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Gary Johnson’s Plan Of Inaction On Climate Change

“When it comes to global climate change, Gov. Johnson believes too many politicians are having the wrong debate. Is the climate changing? Probably so. Is man contributing to that change? Probably so. The important question, however, is whether the government’s efforts to regulate, tax and manipulate the marketplace in order to impact that change are cost-effective — or effective at all. Given the realities of global energy and resource use, there is little evidence that the burden being placed on Americans is making a difference that justifies the cost.”

That’s what libertarian presidential candidate Gary Johnson has to say about climate change. Could it be true? Could it be that the “burden being placed on Americans” isn’t economically justified?

Gary Johnson doesn’t offer any evidence whatsoever to support this assertion. At Irregular Times, we believe in the importance of fact-based politics, so we’ll do what Gary Johnson is unwilling to do, and look at the numbers.

According to an analysis by CitiGroup, a financial company that deals out loans and credit cards, the cost of doing nothing to slow or stop climate change will be $44 trillion dollars over the next 44 years. The math is easy: That’s a trillion dollars per year.

According to the Wall Street Journal, a publication historically opposed to environmental regulation and friendly to economic libertarianism, puts the annual cost of the Paris Accords (the “burden being placed on Americans” to slow down climate change) at somewhere between $28 billion and $170 billion per year by 2030.

Just to give Gary Johnson’s argument the best chance for success, let’s ignore the massive pro-corporate bias of the Wall Street Journal and use their highest estimate of a cost of $170 billion per year.

Again, the math is simple. An investment of $170 billion per year in order to save costs of $1,000 billion per year is extremely prudent.

Johnson doesn’t have an alternative. His proposal is just to sit back and allow climate change to happen.

Johnson proposes that the mythical, infinitely wise Invisible Hand of the marketplace will fix climate change all on its own… somehow… by letting people buy and sell things.

“In a healthy economy that allows the market to function unimpeded, consumers, innovators and personal choices will ultimately bring about the environmental restoration and protection society desires,” Johnson writes.

This libertarian fantasy that climate change would just fix itself if all environmental regulation by the government went away can only be justified by someone who willfully ignores history, human psychology, and environmental economics.

Historically, we see that climate change has been fueled, not impeded, by market forces. Businesses seeking to make quick profits put fossil fuels at the center of our society, without thought of the consequences. Corporations used their power to suppress the development of sustainable, clean energy.

Psychologically, markets are fueled by short-term interests, rather than long-term needs. The marketplace is littered with the stink of rotting businesses that use their dominance to keep their maladaptive, anti-innovative behaviors going long after they have ceased to benefit anyone, believing beyond reason that what worked for them in the past will keep working despite how much external conditions change. Consumers who are struggling to get by in an economy in which wealth has been concentrated in just a few hands focus on buying goods and services that get them through the immediate future. They can’t afford to make big, long term investments in expensive technologies that are both ecologically wise and economically prudent.

Economically, the marketplace has rewarded corporations that shifted the cost of dirty energy onto consumers who lack the political power to do anything to stop it – unless they work through the power of elected, representative government. Gary Johnson’s marketplace-only libertarian ideology seeks to take this power away from the people, so that we are forced to pay the costs of pollution and climate change, while corporations make the profit from it without any democratically-established regulation in place to stop them.

Gary Johnson is right about one thing. The Paris Accords aren’t enough to make the difference we need to avert disaster. If the Accords aren’t making enough difference in the effort to confront climate change, though, that’s because the cost of its provisions isn’t high enough.

To avoid the massive economic damage of tens of trillions of dollars, we need to invest more, not less. In order to save the cost of $1 trillion per year, we should invest larger amounts now, when each dollar yields a greater impact than it will in the future, given the cumulative warming effect of greenhouse gases over time. An annual investment of $750 billion to save $1 trillion per year would be quite reasonable…

…and the benefits would be shared across society, quite the opposite of the economic impact of Gary Johnson’s do-nothing Invisible Hand plan, which would result in costs disproportionately paid by people with low incomes.

But then, that’s what libertarian ideology is really all about in the end – helping the wealthy to grab more stuff while giving everyone else the shaft.

7 thoughts on “Gary Johnson’s Plan Of Inaction On Climate Change”

  1. Al Hopfmann says:

    An “investment” that is forced upon the investor by government is a tax.

  2. Stephen Kent Gray says:

    Free-market environmentalism is the political position that argues that the free market, property rights, and tort law provide the best means of preserving the environment, internalising pollution costs, and conserving resources.

