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Valyooo (99.60)

Economics vs Environment

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November 10, 2010 – Comments (12)

In my microeconomics class I am learning all kinds of good stuff. I have always loved capitalism and I still do. But the one part for me thats controversial is that it makes the assumption that although resources are limited, they always replenish. Yes, capitalism eliminates deadweight loss. But could taxes that make people consume less energy be good for future generations that will have to deal with a deteriorating environment, who are not yet alive to make that decision?

Also, there are other animals on the planet besides us. From a purely economic standpoint, capitalism is by far the best. But are there other considerations, such as not killing our own species? Individuals can not protect their species while acting in their own best interest, but governments can. If I stopped driving a petro based car, I would be behind my peers and wouldn't make the cut. But governments leveling the playing field would make that more attractive. In europe there are huge oil taxes, making people use less. Economically unsound (surplus of oil) but environmentally great

Thoughts?

12 Comments – Post Your Own

#1) On November 10, 2010 at 10:15 AM, Melaschasm (65.63) wrote:

If you take enough economics classes, you will come across this issue in a few different directions.

External costs (costs paid by someone not included in a transaction) are perhaps the strongest arguement for taxing and regulating economic behavoir.  The 'tragedy of the commons' is perhaps the best known example, and is the one which directly relates to environmental issues.

With your specific example about taxing fuel, so that there is more fuel available for future generations, there are a many things to think about.  Below I have listed a few examples.

Once we find a better replacement for oil, whatever is left will be wasted, and the taxes on it will have reduced economic growth without providing the future resource that was expected.

The distortion of various markets caused by taxing oil, could cause living standards in the future to be lower than they would have been after suffering from the loss of an important resource that is being protected by the tax.  For example, the time, money, and research being put into alternative energies is being taken from other areas, where it might have a much better impact upon current and future living standards.

Even if such taxes and regulations could have a positive impact on the future, a bigger more invasive government will tend to expand its power.  Such that it is likely such regulations and taxes will be implimented in a way that causes more harm than good.

 

 

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#2) On November 10, 2010 at 4:56 PM, Valyooo (99.60) wrote:

I didn't mean to not use all of the oil, I meant for less oil to be burned to destroy the earth less. I've learned about externalities but unfortunately my public finance teacher (also my macro teacher) is wayyy too liberal to even discuss both sides of the issue so I never know who's right. He constantly calls me a gold bug and says I'm cold hearted for not embracing welfarë

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#3) On November 11, 2010 at 12:51 AM, whereaminow (42.34) wrote:

If you are looking for rambling thoughts on these issues, I'm your guy! =D 

Your finance teacher sounds like a hoot.  Enslaving people through welfare payments is warm hearted?

But back to the topic at hand.

It is true that resources are scarce. However, everything we have in this world came from humans using their mind and labor to transform nature. This is true from the food we eat to the cars we drive.

So the environment around you - the environment that liberal professors are trying to save - is a product of the very capitalism that they despise. At the very first moment that society progresses past a Robinson Crusoe type existence, nature will be transformed.

I don't see any evidence that government levels the playing field.  If anything, it can eviscerate the playing field, reducing all to equal poverty and misery.  The maldistribution of wealth that liberal econ professors drone on about has only increased with further government intervention.  The G20 spends billions of $$ on private jets, paramilitary thugs, and cozy quarters whenever they meet.  Is that not a maldistribution of wealth?

I also found your comment that governments prevent us from killing our own specie curious?  Hasn't the rise of big government from the late 1800's to today resulted in the greatest slaughter of human life?  Billions dead at the hands of governemnts - from democratic nations to communist dictatorships.

+1 rec for provoking discussion!

David in Qatar

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#4) On November 11, 2010 at 3:59 PM, Valyooo (99.60) wrote:

Glad you commented, knew you would!

You completely misunderstood me on that last part.  I wasn't saying the government saves our own species...I am saying there are other considerations when consuming (mostly energy) besides economic efficiency; such other considerations include not killing humans and the planet.

