Infrastructuralism

What would work best as a preventative to anthropogenic global climate change? According to most economists -- including, in particular for the purposes of this post, John Quiggin -- it's carbon taxes. I don't think so. For that matter, I don't think that any number of other favorite solutions have a good chance of working.

To make long argument short, I favor a model that goes something like this: people use whatever infrastructure is available. In a contemporary society, major infrastructure is essentially a command-and-control activity of government. Therefore what needs to happen is: a) scientists convince the public that change is needed, b) the public tells their governments that change is needed, c) governments issue orders to replace one kind of infrastructure with another. Emissions trading schemes and carbon taxes are basically market fetishism, because the vast majority of users of energy, including businesses, do not have the ability to choose differently enough within the existing infrastructure to make a difference. Demand elasticity only goes so far, and not far enough. Only if the cost of an ETS or carbon tax builds up enough to force a major rebuild of infrastructure would they work. But that is unlikely to happen, because a government in which people are feeling that much pressure from the ETS or carbon tax will respond to that pressure by revoking it.

And let's take the carbon tax argument to its limit. Quiggin writes that "The alternative solution is to make those responsible for carbon emissions pay a price, just as they do for goods and services of all kinds." What good or service are they paying for? Unless they are paying to replace carbon infrastructure with non-carbon, then what they are really paying for is ecosystem services. Imagine a situation in which global climate change goes on unchecked, but in which economists announce that the people doing the polluting have properly paid for their damages, in monetary terms, to other people. Is that really acceptable? No. Aside from the moral or ethical valuations involved, ecosystems can't really be replaced by money (i.e. human activity) just in physical terms.

Quiggin, in the linked blog post, writes that those who favor what is being called "direct action" in Australia do so primarily because they are either business-linked/conservative or because they are climate change deniers. I am neither of those, and wouldn't want to give aid or comfort to them. But it's my sense that this support of "direct action" on their part is purely instrumental, because they perceive that in their current politics it is least likely to lead to any action at all. You see this in the U.S. in the other direction, where measures against climate change were originally proposed to be regulatory, and so the right wing "favored" emissions trading schemes. When it looked like those might have a chance of actually being implemented, they went to pure denialism. So I don't think there's any point in disfavoring regulatory/command-and-control change just because they favor a do-nothing version.

Quiggin uses the usual invisible hand imagery of economics when he writes that "This problem raises a vast number of possible options, and the problem is to choose which will achieve the necessary reductions in emissions with the least possible disruption and economic cost. This is a difficult problem. [...]" Therefore, turn it over to the market (in the main) rather than the experts. But there is a large amount of fictitious economic activity that goes on, at least in the U.S., to camouflage the fact that major energy infrastructure is in fact an activity already decided by a few experts. Want to build a coal-burning electric power plant? In no sense is a "market" really involved. The government is involved from start to finish. How about a gasoline refinery? In fact, the major inputs to the system are government-controlled in all but name, with corporate ownership mostly being there for purposes of crony capitalism.

Someone might reply that the millions of decisions take place on the consumption side, with all of those light bulbs being replaced, car miles being driven to a greater or lesser extent, heaters being turned up or down, and small solar panels being put on roofs. None of that makes enough difference. If the electricity is being supplied by a coal-burning plant, people will use it somehow. If the roads have gasoline stations and infrastructure and no electric infrastructure, people will use up whatever gas is available, for the wider sense of "available" meaning "all that can be gotten out of the ground".

Conversion of our societies from carbon fuel to non-carbon is really a communal, global cost. Governments are how contemporary societies decide on and pay those kinds of costs. Trying to get the government to hand it off to the market is just the economist with a hammer thinking that everything looks like a nail.