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As reported earlier on BNC, Dr James Hansen is currently in Australia (I had the pleasure of taking him out to dinner yesterday evening). Tonight he’ll be speaking on climate change and energy solutions at a public event at the Adelaide Convention Centre. There is still time to reserve a ticket and come along — please go here to book.
It’s also good to see a couple of news stories appearing in today’s media, which are worth reading (James Hansen keen on next-generation nuclear power and ‘Father of global warming’ to speak in Adelaide), as well as an opinion editorial published in The Australian, which Jim wrote whilst here in Adelaide (I reproduce it below). This Op Ed has direct bearing on what he’ll be talking about tonight at the event “After Copenhagen: Looking for real solutions“, and relates to material published earlier on BNC on the fee-and-dividend alternative to a cap-and-trade. Its message also ties strongly to a general thrust of this climate-energy blog, i.e., ensuring that nuclear power is available and able to compete fairly with other non-fossil-fuel technologies, on a ‘level playing field’, so as to maximise our chances of achieving effective emissions reductions whilst minimising the cost and time it takes to do this. All the cards on the table, folks.
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Only a carbon tax and nuclear power can save us
AUSTRALIA will suffer if fossil fuel use continues unabated. Climate extremes will increase. Poleward expansion of the subtropics will make Australia often hotter and drier, with stronger droughts and hotter fires, as the jet stream retreats southward.
But when ocean temperature patterns bring rain, the warmer air will dump much more water, causing damaging floods. Storms will become more devastating as the ice sheets on Antarctica and Greenland begin to disintegrate and cool the neighbouring ocean, as I describe in [my book] Storms of My Grandchildren. Ice discharge from Antarctica has already doubled in the past five years.
Science has shown that preservation of stable climate and the remarkable life that our planet harbours require a rapid slowdown of fossil fuel emissions. Atmospheric carbon dioxide, now almost 390 parts per million, must be brought back to 350ppm or less. That is possible, with actions that make sense for other reasons.
But the actions require a change to business-as-usual. Change is opposed by those profiting from our fossil-fuel addiction. Change will happen only with courageous political leadership.
Leaders must draw attention to the moral imperative. We cannot pretend that we do not understand the consequences for our children and grandchildren. We cannot leave them with a situation spiralling out of their control. We must set a new course.
Yet what course is proposed? Hokey cap-and-trade with offsets, aka an emissions trading scheme. Scheme is the right word, a scheme to continue business-as-usual behind a fig leaf.
The Kyoto Protocol was a cap-and-trade approach. Global emissions shot up faster than ever after its adoption. It is impossible to cap all emissions as long as fossil fuels are the cheapest energy.
There is zero chance India and China will accept a cap. And why should they? Their emissions, on a per capita basis, are 10 times less than those of Australia or the US.
Fossil fuels are not really the cheapest energy. They are cheap because they are subsidised, because they do not pay for damage they cause to human health via air and water pollution, nor their environmental damage and horrendous consequences for posterity.
An honest effective approach to energy and climate must place a steadily rising price on carbon emissions. It can only be effective if it is a simple flat fee on all carbon fuels, collected from fossil fuel companies on the first sale, at the mine, wellhead or port of entry.
The fee will cause energy costs to rise, for fossil fuels, not all energies. The public will allow this fee to rise to the levels needed only if the money collected is given to the public. They will need the money to adapt their lifestyles and reduce their carbon footprint. The money, all of it, should be given as a monthly “green cheque” and possibly in part as an income-tax reduction. Each legal adult resident would get an equal share, easily delivered electronically to bank accounts or debit cards, with half a share for children up to two children per family.
Sure, some people may waste their green cheque on booze or babes. Such people will soon be paying more in increased energy prices than they get in their green cheque. Others will make changes to keep their added energy cost low, coming out ahead.
There will be strong economic incentive for businesses to find products that help consumers reduce fossil fuel use. Every activity that uses energy will be affected. Agricultural products from nearby fields will be favoured, for example, as opposed to food flown in from half way around the world. Changes will happen as people compare the price tags.
The rising price on carbon will spur energy efficiency, renewable energy, nuclear power, all sources that produce little or no carbon dioxide. Bellyaching howls from coal moguls must be ignored. Let them invest their money in renewable energies and nuclear power.
Australia is blessed with abundant nuclear fuel as well as coal. Nuclear power plants are the ideal base-load power for Australia; their excess power in off-peak hours can be used to desalinate water. Power stations can be sited near coastlines, where cooling water is plentiful.
But all potential energy sources must compete, with each other and with energy efficiency. If renewable energies can do the whole job economically, as some people argue, that would be great. Put a price on carbon and let all parts of the private sector compete.
Fee-and-green-cheque is simple, designed to do an honest job. Emissions trading, in contrast, is designed by big banks that expect to make billions out of the carbon market. That means out of your pocket; every dollar will come via increased energy prices to the consumer, with no green cheque to soften the blow.
I mentioned that cap-and-trade will never be accepted by developing countries. But why would China accept a carbon price? China does not want to become a fossil fuel addict, with the requirement of protecting a global supply line. It wants to clean up its atmosphere and water. It is investing as fast as its can in wind and solar energy and nuclear power.
China knows that these clean energies will boom only if they put a rising price on carbon. It seemed willing to negotiate that approach in Copenhagen, but was handed a cap-and-trade edict. Results were predictable.
What the world needs is a nation that will set an example, stop pandering to special interests, do what is necessary for the people and the rest of the life on the planet. It is a moral issue. We cannot turn our backs on our children and grandchildren. Is it possible that Australia could provide that example, that moral leadership?
James Hansen is director of the NASA Goddard Institute for Space Studies. He is a guest of the University of Sydney and Intelligence Squared Australia and will speak at the Adelaide Convention Centre tonight.
Filed under: Emissions, Nuclear, Renewables
“Ice discharge from Antarctica has already doubled in the past five years.” People (including me) have stopped believing all these super-scary tidbits. Now all they do is bring the whole story into disrepute (even if true!). Also the statement is carefully phrased. As we’ve seen across the Northern Hemisphere lately: warmer seas means more moisture means more snow. So increasing discharge could still be compatible with increasing rather than decreasing Antarctic ice. Time for Global Warming campaigners to clean up their act, because the current line is playing into the hands of the coal industry.
Robert, this increased ice discharge figure is based on the latest GRACE satellite measurements. It’s based on total mass balance, so accounts for NET loss (trade-off between increased snowfall and increased glacial flow, ice-tongue melting and surface run-off): http://www.csr.utexas.edu/grace/
I was only commenting on the English. If you are right then it is a serious error to phrase it in such a way that it looks like it might be disingenuous. Also: If we are claiming that the net discharge rate has doubled then what does that mean?? It is not long ago that there were public estimates that the net rate of ice loss of Antarctica was negative. Maybe the net loss 5 years ago was so low that doubling it doesn’t mean anything.
Why is it that Australia is continually pushed to be the one to set the example?
Hansen’s idea of the “Green Cheque” has a lot of merit but as he well knows the creators of the Carbon Market won’t go down without a fight. Lack of a Nuclear debate and the commissioning of more coal fired power stations shows the commitment Australia has made to supporting a Carbon Market. Great example eh!
