Excellent post by Richard T. Stuebi at Cleantech Blog on reconciling capitalism with environmentalism. Nut:
It is because energy prices do not currently include their full environmental costs that Aspen Skiing (and other companies) can’t increase their profitability by pursuing as many green initiatives as they would philosophically like to do. If energy prices were to fully reflect all environmental costs, then the capitalist system would be freed to work its magic in motivating capital and behavioral shifts in the economy to significantly reduce emissions.
Alas, here’s the dilemma: many environmentalists have qualms about letting markets work to reduce emissions, and most free-marketer capitalists are leery of policymakers adding environmental externality factors (a euphemism for “taxes”) to energy prices. Unless this bridge can be gapped, we’ve got trouble.
I do have some reservations about what follows, though:
Oh, yes, customers in Denmark and Finland face much higher energy prices (especially for transportation fuels), including much higher energy taxes, than we do here in the U.S. While Danes and Finns don’t perhaps live la vida loca like Americans do, neither do they seem to be collapsing in existential angst or economic depression. The question for us Americans is: do we have the courage to elect leaders that would put us on a deliberate/planned march towards higher energy prices?
I don’t think this is a winner. For one thing, the Finns do collapse in existential angst, committing suicide at the highest rates in the world (or close to it, depending on your source). For another — no, we probably don’t have that courage, to elect leaders who promise higher energy prices in isolation. Paired with cuts to taxes on productivity, though, as advocates of green-oriented tax-shifting propose, though, higher energy prices might sell.