In the old Soviet Union, the Communists allegedly used the term “useful idiot” to
describe Westerners whose naïve political views furthered the Soviet agenda,
even though these Westerners didn’t realize that they were being exploited in
such fashion. It is in this context that I confidently declare that American
economists have been useful idiotsfor the green socialists
pushing extreme climate change policies. The radical environmentalists were
quite happy to embrace the economic concepts of “Pigovian negative
externalities” and a carbon tax in the past, but now that it is impossible
for economic science to endorse their desired agenda, the activists have
discarded the entire field as hopelessly out of touch. Economists who still
support a carbon tax and other climate “mitigation policies” should be aware
of the bigger picture.
Using the UN’s Own Document to Defeat the Climate Change Agenda
I have been making this case for years. For example, back
in 2014 I used the latest (and still most recent) UN Intergovernmental
Panel on Climate Change (IPCC) report to show that the then-popular climate
change target of 2 degrees Celsius of warming could not be
justified by the research summarized in the report. In other words, I used
the UN’s own report to show that the popular climate change “cures” would be
worse than the disease.
Yet even though they had spent years berating the critics of government
action as “climate deniers” who rejected the “consensus science,” in this
case — once they realized that the economic models of climate change wouldn’t
support aggressive intervention—the
environmental activists all of a sudden began pointing out all the
things that the UN-endorsed studies left out. Rather than
summarizing the cutting edge knowledge on climate science and mitigation
policies, the IPCC document turned into a bunch of misleading nonsense that
would give ammunition to deniers.
Nobel Laureate Inconveniently Blows Up the Paris Agreement
Last fall, we had another demonstration of the chasm between the actual
research and the media/political treatment: William Nordhaus won the Nobel
Prize for his pioneering work on climate change, on the same weekend that the
UN released a “special report” advising governments on how to try to limit
global warming to as little as 1.5 degrees Celsius.
There was just one little problem: Nordhaus’
Nobel-winning work clearly showed that the UN’s goal was insane.
According to his model, it would literally be better for governments around
the world to do nothing about climate change, rather than
enact policies limiting warming to 1.5°C. Rather than aiming for a 1.5°C
target, Nordhaus’ most recent model runs indicated that the “optimal” amount
of warming to allow was closer to 3.5°C. (To an outsider this might not seem
like a huge discrepancy, but it is absolutely gigantic in the context of the
climate change policy debate. Many activists would confidently predict that
even 2.5°C of warming would spell disaster for our grandchildren.)
The Guardian’s Slam Dunk
Ah, but I got the best confirmation of my quixotic position just this
month, when the Guardian
ran an editorial with this subtitle (my highlighting):
Does everybody see that? The people at the Guardian already know
what the policy answers are, without needing any help from the economists.
Conclusion
My economist colleagues who continue to urge for a “carbon tax swap deal”
in order to get rid of “onerous top-down regulations” and enact a simple
“price on carbon” are fooling themselves. Whether it’s in a ballot
initiative in Washington State—literally designed by an environmental
economist, or in the wonky
columns of Vox’s climate expert, in the political
calculus of Nobel laureate Paul Krugman, or in the
FAQ on the Green New Deal itself, the environmental activists in US
politics are making it quite clear that they will not settle
for such half-measures.
Market-friendly economists chiming in on the American political scene
should stop being useful idiots for the green socialists. Whatever the
possible merits of a theoretical carbon tax package—in which a regressive
hike in energy prices is matched dollar-for-dollar with corporate income tax
cuts, and decades of special-interest favoring regulations are thrown out the
window in the zeal for efficiency—this is all a moot point. If
market-friendly economists succeed in getting their readers to hold their
noses and support a carbon tax, they will all learn quite quickly that the deal has been altered.
