Economics’ solution to Environmental and energy policy
By Nick July 12, 2008
Taking [and passing] two economics classes really simplifies the government’s powers and role in society for a student such as myself, especially when it comes to environmental and energy public policy.
When economic theory is applied to energy policy and consumption issues, I find myself in awe of lawmakers’ ability to wriggle around the real solution in favor of gaining votes as well. It’s pretty disgusting, but I keep telling myself “it’s politics” while sighing in despair.
SOO, if you want a game plan to solve environmental issues and energy consumption in the US, look at simple economic theory. It’s been the root of production and consumption for eternity, and it is still that way today. Now for problems + solutions thanks to economics:
- How to lower carbon emissions - Tax
- How to lower gasoline usage- Tax
- How to increase wind energy utilization - Subsidy
- How to increase solar power utilization - Subsidy
And for the beautiful graphs accompanying them:
While there is a function to derive how much tax or subsidy is needed, the data is pretty much impossible to come up with. But a gas tax holiday won’t be slowing gas consumption anytime soon, and removing a subsidy like ability to lease public land for solar farms doesn’t actually help the renewable energy industry.
Theoretically, everything can be accomplished with those graphs. If you’re feeling a bit more creative, you can throw in the taxes and subsidies on alternatives, like coal versus solar. Finally mr. research and development comes along as an alternative that can be subsidized accordingly as well.
While I know this economic theory waters down everything and doesn’t take into account the ripple effects of governmental policies, it’s still fundamentally the only thing government can do in a free market to promote and discourage energy consumption.
Why do I bring up this obvious point and ramble on and on? Well it’s the groundwork for our society, and by understanding the limits and powers of government, we can look at green issues and public policy from a more informed, rational perspectives. But that will be all for ranting, posts in the immediate future, and more green news will follow.
Topics: Government |
Leave a Reply
« New MIT Solar Panels: Organic solar concentrators cost effective | Home | Who is T Boone Pickens? Simple Guide to Pickens Plan »
