Thoughts on economics and liberty

Extract from Robert Zubrin’s Merchants of Despair on how “carbon remedies” will DESTROY the poor

I have touched upon Zubrin here. Now an extract from his on how the carbon remedies will impose a deadly impact on farmers.

Not just energy prices, therefore, but prices of fertilisers and pesticides. Do read his book. He has extensive sections on the benefits of GM and biotechnology.

Let Indian farmers reject the climate hysteria outright. CO2 is a huge blessing – being plant food. If farmers fight this hysteria, there is a chance that GOI will join Trump to shut down down IPCC – which is the most deadly Malthusian group assembled diligently over the past 50 years.

And btw, the source of Greenpeace and modern ideological environmentalism in Nazi ideology, eugenics and anti-poor Malthusianism has been clearly documented in the book – this is a superb resource for me since very rarely have so many details been brought together in one place.

===EXTRACT===

HUMAN SACRIFICE FOR WEATHER CONTROL

The cure of choice for global warming is human sacrifice. Of course, as with all such programs, it would be uncomfortable for those seeking to curb the appetites of others to endure the same constraints themselves. Therefore, the partisans of global warming governance have conceived of an opportunity-limiting concept called “cap and trade.” Under this approach, those wishing to commit the sin of carbon use would be allowed to purchase an indulgence provided by the Regulatory Bureaucracy of the Church of the Climatic Apocalypse. In this way people of quality would be freed from carbon sin, and allowed to consume as desired without unnecessary limitations—such inconvenience being reserved for the rabble of lost souls, too improvident, alas, to pay for their salvation. As an added benefit, some of the revenue acquired by First World governments through the sale of such indulgences could be used to reward those virtuous leaders of underdeveloped nations who nobly prevent their subjects from increasingly using carbon. In other words, under cap and trade, advanced-sector nations will impose highly regressive carbon taxation domestically, and transfer some of the take to Third World despots to pay them to keep their people poor.

The economic burden of the proposed cap-and-trade scheme would be great. Today, the United States produces about 5.5 billion tonnes of CO per year.31 Under the most recent cap-and-trade proposal, the Waxman-Markey bill (passed by the U.S. House of Representatives in 2009 and later killed in the Senate), the federal government would sell to the public permits for the emission of CO , allowing a number of permits near current emissions levels and falling off over time. The Congressional Budget Office (CBO) notes  that estimates for the cost of these permits range from $18 per tonne to nearly $50 per tonne in 2020, and $70–160 by 2050.32 As the number of permits issued falls, the cost per permit steeply increases. So, billed to the U.S. economy as a whole, under any of these estimates, cap and trade would cost the public hundreds of billions of dollars.

The Heritage Foundation estimates that Waxman-Markey would have cost the U.S. economy $161 billion in 2020—or $1,870 for a family of four, rising to $6,800 by 2035. The costs would be stratified so as to be borne more by those with higher incomes; even so, this represents a substantial economic burden. As a result of the markup of carbon costs, businesses would be burdened as well, meaning that many working families would be out of work and unable to pay their existing bills, let alone new ones.33

Consider that burning one tonne of coal produces about 2.5 tonnes of CO . So a tax of even $20 per tonne of CO emitted (a low-end estimate for the Waxman-Markey bill’s cost by 2020) would be the equivalent to a tax of $50 per tonne on coal. The price of anthracite coal runs in the neighborhood of $5 7 per ton, so under the proposed system, such coal would be taxed at a rate of nearly 100 percent.34 The price of Western bituminous coal is about $14 per ton. This coal would therefore be taxed at a rate of over 300 percent. Coal provides almost half of America’s electricity, so such extraordinary levies could easily double the electric bills paid by consumers and businesses across half the nation. In addition, many businesses, such as the metals and chemical industries, use a great deal of coal directly. By doubling or potentially even quadrupling the cost of their most basic feedstock, the cap-and-trade system’s indulgence fees could make many such businesses uncompetitive and ultimately throw millions of working men and women into the unemployment lines.