 Like I was saying in Europe, when I went to visit, the high tax on gas: 1) In Amsterdam, nearly everybody rides bikes.  There were bike parking lots with thousdands of bikes, and bike traffic lights.  There were few cars 2) In Rome, people drove small, gas efficient cars.

What my basic point comes down to, is when I speak to my girlfriend (shes an environmental science major) and she talks about how humans will probably go extinct eventually from keeping up this kind of behavior, what is my counter argument other than "it is efficient" ?

Also, what if I want a Robinson Crusoe type environment?  Other humans are killing my planet without my consent.

 Even if I didn't want to be that simplistic, life in the 1800s was not destroying the atmosphere this quickly.  Eventually we are going to destory the Earth by using all of its resources without letting them replenish, which 1) Kills other species, against their consent 2) Messes sh!t up for future generations, before they are born to protest this 3) Destroys the planet

Even if you don't care about other animals, or the state of the planet, then what about future generations?  Like the ones that you said shouldn't have to pay off the debt we incurred for them?

P.S., I don't really have much of an opinion on the matter.  Whenever it comes to free market capitalism versus other political/economical models, I am pretty good at debating it, but I don't know how to win an argument with my girlfriend when my response to killing everything is "Its is efficient"

I am interested in your responses. :)

 

P.P.S, I got into a fight with my teacher and my whole class about why Social Security is communist and enslavement, and mathematically proved how it creates price distortions, why people need to take responsibiltiy in to their own hands, exampled of why these keynesian systems dont work, etc etc etc, and everybody told me to shut up...very discouraging.

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#5) On November 15, 2010 at 9:55 AM, Melaschasm (65.63) wrote:

Historically, communist governments have done much more harm to the environment than capitalist countries.  It is very likely that the inventions to protect the environment will come from free capitalist countries not heavily regulated and taxed communist countries. 

In my experience, most people who believe that CO2 is destroying the world behave as if it is a religious belief.  If this is the case with your girlfriend, you will likely be better off asking her questions that provoke thought than to try to convince her she is wrong.

College is a very difficult place to believe in freedom and capitalism because the teachers are paid by the government, and the students have not directly suffered under the heavy hand of government regulation.  I recommend having fun with the debates and think of them as a chance to improve you ability to debate and think logically, rather than as a way to convince people you are right.  Then when you do convince someone, that is just a bonus (although they probably will not admit that you changed their minds).

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#6) On November 16, 2010 at 12:20 AM, whereaminow (42.34) wrote:

Valyooo,

 What my basic point comes down to, is when I speak to my girlfriend (shes an environmental science major) and she talks about how humans will probably go extinct eventually from keeping up this kind of behavior, what is my counter argument other than "it is efficient" ?

I would consider "it is efficient" to be a poor counter argument.  That's a utilitarian perspective that I find weak.  I could make several arguments that things would be better if we did X, but X might involve using violence or fraud.  That would be unacceptable.

I think the best place to start is to understand the relationship between the environment and property rights.  The Tragedy of the Commons is a good place to begin, and I'm sure your lady is familiar with it.  In that essay, the author correctly points out that unowned or communal resouces are always squandered. 

The solution should be rather obvious (property rights), but academia doesn't like this solution. The academic world thrives on envy, and like all people that thrive on envy they can't stand private property (at least, other people's private property.)

Also, what if I want a Robinson Crusoe type environment?  Other humans are killing my planet without my consent.

You don't need to take it that far. If we lived in a free society, and someone pollutes your water, air, land, etc. you could seek damages for the destruction of your property.  It might be hard to prove, but there is no evidence that government does a good job of prosecuting it either.  In fact, the government's solution is to tax pollution, rather than prosecute it.  (It should be obvious tht the reason for this is so they have more money, not you.)

