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Comment by bhauer | Hacker News Reader

> Its almost like we're going to fix the climate change issue, slowly (ramping up quickly)....by sheer luck of technological advancement.

Which is an argument made by those on the free-market side of the political spectrum—that technology will help us solve this problem more quickly and efficiently than central planning and energy austerity. As someone who favors free markets, I have gone out of my way to be an early adopter of electric cars (2008 for me) and home solar (2015 for me) because I want the free market to solve these issues. To be clear, I recognize that incentives such as tax breaks have facilitated this. I obviously take advantage of these programs, but I would be on board with electric cars and home solar even without the tax breaks.

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As a free market proponent, I assume you support including the externalities of pollution from fossil fuels into their costs? Which would've made the cost of electric cars and renewables cheaper much sooner?

> As a free market proponent, I assume you support including the externalities of pollution from fossil fuels into their costs?

How do you even calculate that?

For you to calculate externalities, you'd need to be able to assign costs. What's the cost of greenhouse gases in the atmosphere? You can't calculate something like that.

So let me answer with a simple NO. We don't need anything like that. Cleaner technologies are overtaking and will replace fossil fuels. Our energy generation technology has never been stagnant and it won't be now. We'll move on to the next thing soon enough.

The cost is how much people would pay to prevent you for emitting it into their air.

> For you to calculate externalities, you'd need to be able to assign costs. What's the cost of greenhouse gases in the atmosphere? You can't calculate something like that.

You are wrong.

http://www.worldbank.org/en/programs/pricing-carbon

You can absolutely calculate that. There is an entire sub-field of economics devoted to doing just that:

https://en.wikipedia.org/wiki/Environmental_economics

And it is pretty obviously the right way to think about the problem, if you spend two seconds considering it:

The environment is a public good. Which means that it is owned by all of us. Which means that when it is harmed, we have all lost something of value. Therefore, the people doing the harm owe us money in the same way that Subway owes you money if they accidentally put arsenic in their meatballs. Why do places like Subway so rarely have arsenic in their meatballs? Because it imposes an enormous cost on them, so they optimize their business to avoid that cost. If environmental pollution entailed similar costs, businesses would optimize those costs away (to the extent possible).

This is ultimately a far more effective solution than any regulation ever could be. It's just a matter of choosing the right price. Because then what you have is the ability for private individuals to make a living for themselves rooting out cheaters and suing them in court. The system becomes self-policing because everyone's monetary incentives are aligned with the environment, and it is all mediated by one very simple, elegant idea: property rights.

The environment is our collective property and right now private individuals and entities are destroying it for free. That is simple theft, and fixing the enforcement of those rights is the solution.

This is why I oppose free trade to some extent. Chine isn't only competing on the price of their labor; they're also competing on the price of their environment - pollution is simply cheaper there than in the US or EU. However, the difference is, their environment is our environment!

Personally, I would install transparent tariffs for the whole world - they would be based on the estimated cost of externalities depending on the laws in the country of origin, and go down as soon as said countries adopt (and credibly enforce) better environment protection laws.

Your solution will never actually work. Fact is, that so far in human history, if you want to get from poverty to being rich, you need to have significant pollution. But your solution it not really needed in the long run.

Luckily, the amount of pollution generally goes down as countries grow richer. China is doing it cleaner then Britain or the US did it back in the day.

We need Free Trade so that we can grow, growth will lead (on avg) to a cleaner environment. The next society can then maybe do it completely with clean energy.

> The environment is a public good. Which means that it is owned by all of us.

That not strictly speaking true. We all have a stake in it but we don't own it. Also 'the environment' is not a singular thing, lots of people own lots of different parts.

> Therefore, the people doing the harm owe us money in the same way that Subway owes you money if they accidentally put arsenic in their meatballs.

That might be true, but if their tiny bit of a harmful substance in every single sub, they do not have to pay reparations to each person. The amount of damage done, is so small that it does not it would not be enforced. The same problem exists with environmental economics.

> It's just a matter of choosing the right price.

Prices are never a choice. The need to emerge from human interaction and property rights.

I do however agree with me. The problem is how to slice up the environment in different property rights that can be enforced. This problem can often be solved on a local level, such as forest pollution. It is however far harder to do for things that are far larger, like oceans or the stratosphere.

However, such approaches if possible are to be preferred. Sadly the typical environmentalist (and Nonprofits) are anti-market and that is holding everybody back.

Coal is killing a million people a year right now. Is it really "soon enough"?

You can't precisely calculate the costs of the externalities, but you can estimate it decently. A tax based on a decent estimate would be far better than just saying "zero cost, everybody gets to pollute for free" and then trying to patch it up with regulations as we do now.

Without cheap energy in the form of coal, how many would die each year?

Do you mean compared to an alternative where people's energy comes from burning wood and dung, or one where energy comes from widespread solar, wind, and storage?

I mean the alternative that would exist today, absent coal.

As in, if coal had never been used for energy in human history? How is that relevant?

You misunderstand.

You could, I dunno... explain?