Similarly, the CBO estimates that, under cap and trade, gasoline prices would increase by 40 cents per gallon by 2018, and up to $1.70 per gallon over the next forty years.35 This would not only hit consumers’ pockets, but increase transportation costs throughout the  economy, hobbling businesses and further increasing unemployment. While harming the economy, such a gas tax would do nothing material toward the truly essential goal of decreasing America’s dependence on foreign oil. Indeed, the bill’s dramatic hikes in electricity costs would have the opposite effect, since, by forcefully increasing electric power costs, the bill would actually be likely to discourage adoption of electric means of transportation in many areas, including mass-transit systems today and potentially plug-in hybrid cars in the future.

There is another danger even worse than the implicit taxes that would result from passing into law a cap-and-trade scheme like the one outlined in the Waxman-Markey Bill: tax farming. A bit of history is useful here. When ancient Near Eastern potentates wanted ready cash to fund their wars, human-sacrifice community centers, or other worthy projects, they sold the right to loot various districts within their kingdoms to wealthy gangsters, known as tax farmers.36 In this win-win arrangement, the rulers got the gold they needed without any fuss or bother, while the tax farmers secured themselves a handsome return on their investment by deploying thugs to mercilessly loot the peasants within their jurisdiction. Everybody who mattered was happy.37

Cap-and-trade carbon-permit tax farming would work similarly. When the carbon emission permits are offered by the government for sale, most of them could be bought by speculators with sufficient ready cash to snatch them up. By doing so, these speculators could secure for themselves the power to tax without limit anyone who needed to use combustion to stay in business. Since the entire purpose of the cap-and-trade system is to fix the total amount of society’s carbon-emitting activities—with the stated aim, in the Waxman-Markey Bill, of reducing U.S. carbon emissions by over 80 percent by the year 2050—the price of the permits would soar, allowing the carbon-tax farmers to strangle and loot the productive sectors of the economy at will.38 Opportunities for paid employment would become increasingly hard to find. Monopolies would persist, but with  their costs vastly inflated by their need to pay tribute to the carbon tax farmers. These costs would then be passed on to consumers, with the poor being hurt the most.

The most alarming potential for tragedy from cap and trade, however, is not domestic, but in the possible impact on the world’s food supply. Modern agriculture is one of the greatest success stories in human history. In 1930, hunger still stalked the entire globe. Not just in Africa, India, and China, but even in Europe and America, the struggle to simply get enough food to live on still preoccupied billions of people. Since 1930, the world population has tripled. But instead of going hungrier, people nearly everywhere are now eating much better. This miracle depends upon the availability of cheap fertilizer and pesticides, which in turn require carbon-based energy to produce. If you tax carbon, you tax fertilizer and pesticides—and, in turn, you tax food, and by no small amount. A tax of $20 per tonne of CO would directly increase fertilizer production costs by roughly $50 per tonne, with the cap-and-trade bill’s increased transport costs inflating the burden still more.39 That’s enough to make many farmers use less fertilizer, and less fertilizer means less food.

To get a sense of what it would mean for farmers to abandon fertilizer, it is only necessary to go to the supermarket and compare the price of the “organic” produce, grown without chemical fertilizer, to the regular produce, which typically costs less than half as much. It is one matter for wealthy organic food buffs to choose to pay such high prices for their food—that is their right. But to impose such costs for basic groceries on everyone else, and particularly the poor, as part of a largely symbolic effort to try to change the weather, is arrogant in the extreme. Forcing the abandonment of fertilizer worldwide could starve billions.

These are just a few examples of the likely destructive effects of cap and trade. The $20 per tonne CO tax is just the government’s cut. Carbon tax farmers will charge a lot more. As a result, the prices of not only electricity, fertilizer, and food but all products requiring energy to produce or transport are certain to soar. The effects would seep  through the entire global economy, with disastrous consequences.

Yet this is the program that has been embraced by nearly all advanced-sector political parties claiming to represent the plebeian interest.

 

Sanjeev Sabhlok

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