Tuesday, October 07, 2008

Those "Crazy" LEADING Economists

When you are discussing the health of the economy, what you don't need, or want for that matter, is advice from economists. That seems intuitive enough, the last thing you do when formulating policy is to use expert opinion, especially when said experts detail plans that are good for the economy. Economists are "crazy" people, bent on destroying our country, with their "experiments". Now that you understand the asinine Conservative logic, isn't it amazing to see the unanimity of support for a carbon tax, from people in the know:
Back carbon tax, leading economists tell politicians

More than 200 experts say policy is best way to fight climate change

More than 230 academic economists have signed an open letter to the leaders of the federal political parties, urging them to acknowledge that putting a price on carbon is "the best approach" to combatting climate change. In a rare show of agreement...That's an astonishing number for academics not typically inclined to act collectively and quickly on policy issues, Mr. Finnie said.

Interestingly, the economists also mention cap and trade, but see it as more "complicated" and that "regulation" is the most expensive approach because you don't have a "choice". On that note, when confronted with the above, NDP Environment critic Nathan Cullen said the economists have it wrong. Yes, the NDP knows best, not economists. Gotcha.

What is really striking here, the fact that so many economists have jumped on board, which speaks to a real fundamental appeal. Last time I checked, economists don't generally endorse policies which would harm our economy. If, we take the Conservative logic, then Canada is doomed, because our economic ranks are full of "crazy" people, who are willfully endorsing financial peril.

The carbon tax is a sound economic policy, supported by the vast majority of expert opinion. Period. Any other argument is just PARTISAN noise.

16 comments:

Joseph said...

Rumour has it the economists are just panicking by offering this up ; ).

Good post.

I find it intriguing that no major news agency that I know of has ever done a fundamental piece about carbon taxes and cap and trade to simply explain how they work, what countries currently use them, etc.

You know, provide a basic primer for their viewers and readers.

I guess it's just easier to label it "complex" and draft another ho-hum story about how it is too "complicated" for a politician to take on.

Going to war is easy. Changing tax structure for environmental reasons is just way too complex to bother with.

Steve V said...

joseph

What's funny here, it's the carbon tax that is proposed as the simplier option, which flies in the face of all the MSM coverage.

And, all the leading environmentalists are on board, endorsing a carbon tax. That means, the NDP and Conservatives have no backing from the economists or the environmentalists. It isn't even a fair fight, and yet, it's the Liberals that are framed as adopting a policy which is an albatross. It really is amazing, when you think about it.

RuralSandi said...

Send a copy of the article to Mike Duffy and ask if he's willing to discuss it on his show....the response would be interesting.

The Conservatives will say economists are crazy until the use the fact that Harper is an economist. I bet Harper realized it was a good plan and months ago, in a panic like drive - decided to try to trash it.

Scott Tribe said...

C'mon Steve, these are all just elitists in heir ivory towers - what do they know about the real world?

Wait a minute... Harper's an economist too, isn't he?

Steve V said...

sandi

Done, I recommend you do the same, for what it's worth ;)

scott

Experts are the enemy, on EVERY file.

Robert said...

What!? Next you're going to say that because those people are educated their opinion matters.

They're obviously in cahoots with the criminologists to make the CPC look bad!

[/sarcasm]

Bobblehead Steve says "Stay the course!"

Steve V said...

Didn't Harper rely on expert opinion to cobble together his crime package...oh wait, that guy he cited actually disagreed and slammed the initiatives. Sorry, never mind.

Anonymous said...

Who delivers a platform after some people have already voted? Harper's disdain for the voter is on display for everyone to see.

Steve V said...

anon

Somebody who never had one, then quickly penned one, because he's tanking in the polls. Only an IDIOT would buy into this spin about strategic timing, it was there, but they choose to wait.

catherine said...

The US Congressional Budget Office makes exactly this case -- a carbon tax is much cheaper than cap and trade in achieving the same goals.

The CBO has a hefty budget and staff so they can really study these things in depth and they are nonpartisan with a mandate to supply unbiased, reliable budgetary information.

The CBO quotes a result which I actually have difficulty believing, which is that a cap and trade, with fixed, inflexible caps (which is what the NDP proposes) costs *five* times more than a carbon tax in the short term. By cost they mean net benefit (how much it costs compared to the benefits gained by reducing emissions and stimulating green technologies). Five time more! They point out you can reduce this huge differential (but not eliminate it) by having flexible caps. They quote a number of expert studies from MIT and elsewhere.

Anyway, I am heartened to see this information finally appearing in the Canadian press. Why has it taken so long?

the Cloudwalking Owl said...

I remember the CBC did a feature on reporters and science. The researchers were absolutely scathing towards the low level of scientific literacy amongst reporters. One quote said "never underestimate a reporter's ignorance when it comes to science." I think the average reporter is just too dumb to wrap their heads around the concept and they hide behind the supposed ignorance of ordinary people.

Having said that, I work with a person who says time and time again that he doesn't understand the carbon tax. He isn't a knuckle-dragging moron, as he is a skilled tradesperson. But no matter how I explain it, and I think I am pretty good at explaining complex ideas, he keeps saying "I don't understand".

I think that there is something else at work here. I think that people are just in some sort of denial about how their own personal behaviour impacts on the environment and are engaging in "wilful ignorance" rather than an sort of simply lack of understanding. Perhaps this is the same sort of thing that happened amongst ordinary Germans during the Holocaust---they really didn't know because of some sort of collective form of hysterical blindness---.

Steve V said...

owl

I hear you, but it really is a very simple concept. I think the problem comes with the details, but the overall theme is really elemental. It's the media that keeps pumping the "complicated" angle, and they've done it from the beginning.

Travis Fast said...

"Last time I checked, economists don't generally endorse policies which would harm our economy."

Have you been paying attention to the Financial News? How many of those self same LEADING economists pushed for financial deregulation under the guise of financial market efficiency?

Now this does not, of course, mean that bad advice once is bad advice always but it does mean that economists are capable of endorsing policies that are harmful to the economy.

Steve V said...

travis

There were also many warning of storm clouds, you need more sources.

That's a good point though, but what you don't seem to get here, we have virtual unanimity, a fact which is apparently "astonishing".

Travis Fast said...

Yah, the Asian financial crisis never happened right! Japan's property bubble never happened. Nope no broad evidence at all. But indeed how could a real world test runs stack up against a flat universe model where tomorrows prices would endlessly grow at the rate of yesterdays prices. So now we are having a reverse liquidity event. They did not see it because they did not model it.

It is called an ideological blind spot. The default policy model (intuition)that the vanilla section of the economics profession uses holds unregulated markets are superior to regulated markets. They will generally concede the point only after the fact and then it is still like pulling teeth.

Moreover, they can play all the word games they like but a carbon tax is a form of market regulation. And on this score I am generally glad that the vanilla section of the economics profession has come out in favor of regulating markets(however described).

The problem is without a cap there is no guarantee that emissions will actually reduce. So we are going to need some hybrid system where caps are set, emissions are monitored and Co2 taxed at various levels.

Steve V said...

travis

You know your stuff :)