From consumption to conservation


As summer approaches and record-setting heat waves follow, there is little evidence that 2012 won’t continue the rising trend of world temperatures. As 5 of the hottest years on record have all occurred within the last decade, there is an increasing social and political effort to try to reduce carbon emissions in order to try to contain the phenomenon of climate change. The fundamental hurdle with reducing emissions internationally is what economists refer to as the prisoner’s dilemma or the tragedy of the commons. Every country will be better off if everyone else agrees to cut their emissions, however, if a country doesn’t cut its emissions and its neighbors do, it gains almost all of the benefits without any of the costs. If China, the EU and the US sign a deal limiting their carbon emissions, each party will have a strong political and economic incentive to cheat as long as the other two keep following the rules. It’s the reason why the Kyoto agreement and similar international treaties didn’t get anywhere; no country wants to be the first to pay the price for something which doesn’t benefit them unless everyone else does it too.


To tackle this quandary, many people have proposed a combination of stricter national and supra-national restrictions on carbon emissions in the form of carbon taxes and tradable permits. Although this isn’t likely to work due to the incentive issue explained above, it still wouldn’t resolve the problem if it did.

Energy consumption, like almost everything else follows the law of supply and demand. If the US and the EU were to reduce their consumption of carbon emitting energy sources, it would only serve to lower their world price and raise their consumption elsewhere. If energy source X yields one level of worldwide consumption at price Y, it would likely yield a similar level of consumption if its use were limited in some parts of the world because capital tends to be very mobile.

As has been demonstrated by the trade patterns in the age of globalization, production costs, such as labor and regulatory hurdles tend to follow a race to the bottom. Outside of a plan to have an expansive world government capable of enforcing emission standards in all parts of the world, lowering production of CO2 in one part of the world will just raise it somewhere else, much like a game of whack-a-mole.

Does this mean we have no way to deal with climate change outside of a supranational bureaucratic nightmare? Believe it or not, there is an alternative to a “food for carbon credits” scheme and it is both local and international; involves shared sacrifice and individual gain and most importantly, does not fall into the prisoner’s dilemma incentive trap. The solution is simple: we just need to consume a lot more gas, coal and oil.

There has long been an understanding that alternative energy sources will only ever become viable for large scale consumption when they will make financial and economic sense. The problem is that most renewable sources cannot compete with fossil fuels in terms of cost, efficiency and convenience. The only solution to climate change must involve making fossil fuels more expensive and renewable energies cheaper. Consuming more fossil fuels does just that.

The main effect of an increased consumption will be an increase in price. A bottom-up increase, unlike government created barriers cannot be circumvented by any bribes, special treatment or relocation.  An increase in price would also drive a large increase in investment of alternative fuels, which will, in turn, certainly produce cheaper and more efficient market offerings. A large spike in the price of fossil fuels will likely be followed by a precipitous drop in the costs of alternatives. Such resource transitions have been observed multiple times through history, such as the transition from whale oil to kerosene and from tin to aluminum.

It’s important to note that, as backed by both science and economic history, the transition from fossil fuels to clean alternatives will likely be very swift. According to most experts, we will need to reduce our carbon emissions by an excess of 80% by 2050 to stabilize the problem of climate change. Such a high long-term target suggests that continued emissions of CO2 are at least as harmful as their short-term intensity . We may be able to afford to emit massive amounts of carbon for another few years due to the lag between carbon emissions and climate patterns. What we can’t do is continue down the path we’re on; emitting massive amounts of carbon for another 50 years. The world could become a barren wasteland and it would all be the fault of hybrid-driving, organic farming, carbon-tax promoting conservationists who didn’t understand the economic consequences behind their actions.

Another important aspect of our solution is that all incentives are in the right place. Businesses would not be wrongly encouraged to invest in ineffective energy sources due to politically motivated subsidies and tax breaks, and consumers wouldn’t be forced to make any individual, consumption-limiting sacrifices.

Because no environmentally themed article could be compete without a call to action, we urge all our readers to turn on their air conditioning units, buy back their SUV and leave their lights on when leaving a room, preferably earth-friendly incandescent ones. While it may be hard to get back in the habit of having fun in our conservationist-driven culture, remember that it’s for the planet.


 *Editor’s note: We strongly suggest printing hundreds of text versions of this article to distribute around your neighborhoods. Remember, the higher the demand for trees is, the more will be planted in the future. And for God’s sake, do not allow anyone to recycle them.

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