Paul Krugman: The Big Green Test – NYTimes

Paul Krugman

On Sunday Henry Paulson, the former Treasury secretary and a lifelong Republican, had an op-ed article about climate policy in The New York Times. In the article, he declared that man-made climate change is “the challenge of our time,” and called for a national tax on carbon emissions to encourage conservation and the adoption of green technologies. Considering the prevalence of climate denial within today’s G.O.P., and the absolute opposition to any kind of tax increase, this was a brave stand to take. But not nearly brave enough. Emissions taxes are the Economics 101 solution to pollution problems; every economist I know would start cheering wildly if Congress voted in a clean, across-the-board carbon tax. But that isn’t going to happen in the foreseeable future. A carbon tax may be the best thing we could do, but we won’t actually do it. Yet there are a number of second-best things (in the technical sense, as I’ll explain shortly) that we’re either doing already or might do soon. And the question for Mr. Paulson and other conservatives who consider themselves environmentalists is whether they’re willing to accept second-best answers, and in particular whether they’re willing to accept second-best answers implemented by the other party. If they aren’t, their supposed environmentalism is an empty gesture. Let me give some examples of what I’m talking about. First, consider rules like fuel efficiency standards, or “net metering” mandates requiring that utilities buy back the electricity generated by homeowners’ solar panels. Any economics student can tell you that such rules are inefficient compared with the clean incentives provided by an emissions tax. But we don’t have an emissions tax, and fuel efficiency rules and net metering reduce greenhouse gas emissions. So a question for conservative environmentalists: Do you support the continuation of such mandates, or are you with the business groups (spearheaded by the Koch brothers) campaigning to eliminate them and impose fees on home solar installations?

Rima NYT Comment SmallI care what happens to our planet. I really do. But, as I’ve pointed out before, we can’t take care of our planet if we don’t first take care of getting our government in order. In order is not how our government is. In order, is the last thing our economy is in.

Greening our planet should be a priority, but only after making sure our people have a way of surviving, in a nation whose government isn’t broken. Democrats risk losing the voters’ engagement by continuing to be absent from the conversation, or conversing about issues no one immediately cares about. We need jobs that pay a decent wage. We need unemployment benefits to be extended. Remember, since the December budget, there has been virtually no effort to extend unemployment benefits. Where are those millions of unemployed? How are they surviving? How about the self-employed? How are they surviving? Who among us, doesn’t know people who are behind on their mortgages or even rent? Student loans? Jobs for teens?

To read the full op-ed and the rest of my comment, click here.

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