy Research. For the sin of pointing out the political-favor-protection game that IER and MasterResource are engaged in, Rob Bradley has exercised his Constitutional right to ban me from the MasterResource blog (mid-conversation with, but without notice to, Chip, as it turns out).

So sure, let`s fight the pork as best we can, Chip, but let`s not ignore the fact since there are NO property rights in the atmosphere or climate, markets are not protecting it, but instead steadily producing an ever-growing tragedy of the commons. Care to acknowledge that, or to offer any suggestions?

CEI funds, staffs and supports the relatively young, growing and interesting “Bureaucrash” grassroots libertarian social action site, by which CEI tries to tap into some of the discontent with government that has bloomed over the Bush presidency.  I`ve opened an account there and cross-posted some of my blog posts.

I received the attached by email from Bureaucrash:

A message to all members of Bureaucrash Social

Crashers,

Be sure to visit http://cei.org/1984
to see how politicians and bureaucrats are trying to turn 2009 into
1984 by taking control of the entire economy via energy policies.  CEI
has produced a video showing that Al Gore and those like him are really
just Big Brother in green clothes.

You can write your Congressman today and make your voice heard by clicking on the “Write Your Congressman” link on the page.

In liberty,

Cord Blomquist

Visit Bureaucrash Social at: http://social.bureaucrash.com

I responded directly at the Bureaucrassh post (which may be accessible only to those who have registered); I copy my response below

Cord, I think CEI has been playing a counter-productive role for quite some time, and is still doing so.

Rather than taking the lead in (1) finding property-rights based or related approaches to blindingly obvious commons problems
– caused either by open-access without property or by government
regulation and favoritism/kleptocracy – in important local, regional
and global resources (tropical deforestation (theft of native title),
the atmosphere (AGW and pollution in US, China & India) and oceans
(crashing fisheries, dead zones & rising pH), or (2) calling for
deregulation to enhance competition, consumer choice and efficiency in
the “public utility” sector, CEI has played a denialist, delayist and ad hom game, all in ways quite contrary to libertarian principles
– principles that seek ways to resolve problems by enhancing the
ability of people to express their preferences through market
transactions.

This is puzzling, since there are many topics on which libertarians can
productively engage with enviros, who are starting to see the merit of
property rights approaches to fisheries, and whose frustration on power
issues is readily understandable, as Lew Rockwell has noted: The Real Cause of Blackouts

Given CEI`s unproductive and in-your-face approach to environmentalists, despite all of obvious problems and unexplored ground, one is tempted to wonder whether CEI`s purpose is not to achieve any positive action, but
– by talking about how environmentalists are always wrong and by
talking a great game about market principles while steadily ignoring
the way that government has long been used to benefit particular
special interests –simply to defend the status quo, which obviously
is NOT based on pure free markets, but massive governmental
intervention that benefits particular firms and investors.

I recently posted a copy of a comment to Bob Murphy, trying to explain Roe Romm’s attack on Bob’s effort to explain some of the stupidity behind “green” or “clean” jobs, and how it is that Bob just doesn’t seem to be (and is in fact not) above the fray.

Well,  Bob has professed that he just doesn’t “get it”, so I copy here both his question and my further attempt to explain why hired guns tend to be treated as if they are hired guns:

 Bob Murphy said…

TT,

I am being serious, I have no idea what your point is. Are you truly asking me why I didn’t go into IER’s funding at my Heritage talk? Of course you can’t possibly be saying that.

But then, I don’t know what you are saying. It seems with you I cannot win: Even if you agree with everything I say in a particular op ed or panel appearance–and even if I don’t take an issue on whether AGW is serious–you still devote 95% of your post to all the things I “conveniently” left out.

And what is particularly interesting is that I didn’t have the time to make the points you mention.

So, given that I was under the gun because others went long, which sentence(s) should I have taken out of my 5-minute remarks, and what should I have replaced them with?

I am not being sarcastic or “in your face.” I really have no idea if I am supposed to take your criticisms on this seriously, as if you are actually saying I should have said Y instead of X.

May 9, 2009 2:40 AM

 TokyoTom said…

Bob, thanks for the response – but I’m puzzled that you’re not following me.

1. I often agree with you and occasionally give you a full thumb’s up comment. If you need more pats on the back, I’m happy to try harder on that. But I generally comment when I disagree with you, and think I have something to offer. YMMMV.