My worry is that revenues from a carbon tax will simply be used to further subsidise renewable generation and distort the economics such that they appear better than they really are.
Robert: Greenland is now at about 450 cubic kilometres per year net loss, Antarctica (East + West Combined) is now about 300 cubic kilometres net loss. So a doubling is significant, although still a relatively small contribution to overall sea level rise (at this stage).
DV8 – Hansen’s view is that we give nothing to subsidise renewables or nuclear – it goes back 100% to the tax payer.
DV8/Barry – After listening to Jim yesterday and last night at dinner, the 100% back to taxpayer carbon tax he supports has convinced me that is our only option. According to Jim, it seems to be working in British Columbia (an economy smaller than Australia’s), and people accept it there.
I think Hansen is a little naive to think the same problems that plague cap and trade won’t work their way into a carbon tax. Free permits will morph into exempt status and offsets will become carbon tax deductions. Under either approach the revenue could still be be squandered on CCS and feed-in tariffs. On those two issues specifically this week Energy Minister Martin Ferguson has hinted CCS will be cut loose by 2015 if it doesn’t deliver but the Academy of Science has argued that FiT should be expanded.
Unfortunately I think Australia will get its lead from the Northern Hemisphere as a whole, not Hansen. Either the nuclear renaissance going well in some places or more weird weather.
CJAB – British Columbia is overrun by doctrinaire Greens, who were willing to do just about anything to see B.C bring in the first carbon tax in North America.. the result is a regressive hoax that places a burden on low and middle income families, small business, and those that can least afford it.
Even the most committed defenders of carbon taxes agree that this kind of tax will only work if two conditions are met: The tax must be high enough to cause buyers to switch to alternatives, and there must be alternatives available at prices buyers can afford.
Neither is true for the B.C. plan.
Barry: What are you comparing the Antarctic ice loss to?
Have a look at this picture
http://i864.photobucket.com/albums/ab209/Gordon333/MawsonsVicker.jpg
It was from an article in the SMH on the 20th Sep 2008 and basically said they know where Mawson’s Vicker is but it has been under ice since the 70′s (a couple of metres by the look of the photo’s). So if we take 1913 as a baseline then you would have to admit that there has been an increase – yes ?
Barry,
I wonder if you could answer a question for me as I’m currently not in Australia…. I understand that this months leader of the conservatives said on Lateline a while back that he hadn’t read the summary for policy makers of AR4 but soon after that met a guy called Christopher Monckton (who can call himself ‘Lord’ as his grandfather was given a hereditary peerage 5 years after young Christopher was born) who speaks a lot on the subject of AGW.
So this is my question. Is this month’s leader of the conservatives also going to meet with James Hansen (whose grandfather wasn’t given a peerage) while he is in Australia talking with ordinary people and who has done some scientific work on AGW?
BTW DV82XL, I’m typing this in BC. I’m interested to hear that they have a carbon tax here. Have you got anymore details on it e.g. links?
Gordon, GRACE is a year-by-year continental measurement of total land-based ice mass, on a scale of cubic kilometres, as observed from space. It is not based on any site-specific analysis.
Jeremy C, no politician has taken the opportunity to meet Hansen whilst he’s been in Australia, although some State Government staffers and departmental CEOs have, from NSW and SA. There is some background on the BC scheme described here: http://bravenewclimate.com/2009/11/09/fee-and-dividend-better/
Dividend first.
(Boron: A Better Energy Carrier than Hydrogen?)
DV82XL,
I agree.
Furthermore, if we artificially raise the cost of energy by government edict, we will impose a cost on the economy and on society forever. It the bar (cost of energy) is raised, it is raised forever.
We should always focus on reducing the cost of energy. So, a better approach than a carbon tax is to get serious about why the cost of nuclear is so high. It shouldn’t be, given it has much higher energy density than fossil fuels. The cost is high because of government edicts over the past 50 years. These government edicts were caused by the same irresponsible groups that continue to demand irrational policies now – such as mandatory renewable energy targets, subsidies, feed-in-tariffs and biofuel schemes.
We need to undo the distortions in our electricity markets that have been and still are being created by irrational policies. These policies are driven by highly effective, emotive appeals by special interest pressure groups; they are aimed at the voting public, and children who then influence their parents.
re Tax and Dividend.
While accepting that this approach is to be preferred over cap and trade, I’m not sure that a hypothecated tax with no dividend might not be the best option of all.
One is constantly being told that, to address the problem in a timely manner, it will be necessary to go on a “war footing” or adopt a “Manhattan style approach”. The world is currently in a financial mess and things will get a whole lot worse if we don’t address the declining ERoEIs of fossil fuels, regardless of global warming. In the short term, people are going to have to get poorer before there is any realistic chance of rectifying matters. I can think of no better use of extra tax than to spend it on clean energy security/efficiency. It would keep economic activity going and the short term (maybe 20years!) of extra taxation (pain) would yield great gains in the longer term.
Having said that, the tax must be hypothecated – each nation should deliver it to an appropriate independent agency and, ideally, each national agency should work under the umbrella of an international agency. (I write this as a believer in the free market and while being strongly prejudiced against bureaucrats. However, wars can only be won with strong central direction.)
It should be a matter of national choice as to how its agency sought to deliver targets with the funds raised – direct investments in particular technologies (picking winners) or by offering tax exemption of dividends to private investors in clean energy. In addition, bonuses could be added per unit of clean energy that their investments generated as and when those investments started to produce such energy. Of course, a level playing field for clean energy must be created and the bonus would be at a flat rate, regardless of the technology. It might be necessary for the national agency to have powers to over-ride normal planning issues associated with energy infrastructure and to provide loan guarantees to prevent discrimination against technologies that were heavily front end loaded in investment terms.
Each agency should have powers to retain a proportion of its funds to finance R&D and encouragement given through the international agency to ensure that costs and information generated were , as far as possible, shared.
Finally, I would like the agencies to be dominated by scientists, selected by their professional peers. Clearly, there should also be economists, preferably appointees of central banks, and the occasional lawyer might be necessary. However, political appointees would be undesirable as decision making would be easier if party politics could be kept out of the decision making process.
Peter Lang:
An hypothecated carbon tax does not have to be in perpetuity, nor does it necessarily increase energy costs in the long run. In any event, provided investors or the agencies directly opted for a principally nuclear option, yields from the carbon tax would fall precipitately even if it remained in situ when its purpose had been served.
Douglas Wise,
1. How many major taxes have been removed (eg your VAT)?
2. What will be taxed next? This year CO2, next year lead, the following year garbage, the following year swearing. Where does it end once you start implementing taxes rather than actually tackle the cause of the problem?
We should be simplifying and rationalising the tax system, not trying to complicate it further. We have Payroll tax (a tax on jobs), we have taxes on those who insure their houses, to pay for the fire brigade and thus subsidise those who don’t insure. There is no end to this.