I guess you mean a world just like today, but coal power instantly evaporated? There would be mass chaos and death, but again I don't see the relevance.

You're being purposefully daft. A tax on coal would increase the price of coal. An increase in the price of coal would result in more DEATH. Not in the US, obviously, but in some 3rd world country where the price of energy used for heating delineates life and death. So he's asking, quite simply, how many people your good intentions will kill?

No, I don't understand what the guy is asking, for serious. If he wanted to talk about the consequences of a tax on coal, then he wouldn't have stated his hypothetical as "absent coal."

If you tax coal and make it expensive, people won't use it. They'll use X, whatever that is. Hence his comment "absent coal". Now that they're using X, which is more expensive than untaxed coal, some people won't be able to afford heating their hut/yurt/cave/whatever and will die.

Coal wouldn't disappear overnight even if a tax made it uncompetitive with other sources of electricity. There's a ton of infrastructure that would keep it going for quite a while. That's why I can't reconcile "today, absent coal" with this idea.

Anyway, to your point, I think there must be better ways to help poor people afford energy than to subsidize the electricity of wealthy people and industries. Set aside a small portion of the tax revenues for helping poor people pay for electricity. The important thing with taxing an externality is to capture the cost, what you do with the money matters much less.

Calculating harm is difficult (what price do you put on a refugee displaced from some now-unlivable region?), but one could instead calculate the cost of removing that CO2 from the atmosphere by whatever is currently the most economical means (aside from natural processes that happen without human intervention).

Realistically, though, it's more likely that the value of any carbon tax will not be calculated by some formula, but rather by what a handful of democratically-elected leaders deem is reasonable. Which might not be completely satisfying from a fairness point of view, but I think it's greatly preferable to not having a carbon tax at all (which is equivalent to saying, "quantifying harm is hard to determine, so we'll just pretend it's zero").

The way I'd calculate it is to decide on a target for emissions, and progressively raise the tax until that target is hit.

Ignoring things because you can't measure them well or negotiate a price on them, isn't bad capitalism. It's just all round bad thinking.

And don't forget the costs of all the overseas entanglements associated with securing fossil fuel supplies.

This is an excellent point and a perspective I hope more free-market learning people (such as myself) come to appreciate. Although making externality influenced descisions in when factoring in your own energy expenditure and limited resource allocation, it may be a luxury of those of us in the 1st world and nearing the top of maslow's heirarchy.

Some climate change reducing habits can be cost-saving though. Such as biking vs cars, reducing meat consumption, long-term investments in solar power, etc.

I can't quite tell what you are trying to argue, because you acknowledge that government incentives have helped, yet you seem to be claiming that the success of solar was due to free market economics.

Just to set the record straight, the solar industry would not exist without government support. Nearly every company past and present has taken grant money from the DOE, or directly benefited from cash rebates or stimulus money. Local utilities in many states are required by local regulatory agencies to buyback excess solar power at retail prices, which for many regions is the difference between hitting the break even point in a reasonable time frame. And before the ITC (tax credit) was unexpectedly extended last year, companies were preparing to downsize considerably and were warning local politicians that without an extension, there would be massive layoffs in the industry.

With battery tech starting to become viable and with continuing efficiency improvements, we are getting closer to a point where solar might be able to compete on it's own, but in it's current form, the industry is still highly dependent on subsidies and tax breaks.

> With battery tech starting to become viable and with continuing efficiency improvements, we are getting closer to a point where solar might be able to compete on it's own, but in it's current form, the industry is still highly dependent on subsidies and tax breaks.

Small quibble: Wind and solar are already cheaper than utility power in ~20 states (unsubsidized), and cheap wind drove Exelon to close two nuclear power plants in the last week.

While wind and solar can now "stand on their own" as it were, we should be doing nothing but increasing subsidies to deploy them faster.

Not to mention that the entire global market was massively supported (you're talking 20-50% of the global shipping volume) by crazily high subsidies from the German government for 5-10 years, over the period when cost went from $5/W to $1/W.

While that is true, it also goes in the other direction. How much money has been put into keeping fossil fuels cheap?

We simply don't have a free-market price in energy. I would say that in the long run the market would probably, by itself switch to renewable non-polluting energy but the governments investment has probably helped.

Governments can make really drag most markets (with a few exceptions), but they can usually kick it in the butt.

Not soon enough and at the scale that we need to address the problem. Keep in mind the ability to adopt electric cars and go home solar is still a very privileged position and will be for quite a while. Think about how many cars that are 10 or 20 years old on the road now. Or how many people live in apartments. And this is just in the developed world.

This is why most climate scientists advocate for at least a tax on all carbon. While the free market might be able to solve this world-wide on a long enough time scale we don't have the time for that to play out. We've been building our current energy and transportation infrastructure out for the past century globally based on fossil fuels.

To get a good idea on the scope of the problem I'd highly recommend start reading through some of the forum below. Some of the brightest (to me anyway :)) experts on the climate post regularly here.

http://forum.arctic-sea-ice.net/index.php

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