Some environmentalists claim that more environmental protection always or almost always is a means to a stronger economy. That’s silly.
Digging coal out of the ground, burning natural gas to power cities, and cutting down trees to build houses all have environmental tradeoffs and yet, from a pragmatic standpoint, need to be done to keep the economy humming.
It’s worth noting, too, that while the economic effects of policies like endangered-species preservation are complicated, there’s no doubt that the successful effort to protect the spotted owl cost the United State some 30,000 timber-related jobs.
That said, there’s no doubt that sacrificing wealth gains for a better environment can be worth the short- and long-term costs, particularly in well developed economies.
And, sometimes, less than sound economic practices can result in real economic benefits.
For example, one wealthy suburban county near Washington, D.C. has forbidden high-density development in half of its land area in favor of keeping some farms operating. These actions help preserve an agricultural way of life, keep the area greener, and increase the value of developed land. This type of environmental protection has value, particularly on a local level, in part for the increased quality of life such policies afford taxpayers.
When it comes to the most complicated environmental problems, however—ones the management theorist C. West Churchman called “wicked problems”—slowing economic growth to achieve greater environmental protection is almost certainly a bad idea.
Climate change resulting from human activity is a perfect example.
Climate change’s long-term consequences are uncertain and the efficacy of proposed solutions will be evident only in hindsight. Many would argue that these facts don’t support reason to delay action. Given the observable consequences of climate change (e.g., increased coastal flooding) as well as potential future consequences (e.g., shifts in agricultural production), politicians who fail to take action on climate change will pay a political price.
So-called solutions which net economic harm are unlikely to be effective though, even if they result in short-term decreases in greenhouse-gas emissions.
If the U.S. were to implement a crash policy to stop using fossil fuels tomorrow, it more than likely could “succeed” by building out a large number of subsidized nuclear power plants and offering massive subsidies for buyers of electric cars. The costs of putting these solutions into practice and making them viable, however—likely to the tune of several trillion dollars—would swamp the economy and move resources away from better uses, such as education, transportation infrastructure, and national defense.
In any case, such solutions will only work in countries with well-established economies.
Insisting that all countries use a one-size-fits-all “solution” would, for all intents and purposes, mitigate the majority of the global poor’s ability to increase their own standard of living.
As my colleague Catrina Rorke has argued in The American Conservative, getting societies wealthy enough to move away from fossil fuels may, paradoxically, require the development of some fossil fuel infrastructure in those same places. Sometimes, in any case, even relatively dirty fossil fuels can be cleaner and more environmentally beneficial than traditional practices such as clear-cutting forests to provide wood for cook-fires.
Even modest efforts in developed countries—like big-government-oriented, crony capitalist cap-and-trade schemes—will continue to be bad ideas, simply because they’ll leave us with fewer resources to cover future costs, while doing little to solve this global problem.
By contrast, policies that enhance and expand economic productivity—like reducing capital gains taxes and maintaining a strong basic research establishment—will tend to make it easier to deal with the climate change issue, even if these policies have no direct impact on greenhouse gas emissions.
Unless and until a definitive, sustainable solution to climate change is identified, the best policies are those that are likely to make a future society more flexible and open to innovative solutions.
A number of potential solutions are worth considering including a revenue-neutral carbon tax (with proceeds used to cut taxes on productive activity), the offering of prizes for major energy-production breakthroughs, and targeted investments in a “smart” grid that would distribute power more efficiently.
A thriving economy will have plentiful resources to deal with climate change, whereas a poor one will have a difficult time making even modest impacts on this important issue. Economic and environmental interests can conflict; but when it comes to climate change or any other “wicked” environmental problem, policies that aid our overall economy will almost always be the best “solution” for the environment.