Tip of the hat to my buddy Matt for this link (here) to a Krugman article that explains the economics of climate change. It's somewhat long (10 pages), but it is thorough, and written so that even a Econ 101 dunce like me can understand it.
Some of my favorite quotes from the essay:
"If you choose to drive a hybrid car or buy a house with a small carbon footprint, all you
are doing is freeing up emissions permits for someone else, which means that you have done
nothing to reduce the threat of climate change. ...But altruism cannot effectively deal
with climate change."
"The bottom line, then, is that while climate change may be a vastly bigger problem than
acid rain, the logic of how to respond to it is much the same. What we need are market
incentives for reducing greenhouse-gas emissions — along with some direct controls over
coal use — and cap and trade is a reasonable way to create those incentives."
"Just as there is a rough consensus among climate modelers about the likely trajectory of
temperatures if we do not act to cut the emissions of greenhouse gases, there is a rough
consensus among economic modelers about the costs of action. That general opinion may be
summed up as follows: Restricting emissions would slow economic growth — but not by much."
The Congressional Budget Office, relying on a survey of models, has concluded that Waxman-Markey “would reduce the projected average annual rate of growth of gross domestic
product between 2010 and 2050 by 0.03 to 0.09 percentage points.”
"The truth is that there is no credible research suggesting that taking strong action on climate change is beyond the economy’s capacity. Even if you do not fully trust the models — and you shouldn’t — history and logic both suggest that the models are overestimating, not underestimating, the costs of climate action."
"...the economic analysis will be ready. We know how to limit greenhouse-gas emissions. We
have a good sense of the costs — and they’re manageable. All we need now is the political will."
1 year ago