Climate Push Has But Marginal Utility for Economics

Another Zeitgeist piece from the New York Times today denigrates traditional economics, which is to say the price mechanism for allocating resources. This time, it’s about climate and carbon, and the target of sorts is Nobel laureate William Nordhaus, long a favorite among left-of-center economists. Nordhaus, you see, early on proposed a carbon tax to discourage use of fossil fuels. That’s still the method most favored by market-oriented advocates of a greenhouse-gas policy, though it hasn’t mustered a political majority in the U.S. because it would make the middle class (and everybody else) pay more for gasoline and energy-based products. But now activists on the climate front have dismissed such an approach as merely fiddling at the edges when emergency measures are necessary. Grants and loans for alternative energy were instead the thrust of the big Biden-Manchin compromise spending package just passed. And it sounds like more regulatory measures are just around the corner. Heather Boushey, a redistributionist who has the climate file on the White House Council of Economic Advisers, “says the field is learning that simply tinkering with prices won’t be enough as the climate nears catastrophic tipping points,” the Times reports. “So much of economics is about marginal changes,” she is quoted directly. “With climate, that no longer makes sense, because you have these systemic risks.” Sorry, Dr. Nordhaus and all you other dismal (and “marginal”) scientists, Washington has serious work to do.

Published by timwferguson

Longtime writer-editor, focusing on topics of business and policy, global and local.

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