Eventually we are going to destory the Earth by using all of its resources without letting them replenish, which 1) Kills other species, against their consent 2) Messes sh!t up for future generations, before they are born to protest this 3) Destroys the planet

Well, eventually the environazis and the government will destroy the environment because they don't respect property rights. As for as species, they go extinct whether humans are around or not.  Species come and go.  I would recommend The Greatest Show on Earth by Richard Dawkins.  Nature can be cruel. Species adapt or die.  Such is the world we live in.  There is certainly no reason for the environazis to enslave us all over it.  If you care about a species, buy a few of them and breed them. What's so hard?  We do it already with everything from dogs to fruit flies.

but I don't know how to win an argument with my girlfriend when my response to killing everything is "Its is efficient"

The first step to winning arguments is to have no concern about winning the argument.  Understand the theory behind a free society based on property rights.  Understand that anything that is not a completely free society relies on coercion/violence at some level to compel you to act involuntarily to suit others.  Make a decision about what kind of society you can advocate and have peace with yourself.  After that, if your girl or your econ professor isn't interested, forget about it.  The idea that one person can save the world and make a great change is mostly nonsense.  The only way to truly change the world is to create something of value to others.  The man who invvented the car, the microwave, etc. did more for the world than all the econ professors, environazis, and politicians combined.

David in Qatar

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#7) On November 16, 2010 at 12:51 AM, Valyooo (99.60) wrote:

I think you guys are misunderstanding me entirely.  Neither me or my lady are pro-socialism in any way.  I am in no way saying that government control will help, nor am I saying private property needs to be violated, nor am I trying to win an argument.  What I am simply saying is that even though the free market (or the socialist market, or any market) allows for people to destroy the earth by using all of this energy and pollution etc, is it wrong?

Her point is that humans are destroying the earth.  What I am saying is should people be doing this?  We have the economic right to destroy the environment if we choose to do so, and produce as much as we wish.  However, does this mean there is nothing wrong with it?

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#8) On November 16, 2010 at 12:53 AM, starbucks4ever (98.82) wrote:

Yep. Let's privatize air. Problem solved!

Seriously, in the 21 century the problem with environment is population growth. It hasn't always been that way. Until recently, it was economic growth that caused trouble. But today technological solutions have been found and dirty factories will soon be things of the past. But if population continues to grow exponentially, we'll soon be walking on each other's heads. 

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#9) On November 16, 2010 at 1:02 AM, whereaminow (42.34) wrote:

I think you guys are misunderstanding me entirely.

It appears that's the case. I'm happy to try again though.

What I am simply saying is that even though the free market (or the socialist market, or any market) allows for people to destroy the earth by using all of this energy and pollution etc, is it wrong?

This is the part I don't get. Who is "destroying" the earth?  If you drill for oil, you are not "destroying" the earth.  If we run out of oil, you still haven't destroyed the earth. It just strikes me as a weird way to frame the argument.  It just sounds like the hyperventilations of a Code Pink rally.  Even if you cover the world with CO2, nuke it seventy times over, etc, you still haven't destoryed the earth.  You've just made it real difficult for humans to live there.  Not impossible, but very difficult. 

Maybe some of the answers you are looking for are in the Anti-Environmental Manifesto.

I guess I would say, no, no one has the "economic right" to destroy the environment. [There are no economic rights, anyway.]  You don't have the right to pollute the air I breath.  You don't have the right to contaminate my water.  You do have the right to use and exploit any natural factor as long as it does no injury to me.  I do have the right to seek damages against you if this happens.  However, like I said, that's not the way it is currently handled or the path taught at college.

David in Qatar

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#10) On November 16, 2010 at 1:06 AM, whereaminow (42.34) wrote:

zloj,

Yep. Let's privatize air. Problem solved!

No. Air is abundant. Property is a concept developed by humans to allocate scarce resources.  Air is not a scarce resource.

If someone pollutes the air, and it damages my crops or my lungs, that person has invaded my property rights. The crops and my lungs are scarce resourse, not the air. 

Does that help clarify the position?

David in Qatar

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#11) On November 16, 2010 at 1:56 PM, Valyooo (99.60) wrote:

Awesome, thanks

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#12) On November 16, 2010 at 2:13 PM, devoish (99.10) wrote:

 

If we lived in a free society, and someone pollutes your water, air, land, etc. you could seek damages for the destruction of your property. 

I do have the right to seek damages against you if this happens.

Who would help us settle our claims of damage? Best shot? Something we will not call Government, but is?

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