Scott Ludlum has had an opposing anti-nuclear opinion piece published, too:
http://www.smh.com.au/opinion/society-and-culture/nuclear-does-not-have-the-answers-we-need-20100309-puao.html
Peter Lang:
Peter, I was talking about a temporary tax that would be hypothecated. I was given the idea by reading Joe Shuster’s paper on Open Thread 3 and upon which I commented on 6th March. Hypothecation and administration by an independent agency of the money raised should help to depoliticise the issue.
In any event, you seem to have totally ignored my second sentence. Supposing the tax was not removed, what would happen? The tax yield would fall automatically as more and more clean energy became available. It’s purpose served, it would, in fact, become redundant and not worth collecting. One must therefore consider the short and medium term implications rather than fretting over the long term.
To have an effect, the tax would need to be quite high from the start. In my opinion, its rate should be fixed from the word go and not gradually increased. A higher tax would give a faster clean energy outcome and mean that the tax could be withdrawn (or spontaneously dwindle) sooner. To the extent that it would prove insupportable by the poor, there could be more generous treatment of them through the general tax system. The rich, the only citizens with surplus investment funds along with pension funds would, in effect, be rewarded for investing in clean energy because of favourable tax treatment, otherwise not available if they didn’t so invest. (If you want a free market approach, you’d have to accept that some investments won’t , in your view, be well spent and, instead, be lavished on solar and wind schemes.)
This approach is one aimed at rapid transition, which I doubt you’d get without a carbon penalty or cap of some sort. In the short term, it might put nations adopting it at a competitive disadvantage and they may therefore need to protect themselves with tariff barriers. In all probability, the Chinese and Indians would, themselves, prefer a tax that was widely adopted than to be left to face trade barriers. Europe would need to accept that cap and trade had failed. Americans and Australians, currently the worst per capita carbon emitters, could either come to the party or stay out and be discriminated against. There’s no point in going on a “war footing” without a ruthless desire to succeed with the least damage, while accepting the necessity for short term pain (something democratic governments are reluctant to face up to).
In the longer term, those nations making the clean energy transition sooner rather than later will be those whose citizens will derive the most benefit.
The Greens have posted a comment on nuclear power, presumably in response to Dr Hansen: http://bit.ly/axo1l8
Scott Ludlum will be talking at this event in Sydney, if anyone is interested:
The New Nuclear Debate – Politics In the Pub
Friday 26th of March 2010, 6pm to 7.45pm
Gaelic Club, Level 1 64 Devonshire St., Surry Hills
Speakers: Senator Scott Ludlam, Greens WA; Bob Howard, Dept. Govt.& Int. Relations, Sydney Uni.
I hope Prof Hansen gets at least as much media as the charlatan ‘Lord Monckton’ did. Unfortunately given the state of Australia’s media I am not that optimistic.
While I agree that Hansen’s proposal for a tax-and-dividend starting at $100 and rising would be superior to any carbon pricing proposals on the table at the moment, I also think that the chance of a proposal like that being accepted in the next couple of years is zero. I also think it is much more important whether we have a carbon price or not than what form it takes.
Hansen seems to think that cap-and-trade is such a bad alternative that they are inevitably ‘Hokey’, and business as usual behind a fig-leaf. I disagree, but maybe he is right; maybe he is wrong. The issue is that if there is even a small possibility that he is wrong, dismissing cap-and-trade could be extremely counter-productive. A cap-and-trade scheme in the United States would be far preferable to no carbon pricing at all.
I seldom agree with James Hansen but his views on energy policy are worthy of consideration. He makes his case with commendable brevity.
Well if we have trouble talking sensibly about the small difference between two very big numbers then we’re not alone. We get it all the time in discussion of company and national accounts. If you say that revenue doubled then that means a lot, but may not tell you anything about net profit. On the other hand it is meaningless to say “profit doubled” since profit is often close to zero in a bad year (indeed often negative in a bad year: and then doubling would have no meaning that ordinary folk would understand). [A change from 10% profit to 20% profit is best seen as a change from 110 to 120, rather than a doubling.]
The public can’t take too many numbers. I think we should only hit them with the one number that is very clear and not the least bit speculative: The level of CO2 in the atmosphere. Combine this with the fact that CO2 is a trace gas [hence our ability to affect it], but a very important one.
DV82XL writes,
But from the governments’ point of view, those groups are excellently responsible, because they protect the governments’ fossil fuel incomes. Thus the stupidity of the pretense of surprise when Greenpeace, effectively a branch of government was recently able to “slip by Parliament Hill security”. I don’t know if anyone used those exact words, but that was certainly the spin the kept press put on it.
I think we agree an increase in carbon taxation is not the answer. Or anyway, I think it is not essential, but might help things along if the essential thing is done first.
Do you think dividing out, equally to all citizens, the proceeds of existing carbon taxes first, before instituting any new ones, is not both politically astute and good policy?
(How fire can be domesticated)
G.R.L. Cowan, Said:
“Do you think dividing out, equally to all citizens, the proceeds of existing carbon taxes first, before instituting any new ones, is not both politically astute and good policy?”
Handing people a check when is always politically astute, the question of if it is good policy is somewhat moot, if this money was taken from them under pretense in the first place.
As I wrote up thread for this tax to work two conditions must be met: – The tax must be high enough to cause buyers to switch to alternatives, and there must be alternatives available at prices buyers can afford.
The problem is that these two conditions are not being met.
In most of Canada, including B.C. the price of petrol has gone up by several magnitudes of the added carbon tax. In fact in most cases, the carbon tax has been swamped by price rises for other reasons, so it can hardly be considered a serious inhibitor of usage.
The second part is also lacking. Outside Victoria, and the Lower Mainland (Vancouver & ‘burbs) public transit is very thin, when there at all, and the large communities in the Interior where designed to be serviced by private vehicles, and no one is going to abandon these places because of a small tax.
As well there are few alternatives to heating in he North and most buildings are reasonably well insulated because of standing building codes that existed long before this silly tax.
DV82XL said,
You seem focused on the behavioural effect of carbon cost on those who pay it. Do you agree that carbon revenue today strongly affects those who now receive it?
If you agree, what change in this effect might you anticipate if that revenue were distributed back to the citizens?
Sorry if I’m belabouring the obvious … no I’m not. People talk as if this stuff were not obvious, and I wish they’d stop it.
(How fire can be domesticated)
Hansen says,
And what if they spent it foolishly?
(How fire can be domesticated)
We should always focus on reducing the cost of energy. So, a better approach than a carbon tax is to get serious about why the cost of nuclear is so high. It shouldn’t be, given it has much higher energy density than fossil fuels. The cost is high because of government edicts over the past 50 years.
We should keep fighting the good fight, but I think the most compelling evidence is going to come from China (and perhaps India). As they build more plants and drive down the costs (I think at some point they will abandon windmills as idiotic), the West will finally take a look and the ‘duh’ solution will be obvious.
Sorry for not quoting the first paragraph above (not sure how).
Graham – Well the B.C. tax is rebated back to the people and from what I can see (albeit distantly from Quebec) this has had no real impact given that, as I mentioned, the tax itself has had little effect on the B.C. economy.
