Saturday, September 29, 2007

State Government & Global Warming

Brendan Miniter in the WSJ ($$$):

North Carolina's global-warming activists are in hog heaven. Late last month, Gov. Mike Easley, a Democrat in his second term, signed legislation mandating that more electric power in his state come from "green" sources such as wind, solar energy, and hog and chicken waste.

Today, North Carolina gets about 2% of its electricity from "renewable resources." By 2021, under the new mandates, Progress Energy and Duke Energy will have to find 12.5% of the power that they sell to Tar Heel residents from renewables. Hog-waste-generated power -- as required by the new law -- will nearly triple to 0.2% of the electricity used in the state over the next decade as farmers capture and sell the methane gas given off from tons of decomposing manure.

It's gone largely uncovered outside the state, but there is an energy revolution underway in the Tar Heel State that will cost residents more for the energy they use in the name of cutting greenhouse gases. Even while they make little headway in Congress, advocates of heavy-handed regulations to head off global warming are working to enact laws on the state level. They're succeeding in North Carolina.

The immediate cost to consumers will be higher electric bills. For residential customers, an annual fee will eventually reach $34, and for industry the annual fee will grow to as much as $1,000.

The new hog mandate is only the beginning. The state has set up a special commission -- the Climate Action Plan Advisory Group -- to study ways to cut CO2 emissions. It's already adopted a list of 53 recommended new mandates and is drafting a report for the state legislature.

A few ideas the commission will recommend in its report next month include mandates for "higher-density" housing developments, something thought to reduce suburban "sprawl," and, of course, new subsidies for farmers to produce biodiesel.

It will also recommend imposing new costs on the driving public. One thought is to force drivers who put more miles on their odometer to pay higher car-insurance premiums than those who drive less. And it will recommend a CO2 tax or a cap-and-trade system, assuming such a system could be worked out on a state level.

I'm wondering if global warming policies by state governments make any sense in general? It seems to me that concern about global warming involves a problem that is global in geographic scope, not statewide in geographic scope. As such, I suspect state government mandates such as these noted by Mr. Miniter are unlikely to yield much in the way of their stated goal, which is presumably a reduction in global warming. Isn't it likely, therefore, that the economic benefits from mandates such as these are quite small? If so, then it would seem that state government policies such as these will be quite effective at increasing costs to the residents of the state, but in return for the increased costs the residents can probably expect to enjoy virtually no benefits from less global warming.

And, then, there are the actual policies that are being mandated. What's up with policies like forcing higher insurance premiums? Why does anyone think auto insurance has anything to do with carbon emissions and global warming?

Friday, September 28, 2007

Clinton, Global Warming & The Broken Window

James Pethokoukis :

"This issue of energy and global warming has the promise of creating millions of new jobs in America. It can be a win-win, if we do it right."—Sen. Hillary Clinton, at last night's Democratic debate in South Carolina

And with that, Clinton seemingly stumbled into the classic economic trap known as the Broken Window Fallacy. As described by the French economist Fredric Bastiat, the fallacy imagines some punk kid chucking a rock through a store window. A bad thing, right? Yet a contrarian onlooker offers that the troublemaker may have actually helped the economy because now the storeowner will have to hire a glazier, who will make money replacing the window. Then the glazier will use that money to buy bread from a baker, who then might buy shoes from a cobbler. And the "multiplier effect" goes on and on, creating a more prosperous economy.

But Bastiat points out that such reasoning ignores the hidden costs to the shopkeeper, who was forced to spend money on windows instead of something else that may have had higher value to him or society, like a new suit or investing in a start-up tech firm. As the great economics writer Henry Hazlitt once put it:

The glazier's gain of business, in short, is merely the tailor's loss of business. No new "employment" has been added. The people in the crowd were thinking only of two parties to the transaction, the baker and the glazier. They had forgotten the potential third party involved, the tailor. They forgot him precisely because he will not now enter the scene. They will see the new window in the next day or two. They will never see the extra suit, precisely because it will never be made. They see only what is immediately visible to the eye.

Tuesday, September 18, 2007

Ramadi Freedom?

Michael Totten reports from Ramadi in Anbar province:
I was greeted by friendly Iraqis in the streets of Baghdad every day, but the atmosphere in Ramadi was different. I am not exaggerating in the least when I describe their attitude toward Americans as euphoric.

Grown Iraqi men hugged American Soldiers and Marines.

Young men wanted me to take their pictures with their arms around American Soldiers and Marines. The Americans seemed slightly bored with the idea, but the Iraqis were enthusiastic.

Children hugged State Department civilian reconstruction team leader Donna Carter.

Ramadi has changed so drastically from the terrorist-infested pit that it was as recently as April 2007 that I could hardly believe what I saw was real. The sheer joy on the faces of these Iraqis was unmistakable. They weren’t sullen in the least, and it was pretty obvious that they were not just pretending to be friendly or going through the hospitality motions.

