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Elon Musk: Can Government Challenge Money?

While COP21 was underway in Paris, Tesla CEO Elon Musk visited the Sorbonne and talked to a group of graduate students about taxing carbon. His message was pretty simple, and cut through a lot of the rhetoric and confusion that often surrounds the issue. Basically, Musk said that people do what they're paid to do.

The problem is, right now people are being paid to release carbon into the atmosphere. According to the International Monetary Fund, governments throughout the world subsidize carbon-producing activity to the tune of $5.3 trillion annually. These subsidies come mostly in the form of not having to pay for the damage carbon-producing does to the environment. In economic terms, the environmental damage is an unpriced externality. Musk's point is that by allowing these damages to be ignored, society is lowering the cost of doing business for carbon-producing companies. This gives them an economic advantage -- especially over companies producing less carbon.

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Musk's solution to the problem is to tax carbon emission. This would eliminate the subsidy and put high carbon-producing companies on a level economic playing field with low carbon-producing companies. The increased costs experienced by high-carbon producers would be reflected in higher prices, and the market would move toward low-carbon solutions. The high-carbon companies would have an economic incentive to invest in lower-carbon technologies, and consumers would have a compelling reason (lower prices) to buy low-carbon products.

The big question, it seemed to me while listening to the talk and the QA session that followed it, is whether governments still have the power to do it?

Musk was optimistic that "governments respond to popular pressure" and that the young people he was addressing had the power to lead a movement for change. But after a grad student asked him if the answer was for sustainability activists to send more lobbyists to Washington, he said this:

Tesla and Solar City, my companies are very tiny. We're tiny, tiny companies. In order for there to be a big move toward sustainability, the giant companies have to know that that is what the governments are demanding for the future; what the people are demanding for the future...Let me tell you, we definitely can't beat the oil and gas industry on lobbyists. Okay? That would be a losing battle...Exxon makes more profit in a year than the value of the entire solar industry in the Unites States. So if you take every solar company in the United States, it's less than Exxon's profit for one year. There's no way you can win on money. It's impossible (at about 45:00).

I thought that was an honest way to frame the issue. Can government win against money anymore?

Pollution Permits and Monopolies

So I'm reading this op-ed piece in the Guardian by George Monbiot. He's talking about keeping the coal and oil in the ground. Because if it comes out, it will be used. And I'm thinking yeah, that sounds logical, but impossible, given human nature. How are you ever going to get people to leave it in the ground? He talks about a global auction in pollution permits. I'm not sure if the real point of that is making the added expense to corporations a disincentive to using fossil fuels (and an incentive to explore cheaper alternatives), or to build up a slush fund (pun intended) to mitigate the effects when they go ahead and use the fossil fuels anyway.

But as I'm wondering this, an image comes to me. I was cleaning the garage yesterday and on a shelf I found a bag from the local fleet store containing a couple of packages of yellow rope. It's your basic braided synthetic, I remember buying it. And what I particularly remember is that it's made by Koch Industries.

I needed some rope for a job. I went to the store to get some. I noticed that the type I wanted had a little Koch Industries logo sort-of hidden on the back. I'm a little bit politically aware, and I thought, I'd really rather not give my money to the Koch brothers. What other type of rope will work for my job?

It didn't matter. Every variety of rope and twine on the shelves was from Koch Industries. Didn't matter if it was synthetic or natural fiber. Whatever I bought, the Koch brothers were going to get my money.

My point is, so what if big corporations have to buy pollution permits. It's just another tax that they'll either avoid, or offset with tax savings wrung from the nations, states, or cities where they operate. Or, failing that, they'll pass to cost on to their consumers.

As long as we don't do anything to address the overwhelming (and still growing) power of monopolistic multinationals, we're basically just taxing the little people.

Lake Mead

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I just finished reading The Water Knife and started Cadillac Desert. So I thought this Mother Jones article on the mega-drought was interesting.

Market Failure in Minnesota

During a recent "special" session of the Minnesota legislature, a bill was snuck through the House and Senate eliminating the Minnesota Pollution Control Agency Citizen's Board. Established in the 1960s, the Citizens' Board had consisted of eight members and the Commissioner of the MPCA. Their bylaws called for one member to be "knowledgeable in the field of agriculture." According to former Board member Jim Riddle, "The Citizens’ Board came under fire from corporate agribusiness interests last fall, after we required an Environmental Impact Statement (EIS) for a proposed confined animal feeding operation (CAFO)."

The owners of the CAFO didn't have enough land to spread even half the manure they would generate. They had no idea (or interest) how much their water use would impact existing farms in the area. Their water plan consisted of building a twelve mile pipeline from a well that had been permitted seven years earlier for an ethanol plant that had never been built.

