William Yeatman

How Many Economists Does It Take…

To oppose energy legislation that will undoubtedly affect the nation's lightbulbs? Well, the National Taxpayers Union has a letter from 234 economists warning Congress against making the same old mistakes:

"We write to strongly advise against the inclusion of damaging anti-market provisions in the energy bills moving through Congress," the statement began. "History has shown that attempts by the federal government to tax, regulate, and subsidize our way to more plentiful and secure energy have failed miserably."

What? Don't these people know that scientists have decided unanimously that energy taxation, regulation and subsidy are the only way to save the planet? How dare these economists talk about the economy as if they knew something about it!

For the first time in modern history, China will next year contribute more to global economic growth than the United States.

North Carolinians should question the process that’s leading to proposals for fighting global warming in the Tar Heel state. That’s the warning from a John Locke Foundation analyst who has monitored the process.

As he devoted countless hours to lifting weights, sculpting himself into a domineering bodybuilder, a young Arnold Schwarzenegger certainly understood the phrase, "no pain, no gain," or its Germanic equivalent.

The European Union approved a one-year extension of anti-dumping duties on imports of Chinese energy-saving light bulbs on Monday, despite protests from environmentalists, leading companies and several EU capitals.

Hu Jintao wants to make every Chinese twice as rich by 2020. He has done it once – in just five years, income per capita doubled to $2,000 (£983) – and the only obstacle in the Chinese President's path is the fuel needed to stoke the boiler in China's locomotive.

In a very short item at the bottom of page 6 (print edition), the Financial Times reports that, wedded to rationing, the European Parliament on Monday will endorse its next move in the chess game that is negotiations over a "post-2012" global warming pact.  It will be a per capita quota scheme, allocated at the national level.

The level they will suggest remains unspoken, but past negotiations make clear it will be set well below the US emission level, but well above likely all of the developing world, with a global trading scheme (which still hasn't found its way forward under the 1997 Kyoto).  This is in order to peel away Third World support from joining with President Bush's obvious momentum [China now being firmly in the US camp after the EU…joined by some Ds here…aggressively rattled the trade sanctions/border-adjustments saber].

This desperate effort to find something that the EU can still point to as theirs, if adopted, would ensure that Kyoto remains the most direct form of wealth transfer and off-shoring proposal, as opposed to a more growth-oriented, technology transfer type agreement Bush is pushing to set the table with as his term winds down.

As always, this twist on the "Brazil plan" allows us to identify what standard of living is associated with their quota, and tell everyone that Kyoto means, e.g., Malawi for you.

Senator Barack Obama informs us that “We've heard promises about energy independence from every single president since Richard Nixon, but we are actually more dependent on oil today than ever before.”

The only way that this statement is true is if Obama intends by it that we now use more oil in real terms, irrespective of per capita, rate of growth or its relative role in our economy, which would be a pretty simplistic-slash-disingenuous approach to the issue.  Actually, we are in practical terms less dependent on oil now, such that the economy is much more resilient to oil shocks, not less, as Yale economist William Nordhaus has examined.  Cato’s Jerry Taylor & Peter VanDoren address this issue here. 

Former Fed Chairman Alan Greenspan also goes into it at length in The Age of Turbulence.  Short version: between 1973 and 2006, US consumption grew, on average, by only .5 percent per year, far short of the rise in real GDP. In consequence, the ratio of US oil consumption to GDP fell by half, and “the ratio of world oil consumption to real GDP, the most general measure of oil use intensity, peaked in 1973 and has progressed steadily downward to the current level of less than two-thirds of where it was in 1973.”

If Al Gore harbors Presidential ambitions, he would be insane to run in ’08. In the parlance of campaign operatives, Al Gore ‘owns’ the global warming issue. Just as Google has become synonymous with surfing the web, Al Gore is coterminous with climate change.  Which is why patience will pay for Gore. When everything under the sun is blamed on global warming (the heat, the cold, droughts, monsoons, disappearing lakes, rising sea levels, etc, etc), Al gets to stay on everyone’s radar, forever.

And what Presidential aspirant wouldn’t be well positioned to run after 4 (or 8?) years of near-continuous, fawning media coverage?