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Ted Nordhaus: Carbon Pricing Has to be Imposed Slowly, to Avoid Yellow Vest Riots

By Eric Worrall | Watts Up With That? | July 21, 2019

Ted Nordhaus, nephew of Nobel Prize winning climate economist William Nordhaus, thinks the solution to eliminating CO2 is to impose a wide range of cost of living increases gradually, to avoid policy flashpoints which could trigger yellow vest style riots.

CLIMATE CHANGE REQUIRES BIG SOLUTIONS. BUT BABY STEPS ARE THE ONLY WAY TO GO.

Dramatic projects to mitigate climate change often don’t work. Slow, quiet, incremental policies are the planet’s best hope.

BY TED NORDHAUS
JULY 20, 2019

Recent months have seen something of a turnaround in the conventional wisdom about how to address climate change. In December, on the weekend before the Swedish Academy presented the Nobel Prize to my uncle, the economist William Nordhaus, for his work on climate change and carbon taxes, France’s yellow vest movement flooded into the streets, shutting down Paris and other cities across the country and forcing President Emmanuel Macron to rescind the carbon tax he had recently imposed on transportation fuels.

A month earlier, voters in Washington state, as environmentally minded a place as you will find in the United States, soundly rejected a ballot initiative that would have established a carbon tax in that state.

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In the parlance of economists and political scientists, carbon taxes are highly salient, meaning that people will do more to avoid paying the tax than they would in response to the same increase in the market cost of energy. But that salience also makes carbon pricing politically toxic; taxes often stoke an outsized reaction even when they are very modest. One response to a carbon tax is to wrap your hot water heater in a thermal blanket and install double-paned windows. Another is to riot.

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Yet the Green New Deal contains a crucial insight. Economists argue for carbon pricing because it makes the social cost of carbon visible in our day-to-day consumption. Voters and politicians, by contrast, have generally preferred to hide the costs of climate mitigation. Policies to subsidize clean energy technology—including nuclear, wind, and solar—have tended to be far more successful politically than efforts to price carbon.

Government subsidies typically make economists pull their hair out. They encourage rent seeking and require policymakers with imperfect knowledge to make decisions about which technologies to champion. And it’s true, from synthetic fuels to biofuels, Solyndra solar cells to plutonium breeder reactors, governments have bet on plenty of energy technology losers.

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Read more: https://foreignpolicy.com/2019/07/20/climate-change-requires-big-solutions-but-baby-steps-are-the-only-way-to-go/

What I find shocking is the sheer arrogance of these green proposals.

What is wrong with today’s establishment? What ever happened to at least trying to do what voters want, trying to make people’s lives easier, instead of attempting to fiddle the system to conceal why life has become so much harder?

Why have otherwise intelligent people become so mesmerised by big ideas, that they feel justified ignoring the pain their actions and ideas cause to ordinary people?

I don’t see any evidence that voters prefer to hide costs, as Nordhaus claimed; more likely slipping costs under the radar goes unnoticed until one day voters discover they can’t afford to eat.

July 21, 2019 - Posted by aletho | Economics, Science and Pseudo-Science, Supremacism, Social Darwinism, Timeless or most popular | France