| Building a Green Economy (Page 4 of 10) |
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| Written by Social Media Department |
| Wednesday, 14 April 2010 04:23 |
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Yet that’s not the conclusion you might draw from the many media reports that have focused on matters like hacked e-mail and climate scientists’ talking about a “trick” to “hide” an anomalous decline in one data series or expressing their wish to see papers by climate skeptics kept out of research reviews. The truth, however, is that the supposed scandals evaporate on closer examination, revealing only that climate researchers are human beings, too. Yes, scientists try to make their results stand out, but no data were suppressed. Yes, scientists dislike it when work that they think deliberately obfuscates the issues gets published. What else is new? Nothing suggests that there should not continue to be strong support for climate research. And this brings me to my third point: models based on this research indicate that if we continue adding greenhouse gases to the atmosphere as we have, we will eventually face drastic changes in the climate. Let’s be clear. We’re not talking about a few more hot days in the summer and a bit less snow in the winter; we’re talking about massively disruptive events, like the transformation of the Southwestern United States into a permanent dust bowl over the next few decades. Now, despite the high credibility of climate modelers, there is still tremendous uncertainty in their long-term forecasts. But as we will see shortly, uncertainty makes the case for action stronger, not weaker. So climate change demands action. Is a cap-and-trade program along the lines of the model used to reduce sulfur dioxide the right way to go? Serious opposition to cap and trade generally comes in two forms: an argument that more direct action — in particular, a ban on coal-fired power plants — would be more effective and an argument that an emissions tax would be better than emissions trading. (Let’s leave aside those who dismiss climate science altogether and oppose any limits on greenhouse-gas emissions, as well as those who oppose the use of any kind of market-based remedy.) There’s something to each of these positions, just not as much as their proponents think. When it comes to direct action, you can make the case that economists love markets not wisely but too well, that they are too ready to assume that changing people’s financial incentives fixes every problem. In particular, you can’t put a price on something unless you can measure it accurately, and that can be both difficult and expensive. So sometimes it’s better simply to lay down some basic rules about what people can and cannot do. Consider auto emissions, for example. Could we or should we charge each car owner a fee proportional to the emissions from his or her tailpipe? Surely not. You would have to install expensive monitoring equipment on every car, and you would also have to worry about fraud. It’s almost certainly better to do what we actually do, which is impose emissions standards on all cars. Is there a comparable argument to be made for greenhouse-gas emissions? My initial reaction, which I suspect most economists would share, is that the very scale and complexity of the situation requires a market-based solution, whether cap and trade or an emissions tax. After all, greenhouse gases are a direct or indirect byproduct of almost everything produced in a modern economy, from the houses we live in to the cars we drive. Reducing emissions of those gases will require getting people to change their behavior in many different ways, some of them impossible to identify until we have a much better grasp of green technology. So can we really make meaningful progress by telling people specifically what will or will not be permitted? Econ 101 tells us — probably correctly — that the only way to get people to change their behavior appropriately is to put a price on emissions so this cost in turn gets incorporated into everything else in a way that reflects ultimate environmental impacts. Paul Krugman is a Times columnist and winner of the 2008 Nobel Memorial Prize in Economic Science. His latest book is “The Return of Depression Economics and the Crisis of 2008.”
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| Last Updated on Wednesday, 14 April 2010 04:38 |




