Posted by Jeff Id on November 4, 2010
Judith Curry has a new blog post which has inspired me to write on Libertarians and climate. She has written a couple of times with negative commentary toward libertarians and environmental causes. While she never actually attacks the Libertarian philosophy herself, her points are widely believed. For instance:
Libertarian think tanks, the traditional foes of the enviro advocacy groups, began countering with doubts about the science.
The point is hard to disagree with, but there are good reasons to go against the eviro advocacy groups and their anti-prosperity policies but I believe that consumption driven capitalist conservatives are by far the most environmentally friendly political group on the planet. In fact, in my mind, it isn’t even a close call.
Protecting the environment requires doing things which have a benefit/cost relationship that is sometimes greater orless than 1. Greater than one and you are financially incented to pursue the benefit, less than one and you will be pushed to ignore it as a bad deal. If you want to dispose of mercury or some other caustic chemical and you are careless eventually the benefit/cost number can be far greater than 1 to society as a whole but on an individual company costs of handling the problem properly puts pressure on the business to behave badly. Regulations are sometimes necessary to communicate societies need to business, but the effects of those regulations are often poorly understood. From the above, it is very easy to conclude that Libertarian style capitalist consumption will lead to widespread destruction of the environment. Simple thinking people imagine resources consumed to their end, forests wiped out, brown skies and dead fish, but is that really what happens?
The most destructive enemy of humanity is not weather, it is poverty. Poverty has destroyed more lives than any war can however, many wars came about from poverty which was often unnecessarily forced on populations by government policies. Poverty is the enemy of the environment that should be battled, not capitalism and over-consumption as many climatologists believe. Capitalism recognizes costs, it isn’t environmental policy that protects our forests in the US, it is the paper businesses protecting their own livelihood. Forests are treated as tree-farms here, whereas in impoverished areas of the world, they are sometimes slaughtered to make money now – as America used to do a hundred years ago.
Changing a behavior away from the financially incentivized benefit/cost ratio, often requires money. It is simply impossible for Zimbabwe to invest in more expensive programs to protect the environment. Today China has become the whipping boy of the world for its consumption of resources and massive pollution, however, China is not the consumer, the world is. America and Japan are also regularly hammered for the same issues, except that the pollution isn’t there to the same degree. While we have exported many of our jobs to China, our more mature capitalist economies have developed enough sensible regulation that we are far cleaner in our production. It is simply impossible for the poor regions of China to do anything more about pollution than they already do. However, as our global money piles up there, that will also change.
A coal plant in the US emits very little particulate these days from sensible regulation, a coal plant in Pakistan or Venezuela is less regulated – out of poverty. The bottom line is that you need the money to implement the regulatory controls. The more money you have, the more controls you can implement and this is where the environmentalists often go wrong. They see businesses producing, wealthy populations consuming and making a mess, and from the simple understanding of Libertarian policy, they only know that conservatism and capitalism are the enemy of the environment. It is easy to say, coal plants produce CO2, they are the enemy of the environment, we need to raise the cost to limit consumption. Everyone can understand the sense of your policy, but will it give you the result you want?
The answer in the short run is yes but over decades of time is actually no! You will get the opposite effect, and will in fact produce more CO2 and more pollution in the long run, and if you raise the cost enough, you will have wide spread poverty. Some of the environmentalists are so extreme that they see this as a good thing, imagining equal but lower wealth spread around the world as a fantastic result. Of course if you ask someone who has lived under equal-wealth policy, you may find that they weren’t as thrilled with the outcome as it sounds on paper.
Again, the result is not created from the first order effect. Limitation does not mean less production in the long run, it means less money available for solutions. As we adopt ever more limitation policies in America, our prosperity has dropped markedly. I’m sure plenty of economists both disagree and agree with that assessment but it is largely due to the fact that they don’t actually live on daily orders from customers. Businesses in America today are pressured to their limits by taxation and regulation, their true output has dropped but that is hidden by the export of environmentally difficult production out of country. Again, it has the effect of added cost, added shipping and in the end, more production of pollution because poor countries don’t have the wealth to control emissions of various pollutants. Do you think that a barrel of oil is more likely to be dumped into a stream in Viet-Nam or America? Which country would then spend money to clean it up?
Of course, general people don’t think too deeply on these things and first order effects are part of what keeps socialism so popular in the world despite the dramatically improved outcomes for life in a capitalist society. California just voted for more cost to limit CO2, when it will have absolutely zero effect on their ability to solve the problem. The first order effects sound nice, everyone likes clean air, but the reality is that California’s limitation policies have bankrupted their own government, pushed business and production to poorer areas of the country and world, and seriously limited their future ability to really help solve the problems they care about.
The IPCC as pointed out by Judith Curry’s blog post was structured from the beginning to make the conclusion it did. Judith is the first scientist I’ve read to really speak so bluntly about this fact which was the subject of some of the first posts at tAV. The IPCC is a political organization and although it claims scientific consensus, in my opinion it has very little science left in it today. Climategate is almost a year old now, but its main lesson was – don’t trust the big government science industry. It is an industry the same as any other, it has its own benefit/cost balance, and the ratio has biased the science. The ‘benefit’ of government money and power for an extremist global warming position is obvious as are the costs of a moderate statement. From climategate we have proof that it has biased the science, but any honest review of the IPCC leads to the same conclusions anyway. They had to hide the decline one way or another to maintain their benefit. It was either that or they had to admit that the conclusions they wanted to make were unsupported by the science. From the above, you can see that it is in fact, completely impossible to fix the bias in the IPCC. Sure you can have more oversight, you can add layers of bureaucracy which may improve the bias, but in reality, even those layers will be positively affected by extremist conclusions they would be tasked to minimize.
So with all the exaggerated government industry ‘science’ out there, magnifying the costs of not acting on AGW and minimizing the costs of their limitation policy, it is no wonder that thinking individuals who can’t help but notice the benefits of free market capitalism, are viewed as the enemy. What they so easily for politicians to forget is that, if you want to put money into ‘green’ technology, you had better find a way to make the money. Borrowing money now to implement massively expensive solar plants and biofuels can do nothing but decrease our ability to address the problem with real solutions. Unfortunately, our public educated society has lost the ability to think beyond the first order effects of these policies and left America in a dramatically weakened position to deal with our self-inflicted energy issues.
As strange as it seems to most in this world, Libertarian, conservative capitalism with a minimal government and widespread consumption is the environmentalists true friend. Let the people lift themselves from poverty and they will have all the power they need to take care of Gaia for millennia to come. Tax and regulate their consumption, spread the wealth by fiat, and you will get all the happy results that so many communist regimes have demonstrated so many times before. Of course convincing the IPCC of that will be difficult, as those at the top of socialist wealth spreading governments, want for nothing.