    While environmental problems may be viewed as market failures, free market environmentalists argue that environmental problems arise because:

    The state encodes, provides and enforces laws which override or obscure property rights and thus fail to protect them adequately.
    Laws governing class or individual tort claims provide polluters with immunity from tort claims, or interfere with those claims in such a way as to make it difficult to legally sustain them.
    Free-market environmentalists therefore argue that the best way to protect the environment is to use tort and contract laws governing and protecting property rights and tort claims to protect the environment. They believe that if affected parties can compel polluters to compensate them they will reduce or eliminate the externality. Market proponents advocate changes to the legal system that empower affected parties to obtain such compensation. They further claim that governments have limited affected parties’ ability to do so by complicating the tort system to benefit producers over others.

    Free-market environmentalists assert that economics is a branch of ecology. Both study complex interdependent systems science. The fundamental problem for economists is scarcity.

    Though many environmentalists blame markets for many of today’s environmental problems, free-market environmentalists blame many of these problems on distortions of the market and the lack of markets. Government actions are blamed for a number of environmental detriments.

    Tragedy of the Commons is seen as a fundamental problem for the environment. When land is held in common, anybody may use it. Since resources are consumable, this creates the incentive for entrepreneurs to use common resources before somebody else does. Many environmental resources are held by the government or in common, such as air, water, forests. The problem with regulation is that it puts property into a political commons, where individuals try to appropriate public resources for their own gain, a phenomenon called rent-seeking.

    Tenure – Renters do not benefit from value accrued during their tenure and thus face an incentive to extract as much value as possible without conservation.

    Political Allocation – Political information does not have the incentives that markets do to seek superior information (profit and loss). Though many participants provide input to governments, they can only make one decision. This means that governments create rules that are not well crafted for local situations. The government’s strategy is that of anticipation, to hide from danger through regulations. A healthier society would use resilience, facing and overcoming risks.

    Perverse Subsidies – Governments offer cross subsidies that distort price systems. This means that underconsumers and overconsumers are paying the same rates, so the underconsumer is overpaying and the overconsumer is underpaying. The incentive leads to more overconsumers and fewer underconsumers.

    Markets are not perfect, and free-market environmentalists assert that market-based solutions will have their mistakes. Through strong feedback mechanisms such as risk, profit and loss, market-driven have strong incentives to learn from mistakes.

    Individual Choice – Consumers have the incentive to maximize their satisfaction and try to find low cost, high value options. Markets allocate resources to the highest bidder. Producers make purchases on behalf of the consumer. Due to many actors in the market, there is no one-size-fits-all solution and entrepreneurs will seek to fulfill many values of society, including conservation.

    Entrepreneurship – Entrepreneurs seek value, problem-solve, and coordinate resources.

    Price System – When resources become scarce, prices rise. Rising prices incentivize entrepreneurs to find substitutions for these resources. These resources are often conserved. E.g. as prices for coal rise, consumers will use less and higher prices will drive substitution for different energy sources.

    Property Rights – Owners face a strong incentive to take care of and protect their property. They must decide how much to use today and how much to use tomorrow. Everybody is trying to grow value. Corporate value and share price is based on their anticipated future profits. Owners with the possibility of transferring their property, either to and heir or through sale want their property to grow in value. Property rights encourage conservation and defend resources against depletion, since there is a strong incentive to maximize the value of the resource for the future.

    Common Law – In order to have working property rights, you need a good system to defend them. When rights are weak, people will violate them. By creating a strong system, where common resources can be homesteaded, transferred, and defended against harm, resources can be protected, managed, allocated with the results that aggregate and balance humanity’s needs and wants.

    The market is a non-political allocation device. Many environmentalists proposals call to return resources from markets to become political problems.

    How free markets can protects the environment requires this and much more reading from books on the subject.

  3. John Mitchell says:

    Businesses that use their dominance to keep their maladaptive, anti-innovative behaviors going long after they have ceased to benefit anyone go bankrupt. It is a fallacy to presume that the people making decisions for centrally planned energy policy will be enlightened and behave morally whilst consumers and business owners will be driven by ignorance and greed.

    1. J Clifford says:

      John, what you’re saying is that dominant businesses that abuse people and aren’t benefitting anyone go bankrupt.

      What if the dominant businesses benefit dominant individuals and organizations, while abusing everyone else?

      That’s the hell that the Libertarians want to unleash upon the world.

      No thanks.

  4. Anthony says:

    There’s one serious flaw in this article. While I respect the need for common sense response to global climate change, this article assumes that if we spend $170 billion/year on responses to climate change, all of the fiscal impacts of climate change will magically disappear. It’s already too late for that – we will be dealing with costs of climate change for decades to come regardless of how fast we respond to the problem right now. So it’s not just $170 billion/year. It’s $170 billion/year + the costs of the damage because of the impacts of climate change which already cannot be avoided.

    1. Mike says:

      Sure, we are already in a hole. But further inaction will only make it worse.

  5. Pingback: Gary Johnson: Liberalistenes røst – Thomas, bloggeren
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