Tuesday, June 14, 2011

CARB: Economic Collapse Controls Pollution More Effectively than Cap and Trade

When we last left AB 32, California's equivalent of a full frontal assault on its own economy, the cap-and-trade system at the heart of its sweeping environmental regulations had been put on hold. This wasn't done out of concern over the economic suicide the law entails, but rather at the behest of environmental advocates who don't find cap-and-trade a sufficiently draconian way of reducing pollution. At the time, San Francisco Superior Court Judge Ernest Goldsmith ordered the Air Resources Board, which has been charged with implementing the system, to put implementation on hold in order to perform a more thorough review of alternatives. Well, KQED News is reporting that CARB's homework is now complete, and their analysis contains a startling result.

CARB's full report is here. The interesting item comes before any of its analysis of alternatives is presented: in revisiting its calculations, CARB was able to adjust its predictions of future carbon emissions to account for the 2008-09 economic downturn. And according to its calculation, we're already halfway to getting emissions down to 1990 levels. The original analysis estimated that California's total greenhouse gas emissions would be 596 million metric tons of carbon dioxide equivalent (MMTCO2E), and that meeting the goal of 1990s-level GHGs by 2020 would require programs that cut emissions by 174 MMTCO2E. Yet their updated analysis estimates that 2020 emissions would now only total 506.8 MMTCO2E in the absence of AB 32. In other words, even without a cap-and-trade program, California is more than halfway to the goal it outlined in AB 32, and all it took was the collapse of the state's real estate market and construction sector, as well as persistent unemployment and endless job-killing regulation. Way to go, Golden State!

We've made the case before that AB 32's strangulation of economic growth in the state will have the effect of making it a rousing success. And it's nice to be partially vindicated by no less than CARB. There are, of course, many reasons to detest cap-and-trade: its "government command masquerading as an economic market" rationale and its enabling of classic rent-seeking behavior, to name two. But regardless of the mechanism CARB employs to achieve its GHG reductions, this analysis should underscore the reality of curbing one's carbon footprint: the only way to achieve it is by penalizing productive activity.

6 comments:

  1. Your view of "productive activity" seems quite narrow. Avoiding the destruction of our optimal climate is fantastically productive.

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  2. You're assuming an awful lot in that second sentence. I don't think any serious scientist imagines they know what "our optimal climate" is, or assumes that humans are capable of entirely "destroying" it. My guess is that human ingenuity will be sufficient to forestall or bypass the effects of climate change (whatever those might be), which is why I tend to dislike AB 32's "stopping civilization in its tracks" approach to the problem.

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  3. Our optimal climate is the one in which we've built all civilization and economy.

    And speaking of assumptions, "My guess is that human ingenuity will be sufficient..."

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  4. Fair enough. Though I think it's unlikely that people would stop looking for new solutions, and we do have a good track record of developing them. And even the most alarmist global-warming scenarios (well, the ones outside of Roland Emmerich movies) presume that climate change will take generations, not years, to manifest itself.

    As far as your "optimal climate", what does that mean? Is it really so hard to imagine that mankind could survive and flourish under very, very slightly different weather patterns (which is how human beings would experience climate change)? More to the point, isn't forcing mankind to revert to the energy technologies of the Dark Ages to save its "civilization and economy" sort of like George W. Bush's "destroying the free market in order to save it"?

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  5. First of all, Roland Emmerich movies encapsulate all of life's hopes, dreams, and hunkiness in one convenient 90 minute package. That's just efficient.

    I get your points, but you're speaking in absolutes. The "optimal climate" to which I'm referring is only that because that's what we know. I don't believe anything short of the Earth and/or sun exploding will wipe out people. Should it go that far? Should repairing the ecological damage we're causing come at a zero economy price?

    No.

    There can and should be a balanced approach before panic sets in on either side. There can and should be immediate action. We have some idea of what it took to cause massive damage -- I think -- but we have no idea the magnitude of effort and time it will take to lessen our impact.

    Typing such a missive on a phone is a fool's errand...

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  6. That's fair. I just think that many of the policy solutions being pushed these days (including AB 32) are fairly alarmist, and entirely out of proportion to any reasonable assessment of the problem. I'm willing to believe that large-scale industrialization has had a negative impact on the earth's climate. But given how difficult it is to conduct valid climate science, it's unfortunate that the science is so politicized, and so readily accepted without criticism by those who want government intervention (almost as a general rule in life). Until it can be said with a fair degree of certainty that climate change is an imminently dire problem, I'd prefer to educate people on the science and allow them the freedom to choose what they want to do about it, rather than eliminating people's freedom. Certainly, the majority of the population who believe fossil fuels are evil could solve the problem right now if they all stopped using them; but those are usually the people who do as they please until they're forcibly prevented from doing so.

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