Now what would happen if this tax bit down hard on carbon, and assuming there was some fair and effective formula to reward those who did maintain a lower carbon footprint, that’s a matter of conjecture, and I won’t go there.
As it stands, at least as far as the B.C. program goes, this is just tokenism. Keep in mind that this is a Provence that forbids even prospecting for uranium in its jurisdiction, nevermind mining it.
I think a way to greatly amplify the effect of a domestic carbon tax would be to impose it on fossil fuel exports. Garnaut suggested starting at $20 a tonne of CO2. I estimate that would add $48 per tonne to the cost of thermal coal, spot price around $90. Yes more than 50% price increase. It would add about $27 to LNG, spot price around $400/t. The importing country has to ask for the money to be handed back. The money could either end up in green programs or with corrupt officials who get the booze and babes.
This is really directed at China and India who increasingly need Australian coal and gas yet obviously have no plans to curb their domestic emissions. What could sell this idea politically is that coal and gas users within Australia will have to pay these charges but foreigners who use several times as much don’t.
I don’t buy the line that first we have to find something cheaper than coal. Let’s not repair the roads in case jet packs become the preferred mode of transport. Taxes or charges on fossil fuels are like compulsory saving for retirement. Some of the benefit must be set aside for when the good times run out.
Great presentation by Jim Hansen last night. He presented a couple of new slides (developed since his book came out) and up to date information about the extent of ice sheet destruction in Antarctica and Greenland. Barry has mentioned some of the detail above obtained from GRACE:
I’d like to see the source of this since I’m still arguing with other friends about the state of the science.
The other benefit of that John Newlands is that it might help with the “Dutch Disease” implications of a renewed resources boom.
Right now, windfall income is likely to again flood into AW, QLD and the NT, and one result of that will be to test capacity constraints in all the areas where these operations will want to bid for labour. Unless the housing sector goes into decline, wage pressures could be very significant.
Not only that but in order to contain these things, the standard response is increases in the OCA well beyond those of comparable countries. The Aussie Dollar is over 91 cents US and 61 p … How major export earners like tourism and educational services compete with that is not clear.
If a tax on these exports curbed the enthusiasm a somewhat more orderly infrastructure development program, possibly funded in part by the same tax, could arise and upward pressure on interest rates and the currency could follow. Certainly, some of the revenue could be used to develop the skills base needed to underpin a more diversified skilled labour pool.
Actually, I had the numbers wrong, that was the accumulated loss over the last few years. The actual loss RATE per year has now increased to about 250 cubic kilometres/year on both ice sheets. Reference [and abstract, with key details] is here: http://www.agu.org/pubs/crossref/2009/2009GL040222.shtml
EL I agree it is crazy that thousands of Filipino etc slaveworkers will be imported to build the Gorgon infrastructure while urban youths elsewhere in Australia steal cars out of boredom. No doubt the captains of industry will say lets build more cities because it’s all so great. They don’t see the coal and LNG boom as a one-off and a poisoned chalice. More blowback from global emissions, unsustainable energy use expectations in China and India, higher electricity and gas prices in Australia, depleted resources and a flakey climate for future generations. And that financial stuff.
thanks for correction barry, the GRACE figures are alarming
I think Hansen is essentially right but I think the green cheque is silly. A general dividend is best paid as a reduction in income taxes (perhaps an increase in the tax free threshold) otherwise it merely entails additional churn and dead weight losses. A tax cut is also vastly simpler to administer and creates less confusion in the tax code. There would be a case for increasing some tax exempt welfare benefits such as the disability pension.
If you actually did send out green cheques would they be on a monthly or weekly basis to accomodate peoples cash glow needs?
Hansen: “The Kyoto Protocol was a cap-and-trade approach. Global emissions shot up faster than ever after its adoption.”
Adoption? Hilarious.
Would a carbon tax have worked with inadequate targets and the non-participation of the biggest emitters?
Will China be keener to slap a tax on its fossil fuels than to introduce emissions trading? Why would it?
Hansen’s sermons on economics would be a bit more convincing with fewer bald, unsupported assertions and a bit more genuine analysis – he’s sounding like he’s come down with a bad case of the Dunner-Kruger flu.
Still glowing over cash glow … Maybe I’ve been at this site too long … 😉
Terje
Not unless the same people are paying taxes and paying the carbon tax. Trying to quantify any reduction would add new complexity to the system. Also, not all people have significant income so the reduction method would best suit those paying substantial tax.
It’s simpler to work out what the dividend should be and send people a cheque — or better still send it DD to a nominated bank account.
As I said above though I’d prefer that there be more means-tested community services which could themselves be near zero-carbon in character e.g. mass transit, community kitchens and laundries, energy efficient housing ….
Some more thoughts on carbon taxing fossil fuel exports. Firstly the ‘trade exposed industry’ ruse would have to be re-assessed. It seems whacky to export iron ore and alumina if they are smelted using Australian coal for coke and electricity just to escape local carbon tax. Do the whole shebang in Australia and avoid the cost of shipping complete hillsides halfway across the world. Steel and aluminium smelters could pay high local wages and still not be undercut on costs.
Secondly Australian coal and LNG simply cannot elevate the bottom billion in China and India to our 20 tonne lifestyle in CO2 terms. Say 7-8 tonnes of coal and 1-3 tonnes of LNG each year minus their local carbon sinks. Multiply by 2 billion. I doubt Aus exports will ever exceed 300 Mtpa and 50 Mtpa respectively. Unless these countries find low carbon alternatives their majority populations won’t make it. I suspect they will have to tinker with the GDP concept. Yet night after night on ABC Lateline Business we are told how great it is, never ‘half the world population doomed to permanent energy poverty’.
Last I heard John, Australian coal was only about 5% of China’s coal usage (though a larger share [20%? not sure] of their coal imports)
This is all so depressing.
EL you’re right and I’m using the wind advocate’s trick of pointing out high growth but not the small base. If I recall the numbers from Tom Whipple’s website India now consumes 48 Mt of Australian coal and seemingly their steel industry can barely function without our coking coal. China is much less at 16 Mt but was a mere 3 Mt or so the year before. Extrapolate that. Their domestic coal consumption is around 3,100 Mt and will be impossible to sustain after 2015 or so using domestic and imported sources. That explains a few things ranging from their desire to dig up the NSW Liverpool Plains to the number of NPPs they plan to build.
As the world’s swing producer of coal though far from the biggest Australia will have pay black coal prices set by South Korea, Taiwan, Japan, Europe and increasingly China. I rate China coal peaking just behind recent global oil peaking as the key factor in near term anthropogenic emissions. Rudd will give them all the coal and LNG they want but it won’t be enough. See also Wikipedia Peak Coal and Richard Heinberg’s column.
Slightly simpler to work out perhaps but vastly more complex to administer. And given that even welfare receipients (except those on the disability pension) all pay tax then an increase in the tax free threshold offers very wide reach. An alternative would be a reduction in the GST but this would not be as progressive as an increase in the tax free income threshold.
