Comment by Benjo | Hacker News Reader

Comment by Benjo | Hacker News Reader

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I agree. The free market and competition have created more value than any other tool in human history and it's absolutely the best tool for this job. There seems to be a common misconception that free markets will arise naturally and any government involvement will jeopordize them. In reality, government is the method that a capitalist society must use to ensure that no resources are undervalued; that the system is truly generating value, not just moving it from one place to another at a loss. In the case of energy, the role of goverment should be to determine the immediate value and future costs fossil fuel energy production.

In practice of course, goverment is too heavily influenced by those who currently happen to have the most resources. As a result, they are incapable of correctly evaluating the true value of immediate energy output versus future greenhouse gas levels. It makes the question of how to solve the energy problem moot, because there's no way to implement that solution under the current political conditions.

> not just moving it from one place to another at a loss.

By definition, unprofitable ventures will run out of capital and stop without government intervention.

> There seems to be a common misconception that free markets will arise naturally

History is full examples of humans freely trading with humans. International trade is completely co-operative, free of government oversight (there is no world government).

It is not a misconception that people can trade without a central authority figure. And the presence of the black market in all cultures shows us that it is universal that people want to trade freely.

> the role of goverment should be to determine the immediate value and future costs fossil fuel energy production.

Can you cite an example of when price fixing has improved living standard of the general population?

And is there ever been a time when raising energy costs has improved the human condition?

Do you really propose lowering the standard of living for the poor and middle class because of an unproven theory that the climate is a positive feedback loop and 2 degree change will snowball into catastrophic effects?

>"not just moving it from one place to another at a loss."

>By definition, unprofitable ventures will run out of capital and stop without government intervention.

in the context of this discussion it means : "not just moving it from one place to another to generate personal profit at a somebody else's [usually wide public's] loss." The government role is to prevent such profitable ventures which profit at the loss of the general public - free market isn't able to do so on its own.

>Do you really propose lowering the standard of living for the poor and middle class because of an unproven theory that the climate is a positive feedback loop and 2 degree change will snowball into catastrophic effects?

this is just Red Book of Cheyney.

Anyway, technological progress, including development of new sources of energy, has generally benefited poor. Where is limiting market competition by subsidizing ineffective outdated technological processes (which de-facto happens right now with coal and other fossil fuel energy) has always restricted technological progress and thus impacted the whole society, including poor.

>And the presence of the black market in all cultures shows us that it is universal that people want to trade freely.

presence of black market in the Soviet Union was showing universal people desire to smoke Marlboro and wear LEVI's jeans. Desire to trade freely would created the black market in bread as well, yet no such market existed. Such market exist in Zimbabwe though, where it shows universal people desire to eat.

Private profit, socialized losses. Now I understand what you meant. I believe the government enables these actors, not prevents them. Finance sector is the recent example. Polluters are protected from being sued (and damages are capped) by the government.

I think there is room for well defined externalities to be captured in transactions, but handing out subsidies to special interest in the name of technology progress is ridiculous. Who picks the winners and losers? How long do you subsidize? Who pays when the costs of the new tech do not come down? Will you raise the cost of transportation so I can develop teleportation technology?

I think Spain is going to provide a painful lesson in what happens when you subsidize green tech, and unfortunately the people who pay for it are already impoverished.

The finance sector is a perfect example of how an industry influences the government for profit, to the detriment of the greater goals of a society. I don't think lawsuits are a suitable way to deal with the energy problem, but I could be convinced. Lawsuits as they exist today give too much power to those with more legal resources.

The government already provides incentives to individuals who don't murder people, and businesses who don't hire child workers. There's lots of profit to be made in building an army and stealing from others, but we discourage it as a society because it doesn't result in a net benefit. There are plenty of fines for fraud and other transactions that are deemed to be not in the best interest of society, no matter how much profit they generate for the actor. Where is the break-even point on this spectrum as far as you are concerned?

The winners are still picked by market forces. The losers are picked by the scientific evidence and the decision making processes of our democracy. The market is set up to penalize actors who take from the common good. "Subsidy" is a misnomer, think of it as a sumptuary tax or a fine. These taxes can be left in place indefinitely, since the goal is to discourage use.

>I believe the government enables these actors, not prevents them.

some governments, some actions. Some governments kill their people, some - protect, though still killing a bit.

>I think there is room for well defined externalities to be captured in transactions, but handing out subsidies to special interest in the name of technology progress is ridiculous.

yep, that is the point- minimizing the subsidies. 200-50 years ago we didn't know these externalities - they weren't included. Once they recognized - they need to be included. That really means removing [recognized] subsidy. No new subsidies should be created. Any subsidies, even for green tech, limit the market forces and create tumor of special interest on the body of the economy.

>I think Spain is going to provide a painful lesson in what happens when you subsidize green tech

no arguing here. Have you heard about Russian cars? It is the most heavily subsidized and protected industries in Russia. Such ugly and low-tech (and overpriced) cars can't be found anywhere.

what you say is true at the national level. Yet there is a hope. This is classical case of "tragedy of commons". Right now the US enjoys the most benefits while the cost is carried by the whole world. In short time China will be enjoying disproportionally much benefits while the costs is spread around the world (i.e. in particular US will be carrying more costs than benefits). This dynamic disbalance will force reconsideration of the current world order.

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