Well, this is how I look at the problem. First, I start by looking at the dynamics of politics and what is and isn’t possible. For example, we have plenty of evidence that when push comes to shove, people simply will not tolerate being taxed for a ‘greater good’ - especially not in times of financial difficulty.
For example, even today people who strongly believe that we should ‘do something’ about global warming are complaining that gas prices are too high. And even the Obama Administration, which claims to be seriously committed to doing something about global warming, is trying to do everything it can to goose the economy and lower gas prices.
For example, one thing you CAN do to make petroleum more expensive is to simply buy it up and sequester it. When the U.S. fills the Strategic Petroleum Reserve, gas prices go up. When it empties the reserve, gas prices go down. Simple supply and demand - additional supply comes on the market, and prices drop.
So what is the Obama administration thinking of doing right now? They’re thinking of opening the petroleum reserve to push gas prices down. This will inevitably drive up consumption, and make global warming worse. I’m sure they know this, but political considerations (it’s an election year) override the environment. They always do.
Now imagine what will happen to a government who puts in place extremely expensive tariffs to control carbon. The only time they could pass such laws would be during an economic boom when people aren’t focused on the economy. But as soon as times get hard again, those tariffs will either be removed, or they’ll be ignored, or the administration that supports them will be kicked out in favor of one that will repeal them.
So I start with the assumption that chasing a dream of some worldwide carbon tariff and tax regime is impractical, and even if it was attempted it would undoubtedly be hijacked and perverted by special interests, just as the U.S. stimulus package was, and how the tax code and regulatory structure of the U.S. has been hijacked to the benefit of big business and big labor.
Second, you have to accept that every drop of oil that’s in the ground is going to be drilled and extracted, until it no longer makes economic sense to do so. There is simply too much money in play for people to voluntarily walk away from the cheapest sources of energy. Environmentalists tend to agree, but their solution it to attempt to tax and regulate it until it’s too expensive to use. As I said above, I think that’s an unworkable strategy in a competitive global economy.
So, the other option is to make the alternatives cheaper. Environmentalists also tend to agree with that, but their solution seems to be to tax people and use the money to ‘invest’ in research. I’m not strongly opposed to R&D funding, but I am strongly opposed to government micro-management of the R&D infrastructure and of the government getting involved in picking winners and losers and in choosing the best technology. They aren’t competent to do so.
Given all those constraints, here are some realistic options:
- To stimulate R&D, the government can start funding prizes for various efficiency achievements. The prize won’t demand a specific technology - it’ll be more like, “10 million dollars to the first person or company that can make a road-worthy vehicle that passes standard safety regulations and yet achieves the equivalent of 120mpg on a 5 mile open loop road.”
To get smaller entrepreneurs, you can have smaller prizes, like $100,000 to the first person who can make a battery flexible enough to be sewn into clothing but which can power an 800ma device for four hours". Look at little incremental gaps in the infrastructure, and incentivize people to fill them.
Instead of funding specific technologies like hydrogen fuel cells or thin-film solar cells, simply announce a prize of 100 million dollars to the first company that can power a standard car on electricity alone for 500 miles within certain constraints (must accelerate to 60 in no more than 12 seconds, must carry four passengers, must not be more than X in length). Then let the market decide whether to use fuel cells, or batteries, or ultra-light materials, or new motor designs, or whatever.
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Maintain funding for global warming research. We need to understand it better. However, I would clean up the field, which has been infused with politics and political activists, and the results of which are increasingly being viewed skeptically by the public. I would go out of the way to include climate skeptics along with climate researchers that believe warming is happening. I’d demand that all data created with public funds be open-sourced, along with the source code for all climate models. I would set up a commission to ensure transparency. If this is the most important issue of our time as the climate alarmists say it is, then it needs to be debated openly and the public has to be convinced that the science is sound.
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Fund studies of the costs of coping with climate change. Frankly, I think the most likely path we’re on is one where there will be moderate climate change that will have a negative effect on some parts of the world. Let’s start figuring out how to minimize those costs and plan for the disruptions. More information on what the costs are likely to be will also help sell climate change avoidance policies if necessary.
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Examine and remove regulatory barriers preventing alternative energy. That includes things like opposition to the Nantucket wind farm, excessive regulatory barriers in place for nuclear power, tariffs that are hurting alternative energy such as the tariffs on sugar products that protect corn producers in the U.S. at the cost of cheaper, more efficient biofuels, or this Obama administration policy that may put a solar company out of business.
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Ramp up nuclear power. We still don’t have a GHG-free alternative energy source that can come close to replacing even the large minority of our energy consumption, other than nuclear power. Nuclear power no longer requires gigantic power plants with huge liquid-cooled piles. New designs like the Gen 4 module are small generators that are buried underground, and turn water into steam to power a generator. They can power small towns or industrial complexes without needing to be connected to a grid. They last for 10 years, then they are dug up and removed by truck and a new one put in place. No waste remains, and the fuel is recycled.
We should be encouraging their use in countries like India and in the 3rd world where the electrical infrastructure is weak, and for remote industrial sites in lieu of gas generators.
- Wait. The cost curve for oil is going up, and the cost curve for alternate energy is coming down. When those two curves cross, major changes happen rapidly. Look at how quickly natural gas is displacing coal in the U.S. The same thing will happen to oil at some point. It’s also still an open question whether it would be better and more cost-effective to simply deal with the damages caused by global warming than to try and stop the warming from happening in the first place.