The Corner

Debating Cap-and-Trade

Ryan Avent responds to my post as follows, with my reactions inserted:

Conservatives are going to win on climate change, says Jim Manzi. How? By repeating, ad infinitum, that emissions reductions aren’t possible/are too expensive.

Not impossible, just much more expensive than the benefits they would provide.

Now, it’s no doubt clear to all of you that I think Manzi is very much wrong on the economics, but I also think he’s absolutely wrong on the politics. For one thing, the cost-benefit, discount rate discussion is not going to be a political winner. That’s not how voters think, and that’s not going to be the kind of thing to get them impassioned.

Really? Voters don’t care about massive tax increases that aren’t projected to create any benefits for the US economy for many decades, and will never create present value of benefits greater than costs?

The public would be likely to entertain an argument that emissions reductions will increase energy costs, but the problem here is that Republicans are not going to be able to reduce energy costs. No one will. So all Democrats have to say is that, look, these costs are going to continue to rise. Better then to make an effort to switch to renewable fuels that don’t involve massive emissions and massive transfers of wealth to fossil fuel exporting nations. The Republican position will also be very vulnerable to the (not inaccurate) charge that they’re primarily concerned about the bottom lines of big energy companies.

Ryan is a very smart guy, but this strikes me as quite misguided. We are discussing incremental taxes (or their equivalent) on energy that would make them more expensive than they otherwise would be, no matter what the market price. See, for example, Europe. The whole point of carbon taxes / cap-and-trade is to make carbon-intensive energy more expensive so that we use less of it and therefore generate lower emissions. Those who oppose carbon taxes / cap-and-trade are by definition arguing that we should have lower energy costs than those who support them, and have a very simple, believable program to achieve this result: don’t add taxes to them.

But to see why the GOP will ultimately have to join Democrats on this issue or face political disaster, all you have to do is pick up a newspaper, or talk about the news with anyone who doesn’t cover these issues for a living. The weather has been really freaky recently, and that’s not coincidental. It’s going to get worse. You’re going to see oddly intense storms, and stories about droughts and desertification, and heart-wrenching tales of cuddly animal extinctions. And then you’re going to see pictures of thousands of dead Bangladeshis and millions of climate refugees. And the GOP is going to win electoral victory forever by saying that all we need to do is build bigger levies.

This is what it now comes down to?: “The weather has been really freaky recently, and that’s not coincidental.” And “It’s going to get worse. You’re going to see oddly intense storms, and stories about droughts and desertification, and heart-wrenching tales of cuddly animal extinctions.” This is what is going to convince voters to agree to a very large tax increase? The future is unknowable, but I wouldn’t bet on it.

Jim Manzi is CEO of Applied Predictive Technologies (APT), an applied artificial intelligence software company.
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