TerjeP,
The more you and others talk about how to use the funds from a carbon tax to redistribute wealth (ie to buy elections through giving handouts to swinging voters in marginal electorates) the more clear it becomes what is wrong with the whole concept of a carbon tax or ETS or any other form of raising revenue and redistributing it.
In my opinion, raising the cost of electricity is morally wrong. When we raise the cost of electricity in developed countries we also raise the cost of electricity for the developing countries in the future. Conversely, if we reduce the cost of electricity in the developed countries, we will lower the cost of electricity for the developing countries also, and allow them to bring electricity to their people earlier and faster. I believe it is our moral responsibility to lower the cost of electricity in the developed countries, not raise it.
We can reduce the cost and improve the health and environmental outcomes of electricity generation. We can do this by removing the ridiculous imposts on nuclear energy.
Why do we mandate renewable energy? If we really want to reduce GHG emissions, why aren’t we mandating nuclear instead of renewables?. The fact that we are not suggests that the greenies are not serious about GHG emissions. It suggests to me they are more interested in power and control.
Peter,
In terms of where to place the tax cut I propose an increase in the tax free threshold. Yes this is progressive but a carbon tax is regressive so I don’t see the outcome as being about wealth redistribution, merely a realignment of tax policy with probably no net change in the progressive / regressive tendancies of the system.
Another possiblity to consider. We currently have a tax on fossil fuels that go into cars but none on fossil fuels that make electricity. The fuel used for cars releases less emissions for the same raw joules (although the overall operation of a car overall is clearly low in efficiency). One proposal that I have seen would entail a broadening and refocusing of the fuel tax so it represented a lower tax on fuel and a higher tax on electricity and a tax correlated to associated emissions. In general such an option would be more economically efficient irrespective of nuclear being permitted or not. The devil as always is in the detail.
The CIS published a paper on the fuel tax swap a while ago (written by a friend of mine).
http://www.cis.org.au/policy_monographs/pm80.pdf
TerjeP,
I understand the concept of extending liquid fuel taxes to coal. However, this is still increasing the cost of electricity by tax. I think that is morally wrong, as explained in my previous post. As long as we are talking about taxing electricity to raise its cost rather than looking at removing the imposts on the obvious solution to GHG emissions from electricity generation, I think we are ‘barking up the wrong tree’.
To me discussing a carbon tax is a diversion; the purpose is so the greenies can increase their power and impose more of their schemes and beliefs on society. I am convinced that trying to raise the cost of electricity rather than lower it is morally wrong.
(I should repeat, that I agree with internalising the cost of externalities to the extent practicable. Soome progress has been achieved already, by cleaning up much of the toxic emissions, but it is impossible to incorporate the externalities from coal to the same extent as they are incorporated in nuclear).
It isn’t my purpose but I accept that lots of people want a new tax on carbon emissions for exactly that reason. I’ve consistently argued elsewhere for substantial reductions in the rates of taxation and government spending in Australia. I even stood as a candidate in a federal election on the platform of significantly lower taxes. However I don’t think this is relevant in a discussion about emission mitigation strategy so I confine myself in this context to arguing for a revenue neutral carbon tax. The key point is that a carbon tax reform is unacceptable in my view if it is about raising additional government revenue. We ought to have a much smaller government sector.
Peter,
You can’t have it both ways: declaim that any increase in the price of electricity is morally wrong AND be in favour of internalising the cost of externalities. Your get-out phrase ‘to the extent practicable’ is the real killer- current public ignorance of the problems (peak fossil fuels/climate change etc) means that it’s just not politically practicable at the moment. If current electricity prices are in effect subsidised because they don’t include the future costs of environmental damage, they’re not a fair reflection of the true costs of the energy we are using, and it’s a moral imperative that they go up. This is one of the main thrusts of Hansen’s piece above. Do you accept this argument, or not?
I know you argue that nuclear power can be made cheaper than coal, which would render the troubling implications of Hansen’s argument irrelevant. This would be great, but it’s a separate point. I hope you’re right, but can it be done easily and quickly enough? I’m not ready to bet the farm on it, and feel we shouldn’t rule out certain options just because we find them politically uncomfortable.
Costing externalities seems to me just a waste of time. The only reason to do it is to avoid the appearance of regulation, to make it seem like some sort of market mechanism is doing the work. But the fact that the world cannot come close to agreeing on a carbon price (why is this?) suggests that there’s no “natural” pricing (“true price”) mechanism at work here. There’s a power struggle and nations and firms [the powerful ones, who are the ones that count in our world] don’t want to give up their competitive advantages or exacerbate their disadvantages.
How do you meaningfully compute the price of ocean depletion or deforestation or cooking the planet? This makes as much sense as putting a “true” price on bonded (slave) labor (what would the “externalities” be there?)
sure, ingenious economists can do it, but it doesn’t mean anything. Carbon pricing is just a disguised form of regulation and businesses will not agree universally to onerous regulations whatever the moral consequences. Of course, they might be forced to agree to a price scheme but since the most powerful countries are the problem, who will do the forcing?
You can’t always quantify the costs of great crimes—like ecological destruction or grotesque inequality.
Politically rather than via a market. I think we should have a tax on the burning of fossil fuels that is linked to emissions. However whilst that defines the mechanism it says nothing about the rate of tax. I think the rate of tax needs to be determined through the political process as the public decides what price it wants for use of it’s atmosphere. Personally I’d be voting for a price at the very low end of the spectrum, perhaps even zero. Deciding the price and the price mechanism are two different things.
At ETS has pretences to be deciding the price via a market mechanism but it is a sham. The real determinent is the cap. And the cap is decided politically not via a market. Deciding a cap politically is much more divisive and opaque than deciding a price politically.
Peter
Putting aside the hit and run trolls who visit this place, the focus here is on evidence-based ideas. Your claim that greenies just want “power and control” really isn’t attested anywhere. I’m a greenie myself but I have no desire to have power and control over anyone beyond what is necessary to protect general interests. Causality flows from the latter to prescribe the former.
I’m disappointed that you haven’t acknowledged the provenance of your ideas in the thinking of libertarian ideologues and cynical reactionaries.
You keep using the concept of “raising the cost of electricity while ignoring the rality that nobody is proposing to raise the cost of electricity but rather, to better account for costs imposed bgy its use in the price paid by those directly using it. Not internalsing the dumping costs of effluent for example doesn’t mean that cost goes away. It simply means that others who are benefiting only marginally if at all bear most of the cost and in that sense it is exactly like every other subsidy. If there is something morally wrong with electricity use then this is what it is — that there should be some people benefiting a lot in part because others suffer a lot but get little.
You pay lipservice to internalising cost, but in practice you are against it or don’t fully understand what this would mean.
While I favour nuclear power, it is hypocritical of you to imply that imposing nuclear would not be imposing one’s beliefs on others. Or maybe you do accept this and simply project your desire to impose onto others you don’t like. I favour full intenralisation and when that happens I think nuclear will be chosen as the preferred source, but that will be through consent rather than imposition.
Corporations, being sociopahts, will externalize everything they can. Therefore some regulation or law is required. For coal, one possiblity is a CO2 tax sufficiently large to pay for some (large) offsetting scheme. Unless the coal burners do the offsetting as an internal cost. Their choice as fas as I am concerned.