The Board's request for an environmental impact statement angered the
Agri-Growth Council, whose Directors include executives from Cargill, CHS, and General Mills. Although Riddle says the Board didn't prohibit the CAFO, apparently agribusiness is unhappy with the idea that anyone has the authority to insure that "more information be provided on the environmental and economic impacts of the proposed facility, in order to demonstrate that Minnesota’s laws would be followed and the health and safety of area residents and the environment would be protected."

Advocates for a lot of schemes like CAFOs, sulfide mining on the Iron Range and pipelines through the Headwaters like to portray the opponents of these schemes as head-in-the-sand Luddites. Elimination of the Board, says Riddle, will make it "easier for industrial agriculture, mines, pipelines and other extractive and polluting activities to be approved with little or no citizen participation."

The reality, it seems to me, is that the advocates of these schemes fear their plans won't stand up to close scrutiny. The point is not that CAFOs should never be built, that copper should never be mined, or that oil should never be transported. People could argue those points, but that's not the point here. The point is that politically powerful owners and corporations want to do these things in the cheapest, sloppiest way possible, with no oversight. This makes good economic sense, if your economic perspective extends only to the next quarterly or year-end report. The corporations are acting rationally, from their economic point of view, when they behave this way. CAFOs and companies like Enbridge and Polymet have a long history of cutting corners to save money, and then trying to evade the penalties and costs of cleanup when things go wrong.

But clearly this kind of sensible economic behavior is not in the public interest, or even in the long-term interest of the companies involved. The decision to do it anyway and try to silence the opposition is what economists call "market failure." It is precisely why we can't have a completely free market (despite the fantasies of Ayn Rand-readers), and why regulatory agencies and citizen boards need to exist.

Google Glass Gargoyles

The Atlantic ran an article this week called "How the Camera Doomed Google Glass." It was the creepiness of being "walking, talking invasions of privacy" that people found unacceptable. Funny that Neal Stephenson predicted that reaction in 1992 in Snow Crash. Hip skateboard courier YT is appalled when Hiro Protagonist (yep, that was really the central character's name) straps on a wearable computer fitted with surveillance gear and becomes a walking intel-vacuum. Stephenson calls these guys gargoyles, and captures the combination of creepiness and lameness this way:

Gargoyles represent the embarrassing side of the Central Intelligence Corporation. Instead of using laptops, they wear their computers on their bodies, broken up into separate modules that hang on the waist, on the back, on the headset. They serve as human surveillance devices, recording everything that happens around them. Nothing looks stupider; these getups are the modern-day equivalent of the slide-rule scabbard or the calculator pouch on the belt, marking the user as belonging to a class that is at once above and far below human society. They are a boon to Hiro because they embody the worst stereotype of the CIC stringer. They draw all of the attention. The payoff for this self-imposed ostracism is that you can be in the Metaverse all the time, and gather intelligence all the time. (pp. 123-124)

Is Climate Skepticism Religious?

There's an interesting story on Scientific American. Posted Dec. 22nd, the article is titled "What Have Climate Scientists Learned from the 20-Year Fight with Deniers?" The article tells the story of Benjamin Santer, who was responsible for the original IPCC statement in 1995 that "The balance of evidence suggests a discernable human influence on climate change." Santer has been vilified and hounded by climate change opponents since then, according to the article. Although he's apparently a very private person, Santer decided "Climate scientists don't have the luxury of remaining silent."

The article goes on to discuss the ways climate change has been turned into a political debate. One interesting element is the idea that it's everybody's fault: that "all 7 billion of us" are equally, "collectively responsible for industrial greenhouse gas emissions." The implication, of course, is that we can only change the situation by radically changing our lives -- every single one of us. That's hard.

 
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In reality, a study by the
Union of Concerned Scientists has found that nearly half (48%) of the atmospheric CO2 contribution since 1854 has been made by twenty organizations. The largest contributors have been the former Soviet Union and China (each considered as a whole), followed by Chevron, Exxon/Mobil, Saudi Aramco, BP, and Shell. Another seventy organizations account for 15%, so in all we can trace nearly two thirds (63%) of all the carbon pumped into the atmosphere to 90 organizations.

That's not to say that we aren't all partly responsible. Nearly everybody in the developed world is a customer of one or more of these organizations. We heat our homes and drive our cars with their oil and gas. But it does at least suggest that as a society we may have some leverage on the issue. That we may be able to develop technology that would allow these 90 organizations (or their successors) to provide us with needed energy more cleanly than they have since 1854. There may be efficiency trade-offs involved in this -- which may be why for-profit corporations haven't yet done all they can. At the very least, it's a different problem (calling for a different solution) than the "we're all equally to blame" scenario.

The article continues by observing that climate scientists have learned a lot about their opponents by studying the creationist response to evolution in American politics, and also by understanding the tobacco industry disinformation campaigns of the 1990s, when "tobacco companies ran media campaigns that equated smoking with freedom of choice" and regularly obscured scientific findings showing that smoking and second-hand smoke cause cancer and other serious diseases. It's been well-documented that cigarette manufacturers actually lied about the results of their own research on the issue -- although ironically just this week climate skeptics commenting on Google executive Eric Schmidt's recent remarks about climate got into a side-argument in which they
reiterated the claim that second-hand smoke wasn't really dangerous.

