Thursday, 24 October 2013

A properly funded direct action plan wouldn't be so bad

After the Coalition victory in the election, we face the repeal of the carbon tax and the implementation of a woefully underfunded "direct action" plan - so transparently so that it seems designed to fail. Our Prime Minister, while paying lip service to climate change politically, is almost certainly still a denier. A properly designed carbon tax would be a far more economically efficient mechanism to reduce emissions than a properly funded direct action plan. Alas we won't even have that.

Writing in the New York Review of Books, economist Paul Krugman reviews William Nordquist's The Climate Casino: Risk, Uncertainty, and Economics for a Warming World, which discusses the economics of climate change. In discussing carbon tax/cap and trade vs direct action, Krugman writes:
Why is putting a price on carbon better than direct regulation of emissions? Every economist knows the arguments: efforts to reduce emissions can take place along many “margins,” and we should give people an incentive to exploit all of those margins. Should consumers try to use less energy themselves? Should they shift their consumption toward products that use relatively less energy to produce? Should we try to produce energy from low-emission sources (e.g., natural gas) or non-emission sources (e.g., wind)? Should we try to remove CO2 after the carbon is burned, e.g., by capture and sequestration at power plants? The answer is, all of the above. And putting a price on carbon does, in fact, give people an incentive to do all of the above.

By contrast, it would be very hard to set rules to accomplish all these goals; in fact, even figuring out the comparative emissions from a simple choice, like whether to drive or fly to a city a few hundred miles away, is by no means a simple problem. So carbon pricing, says Nordhaus, is the way to go. And I, of course, agree—they’d probably revoke my economist card if I didn’t.

And yet there is a slightly odd dissonance in this book’s emphasis on carbon pricing. As I’ve just suggested, the standard economic argument for emissions pricing comes from the observation that there are many margins on which we should operate. Yet as Nordhaus himself points out, studies attempting to analyze how we might most efficiently reduce carbon emissions strongly suggest that just one of these margins should account for the bulk of any improvement—namely, we have to sharply reduce emissions from coal-fired electricity generation. Certainly it would be good to operate on other margins, especially because these studies might be wrong—maybe, for example, it would be easier than we think for consumers to shift to a radically lower-energy lifestyle, or there might be radical new ideas for scrubbing carbon from the atmosphere. Nonetheless, the message I took from this book was that direct action to regulate emissions from electricity generation would be a surprisingly good substitute for carbon pricing—not as good, but not bad.
Krugman also makes reference to something that sometimes leads me to be somewhat pessimistic about our chances of addressing the problem of climate change:
I enjoyed The Climate Casino, and felt that I learned a lot from it. Yet as I read it, I couldn’t help wondering whom, exactly, the book was written for. It is, after all, a calm, reasoned tract, marshaling the best available scientific and economic evidence on behalf of a pragmatic policy approach. And here’s the thing: just about everyone responsive to that kind of argument already favors strong climate action. It’s the other guys who constitute the problem.
Unfortunately we Australians recently elected the other guys.

Read Krugman's full review over at the New York Review of Books.


  1. The truth is shocking. Do you want the truth? Can you handle it? I have been a Greens/Labour voter for 15 years and financially supported the Greens due to my love of the environment and concern for what global warming would do to our planet. I have a BSC degree in biol, geol. I have a very particular quirk. I am a truth seeker, no matter how unpleasant that may turn out to be - I cannot be lead blindly by faith.

    Here's what I have researched and know for a Fact: There IS NO GLOBAL WARMING!! This was confirmed by the UK Met Office months ago and printed in some obscure pack page of The Australian. The United Nations IPCC have had to admit this too. The Arctic ice sheet has come back with a vengeance and is larger than ever. There has been no global warming now for 16 consecutive years. In fact there is a slight cooling trend occurring over the last 10 years. Why are mainstream media/CSIRO not reporting this? We are being deceived by vested interests that are benefitting in many ways, not just financially (Al Gore is now very wealthy and has more to gain through carbon trading investments). If you read only 1 book in your life, get the book "Behind the Green Mask" by Rosa Koire (online) and learn about UN Agenda 21, a United Nations takeover by stealth of our sovereign nation by numerous treaties signed up by both our governments. It is about stealth steps to remove our private property and individual rights by embedding ICLEI, a U.N. front organisation, into our local councils and is carried out by placing numerous 'overlays' through the planning depts on our private properties one step at a time. Listen to Leon online on Fair Dinkum Radio to be informed and educated on the Big Picture. Time is running short. It is about bringing in Bush, Howard's, Gordon Brown, Tony Blair's self proclaimed 'New World Order' ie One World UN run communist Government, controlled by the international bankers/transnational corporations - the Elite and the serfs, no more middle class. Our two party system is actually Two Cheeks on the Same Bum and carry out the orders of their masters, whilst we, the people get to believe that at election time we have 'thrown the rascals out'. America is fighting Un Agenda 21 in various counties and states - they are more awake than Australians. Also check out where Alex Jones is awaking americans and people all around the globe including australia and NZ. Also go to for the big picture - there are many tentacles to this global octopus and it is essential to connect the dots in order that it all makes sense.

    1. I'm impressed by your ability to pack so much fail into such a little space. Stop reading the Australian and the Daily Mail - they're both notoriously dishonest when it comes to climate change.

      I've dealt with you claims about climate in previous posts. The "UK Met Office said warming stopped" meme is a well known lie. It was started by the Daily Mail despite the UK Met Office warning them not to. A blogger/columnist of that trash rag magazine did his own analysis, cherry picking dates and data sets to get the result he wanted. Warming continues apace, especially if you include ocean warming. And the Arctic ice sheet is not back with a vengeance. It's just better than recent record lows. It's still well below average. You are an idiot.

      Your Agenda 21 claims are well known nonsense too. It's the paranoid ranting of tea party loons in the US. Again, you are an idiot.

      With all the rampant bollocks in your second paragraph, I'm going to doubt your sincerity in the first as well. .