TerjeP,
I agree. However, there are two other thinks that you are advocating that I disagree with. One is raising the price of electricity (instead of removinfg the impedicmets to nuclear so we can have low cost, clean electricity), and the second is redistribution of wealth. Tis shou.d not be the goal of a carbon tax. This is the purpose of the main taxation system. I agree with much of your philosophy, but not on these two important points.
There seems to be enormous resistance (by many on this site) to actually looking into the alternative to raising the cost of electricity. Why is there such reluctance to brainstorm and develop a list of the government impossed impediments to cheap clean electricity generation? Once we have a list we could start costing them. But let’s develop the list first. I proposed a few ideas earlier. Would anyone like to take a lead towards developing it further?
1. Remove the blocks to nuclear energy in federal and all state governments (cost $0, how party policy changes and some legislation changes in state governments.
2. Remove the MRET from now on. Honour existing agrements but no more.
3. Replace the MRET with mandatory clean energy targets. Phase in the emissions allowed from electricity generators (see http://bravenewclimate.com/2010/01/31/alternative-to-cprs/). Cost to government = $0. How? legislation combination of MRET and the legislation that sets limits on polution such as lead, SOx, NOx and polutants in water, air etc. Cost to community? Much less than the MRET for a far greater return.
4. Bank guarantees for nuclear power. Cost to government $0 if the power companies succeed. And that is up to the community. If we block and delay at avery possible point, there will be costs and it is right that the community should pay these costs. This bank guarante is also justifiable to assist nuclear to get started in Australia. This is for the benefit of us all. And this si the same argument that Solar and Renewables have been using for decades to justify ongoing government funding. Geothermal and CCS are also demanding such funding to get them started. So why not nuclear?
gregory meyerson,
One of the main ways we internalise the costs of externalities is by regulation.
You are misleading somewhat, dv82xl. The B.V. Carbon Tax was introduced by a Conservative government that masquerades under the name Liberal. And B.C. is not overrun by Greens who have not made any real inroads into that Province’s politics.
I do not know what you mean by gas prices going up in orders of magnitude because of the price at the pumps. They have actually risen only a few cents on the dollar.
I would almost agree with you about “tokenism.” The amount of the tax is not going to achieve very much but, the fact that it has been implemented and by a Right leaning government is n encouraging start. It shows that the people will, in general, accept what is needed once they understand and can see the revenue neutrality.
Peter Lang I’m trying to formulate your approach as a linear programming problem in the variables C clean power and D dirty power in gigawatt years. A 20% RET then becomes C/(C + D) = .2 or D = 4C. If 400 Mt of CO2 is the cap we might have 0.C + 20.D < 400. The intersection of those requirements is C = 5, D = 20.
If a gigawatt year of clean cost $.8bn and a gwy of dirty costs $.4bn this combination will cost $12bn. However if we drop the requirement for any clean then we could get the same 25 gwy of all dirty for $10bn. That is (C,D) = (0,25) is a lower cost combination than (C,D) = (5,20) but it is outside the zone. Energy consumers will want to know why the unnecessary expense. Therefore we need some kind of goalpost that justifies why we shun the least cost. I believe a shrinking CO2 cap is the single best constraint or motivator, not a technology quota. The aim should be a least cost combination that will meet the CO2 cap years ahead.
I hope nuclear is not compromised with ideas akin to feed-in tariffs. Brightsource CSP in the US has been given a $1.7bn federal loan guarantee. Australian gas has been given an indemnity for CO2 escape from Barrow Island. All nuclear should need is loan guarantees and tough (not pathetic) CO2 caps.
@In Ontario – When I wrote: ‘British Columbia is overrun by doctrinaire Greens,’ I perhaps should have written ‘greens’ without the cap, as I was not suggesting that the Green Party of Canada / Parti vert du Canada, was a political force in the Provence, which as you correctly pointed out, they are not.
The swing in average gasoline prices in B.C have moved between a high of 105.6 ¢/l and a low of 78.0 ¢/l over the period the tax has been in force, which itself has added only 2.4 ¢/l to the price. The fact is that any impact on the price at the pump from this tax has been swamped by the swing in the base price, and thus can hardly factor in a reduction in consumption.
As to parties named Liberal and Conservative in Canada, and which ones are actually Left or Right relative to each other at any given time, you know as well as I do, is open to interpretation and geography and is of little consequence to this discussion. The fact remains that in B.C. there was much lobbying both by local and out-of-Provence organizations to get anything that looked like a carbon tax instituted in B.C., mostly so they could run around saying it was a success, and claim credit. for getting it passed.
The tax has not met any of the objectives stated in the enabling Act; in particular it has not reduced B.C. carbon footprint by reducing consumption, and it has not forced a move to low carbon alternatives. Yet supporters hail it as a significant step forward.
That’s tokenism, pure and simple.
John Newland,
Your calculation is based on the assumed costs “If a gigawatt year of clean cost $.8bn and a gwy of dirty costs $.4bn”.
This is what we should be working on. What I am saying is if we could change our focus from taxing C, to removing the imposts on nculear, together with some start up assistance, then we should be able to have nuclear for less than coal. So it is your .assumed “clean cost $.8bn and a gwy of dirty costs $.4bn” that I am trying to get contributors here to start discussing. There seems an enormous reluctance to do so.
There is no reluctance on my part Peter, I have been writing for years that a level playing field needs to be legislated in – ether nuclear gets a free pass on waste, emissions, and decommissioning costs, the way carbon combustion does, or barring that the latter be held to the same levels of responsibility that nuclear is.
That a NPP is facing a shut-down for a release of radioactive material that in total is several orders of magnitude smaller than what a comparable gas power plant emits on a regular bases is is simply ludicrous.
A single set of rules across the board would make nuclear the least expensive of all, with the possible exception of hydro. It is all that would be needed.
And personally, if every form of energy and every producer of goods and services were required to sequester (until innocuous) from the commons every emission or waste product for which there was good evidence of harm to the commons, I’d be totally relaxed about not imposing charges on emissions.
I’d want a robust system for ensuring that would happen in perpetuity of course.
DV82XL,
Yes thank you. I didn’t mean to make such a sweeping statement to include/exclude all. I am hoping tha those who want to raise the cost of electricity by legislating a price on on carbon, will take some time out to look at the alternative – i.e. what could be done to remove all the impediments to nuclear. It’s a challenge to all those who are thinkig only of how to add a cost to electricity generation.
A single set of rules across the board would make nuclear the least expensive of all, with the possible exception of hydro. It is all that would be needed.
The trouble is, those impositions on nuclear power were carefully crafted to ensure that no such single set of rules could ever be applied across the whole power industry and make the comparative advantage of nuclear obvious. It took someone a great deal of effort to set things up as they are, and they’re not going to just stand by while all their beautiful work is undone.
ewen’s point is that the polluter is responsible for the waste at all stages of production process.
