Thursday, October 29, 2009

Cash for clunkers was really expensive (on average)

I haven't seen the actual report, so their numbers might be bad, but I found this interesting:

"Taxpayers real cost for cash-for-clunkers"

Note that this is an incentive program for getting old, inefficient cars off the road.

What were the goals behind the program? That is, what were the benefits that gov't was seeking to achieve?

We have an estimate of the average cost here... what would we need to complete the analysis?

UPDATE: It seems that the White House is not too happy about the report.

Tuesday, October 27, 2009

Krauthammer on climate change

Below is an excerpt from an interview that Der Spiegel did with Charles Krauthammer.

Der Spiegel is a German weekly news magazine.

Charles Krauthammer is a (very) conservative columnist for the Washington Post. I won't tell you whether I agree with his politics (I hope you have no idea about my political leanings, or even if I have any), or his thoughts about nuclear power, but he is an excellent writer; always clear, always concise, often biting, usually witty. He's won the Pulitzer Prize, and has an M.D. from Harvard. He also has an undergrad degree in economics and poly sci. He left medicine in the late 70's to work for the Carter administration, at which time he also began writing (including writing speeches for Walter Mondale, Carter's VP).

Note: If you're going to read Charles K., you've also got to read Paul Krugman, the Nobel Prize winning economist and liberal columnist for the New York Times. As I've said before, read everything (left, right and center) and form your own opinions. You won't learn much if you only listen to people that you agree with.

I've cut most of the interview, because the topics don't relate to our class, but I found this portion interesting enough to share.


SPIEGEL: How do you solve problems like climate change if international institutions are failing?

Krauthammer: It's not the institution that does it, it's the confluence of interests. Where there is a confluence of interests among nations, as, for example the swine flu or polio, you can get well functioning international institutions like the World Health Organization. And you can act. Climate change is different, because the science remains hypothetical and the potential costs staggering.

SPIEGEL: You think it's a speculative theory?

Krauthammer: My own view is that there is man-made warming. On several occasions I have written that I don't think you can pump carbon dioxide into the atmosphere indefinitely and not have a reaction. But there are great scientists such as Freeman Dyson, one of the greatest physicists of the last hundred years, who has studied the question, who believes quite the opposite. The reason transnational action is so difficult is because the major problem with climate change is, A, that there is no consensus, and, B, that the economic cost is simply staggering. Reversing it completely might mean undoing the modern industrial economy.

I'm not against international institutions that would try to tackle it. But the way to go, at least in the short run, is to go to nuclear power. It's amazing to me that people who are so alarmed about global warming are so reluctant to adopt the obvious short-term solution -- the bridge until the day when we have affordable renewable energy -- of nuclear power. It seems to me intellectually dishonest. Nuclear is obviously not the final answer because it produces its own waste -- but you have a choice. There's no free lunch. If you want an industrial economy, you need energy. If you want energy, it will produce pollution. You can have it in two forms. You can have it dissipated in the atmosphere -- like carbon dioxide -- which then you cannot recover, or you can have the waste concentrated in one small space like nuclear. That is far easier to deal with. The idea that you can be able to create renewable energy at a price anywhere near the current price for oil or gas or coal is a fantasy."

Wednesday, October 21, 2009

Tropical forests, carbon credits and discount rates

There's a good read over at WorldWatch: "U.S. Under Pressure to Protect Tropical Forests".

The short of it:

To meet emissions reduction goals via cap & trade, polluters in more industrialized nations need to purchase carbon offsets.

Reducing rates of deforestation in less developed nations (allowing standing forests to stand) can offset carbon emissions cheaply and effectively.

Now, think about discount rates and incentives ... does this sound like "win-win"?

Note the discussion of risks. Ideas for how to mitigate those possibilities?

Loggerheads in trouble

From Oceana: 2009 Nesting Data for SE States Shows Dire Status of Loggerhead Sea Turtles

Note that some of the data comes from Topsail and some from Baldhead (beaches immediately to our north and south).

Lots of issues here besides the obvious non-use benefits from the existence of charismatic megafauna...

When we think of turtle population trouble, we might first think of marine issues such as turtles being incidentally caught or trapped in fishing gear ("by-catch") or the destruction of habitat. But land use activities are also critical to turtle populations. Here's the rub. Beach renourishment generates or maintains untold millions in tourist revenues and protects valuable coastal investment. We all benefit from such investments via economic impacts, the beneficial effect of wider beaches on insurance rates and our share of the land rents from wide coastlines. Yet this same renourishment threatens an important species. What information do we need in order to inform policy aimed at protecting beaches AND protecting turtles?

Tuesday, October 13, 2009

The Nobel Prize in Economics

On Monday, two American economists won the Nobel Prize in economics.

Read about it here at CNN.

Notably, Professor Elinor Ostrom (Indiana University) won the award for her work on governance of common property resources.

Check out this short YouTube video (a little over 8 minutes) for her take on the issue.

Her opposition to "top down" control,
her insistence that it doesn't have to be a "tragedy",
her notion of collective ownership and enforcement of property rights ("who is a member?"),
her push for adaptive management, trust in the other members, the importance of local knowledge and that the diversity of management institutions match the diversity of the resources being governed.


P.S. We'll cover the Gordon model that she references later in the term when we get to fisheries econ.