Bad Energy Policy from Both Ends of the Political Spectrum
This past Wednesday, Michael Boskin, Stanford economist and chair of the Council of Economic Adivisors under Bush 41 had an op-ed on green jobs and industrial policy in the WSJ. He said a bunch of things that nearly all economists would agree with: government should fund basic R&D — which the market will not adequately support on its own — but should generally stay out of downstream markets. And government shouldn’t pick specific technologies or firms as winners in market competition. So far, sounds great.
But it’s what Mr. Boskin doesn’t say that tips his hand as a partisan political advocate. He doesn’t mention that nearly all scientists believe that carbon dioxide is a major cause of climate change, or that nearly all economists agree that the best way to deal with the threat is to put a price on greenhouse gas emissions, through a tax or cap-and-trade program. He also doesn’t mention that the Republicans have blocked those most-efficient responses to the environmental threats, so the Democrats are responding by ramping up much-less-efficient alternatives, as I pointed out in a Bloomberg Business Class op-ed earlier this week.
I know that economists close to candidates in both parties pull their punches on their own side’s inconsistencies, but it really does make it difficult to have a reasoned debate when the presentations from experts get so one-sided. If you aren’t annoying politicians on both ends of the spectrum, you probably aren’t telling the whole story.
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Severin Borenstein View All
Severin Borenstein is Professor of the Graduate School in the Economic Analysis and Policy Group at the Haas School of Business and Faculty Director of the Energy Institute at Haas. He received his A.B. from U.C. Berkeley and Ph.D. in Economics from M.I.T. His research focuses on the economics of renewable energy, economic policies for reducing greenhouse gases, and alternative models of retail electricity pricing. Borenstein is also a research associate of the National Bureau of Economic Research in Cambridge, MA. He served on the Board of Governors of the California Power Exchange from 1997 to 2003. During 1999-2000, he was a member of the California Attorney General's Gasoline Price Task Force. In 2012-13, he served on the Emissions Market Assessment Committee, which advised the California Air Resources Board on the operation of California’s Cap and Trade market for greenhouse gases. In 2014, he was appointed to the California Energy Commission’s Petroleum Market Advisory Committee, which he chaired from 2015 until the Committee was dissolved in 2017. From 2015-2020, he served on the Advisory Council of the Bay Area Air Quality Management District. Since 2019, he has been a member of the Governing Board of the California Independent System Operator.
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Thanks Severin for your posting and article. So, since you laid down challenge for pointing out inconsistencies ….I can’t have a discussion with Republicans when they deny there is a problem called climate change or other environmental impacts of fossil fuel use. If they thought there was a problem (other than high gasoline prices) we could discuss options, as the positions of those recognizing the problem are not one-sided – nuclear yes or no, CCS or not, cap and trade or command and control, renewable subsidies or not – but on the other side of the aisle (in Bizzarro world) there is no concern for climate change, health and environment impacts – just burn baby burn and that is their one (supply) side. There is no fair and balanced for the “Rs”; it is frustrating to pretend there is anything other then a blind devotion to a tragedy of the commons.