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March 28, 2007

Comments

Andrew Lilico

As I understand it, the solutions preferred here involve "incentives, transaction costs and well-defined property rights". Now cap-and-trade is clearly a property-rights-based solution - there is a property right in pollution that is to be traded. In order for these trades to be economically valuable (and so create the incentives mentioned above), there must be scarcity. So it is essential to any system of property rights in pollution that there be a cap (no cap = no scarcity = no value = no incentive to limit pollution).

Given this, it is hard to see what your objection *in principle* is to a cap-and-trade system - such a system would seem to be what you are in favour of when you advocate the use of property rights and incentives. Rather, your objection seems to be that "we know the appropriate amount of carbon to be emitted and whether achieving that level is worth the cost". Perhaps. But if we are forbidden from acting by such ignorance, then we shall not be able to use property rights in pollution at all. So I am at a loss to understand what it is that you are really suggesting.

Care to help me out?

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SomeoneOrOther

"Yet the fuel efficiency argument is instructive. In terms of miles per gallon, the American automobile is no more efficient than it was many years ago, yet the cars are unmistakably better. What has happened is that the automobile efficiency gains have been traded, following consumer demand, for other things than gasoline usage – safety, amenities, passenger capacity to name but a few. When fuel efficiency was forced on the auto makers and customers via the CAFÉ regulations, the National Academy of Sciences found that the resulting downsizing of the fleet led to 2000 extra deaths on the road each year. That’s a big price to pay for a few more mpgs."


This is absolute nonsense, where is the evidence to suggest that car buyers are making or even can make a dichotomous choice between increased fuel efficiency and reduced safety, there is no correlation, specifications in respect to safety features are moving upwardly all the time, with better design, materials and technology products such as ABS, integrated impact protection, seat-belt pretensioners and airbags. The fact that road deaths have increased in spite of these advances is shocking in itself but cannot by any stretch of the imagination be attributable to disputable marginal increases in fuel efficiency, it is preposterous to make such an illogical assertion. Clearly driver standards and behaviour are the unexamined and most probable source of this increase, 'risk compensation' i.e. driving more dangerously as a result of the safety devices extending capabilities or mitigating consequences, and new driver testing incompatible with the demands of modern road conditions, vehicle capabilities and inter-vehicle dynamics.

The safety features themselves impact in the reverse direction by increasing weight, negating economy benefits. Larger and thus heavier vehicles, particularly SUV styles are considerably less aerodynamic, a huge factor itself in fuel consumption, though not so much a factor in todays stop-go-stop congested, aggressive road conditions as much time is spent at low speed or stationary.

Smoothing longer distance travel, ending bunching of traffic, stopping tail-gating, enforcing minimum distance between successive cars relative to their speed will all be necessary measures as they can demonstrably reduce accidents and their severity and at the same time reduce fuel consumption; equally effective for our current fleet and for any projected or as yet hopelessly over-optimistic science fiction alternatives.

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Kt is hard to see what your objection *in principle* is to a cap-and-trade system - such a system would seem to be what you are in favour of when you advocate the use of property rights and incentives. Rather, your objection seems to be that "we know the appropriate amount of carbon to be emitted and whether achieving that level is worth the cost". Perhaps. But if we are forbidden from acting by such ignorance, then we shall not be able to use property rights in pollution at all. So I am at a loss to understand what it is that you are really suggesting.

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