Which brings us to the main issue: core beliefs. If climate skeptics are also arguing for the safety of second-hand smoke and
claiming that HIV/AIDS is not a real disease, what should climate scientists do to get their message through? Is there any hope of a sincere dialog? The article concludes that "people's belief in climate change often correlates with their ideology and their religious and cultural beliefs." The author tries to tie up the article and bridge this gap by suggesting that religion and science are compatible. He concludes (no kidding, in Scientific American) by quoting a Brown biology professor's assertion that "God is not the antithesis of scientific reason but the reason why it works in the first place."

I have trouble not believing the argument about scientific evidence of climate change is already lost if you start with start it with, "I'll give you your religious preconceptions, but…" Because if you really believe, then climate change isn't a problem because:

  1. God made the earth and can fix it if he chooses to,
  2. This isn't really our home. We (those who count, at least) are going somewhere more important.
  3. The Bible says we have dominion and can do what we want with nature.
Of course there are other traditions within the same religions that say we are stewards of nature and have some type of responsibility. Sometimes religions even acknowledge the social responsibility issue and the idea that environmental impacts (climate or otherwise) don't effect everyone equally. Last spring, the new Pope Francis made a Biblical case for addressing climate change, saying "If we destroy creation, creation will destroy us." The problem with religion is, which tradition are you going to subscribe to?

Even with the Pope's statement, though, I'm still concerned by that first step of caving on religion. Seems like it's at least necessary to draw a line and say
this discussion is in the realm of science. Invoke a separation of church and state for what basically amounts to a discussion of public affairs. We could argue that in order for people of all faiths (and none) to have a discussion about this, we have to keep arguments from faith out of it. But if your basic world view is informed by faith and you're told it has no place in the discussion, don't you then just spend your time not believing in the discussion? Maybe even trying to derail it? And using skeptical arguments if the faith argument has been ruled out of bounds?

What's the Point of Climate Change Denial?

The AGW (anthropogenic global warming) opponents at WUWT posted a review of an article on RealClimate this morning. The gist of the post is that the author (who by the tone of comments is well-known and well-hated) was admitting that "modeled absolute global surface temperatures" are bogus. A closer reading of the article, I think, suggests that the modelers are aware of the shortcomings of models but still believe them to be relevant and useful in some situations. And that they're trying to refine the models and trying not to use them inappropriately.

I commented on a quoted passage where the RealClimate author says “no particular absolute global temperature provides a risk to society, it is the change in temperature compared to what we’ve been used to that matters.” This seems like common sense, if a global surface temperature number is an average. It is easy to imagine that plus 5C, for example, might not be as devastating to human society in the Sahara as it would be on the Himalayan glaciers.

 
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Responding to my comment, a "Jeff Alberts" said "Anyone who expects 'the temperature we’ve been used to' to never change, has no common sense. The question is, are changes we’re seeing due primarily, or even measurably, to human industrial activity. We simply don’t know. CO2 went up, but temps went up and down, and even remained static in many places. Therefore we have no evidence of any even minor impact due to CO2. We have no evidence as to whether today’s temps are unprecedented in any way, none."
But I wonder if that
really is the question? If mountain glacier systems at the headwaters of many of the world's most important watersheds are melting at an alarming rate, does it matter whether the cause is AGW or some natural process? Won't the billions of people depending on that water be equally effected either way? And if the natural processes of climate are as variable as AGW skeptics claim (to be the cause of all the observed changes), is there any reason to believe they'll bounce back right away and remain in a range that's comfortable for us?

If you were a nation depending on glacier-fed rivers, wouldn't it be incredibly irresponsible not to consider the possible continuing reduction of glaciers and the concurrent possible challenge to your national water supply? Would you care whether the cause was AGW or nature? Yes, you would, because if it's AGW, there may be ways to mitigate or reverse the effects - not to mention the potential liability involved. But would you wait until the jury was "in" and nobody was arguing on the cause before starting to think about what to do? I hope not!

Does all this suggest that that one of the goals of AGW skeptics is muddying the water in order to prevent action? I don't know. My free-market friend Bob recently said the skeptics are frustrated because so much money as been poured into this -- in his opinion, down a drain. He mentioned "
$165 billion so far (CBO report)." The number I was able to find for 2014 was $21.4 billion, which is definitely a lot of money. But in perspective, the total federal budget is about $3.9 trillion, so we're talking about a half a percent. And that spending is spread across dozens of government agencies including Defense (the DOD believes climate change is a strategic concern). The DOD budget is about $457 million, out of a total package of over $600 billion. So I don't think studying the climate is bankrupting America.