It's true that oil companies will reap eye-popping profits from high prices. Still, the logic that steep prices, imposed by the market or by taxes, will encourage energy conservation is irrefutable. At the least, high prices would curb the growth of greenhouse gases and oil imports. Congressional Democrats especially have targeted global warming. "We hold our children's future in our hands," Pelosi said early this year. "As the most adaptable creatures on the planet, it is time for us to adapt."So what is Nancy Pelosi willing to sacrifice for global warming? How about sacrificing the easy demagoguery about gas prices?
Energy prices apparently are the huge exception to this moral imperative. It is not necessary to adapt to them. The way that Pelosi and others navigate around this illogic is to assume painless improvements in energy efficiency. Congress will order car companies to make more efficient vehicles. It will mandate more renewable energy. It will impose stricter efficiency standards on appliances. Presto, everything's solved. No voter must suffer any inconvenience or cost.
But if fuel prices aren't high, people won't want to buy fuel-efficient cars, which will be more expensive, smaller or both. People will also drive more -- offsetting efficiency gains -- because it's cheaper. In 2005, the average car traveled 12,375 miles, up 1,871 miles since 1990. Given expanding populations of people and cars, massive gains in efficiency are needed merely to hold total fuel use constant. All this applies equally to buildings and appliances; higher electricity prices are an essential catalyst.
Americans want to stop global warming. They want to cut oil imports. They want cheaper energy. Who will tell them that they can't have it all? Not our "leaders."
Wednesday, May 30, 2007
Contradictory demagoguery
Robert Samuelson has a column today that is spot on. He points out that Democratic leaders in Congress are out there complaining about higher gas prices and also saying that we have to change our lifestyles in order to ward off global warming. Yet, high gas prices provide the incentives for people to cut down on driving and to buy more fuel efficient cars. If you truly care about global warming, you should be cheering for higher gas prices.
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Economics
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