“It was nothing we did,” said Marine Lieutenant Colonel Drew Crane who was visiting for the day from Fallujah. “The people here just couldn’t take it anymore.”

What he said next surprised me even more than what I was seeing.

“You know what I like most about this place?” he said.

“What’s that?” I said.

“We don’t need to wear body armor or helmets,” he said.

I was poleaxed. Without even realizing it, I had taken off my body armor and helmet. I took my gear off as casually as I do when I take it off after returning to the safety of the base after patrolling. We were not in the safety of the base and the wire. We were safe because we were in Ramadi.

[. . . .]

The Iraqis of Anbar Province turned against Al Qaeda and sided with the Americans in large part because Al Qaeda proved to be far more vicious than advertised. But it’s also because sustained contact with the American military – even in an explosively violent combat zone –convinced these Iraqis that Americans are very different people from what they had been led to believe. They finally figured out that the Americans truly want to help and are not there to oppress them or steal from them. And the Americans slowly learned how Iraqi culture works and how to blend in rather than barge in.

“We hand out care packages from the U.S. to Iraqis now that the area has been cleared of terrorists,” one Marine told me. “When we tell them that some of these packages aren’t from the military or the government, that they were donated by average American citizens in places like Kansas, people choke up and sometimes even cry. They just can’t comprehend it. It is so different from the lies they were told about us and how we’re supposed to be evil.”

[. . . .]

I photographed a freshly painted cell phone store that looked new.

“That’s when you know life is coming back to normal,” Sergeant Hicks said, “when they open a cell phone shop.”

“It’s amazing for us to see people out on that street buying and selling things,” Captain Phil Messer said to me later. “That never happened for the first months we were out here. Literally zero businesses were open. People were scared shitless of Al Qaeda. If you pissed them off they would show up at your house in the middle of the night, rape your women in front of you, kill your sons, and say you will not help the Americans. Huge numbers of these people just fled to Syria.”

Reminds me of Mancur Olson's Power and Prosperity.

Even if you don't read Totten's entire report, you really should take a look at his photos of the people of Ramadi.

Wednesday, September 12, 2007

Health Zoning

The LA Times reports:
As America gets fatter, policymakers are seeking creative approaches to legislating health. They may have entered the school cafeteria -- and now they're eyeing your neighborhood.

Amid worries of an obesity epidemic and its related illnesses, including high blood pressure, diabetes and heart disease, Los Angeles officials, among others around the country, are proposing to limit new fast-food restaurants -- a tactic that could be called health zoning.

The City Council will be asked this fall to consider an up to two-year moratorium on new fast-food restaurants in South L.A., a part of the city where fast food is at least as much a practicality as a preference.
After reading this I'm reminded of Patrick Henry:
"Give Me Liberty. . . ."

While this sort of government policy seems nonsense to me, it does seem to make sense to some people:
"While limiting fast-food restaurants isn't a solution in itself, it's an important piece of the puzzle," said Mark Vallianatos, director of the Center for Food and Justice at Occidental College.

This is "bringing health policy and environmental policy together with land-use planning," he said. "I think that's smart, and it's the wave of the future."
Please, no, not the future. My hat-tip to Peter Gordon who writes:
In the goofiness sweepstakes, the professors and the politcians continue to battle it out.

Monday, September 10, 2007

Liberal Brains & Conservative Brains

The Denver Post reports on a study on the brain and politics:
Exploring the neurobiology of politics, scientists have found that liberals tolerate ambiguity and conflict better than conservatives because of how their brains work.

I'm wondering what value judgment underlies the "better than" conclusion.

I do find the following kind of interesting:
Participants' politics ranged from "very liberal" to "very conservative." Scientists instructed them to tap a keyboard when an M appeared on a computer monitor and to refrain from tapping when they saw a W. M appeared four times as frequently as W.

Each participant was wired to an electroencephalograph that recorded activity in the part of the brain that detects conflicts between a habitual tendency (pressing a key) and a more appropriate response (not pressing the key). Liberals had more brain activity and made fewer mistakes than conservatives when they saw a W.
Maybe the participants thought they would be voting for W if they pushed the W key, eh?

Taxes & Recession

Wall Street Journal commentary ($$$) on Congress and the economy:
. . . . New York's Chuck Schumer wasted no time Friday calling the jobs report "a punch to the gut of our economy," but his own party is preparing to deliver more blows. Any hint of a growth agenda has vanished since Democrats took Congress. Trade-expanding deals with Latin America and South Korea are stalled, and every week brings a new proposal to restrict trade with China.

On fiscal policy, Democrats have proposed or discussed raising taxes on cigarettes, oil and gas companies, hedge funds, private equity, capital gains, dividends, the U.S. subsidiaries of foreign companies, and individuals earning more than $500,000 a year (which includes millions of small businesses filing under Subchapter S). Add the promise of every Democratic Presidential candidate to repeal the Bush tax cuts if he or she wins in 2008, and no wonder investors are growing more cautious.

Oh, my, more and more taxes.

Wednesday, September 05, 2007