Thursday, July 17, 2008

BHI's Tuerck on Global Warming Legislation

In this month's edition of Carolina Journal, David G. Tuerck argues persuasively that global warming alarmists ignore -- if not diminish --- the economic costs of climate change mitigation. The tendency among activists and others calling for more aggressive policies against GW rests on a claim that going green will be an economic stimulus. That's not the case.

Tuerck contends the foundation of such economic analysis is based on flawed methodology. The debate could use a dose of more rigorous cost-benefit analysis, a domain left better to economists than environmentalists.

Earlier this year, the Beacon Hill Institute conducted a peer review of the Center for Climate Strategies' (CCS) proposal for climate change legislation in North Carolina. The whole report is available here. Tuerck explains his critique of the NC-CCS:
And the trouble with [the NC-CCS] representation is that it doesn’t make any sense. You can’t create jobs that are good jobs that are adding to the state economy by shifting workers from more productive to less productive activities. You can’t create good jobs, the kind of jobs we want to create, by increasing energy costs, by increasing the price of electricity, by imposing what amounts to new taxes. This is not the way to create jobs. What you have to do, in order to analyze what will really happen, is look at the cost-increasing effects of the legislation, look at the taxes that would be implicitly imposed, and sort out the negative effects that these actions would have on the state economy. You can sort out those effects, as we have tried to do, and you can identify them for their negative effect on jobs and the like. And then, when you’re done with that, you can ask the question, “Is it worth it to pursue this legislation given the negative effects that will actually be imposed?” All these claims about job creation and the like, though, are bogus claims and unsupportable by even the most na├»ve sort of economic analysis.

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