Business & Technology

Economics and environmental protection

Nobel winner explains why markets can’t replace public goods

From Reuters: Societies should not rely on market forces to protect the environment or provide quality health care for all citizens, a winner of the 2007 Nobel Prize for economics said on Monday. ... "The market doesn't work very well when it comes to public goods," said [Professor Eric] Maskin ... Mechanism Design Theory is one explanation for why even a well-regulated market with external costs priced via Pigovian or green taxes is inadequate in areas like environmental performance or health care. Certain types of goods -- public goods -- simply cannot be allocated efficiently through market mechanisms alone. This was known long before Mechanism Design Theory came along. For example, the U.S. spends more on healthcare than any other nation, and gets worse results. There are various reasons for this, but one is that a competitive market in health insurance tends to provide more insurance and less healthcare than public insurance mechanisms.

Activists threaten to sue Apple over chemicals in iPhone

Greenpeace claimed recently that Apple’s much-hyped iPhone contains dangerous levels of phthalates, chlorine, and bromine, and now another environmental group, the Center for Environmental Health in Oakland, Calif., has sent the company a formal warning claiming that Apple violated California’s Proposition 65, which requires companies to warn consumers of the risk of toxic exposure. “There are chemicals in some of the parts that come with the iPhone that are well known in California to cause birth defects,” said CEH’s Michael Green. “We want those chemicals out.” Apple has 60 days to clean up the phones or warn consumers about them; …

Connecting the dots: Part I

From black to white: An argument for green-collar jobs

"Spiritually fulfilling, ecologically sustainable, and socially just" is the title of a recent speech by Van Jones, who has been appearing in strategic places for a few years now. As cofounder of the Ella Baker Center in Oakland, he has been attempting to fight environmental pollution that has been poisoning the residents of inner-city areas in Oakland and all over the country. As such, he is in a unique position to bridge a rather wide chasm: the African-American community and the environmental community. In my previous post, I put forward a utopian realist agenda that, I hypothesized, would solve many of our global environmental problems -- that was the realist part -- but that was completely utopian politically. But another definition of utopian is envisioning a better place -- and I want to pursue the possibility in this post that such an agenda would create a basis for a widespread coalition, of the sort that Van Jones has been pursuing. For instance, he has been lobbying for green-collar jobs legislation that could be used to increase employment in poor areas while helping to decrease greenhouse-gas emissions. Jones shows up in another interesting place: in a critical section of Nordhaus and Shellenberger's essay, "The Death of Environmentalism" (p.26): Van Jones, the up-and-coming civil rights leader and co-founder of the California Apollo Project, likens [labor unions, civil rights groups, businesses, and environmentalists] ] to the four wheels on the car needed to make "an ecological U-turn." Van has extended the metaphor elegantly: "We need all four wheels to be turning at the same time and at the same speed. Otherwise the car won't go anywhere."

Largest U.S. garbage hauler greens operations

Strange but true: Our trash is going green. The nation’s largest garbage hauler and landfill operator, Waste Management Inc., has announced plans to make its operations more eco-friendly. The company hopes to double its landfill methane-to-electricity production by 2020, boost the fuel efficiency of its fleet by 15 percent by 2020, process more recyclables, and set aside more land for wildlife habitat. Now we almost feel bad that our lifelong goal is to put them out of a job.

'The ABCs of rainforest destruction'

Raising a ruckus about agrofuels at the Chicago Board of Trade

From the The Chicago Tribune: Police this morning arrested five people who scaled the Chicago Board of Trade building in the Loop and unfurled a banner to protest the destruction of the world’s rain forests. The demonstrators, members of the Rainforest Action Network … displayed a 50-foot banner protesting three U.S. agriculture companies. The protest was part of a campaign to "halt agribusiness expansion in the rain forests of South America, Southeast Asia and the Pacific," according to a statement by the group. The protest targeted agribusiness firms Archer Daniels Midland Co., Bunge and Cargill. Yes.

Warmer weather causes Big Retail to lower profit forecasts

A dozen leading U.S. retailers are reducing profit forecasts and blaming warmer weather for contributing to slumping sales. Retailers plagued by lower-than-expected September earnings included Nordstrom, Target, American Eagle Outfitters, Limited Brands, and JCPenney, all of which have had trouble moving autumn and winter clothing. Our suggestion: prove those reduced-profit predictions right by buying your winter shorts at that cute local place down the street.

The meaning of global warming, part two

Stabilizing climate means embracing technology, public investment, and global economic development

The following is a guest essay by Ted Nordhaus and Michael Shellenberger, the latest in the ongoing conversation about their new book Break Through: From the Death of Environmentalism to the Politics of Possibility. —– This week saw a watershed moment for those of us committed to moving environmentalism from a politics of limits to a politics of possibility. Senator Barack Obama proposed a $150 billion investment to develop and deploy clean energy technology on a scale approaching the challenge we face. In doing so, he has become the most recent of several national political leaders to go beyond the …

AEP settlement exempts company from enforcement for 10 years

Earlier this week brought news of a settlement agreement between utility giant American Electric Power and the U.S. EPA in which the company agreed to install some $4.6 billion in pollution controls at some of its power plants and pay over $70 million in penalties and cleanup costs. Today, The Washington Post reported that the agreement contained language exempting the company from enforcement for the next 10 years under the same rule it was sued for allegedly not obeying. The new-source review rule mandates that utilities upgrade pollution controls when building or significantly renovating a power plant. “It just shows …

Fascinating, but for the wrong reasons

Shellenberger & Nordhaus echo flawed economic assumptions

I just finished reading Shellenberger & Nordhaus' latest, and while I realize I am a bit late to the party, I think they say some fascinating things -- perhaps not for the reasons they intended. S&N manage to succinctly distill an awful lot of the ideas that are core not only to policy debates on carbon, but to policy discussions of any major change to the economy. Understanding these biases is critical to understanding why S&N write what they write, but also why they are so deeply wrong.