This is a good idea and avoids the whole price thing. but the issue of global coordination doesn’t go away. Under what conditions do states or firms accede to regulation? under public pressure, yes, but also usually because regulation can eliminate competition: smaller firms cannot afford the regulations and they get pruned, making the firms left more powerful.
peter, I agree that regulation is a way of “internalizing costs” in some sense of the term. That was actually my point.
Jacobsen
The Bete Noir himself has rereared his ugly head and can be found here
http://www.scientificamerican.com/article.cfm?id=letters-march-2010#comments
Lets give him a pasting lads.
DV, Peter,
Do you have a contemporary set of figures to show the above? Along the lines of what Bernard Cohen developed in his 1990 book (http://www.phyast.pitt.edu/~blc/book/BOOK.html) in chapters 9 and 10?
Today’s ABC Landline program (no transcript) yet illustrates what I think is wrong with thinking on carbon debits and credits. Two biomass burning power plants that co-fire sugar cane waste or bagasse say the the REC price is uneconomic. The REC price was $52 (per Mwh I believe) but dropped to $24 after solar was credited with 5 units for every 1 of actual output, thereby swamping the ‘market’.
I say the the REC price should be $0 but the CO2 debit price should be high. That is make the objective fewer debits since credits do not apply. The George Monbiot articles linked in the sidebar focus on feed-in tariffs but point out the illogic of selling credits for low net carbon energy. It just means someone else pays a small amount to burn more coal. I think it also shows there will probably be even more huge glitches in the CPRS if it ever happens. No way it will start July 2010 despite being promised in November 2007.
Another telling scene for biomass enthusiasts showed the pest tree camphor laurel being harvested as an alternative steam boiler fuel. In a single camera shot was what seemed like a diesel powered harvester, a diesel powered hydraulic hoist and a diesel powered truck. They may have been powered by batteries or macadamia oil but I suspect the actual fuel was petroleum based, a tough ask when oil runs out.
Peter – I’m all for having a carbon tax that is vanishingly small, perhaps even zero, and focusing on removing the regulatory hand brake on nuclear. My argument for a carbon tax is primarily as a more intelligent alternative to an ETS. Whether we have an ETS, a carbon tax or neither I think we ought to be removing all unreasonable obstacles to nuclear. I’m a but hesitant in going as far as loan guarantees but if that is necessary to deal with regime risk then I do see the merit. However not all of the construction risk relates to regime risk.
TerjeP,
We are close. I don’t believe in any ETS or Carbon tax at this stage. If there was an international ETS, administered by the World Trade Organisation as part of the GATT, and it was no more subject to fraud or cheating than anyother traded comodity I would support that. However, that is clearly impossible to achieve, ever. Because, we will never be able to measure CO2 emissions and do the accounting of them nearly as well as we can for other traded comodities like iron, oil, wheat, etc. In fact, we’ll never be able to measure and account for CO2 emissions as well as we can account for uranium, and Jim Green and his mates are not satisfied with that accounting. So what hope for CO2? I suspect it will never happen.
Furthermore, implementing ETS or C tax shifts the focus from the real solution. People think ETS or Carbon tax is going to solve climate change. What a joke that is. It is totally naieve.
While we are distracted by ETS and Carbon tax, we are not focused on what we need to do to remove the imposts on nuclear. If we mremove the regulatory imposts, and then give the engineer s the goal “give us nuclear generation at lower cost than coal” and let them at it, I am convinced they will achieve that goal.
I am too, in principle. However, we have distorted the market by such an enormous amount and have done so for 40+ years, that we cannot unwind the perception of the investment risk without a major involvement of government.
I agree not all the construction risk is relates to regime risk, but that is to be handled in the negotiations and the contract. It certainly does take longer to build nuclear plant in a county that has not built them recently, and that is a fault of the regime, not the contractor. So that cost burden should be carried by the regime. In short, the investment risk premium and the First of a Kind cost premiums should be carries by the regime if we want clean cheap power. That is no different to the argument the renewable advocates have been running for decades to support government funding of their renewable energy generators.
Bill Kerr,
Unfortunately, I don’t sorry. That is the topic I’ve been trying to start a discussion on. However, most contributors seem to be stuck on wanting to increase the cost of electricity.
Peter – I agree we are close. I think your point about lowering cost is a good one. Although ultimately I think this will play itself out on the global stage with Australia being mostly irrelevant to the process.
TerjeP. I totally agree. However, if we want to start of the road to clean electricity generation, we should start now, not wait.
It will take at least 10 years to:
1. Set up the regulatory framework
2. Set up an organisation to manage the implementation of the initial fleet of power stations (I see something like a modern version of the Snowy Mountains Authority)
3. Set up the education facilities we need (eg nuclear engineering facilities in each mainland state Capital)
4. Got through the procurement process – at least 4 years, probably longer – to award of the firsdt contract
5. Construction to commissioning – 5 years would be optimistice for the first one, based on current experience although we can expect that to improve over the next decade.
Note, some of these can be done in parallel, if sufficient authority is delegated to the ‘Nuclear Energy Implementation Authority” to get on with the job (similar to the authority given to Sir William Hudson to build the Snowy Mountains Scheme.
Give the job to an engineer, get the politicians and the greenee activists out of the way, and it can be done.
Ewen Laver, (13 March 2010 at 11.07),
You say your main interest is in what is right for the commons. In previous comments you haves scoffed at business and investors.
I suggest that those who are interested in what is good for the commons need to think first about what is good for business and investors. It is business and investors that pay for everything we want from the commons. They pay for all our capital works and all those people on the public purse. The feed us and provide our energy.
The more we constrain business and investors the less there is for everyone, and the less there is to be spent on the commons.
Our ideologies are so far apart it is difficult to find any common ground to a discussion on.
Something that has been under discussion on this web site is whether we should constrain the sale of coal. I’d put the Tasmanian pulp mill in the same type of issue. Some people think we can control the world market for products and resources such as coal and paper (from the pulp mill). We cannot. If we don’t provide the coal or the paper, it will be provided by others. In the case of paper, the mill will be built in another country, and probably with worse environmental for the world that if built in Australia. So we reduce our income and reduce what we have to spend on the commons in Australia for no net benefit for the world at large.
I do not have a much time for the narrow, simplistic agendas of the radical, extremist greenies.
Ewen Laver said on 13 March 2010 at 16.13
This is an example of an extreme position that I find off-putting. It is impossible to achieve. It would require shutting down mining. We cannot “sequester (until innocuous) from the commons every emission or waste product” forever. Similarly for uranium, iron and all ores. So we’d have no electricity. We couldn’t build wind turbines or solar panels either. Some who advocate this sort of position don’t seem to recognise that the noxious chemicals last forever, unlike nuclear wastes which have a half life.
The benefits of low cost electrcity must be balanced against the damages.
Actually, Peter, I haven’t “scoffed at business and investors”. I’ve insisted they do the right thing, which is a different thing.
And old myth. Actually, the public ultimately pays for everything. The investors are just middlemen.
Perhaps, but is this relevant? And is this certain? And do we know this would eb worse for humanity? It’s all guesswork. We can only control what is within our power. Second guessing without clear modelling is pointless.
Precisely why the costs and damage must be monetised and internalised. In the case of nuclear, this is done.
