The intellectual bankruptcy of the Cato Institute
“They have learned nothing, and they have forgotten nothing.” So the French statesman Talleyrand supposedly said of the pre-revolution monarchy. The words apply equally well to that bastion of libertarianism, the Cato Institute.
Over the years, I have debated one of their senior scholars, Jerry Taylor, many times. He is probably the craftiest debater that the delayer/inactivist side has. But since, like all delayers, his positions are frozen in stone by his ideology, those positions inevitably become farther and farther disengaged from the reality of a (climate) changing world and hence less and less compelling. That is most clearly evident in my latest debate with him, online at Google’s new Knol site (aka the would-be Wikipedia killer).
Let’s assume for the sake of argument that global warming is a serious problem and that reducing emissions is cheaper than adapting to climate changes. Neither argument is persuasive to us …
It’s not altogether obvious to us that oil is becoming scarcer … Regardless, if and when oil begins to disappear — or more accurately, if and when market actors believe the oil scarcity is on the horizon — oil prices will go up accordingly and the market will adjust without any need for government assistance. So while “peak-oil” arguments come and go with the related booms and busts in oil markets, there is no need for a policy argument about oil depletion.
In short, global warming isn’t a problem, and peak oil, if it ever occurs, is self-correcting. What a blissful world the Cato folk live in. Either problems don’t exist or the all-powerful, all-knowing free market will fix them. Now you might think that recent events would cause Cato scholars to at least slightly temper their blind faith in the power of greed to set all things right. But you would be wrong. Indeed, the most jaw-dropping paragraph in Taylor’s “rebuttal” is the last one:
We return then to our original argument. To wit, we know that, as a general matter, free markets work better than socialism. We know that market allocation of goods and services leads to better economic outcomes than political allocation of the same. Only if there is a market failure — that is, only if there is something peculiar about energy markets that makes prices “wrong” — is there intellectual room for the argument that government intervention will improve efficiency. We are still waiting for that argument from Joe.
Seriously. The lines in boldface are not some parody by The Onion. OK, you knew that because those lines weren’t (intentionally) funny. But just click here if you don’t believe me that a real live person wrote that paragraph in an effort to persuade people to his point of view. My response:
Jerry says this with a very straight face in spite of recent events that should have ended forever the notion that the unfettered marketplace always knows best. In fact, the unfettered market has brought us to the worst economic crisis since the Great Depression. Had the federal government combined with the world’s other major governments not acted quickly, the entire financial system would almost certainly have collapsed under the unrestrained greed of brand-name market actors who had, until now, been considered incredibly sophisticated.
For Jerry, Cato, and libertarians the choice is between some abstract free-market or socialism. For the rest of us, the choice is between catastrophic climate impacts and intelligent government-led investments in clean energy. I have again and again described the market failure. More importantly, so have our leading scientists. I agree with the world’s leading climate scientists that we need to keep carbon dioxide concentrations at or below 450 parts per million, which means global emissions must peak around 2020-2025, and we need a 50 percent cut in global carbon dioxide emissions from current levels by mid-century. It also means this country (and all industrialized nations) must return to 1990 levels of emissions by 2020 and achieve an 80 percent cut by mid-century, which U.S. politicians from Arnold Schwarzenegger to Barack Obama have embraced. I support such domestic action and international action, and I have repeatedly proposed both near-term and medium-term strategies to get there.
It is time for Jerry and Cato to stop dancing around this central issue. What carbon dioxide concentrations target does Jerry propose? What emissions target does Jerry propose for the nation and the world both by 2020 and 2050? What climate policies should the nation and the world adopt to achieve those targets? If he won’t answer those questions, then he is embracing unrestricted greenhouse gas emissions, and those interested in avoiding catastrophic climate impacts will need to look elsewhere than Cato.
Let me also excerpt here my brief rebuttal to Taylor’s dangerous to do-nothing approach on peak oil:
The “market” in oil consumption doesn’t actually adjust quickly because our transportation system is 97 percent dependent on oil. You simply cannot change the transportation system or the fuel delivery system fast enough to avoid devastating economic impacts.
Replacing oil in the transportation sector requires strong government action two decades before a peak because of the time needed to replace vehicles and fuel infrastructure. That was the conclusion of a major study [PDF] funded by the Department of Energy in 2005 — yes, the Bush DOE — on “Peaking of World Oil Production.” The report notes: “The world has never faced a problem like this. Without massive mitigation more than a decade before the fact, the problem will be pervasive and will not be temporary. Previous energy transitions (wood to coal and coal to oil) were gradual and evolutionary; oil peaking will be abrupt and revolutionary.”
The same central point is true about global warming. Act now, or face very harsh consequences. The global warming situation is, however, much worse than the peak oil situation, since when the climate changes, it does so irreversibly on a timescale of millennia.
My full reply to Taylor is here, “Cato proposes a do-nothing energy and climate strategy.”