2. Presumably you understand well the Austrian and public choice perspectives on how government is frequently misused by favored insiders for private gain, or, when opposition is more organized, on how government becomes a public battleground between opposing interests with respect to resources that are not privately owned (so the expression of private preferences in the market is not possible or is frustrated).

3. Given this, can you see that while you might think you’re being even-handed, others see you as a hired hand for the long-dominant rent-seekers (the investors & industries for whom it is profitable to use our largest shared, open-access commons – the atmosphere – as a free dumping ground, while shifting risks on an uncontracted-for manner to others)?

4. And given such a perspective, can you understand that others – particularly others like Joe Romm who have been deeply involved in the rent-seeking battle – have a hard time actually listening to what you have to say, since they tend to see you as a wolf in sheep’s clothing? (Indeed, they may be so convinced that they’re “right” that they may not even notice that, like Joe, they are spokesmen for a little Baptists-bootleggers coalition of their own!)

5. As for your own position, have you really failed to notice that when speaking for IER you’re in the pay of the biggest “skeptic” rent-seekers left with respect to our largest open-access commons – the coal lobby? (Not oil, as Romm has overlooked that Exxon has stopped funding IER.)

And have you noted that Rob Bradley never talks about rent-seeking by coal (including their desire to have government fund billions for “clean” coal), while happily blocking from the “Master Resource” blog guys like me who point out these inconsistencies and some of the nonsense comming from his co-bloggers and readers?

6. Note that this point is not, as [other commenters deleted] would have it, an ad hominem; rather it is a fundamental, Austrian meta-argument about the misuse of government and the frustration of preferences when squabbles over government take place in the stead of private transactions (for clearly identified and defendable private property.

7. Of course I don’t expect you to mention in your Heritage talks your funding by IER/coal, but since you’ve brought it up, perhaps you might wish to consider – particularly if you wish to actually influence those who now have their fingers in their ears – how to address this issue. Here`s hoping that you strive to step above the fray and aim for more transparent balance.

Regards,

Tom

May 9, 2009 7:24 AM

In an earth-shaking 😉 essay in today’s Human Events, CEI‘s Chris Horner comes clean and acknowledges that climate denialists and alarmists are peas in the same rent-seeking pod. 

We have encountered Horner,  former lawyer and now full-time scourge of envirofascists on behalf of the firms that fund the Competitive Enterprise Institute (and author of “Red Hot Lies: How Global Warming Alarmists Use Threats, Fraud, and Deception to Keep You Misinformed), a number of times here previously.  I consider Chris to be very knowledgeable and insightful, but it seems to me that his passion paints him into a corner as a spokesman for one side of the commercial interests seeking to influence policy, hinders a broader self-awareness, and leaves him with little ability to reach out to persuade others.

Says Horner:

Further, the premise behind most alarmist slurs, of the “tobacco scientist” variety and the ritual claims of “ties” to “big oil” or “industry,” is that a scientist’s convictions and those of other dissenters are for sale. Yet it is illogical to assume that dissenters can be bought but alarmists cannot. Looking at the balance sheets on both sides, their logic would conclude that the greatest amount of corruption occurs on the alarmist side.

With federal expenditures on climate-related research soaring above $5 billion annually – more than we spend on AIDS or the National Cancer Institute – and hundreds of billions in “rents” to corporations pushing these schemes should the alarmist campaign succeed, the potentially corrupting factor of money cannot be ignored.

Someone saw a good investment in giving Al Gore $300 million for his “climate crisis” re-branding campaign. Gore’s advisor (and, officially, NASA astronomer) James Hansen and other activists receive enormous sums of money underwriting their alarmist activities, sums that no “skeptic” has ever been accused of receiving. Meanwhile Gore—the king of claiming that those who disagree are merely in it for the money—makes millions annually from all manner of enterprises premised upon the climate crisis, and his lucre will increase several fold upon passing the laws his alarmism demands.

The difficult truth is that the alarmists cannot logically fault the skeptics’ credibility without also faulting Gore’s credibility, and that of their heavily compensated alarmist mouthpieces. Yet no “skeptic” receives as much as Gore or even Hansen from shouting falsities about the issue.

The delicious irony found in the global warming alarmists’ claims is that it is they who closely resemble the “tobacco scientists” they accuse those who oppose them of being, and are quite plainly the ones stuck on “denial”.

Several thoughts occur to me:

First, most of Horner’s points are perfectly fair, but it’s interesting that he can make them while ignoring what they imply about himself and others who are denialists (since Horner calls those concerned about the effects of releasing all of the fossil carbons “alarmists”, for the sake of balance, let’s call him and others “denialists”, as opposed to “dissenters” or “skeptics”).

Second, Horner fails to distinguish between amounts spent by governments and amounts spent by rent-seekers directly.  While large government expenditures are “potentially corrupting”, such expenditures clearly do NOT directly corrupt the results of scientific investigations, nor do they directly influence decision-making by government, politicians or others.  As a result, such expenditures are certainly in a different class than direct and indirect rent-seeking (via paid mouthpieces, contributions to think tanks, campaign contributions, junkets and the like) by special interests.

Third, while Horner is right to note that there are large amounts flowing to support rent-seeking via alarmist mouthpieces like Gore, there is nothing really new here – this is just plain old garden-variety rent-seeking of the same type that we have seen from the denialists (fossil fuel interests and others who have different preferences regarding rights to the atmosphere and science/defense-budget priorities).  In one sense this is a relief – as it clarifies that the chief financiers of the alarmism are not out to destroy capitalism – but  one is left wondering WHO, precisely, is doing the funding and what precisely are their objectives.  While some may be looking for favors from government, others may be sincerely concerned about the potential consequences of releasing all of the fossil carbon stored up since the Age of Dinosaurs and the lack of any market mechanisms to express their preferences.

Fourth, while more information on rent-seekers is needed, it’s clear that most of them are commercial interests, whom our laws say are legal persons and our courts have declared to have the same Constitutional rights to spend freely to influence government via “free speech” as do you or I.  While a discussion of the merits of legal personhood is beyond the scope of of this post, I wish to draw attention to the role of limited liability, in fuelling the growth of (i) the corporate form, (ii) rent-seeking (at all branches of government) by corporations, and (iii) public pressure by citizens’ groups (and faux-citizens’ groups) to fight over the wheel of government.

Finally, Horner oversteps when he argues that the alarmists’ views must be based on a premise that “scientist’s convictions and those of other dissenters are for sale”. I think a little more nuance is called for.  We are cognitively wired as tribal animals.  That means we are inclined to see “our side” as right, and the other side as lying and scheming. While very clever rent-seekers know this and try to use it to jerk us around, this does not mean that any particular group – or its spokesmen – has consciously sold itself out.  Rather, as William Butler Yeats famously noted, “the worst are full passionate intensity” – and each of us is good at the self-deception needed to provide the requisite conviction and self-righteousness.  Perhaps not only Al Gore, Jim Hansen and Horner’s frequent sparring partner Joe Romm share this quintessential human trait, but also Chris Horner himself?

William Anderson (an adjunct scholar of the Mises Institute and economics prof. at Frostburg State University) has a thoughtful New Year’s Day post, pointing out how Paul Krugman fails to understand the causes of ouir economic stagnation and financial meltdown.

I posted the following comment, in which I argue that the state grant of limited laibility (which I have discussed in several recent posts) is a key to understanding the Great American Ponzi scheme:

Bill, I agree with the thrust of your criticisms of Krugman, but have a few small quibbles.

First, while you rightly condemn “most economic regulation … of the command-and-control variety”, you blame all of this on “the whims of bureaucrats and environmentalists” and completely fail to note that state and federal environmental regulation (i) initially responded to real environmental problems and (ii) also represents the successful efforts by established firms to raise barriers to entry and to cartelize their industries.  See Roger Meiners & Bruce Yandle, Common Law and the Conceit of Modern Environmental Policy, 7 Geo. Mason L. Rev. 923, 926-46 (1999), and Walter Block, Environmentalism and Economic Freedom: the Case for Private Property Rights..

Second, while you are correct that Krugman fails to understand the role of the state in creating the distortions that underlie our current problems, it seems to me that you have neglected one of the key state interventions that has fuelled the rent-seeking and risk socialization that we see today – the grants of legal personhood (with unlimited purposes and life and Constitutional rights) to corporations and blanket limited liability to shareholders.

Limited liability has enabled corporate managers to act without close shareholder oversight and management; this I believe has played a key role in the vast misalignment of incentives that Michael Lewis and David Einhorn describe at the NYT, and in the risk mismanagement that Joe Nocera of the NYT describes at length in the NYT Magazine.  Those taking large bonuses (whether in the financial industry or large corporations) were essentially playing with OPM – Other People’s Money – and capturing the upside of short-term gains while leaving shareholders and taxpayers holding the bag for loses.

I hope that you and others here will look more deeply at the role of the state in the problem of misaligned incentives that continue to corrupt American capitalism.

In my recent post on limited liability, I argued that one of the perverse consequences of limiting shareholder responsibility for corporate torts was to create the moral hazard by which investors could capture the upside of risky activities that imposed costs on others, without having to worry about whether the harms such activities may impose on others exceeded the benefits to the firm. 

This dynamic can be clearly seen in the historical growth of various environmental torts, which expanded as courts, taking a signal from government policy to favor industry, turned away from a strict enforcement of property rights.  The result was massive pollution, which enriched corporate owners while transferring costs to others.  The further result?  The massive resort to federal regulatory approaches that further undermined property rights, not only by dictating to industry but by giving firms that complied with regulations a “right to pollute” within such bounds, regardless of harms caused to others.

Walter Block captures some of these dynamics in his excellent piece on the need to return to a property rights approach to environmental harms,  “Environmentalism and Economic Freedom: the Case for Private Property Rights”, Journal of Business Ethics 17: 1887–1899 (1998).  An excerpt is below (emphasis added):

But then in the 1840s and 1850s a new legal philosophy took hold. No longer were private property rights upheld. Now, there was an even more important consideration: the public good. And of what did the public good consist in this new dispensation? The growth and progress of the U.S. economy. Toward this end it was decided that the jurisprudence of the 1820s and 1830s was a needless indulgence. Accordingly, when an environmental plaintiff came to court under this new system, he was given short shrift. He was told, in effect, that of course his private property rights were being violated; but that this was entirely proper, since there is something even more important that selfish, individualistic property rights. And this was the “public good” of encouraging manufacturing.

Under this legal convention, all the economic incentives of the previous regime were turned around 180 degrees. Why use clean burning, but slightly more expensive anthracite coal rather than the cheaper but dirtier high sulfur content variety? Why install scrubbers, and other techniques for reducing pollution output, or engage in environmental research and development, or use better chimneys and other smoke prevention devices, or make locational decisions so as to negatively impact as few people as possible? Needless to say, the incipient forensic pollution industry was rendered stillborn.

And what of the “green” manufacturer, who didn’t want to foul the planet’s atmosphere, or the libertarian, who refused to do this on the grounds that is was an unjustified invasion of other people’s property? There is a name for such people, and it is called “bankrupt.” For to engage in environmentally sound business practices under a legal regime which no longer requires this is to impose on oneself a competitive disadvantage. Other things equal, this will guarantee bankruptcy.

From roughly 1850 to 1970, firms were able to pollute without penalty. This is why “there is no way to force private polluters to bear the social cost of their operations” a la Pigou; this is why there was a Samuelsonian “divergence of social and private costs.” This was no failure of the market. It was a failure of the government to uphold free enterprise with a legal system protective of private property rights.

In the 1970s a “discovery” was made: the air quality was dangerous to human beings and other living creatures. Having caused the problem itself, the government now set out to cure it, with a whole host of regulations which only made things worse. There were demands for electric cars, for minimal mileage per gallon for gasoline, for subsidies to wind, water, solar and nuclear power, for taxes on coal, oil, gas and other such fuels, for arbitrary cutbacks in the amount of pollutants into the air. The nation wide 55 mile per hour speed limit was not initially motivated by safety considerations, but rather by ecological ones. “Rent seeking” played a role in the scramble, as eastern (dirty burning sulfur) coal interests prevailed over their western (clean burning anthracite) counterparts. The former wanted compulsory scrubbers, the latter wanted the mandated substitution of their own coal for that of their competitors.

FN 23. From 1845 to 1970, approximately, polluters had a free run of the atmosphere, other people’s property and their lungs. From roughly 1970 to 1995, and counting, there was concern for invasive air and water borne pollutants, but only command and control (and in the last few years tradeable emissions rights schemes) regulations. Provision for environmental lawsuits is still, as of this 1995 writing, virtually nonexistent. See Horwitz (1977), Block (1990, pp. 282–285).

[Update:  Items 2 & 3 revised and an item 4 added.]

J.H. Huebert and Walter Block have posted a critique of Roderick Long‘s recent Cato essay.  Allow me to make a few comments:

1.  Huebert and Long argue that “There Is No Such Thing as Corporate Power”, stating that:

“Long writes that “Corporate power depends crucially on government intervention in the marketplace.”

But what does he mean by “corporate power”? A corporation is merely a group of individuals who have entered into a particular type of business relationship. The corporate form allows them to be known collectively by their business’s name instead of their own names. And it allows them to enter into contracts under which they limit their own liability – something which is perfectly legitimate under libertarianism. (Objectivist historian Robert Hessen has made this point well in his book, In Defense of the Corporation, and see our article, “Defending Corporations,” forthcoming in the Cumberland Law Review.)

The corporation, therefore, has no power to speak of.

Instead, only the state has power.”

(emphasis added)

This omits something rather crucial – that the corporate form allows owners to sidestep any personal liability for the wrongful acts that their corporation commits, with the result that liability of the corporation is limited by its assets.  Can someone point me to where libertarian principles defend this result?

2.   Huebert and Block further state that:

“sometimes the state uses its power to confer benefits, direct and indirect, on corporations. It also uses its power to confer benefits on partnerships. And sole proprietorships. And individuals. There is nothing special or different about government privileges for corporations – so why does Long single them out?”

I’m sorry, but a state grant of uncontracted-for limited liability vis-a-vis consumers and others IS a special privilege , and the very reason why so much economic activity is concentrated in corporations, as opposed to partnerships, sole proprietorships and individuals.

Further, there is indisputably quite a difference in SCALE of the benefits that the state confers on corporations, particularly larger ones.

3.  Huebert and Block concede that

“There is a kernel of truth in Long’s viewpoint – some larger firms do use the apparatus of the state to steal an advantage over smaller competitors. As a matter of history, things work out this way more often than in the opposite direction.”

But they fail to acknowledge the obvious implications of this concession:  the aggregated resources and long lives of larger corporations make it much easier for them, as compared to individuals, other forms of association and smaller corporate rivals, to effectively seek rents from the state by offering bribes of various forms (campaign contributions, lecture fees, junkets and revolving-door employment) .  Consequently, the state very often marches to the tune of large corporate drummers, with lobbyists and politicians acting as entrepreneurs in brokering the rents.  It is readily apparent that in the larger firms, executives are very effective at extracting equity at the cost of investors, and are often likewise effective in socializing costs (via federal and state bailouts) when their firms fail.

The creation and expansion of the corporate form has worked hand-in-glove with a steadily expanding and intrusive state.  Huebert’s and Block’s statements that “The corporation, therefore, has no power to speak of” and “onlly the state has power” are both obvious rhetorical excess.

4.  While Long argues that “In a free market, firms would be smaller and less hierarchical, more local and more numerous … and corporate power would be in shambles. Small wonder that big business, despite often paying lip service to free market ideals, tends to systematically oppose them in practice.”  Huebert and Block take this to mean that Long is making the “unfounded” assertion that “big business needs the state to survive”.  Rather than being unfounded, such a view simply cannot be found in Long’s essay.

Huebert and Block argue that:

As it is, there are big businesses that don’t benefit much from government and there are small businesses that benefit greatly from government. In a fully free market, undoubtedly, large and small businesses would both survive, succeed, and prosper. Long’s assertions to the contrary are unfounded speculation.

The first two sentences are unobjectionable, and are not inconsistent with Long’s points. 

Of course what a fully free market would look like is pure speculation, all around.  But without the ability of larger firms to use the state to raise barriers to entry, it seems to me axiomatic that there would be a greater percentage of smaller firms.

The Competitive Enterprise Institute and the American Conservative Union have joined with environmental groups such as the Earth Policy Institute and the Environmental Working Group and with meat growers, food processors and others in the “Food Before Fuel” campaign, which on November 18 called on Congress and the incoming Obama Administration to repeal subsidies for ethanol in light of the harmful effects of such subsidies on “the environment, consumers and numerous industries”.   Thankfully, the press release also mentioned that the subsidies are a waste of taxpayers’ money.

This is the type of lobbying that ought to warm the hearts of libertarians of all stripes, even if it means getting into bed with environazis and other more run-of-the-mill rent-seekers.

Choice excerpts from the Food Before Fuel press release follow (emphasis added):

This November marks the 30th anniversary of the first government subsidies for ethanol. These subsidies now total nearly $5 billion annually.  In recent months, a wide number of independent voices have spoken out against ethanol subsidies as a failed policy that does more harm than good. This includes three Nobel Prize winning economists, Joseph Stiglitz, Paul Krugman and Amartya Sen, as well as international institutions such as the IMF, World Bank, the UN, the International Food Policy Research Institute and others. …

Joel Brandenberger, president of the National Turkey Federation commented, “Ethanol has been on the government payroll for 30 years.  After three decades of government policies subsidizing and supporting the ethanol industry, we find ourselves at the end of 2008 with more questions than ever before about the wisdom of this course.”

“On many issues, these groups gathered here today do not see eye to eye.  But we have come together because we all can agree that the government’s subsidization of the corn ethanol industry is a flawed policy that pits rural industries against one another, raises food prices for everyone and has failed to yield promised environmental benefits,” Brandenberger said.

Duane Parde, president of the National Taxpayers Union, was critical of the ethanol industry as a “demonstrative waste of taxpayer money in a time of economic hardship.”

”President-elect Obama and the 111th Congress have an opportunity to protect taxpayers and end business as usual,” Parde said. “We have spent 30 years and billions of taxpayer dollars subsidizing the production of ethanol with little to show for it. Despite the subsidies, ethanol is not competitive in the marketplace and the industry only survives because politicians shovel our money into their pockets. We must end the bailouts and subsidies for industries that are unable or unwilling to stand on their own.”

Craig Cox, Midwest vice president of the Environmental Working Group, said that, “After 30 years of subsidies, ethanol is displacing only 3 percent of the gasoline we use each year, is likely increasing rather than decreasing greenhouse gas emissions, and is threatening our soil,  water and wildlife. Yet ethanol gets $3 out of every $4 of tax credits the federal government gives to all renewable alternatives including wind, solar and geothermal. It is time we direct our tax dollars to renewable alternatives, including biofuels, based on how well they protect our climate, our environment and our energy security.”

Jason Clay, senior vice president for market transformation at the World Wildlife Fund, noted, “In its work with local communities and habitats across the globe, the World Wildlife Fund has seen the negative impacts of the biofuel policy not only on the environment, but on vulnerable populations throughout the world.”

“Biofuels have a role to play in our response to energy independence and climate change, but the rush to produce them has been ill-considered. The United States must set an example to the rest of the world by pursuing sustainable agriculture and energy practices that meet scientifically based environmental performance standards,” Clay said.

Even the New York Times, in a November 17 editorial, has stood up against ethanol subsidies.

We’ll see if Obama and the Dems have the political will to say no to ADM and other ethanol subsidy recipients.  I’m not holding my breath, but am pleased to see such a broad effort nonetheless. 

H/T to David Zetland/Aguanomics.

On July 17, Al Gore challenged our nation to produce “100 percent of our electricity from renewable energy and truly carbon-free sources within 10 years“.

Ron Bailey, science correspondent of Reason online, has examined whether Gore’s proposal is at all practically achievable.  Bailey reviews the main options mentioned by Gore (solar, wind and geothermal) and the chief option implied but unmentionable – nuclear power – and concludes that low ball estimates of the costs for realizing Gore’s target are on the scale of $1 trillion to $6 trillion, with nuclear being by far the cheapest.  Concludes Bailey:

Curiously, nowhere does the “N-word”—nuclear—appear in Gore’s speech. Currently, 104 nuclear power plants generate about 20 percent of America’s electricity. Once a nuclear plant is up and running, it is essentially carbon-free. Westinghouse claims that it can build a third generation 1,000 megawatt nuclear power plant for around $1.4 billion. Assuming this estimate is right, all U.S. carbon-emitting electricity generation plants could be replaced with nuclear power at a cost of about $1.2 trillion by 2018. …

“Of course there are those who will tell us this can’t be done,” warned Gore. I am not one of those people. I am sure it can be done. But before embarking on his “generational challenge to re-power America,” I would like the former vice-president to sketch out a few more details on how it’s going to be paid for and who’s going to be stuck with the bill.

These numbers – roughly on the scale of our out-of-pocket and committed costs for our Iraq and Afghanistan adventures (largely corporate welfare for the defense/logistics industry, good friends of Republicans) – help us get a bit of a handle on the opportunity costs of those wars, which have undermined rather than improved our security and jacked up oil costs.

Bailey also comments on the costs of shifting our automobile fleet to one that is powered by electricity.

Bailey’s piece is here: “Al Gore’s Curiously Cost-Free Plan to Re-Power America“. 

Jared Diamond has an interesting essay at the current issue of New Yorker, “Vengeance Is Ours“, that is worth considering.  

In the essay, Diamond not only describes the moral and political economy of cycles of personal and inter-tribal vengeance in one of the relatively stateless area of the Papua New Guinean Highlands – cycles of violence that very likely represent typical human dynamics throughout the course of our evolution –  but also, via a contrast with a family story regarding personal vengeance not taken, he presents various thoughts on:

• the evolution of the state,
• the mechanisms by which those who live in states repress and channel our latent tendencies towards violence, and
• the personal satisfactions of taking vengeance, and the personal costs incurred when the right to seek vengeance is surrendered to the state.

Diamond appears to assume the legitimacy of the state, and focusses in the latter part of his essay on the personal costs that each of us incurs by being forced to surrender our “thirst for vengeance” when we are injured or offended and to rely on an impersonal state for “justice”. 

This is interesting, but rather shallow, as it fails to discuss how our state-run justice systems themselves seem to be rather out of control, especially in the US.

Further, Diamond skates too quickly past important issues when he concludes that the evolution of states has been a good deal generally for those who find themselves in them.  Here are a few key quotes:

“State government is now so nearly universal around the globe that we forget how recent an innovation it is; the first states are thought to have arisen only about fifty-five hundred years ago, in the Fertile Crescent. Before there were states, Daniel’s method of resolving major disputes—either violently or by payment of compensation—was the worldwide norm. Papua New Guinea is not the only place where those traditional methods of dispute resolution still coexist uneasily with the methods of state government. For example, Daniel’s methods might seem quite familiar to members of urban gangs in America, and also to Somalis, Afghans, Kenyans, and peoples of other countries where tribal ties remain strong and state control weak. As I eventually came to realize, Daniel’s thirst for vengeance and his hostility to rival clans are really not so far from our own habits of mind as we might like to think.  …

“Nearly all human societies today have given up the personal pursuit of justice in favor of impersonal systems operated by state governments—at least, on paper. Without state government, war between local groups is chronic; coöperation between local groups on projects bringing benefits to everyone—such as large-scale irrigation systems, free rights of travel, and long-distance trade—becomes much more difficult; and even the frequency of murder within a local group is higher. It’s true, of course, that twentieth-century state societies, having developed potent technologies of mass killing, have broken all historical records for violent deaths. But this is because they enjoy the advantage of having by far the largest populations of potential victims in human history; the actual percentage of the population that died violently was on the average higher in traditional pre-state societies than it was even in Poland during the Second World War or Cambodia under Pol Pot.“

While I think Diamond’s observations here are largely fair, Diamond makes no effort to analyze the failings of modern states, and these failures are significant and cannot be ignored.  Neither, however, can the implications of Diamond’s observations for those who think we would be better off in stateless societies.  However, Diamond is primarily an ornithologist and anthropologist, so perhaps he can be forgiven for not examining more closely the problems of states in a rather short essay that is more concerned about cycles of violence and our modern repression of personal vengeance.

Further, Diamond’s essay only tangentially addresses, but is nonetheless seems a good jumping-off point for considering further, our evolved human nature and the heritage that such evolution has left us in terms of a cognitive system that is prone to suspicion of others, black and white views, self-justification and other characteristics that tended to reinforce our important tribal identities.  These are matters that I think affect each of us and are very much in evidence in the modern, “civilized” world – the world of impassioned disagreements between factions, racial divides, hostility towards “others” (those evil “Islamofascists,” gays, immigrants, liberals, envirofascists, etc.) and our fabulous ability to identify the mistakes and inconsistencies of others while ignoring our own.  As hjmaiere pointed out in a recent forum post (“Hermann Goering on Anthropogenic Global Warming” – naturally I disagreed with him in relevant parts), it is the powerful effects of our tribal nature that rent-seekers (and their political handlers) are so good at identifying and manipulating.