No, they don’t or they can be secured.
It is clear that your sympathies lie with securing the privileges of the elite. That’s fair enough, but you should stop hiding behind cliched slogans. This has nothing to do with energy policy and everything to do with your cultural agenda.
What I don’ t understand about Hansen’s carbon tax is what happens to big energy industrial consumers, for example steel or aluminium producers. There is very little efficiency to improve in those fields, thus at best there are serious risks these activities are going to close
Alex, well, we’d use zero-carbon energy for the Al (e.g. from nuclear) and, if the economics can be made right (and they probably can, with a carbon price), nuclear-derived hydrogen for iron oxide reduction to replace coking coal. See here for a discussion on the latter point:
http://bravenewclimate.com/2009/06/16/steel-yourself-a-clear-role-for-hydrogen/
Yes Barry, this may be the right solution once that the nuclear plants will be operating, but we need an interim solution, too, if we want these industrial activities to survive even in the mid term (for example, not to tax big industrial consumers, at least in the mid term)
[…] what, in addition, a carbon price might achieve. There has been a lot of recent heated debate in this thread on that very point! One obviously positive outcome would be to hasten — rapidly, if the price […]
True Alex. That’s why Hansen argued that a strong agreement to impose a fee-and-dividend carbon price, between, at a minimum, the major emitters (China, US, the EU, Japan, Russia, India, Canada, Australia), with the related action of imposing trade-gate tariffs equal to this price on imports and removing it on exports to non-complying countries, would be critical.
I suggest that those who are interested in what is good for the commons need to think first about what is good for business and investors. It is business and investors that pay for everything we want from the commons. They pay for all our capital works and all those people on the public purse. The feed us and provide our energy.
The more we constrain business and investors the less there is for everyone, and the less there is to be spent on the commons. Our ideologies are so far apart it is difficult to find any common ground to a discussion on.
Peter: could we avoid terms like “extreme,” and “radical, extreme greenies?”
it’s empty name calling (sometimes names should be called). use of words like “extreme” and “extremist” have no content. either a position is reasonable or not (or both at once, often the case); true or false (or contradictory, most often the case).
rhetorically, words like “extreme” end up giving a pass to “the mainstream” and “the moderates,” who can’t be “extreme” because after all they’re “in the middle.”
so peter: in the united states, to be “in the middle,” and “not extreme” is to be unsure about global warming and probably opposed to the idea that humans evolved. To think global warming an urgent problem, to believe in evolution and to view barak obama as the furthest thing from a socialist-these three beliefs held at once would put one in the EXTREME MINORITY, even though they are all true.
Your view of business makes it sound like philanthropy. They provide for the public purse, they pay for everything we want from the commons, … they even feed us. they’re all Ebeneezer Scrooge’s after a good night’s sleep. Wait: my door bell is ringing-it’s a big turkey for our family dinner!!
I thought your philanthropists enclosed the commons and exploit the working class, whose labor is the source of wealth. In the U.S., the top one percent own nearly as much wealth as the bottom 95 %. Real unemployment is close to 20 % but the wealthy get bailed out (and pretty much have to get bailed out or the system will collapse-that’s how things are set up) and you’re telling Ewen to be grateful to them. why if not for them, we’d all be even poorer, is that it?
They don’t provide for those on the public purse: they GUTTED the pathetic “public purse” in the U.S. and have been doing it since the late seventies.
So there are disagreements: some think labor is the source of wealth (Locke, Ricardo and Marx thought this too despite their many differences); and you think entrepreneurs and investors are the source of wealth or perhaps they do all the thinking and working?
It’s hard for me to believe that you can be right on this topic: the businesspeople and investors have enormous power, and you want to give them more so they can continue to provide for us-food and cheap power.
if this story were true, you would think inequality and poverty would be much less than they are. But instead they are growing, and ordinary people grow more powerless by the day.
why is there so much inequality given the social power of business and investors? if they are providing so much for the ungrateful people?
That said: Peter, I read everything you write-especially on energy- and try hard to understand it. I think it’s incredibly important. In part, it is due to your arguments that I think (here comes a slogan): NUCLEAR MAKES CENTS.
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Peter’s position on this makes no sense. Money only has meaning as an expression of the social labour people do. Absent that and it is as meaningful as currency in Monopoly
It is simply a medium that facilitates trade in labour power. An investor can invest only in stuff connected with people delivering goods and services, with assets accumulated from valuable goods and services, and when he or she does so, the cycle continues. The investor is a mere cipher in this not the creator of value.
He or she could argue that the discretion shown added in net terms to public goods, but in the end, whether the investor wins or loses, somebody benefits from that value and it becomes embedded in other production of public goods.
Peter should really stick to engineering.
gregory meyerson, 15 March 2010 at 5.44
I agree with your point about dropping the use of adjectives suchs as extreme etc. I accept the rebuke.
I do not agree with much that you say about equality. From my perception the GFC was largely caused as a result of state intervention to force Fanny May and the other big insurance firm to lend to people who could never pay back, combined with the fact that if a home owner doesn’t want to keep paying the morgage, they send the keys to the bank and say “your problem”. This was caused largely by bad government intervention to force lenders to lend to those who were a bad risk. Of course, there is much more to it, but this began after the Depression and Carter and Clinton made it worese instead of fixing it. Greenspan and Bush also got it seriously wrong.
There is little point us discussing this sort of thing because we are so far apart and it is a distration from what is important.
Regarding equality, I’d point you to GapMinder. I suggest it is also worth looking at the first two videos by Hans Rosling.
@Lang: you write that discussing equality with Meyerson is a distraction from what is important. Presumably you mean by this nuclear rollout to replace fossil fuels.
When I am saddling a horse to put before a cart, it is true that the horse can be ready to go while the cart is still in unassembled bits and pieces.
But if I have no destination for the cart, or the destination is a swamp, the harness on the horse can be 150% state of the art, it doesn’t matter.
I repeat my usual uanswered query as to how you envisage the social engineering you favour. is China not a good model to follow?
Peter L: so you blame the 2006-9 housing bubble and the financial crisis to a significant extent on the community reinvestment act of 1977.
This is the Rush Limbaugh position. Right wing blogosphere stuff. Soundbytes to avoid thought.
But Okay: I’ll look at GapMinder if you look at Bellamy Foster and Magdoff, The Great Financial Crisis: Causes and Consequences. Or even former Reagan man, Kevin Phillips: Bad Money.
I’ll shut up now. I want to appeal to what you really know well.
The D of E has offered a 1.4 billion loan guarantee to a CST project designed to produce 400 MW of power. do you know what the capacity factor for this would be and how does the storage problem relate to capacity factor since of course any power source having to divert its power to storage will not be producing at nameplate.
Barry’s post on Andasol partially answers my question to Peter.
Do anti nukes mention the cst loan guarantee when they go on about the nuke guarantee?
and do they analyze it? 8.3 billion for 2.2 GW is comparable to 1.37 billion for 400 MW except that the 400 is likely to be less reliable and ignore CF.
ABC TV in Australia, Lateline interview with Dr. Hansen: