Our Temptations

Charles C.W. Cooke at NRO has a post titled Vote For The Dangerous Guy. Democrat groups have spent millions of dollars in Colorado trying to influence the GOP Senate nominee. It didn’t work and it is a bad idea but we understand the temptation.

The Wisconsin primary is fairly late in the nomination process. We think it is in April and it is an open primary. In 2016 The Donald had all but sewn up the GOP presidential nomination. The decision between Hillary and Bernie was a more open question. We didn’t want The Donald as the GOP nominee but there wasn’t much chance of having an impact on that. We really, really didn’t want Hillary as president. Time has shown that The Donald and Hillary were two of the (or just the two?) most corrupt presidential nominees in history.

So the question became: should we vote for Bernie in the Democrat primary? He, as you know, identifies as a socialist and we are a capitalistic orphan so we disagree vehemently on almost every political point. Still, we judged him as way less corrupt than Hillary so we were tempted to vote for Bernie. Bernie might be a less bad president than Hillary because nobody is going to listen to him. Right? Right?

Our decision came down to what would we tell our children and grandchildren if Bernie became president. It would be worse than lame to say we voted for Bernie because we didn’t think voters were foolish enough to elect him or Congress was foolish enough to listen to him. We voted for a senator, we think it was Ted Cruz, in the Wisconsin GOP presidential primary in 2016. Voting or spending money to game elections is really dangerous because the person you think is a sure loser might win.

The same reasoning is why we voted for The Donald in the 2016 and 2020 general elections. It is dangerous to try and game the current election and even more dangerous to try and game the next election. The Donald was the best choice both times. He wasn’t a great choice but he was the best of the two on offer. And yet, we don’t think we can use that argument in 2024. If the GOP is foolish enough to nominate The Donald in 2024 we might leave the presidential boxes blank. It is about what we can tell the kids and grandkids.

Towards Energy Neutrality

We, as a country, need explicit policies on energy and Climate Change. The Democrats, as is their wont, have explicit actions like stopping pipelines, drilling, and refining while subsidizing inefficient energy sources like wind and solar. Their policies are not quite explicit or better description might be explicit but later denied if they are effective. So they are explicit when they say they want to get to carbon neutral by some extraordinarily costly date but they don’t explain how they are going to get there. Or they say they want to raise the price of gas comparable to Europe but when our current president, The Frontrunner, has some success in that area then they deny their intent and do or suggest all manner of ineffective gestures as their denial.

The GOP tends to like subsidies of all sorts but, although Sarah said, “Drill, baby, drill.” they are in a muddle about actions and have no policy other than to try to stop some of the Democrats silly schemes while going along with others. The GOP’s lack of substance and the Democrat’s lack of honesty means that we wander about about as an energy disaster looms. Andrew Stuttaford at NRO is on the case about electric cars and economics. Here is a neat short post about electric cars. Do read it all but here is a great quote Andrew includes from the CEO of the fifth largest auto maker in the world (date is January 2022):

“What is clear is that electrification [of vehicles] is a technology chosen by politicians, not by industry,” Tavares told a handful of European newspapers in a joint interview. “Given the current European energy mix, an electric car needs to drive 70,000 kilometres to compensate for the carbon footprint of manufacturing the battery and to start catching up with a light hybrid vehicle, which costs half as much as an EV (electric vehicle).”

So to summarize: electric vehicles don’t break even on carbon until about 44,000 miles and they cost twice as much. We need a consistent energy policy where the government supports market based solutions rather than government solutions. The two problems with government based energy policies are, one, that governments are often wrong in their choices and reluctant to change their mind as we see with wind and solar energy. Second, elections lead to some changes as we saw with the whipsaw of the Keystone XL pipeline.

Scott Lincicome at The Dispatch has a great article on the problems that government causes but changing policy as with the famous Keystone XL pipeline. It is called Fueling Uncertainty. You should read it all but it is behind a paywall so here is his description of US energy and Climate policy and its impact on the shortage of refinery capacity:

[W]e all can hopefully agree that it’s been an erratic, kludgy mess for well over a decade [how about at least three?] —a situation likely contributing to our current dearth of domestic refinery capacity and caused by a Congress that’s implemented an incoherent heap of temporary subsidies and mandates and delegated much of U.S. energy policy to a frequently-changing executive branch.

We agree entirely with Scott’s insight that fossil fuel investments are less likely to be made when the government and other institutions are, to be kind, inconsistent in their attitude towards fossil fuels. When we combine the two quotes we see the need for consistent government but a reliance on markets. Both parties have a long way to go to get there. The answer starts with a carbon tax.

The Pro-Life Movement: A Lesson In Civics

InstaPundit, Glenn Reynolds, uses his post at the Post to properly decry the behavior of the pro-choice movement, almost entirely on the left, before during and after the reversal or Roe v. Wade. Do read it all but we love this paragraph:

Extremist rhetoric — of the sort that’s called “hate” when it comes from the right and “passion for justice” when it comes from the left — raised the temperature to the point where a would-be assassin actually showed up at Justice Brett Kavanaugh’s house with a Glock, two magazines and pepper spray. He’s now awaiting trial. Sen. Chuck Schumer (D-NY) even threatened Kavanaugh and other conservative justices that they would “pay the price” for overturning Roe.

It encapsulates the nature of media bias in 2022. Folks on the left can make the most vile statements without the media caring. We would like to go the other way in this post. We would like to praise the behavior of the pro-lifers in their fifty year journey to overcome Roe v. Wade and return the question of abortion to democracy. It is not that everyone of the tens of millions of pro-lifers behaved with perfect propriety. They did not. It is that the pro-life movement as a whole behaved properly. They are a study in civics. They worked tirelessly within the system to elect Congress critters and presidents that would lead to a Supreme Court that would make the question of abortion one decided by democracy. When evil was attempted in their name they spoke out about. InstaPundit’s Post post shows several examples of how the pro-choice movement behaves differently. Again, it is not the individual actions of either group but what happens when an individual from that group misbehaves. The pro-choice leaders find excuses while the pro-life leaders take the miscreants to the woodshed.

The democracy part of finding a resolution to abortion is going to be another challenge for the pro-life movement. They should, as they turn to the next step, take a moment to consider the epic struggle they have won over the past half century. We should write it into the civics (is that still a high school course?) curriculum as an example to be followed.

The Donald And Energy

While reading the frustrating attempt by Kurt Schlichter trying to convince somebody (perhaps himself) of The Case For [The Donald] in 2024 we came across something interesting. One of the silliest arguments he tries out is that The Donald and his cronies will have the advantage of two election campaigns. The problem is that The Donald et al. are getting worse at campaigning over time. He eked out a victory in 2016, lost in 2020, and then lost the Senate for the GOP in 2021. Why on earth would a GOP supporter want him to try again?

But while reading that dreck we came across a link from Ed Morrissey to the American Petroleum Institute’s (API) list of 10 in 2022: Ten Policies To Unleash American Energy And Fuel Recovery. They call on the administration of current president, The Frontrunner, to do all these things in 2022. Unfortunately, none of the proposals are going to happen in 2022. The GOP, however, needs an energy policy. They need to do more research but here is an off-the-shelf energy policy to adopt at least in part. We are not convinced on number seven:

Congress should expand and extend Section 45Q tax credits for carbon capture, utilization, and storage development and create a new tax credit for hydrogen produced from all sources.

As we oppose specific energy subsidies it seems like a bad choice. Number ten also seems suspect:

Congress and the Biden administration should support the training and education of a diverse workforce through increased funding of work-based learning and advancement of STEM programs to nurture the skills necessary to construct and operate oil, natural gas and other energy infrastructure.

We think the energy companies can do most of that on their own. The other eight might need an adjustment or two but they look pretty solid. So, take those two out and add a modest carbon tax replacing the gas tax and eliminate all (well, at least many) energy subsidies and you have a sensible ten-point energy program. The GOP is welcome! Now get to it. If the GOP has something to run on rather than just running against the disaster that is The Frontrunner they can ignore The Donald, win, and do something useful for the country.

Still Supporting A Carbon Tax

We just noticed that Benjamin Zycher from AEI had a post on NRO a few days ago titled Against A Carbon Tax. The subtitle is: The common arguments for taxing greenhouse gases aren’t persuasive. You would think that a post at the intersection of two conservative powerhouses, AEI and NRO, would be more persuasive than it is. Instead Ben creates enough straw men to field a sports team. You should read it all to see how he argues.

Ben’s first straw man is that there isn’t a Climate Crisis. Agreed. It is not relevant but we agree. He makes a straw man doubles team by observing that carbon is different than carbon dioxide. Yes, he is right that folks try to enforce Climate orthodoxy by such shorthand. Then he gives us four common arguments for a carbon or CHG tax that he dresses up but they boil down to:

Negative externalities 
A GHG tax would be more efficient than a command-and-control regulatory approach
A GHG tax would be more efficient because it would preserve neutrality across technologies
A GHG tax would generate revenue
We agree that the first three are important arguments for CHG tax but we see them as still valid. In addition, he leaves out the most important political argument.

He uses multiple straw men to argue against negative externalities. He completes the relay team by telling us that there are positive externalities too (obviously) and that dire predictions in the media (even more obviously). The best evidence is that there are net negative externalities.

He completes the basketball team by seeming to argue that we must accept a really high CHG tax because at least some of the Democrats will propose it based on a high Social Cost of Carbon (an example that Ben is right about the left and terminology). It is true that the 44th president and, likely, the current one, The Frontrunner, would argue for a hight social cost of carbon but we are not sure they want to support a big regressive tax that would come with it. As we often say (except adopting Ben’s terminology), a CHG tax should replace the gas tax and be modest. It should be on the order of twenty to thirty cents per gallon of gas. Supporting a modest CHG tax does not mean supporting any CHG tax.

For technological neutrality Ben is properly worried about Congress and completes the hockey straw man team with this:

Accordingly, it is not plausible that a GHG tax would be applied in a uniform, neutral fashion across industries and geographic regions as it emerges from the congressional bargaining process.

Ben is making a valid point that we need to be worried about what Congress will do. There are CHG taxes that we would vote against. There is also a possibility that there will be positive steps towards technological neutrality with the reduction of subsidies as part of a CHG tax package. We believe that the only way to make such positive steps is to adopt a CHG tax.

A CHG will not generate much revenue for the federal government. Ben is right that that little increment will be fought over. The straw man to complete rugby sevens is that we need to take any deal offered.

The command-and-control Energy and Climate policies over the past thirty years or more continue to be a disaster. As we see it, a CHG tax is the only way to escape the command-and-control regulatory policies that have worked so badly and get closer to a market oriented approach that we, Ben, AEI, and NRO would enthusiastically endorse. There are real dangers when creating a new tax but there is a huge space to create a CHG tax deal that improves the situation immediately and provides opportunities to move further towards a market solution because a CHG tax removes the rationale to alternative energy subsidies. If there is a better alternative we would like to hear it.

A Tale Of Three Posts

At first we were going to be a closer literary connection where we compared two posts reacting to our president’s (The Frontrunner) letter to the oil companies. The one critical of The Frontrunner is by Steven F. Hayward at the Pipeline entitled [The Frontrunner’s] Bottomless Energy Foolishness and the one supporting The Frontrunner is by Andy Kalmowitz at Jalopnik entitled [The Frontrunner] Sends Strongly-worded Letter To Oil Companies. But when we eventually found the letter in a John Hinderaker post at PowerLine we realized that it needed comment too. Here is the direct connection to the letter. Read all three to see where you stand.

We’re generally with Steve but we want to start with the actual letter. You should read The Frontrunner’s whole letter to see how awful it is. We’ve tried to quote it faithfully below but we can’t cut and past from John’s document. We know he didn’t write it but he did sign it so it is his letter. Vladimir Putin is the primary villain with several mentions including this one begging to be fact checked, “There is no question that Vladimir Putin is principally responsible for the intense financial pain that the American people and their families are bearing.” It seems like they couldn’t decide between American people and American families and opted for both.

Our other highlight from The Frontrunner’s letter is this: “I understand that many that many factors contributed to the business decisions to reduce refinery capacity, which occurred before I took office. But at a time of war ….” We want to discuss two things from that passage. First, The Frontrunner has been vice president or president (assuming he makes it past Tuesday) for 113 of the last 161 months and senator for years before that. Is there any thing he has done or supported in, as Bjorn Lomborg says, our last thirty years of bad climate policies that would have led to an expansion of refinery capacity? The second item is the phrase “at a time of war.” The US is not at war. Russia and Ukraine are. That short passage reflects an amazing attempt by The Frontrunner to avoid responsibility for his policies.

Andy’s second paragraph goes like this:

We’ve reported extensively on the rising price of gas in the country, and now that the national average is above $5 per gallon, the President is doing all he can really do: sending a strongly worded letter. It is interesting that strongly worded is hyphenated in the title but not the text. Three things about this passage. First, as a university administrator we have written strongly worded (or strongly-worded) letters and this is not one. It looks like a response to a strongly-worded letter: It is Vladimir’s fault! We have taken historic actions! Can’t our friends in the oil industry save us?

Second, Andy is close to right that a strongly-worded letter is the best The Frontrunner can offer for right now. If Chevron decides to build a new refinery because of the circumstances it will not produce gasoline for quite some time. The same would be true for new oil wells. Decades of mistakes have been exacerbated by The Frontrunner and led us to this set of circumstances.

Third, The Frontrunner can’t do much that would immediately increase supply or reduce demand but there is one action that might help by changing attitudes. It would be to reverse course convincingly (the convincingly part would be really hard). If he said he accepts the estimates of his administration that fossil fuels will be with us for the next five or ten decades and he committed to support production of reliable fossil fuel energy then he might have an impact on attitudes and attitudes can have an impact on prices. As we said, actual results will take time. The probability of such action approaches zero.

Steve’s post is really worth reading carefully. We want to emphasize two points. The first one is the one that he left out: There have been decades of poor energy and climate change policies with both parties contributing. A nice example of this is blackouts in Texas and California. The Frontrunner is not the only one to blame but, as Steve details, his energy foolishness is bottomless.

Our second point of emphasis is Steve’s excellent analysis of political risk in fossil fuel industries. He is exactly right when he says:

A bigger problem for the industry is political risk. After years of open hostility to the industry from Democrats, why would the industry now put its neck on the line to rush new production when it is certain that Democrats will resume their old hostility to the industry once prices and profits start to come back down?

Indeed, why would anyone make a long-term investment in such a political climate? If you are not convinced of the Democrats hostility towards fossil fuels here is Andy’s approving quote from a recent speech by The Frontrunner:

“Exxon made more money than God this year.”

Huh? Where can we find God’s annual report? It is nonsense but it is clearly hostile. Here is part of Steve’s post that replies to that evident hostility:

ExxonMobil is expected to earn less than one-half as much as Apple this year (Exxon: $41 billion; Apple: $100 billion), and Apple enjoys a much larger profit margin on sales than ExxonMobil (Apple: 26 % in its most recent quarter; ExxonMobil, 6.2%).

We don’t know what is in God’s portfolio but He clearly doesn’t own Apple. Political risk is a huge problem for companies that must plan over years and decades. Speaking of hostility, here is a great quote from one of the organizations that opposed the Keystone XL pipeline:

When the backers of the Keystone XL (KXL) pipeline pitched their project in 2008, they couldn’t have foreseen this ending.

Exactly. Now folks in fossil fuels understand that political risk has come to North America. It means that refineries, pipelines, and other crucial infrastructure are not proposed or expanded as the political risk means companies ignore the signal from prices. The cost of gasoline, heating, electricity, and so on are generally going up but will vary wildly because we don’t have any excess capacity and investors will ignore the price signals because of the political climate.

We desperately need a market based energy system to help us deal with Climate Change. The Frontrunner and the Democrats are taking us in exactly the wrong direction. Is the GOP ready to champion a carbon tax and all that goes with it in 2022 and 2024?

The Problem With Political Parties

Yesterday we were discussing a newspaper post by Josh trying to absolve The Frontrunner from the current surge of inflation and we said:

We don’t think that Josh’s grain of truth will save The Frontrunner or the Democrats. Could this turn the remaining Democrats serious after 2022? The GOP has been happy to watch the disaster unfold with precious little to offer as an alternative. We are in desperate need of serious people in the Congress, in the administration, and reporting on them. Is either party up for nominating serious people and will Josh work on his economics?

Now it is true that The Frontrunner is not responsible for one hundred percent of the current surge but the alternative offered by Josh, shoppers, isn’t plausible.

The problem for the Democrats is that they will still win all the deep blue districts so we will end up with entitled folks like Giberto Hinojoso. Yesterday the GOP flipped a seat in South Texas and he said:

“In January 2023, this seat will rightfully return to Democratic hands,” Hinojosa said, the Texas Tribune reported. [Emphasis added]

So we are left will little hope for the Democrats and just a modicum for the GOP.

Sidebar: Kevin also has a section on the problems of attributing every single economic outcome to the president at the time of the outcome. We concur in part. As we have said positive economic outcomes are a lagging indicator of sound economic policies. Negative economic outcomes tend to be a lagging indicator of bad economic policy. The baby formula shortage is a nice example of that where several actions by the FDA combined with the new NAFTA combined to cause economic problems. There are also events that have an immediate impact like the government shutting down the economy to fight COVID. As everyone expected there was a big drop and a big rebound. End Sidebar

Today, Kevin D. Williamson on NRO in his newsletter The Tuesday said something similar to us:

The current economic troubles are likely to deliver control of Congress to Republicans in 2023 and may contribute to the election of a Republican president in 2024. But while I am confident in the near-term electoral prospects of the Republican Party, I am not at all convinced that Republicans know what to do with power. “The economy sucked under Joe Biden” may get you elected, but it isn’t a real analysis, and it isn’t the basis for a real agenda.

Yes, if you want to be an informed citizen you should subscribe to The Tuesday and whatever else is bundled with it. We need serious citizens to produce serious government.

Kevin and MWG are concerned about political parties. The objective of the GOP and Democrats is to win elections. Right now the GOP is following one of the primary directives of two-party elections: when the other party is drowning don’t throw them a life ring. The Frontrunner and the Democrats are drowning in bad news including: inflation, stock market, and economic growth. Astonishingly, The Frontrunner is still calling on the GOP to help him increase inflation. November is looking good for the GOP so they are generally content to critique The Frontrunner rather than offer real analysis that leads to a real GOP agenda. Tom Cotton on foreign policy is an exception. The 2024 presidential election looks good for the GOP unless the Democrats nominate Joe Manchin or the GOP nominates The Donald.

We need from at least one party a vision of what can be accomplished. Our domestic vision would include two things. First, address climate change with a carbon tax that replaces the gas tax along with reducing subsidies for specific types of energy. Prosperity or economic growth world-wide is part of that climate policy.

Second, reform entitlements. Reforming entitlements should solve the deficit over time. Reforming isn’t code for cutting.

There are other things that are on the Would Be Nice list but to have accomplishments in DC you need to have priorities. Those two are our priorities. We don’t expect either party to embrace them. Rather we will see a combination of good and bad in the platforms and little will be done other than posturing.

Inflation Spin

Like Jimmy Buffet, we are finally going to admit “It’s [our] own damn fault.” In our last post we hit the publish button way too soon. We thought we could edit but now we can’t edit posts and get this for free. We were miffed but as we said it took time but we finally realized where the blame should fall. So we have copied the previous post and will do the editing in a new post.

The best spin has an element of truth and comes from an unexpected source. Josh Boak writes for the Associated Press as the White House reporter and economics writer. So Josh is familiar with our president, The Frontrunner, and economics. We were unimpressed for the latter by his post on the front page (above the fold) of our local paper: [The Frontrunner’s] Inflation Crunch: Too Much Shopping. We’ve linked to a different paper as the local daily has paywall restrictions. We think you should read it to see the astonishing lengths that Josh goes to try to get The Frontrunner and the Democrats off the hook for what they have done. One way that really backfired on Josh was he used expected data:

Friday’s report on consumer prices is expected to show that annual inflation slowed ever so slightly to 8.2% in May from 8.3% in April. Economists surveyed by FactSet indicate the decline will largely be driven by expenses other than food and energy, as Russia’s invasion of Ukraine has led to higher prices in those categories worldwide.

That’s not what happened. It was 8.6 percent, the highest since 1981. You can pick your description but we like surge. As in inflation continued to surge under The Frontrunner’s administration.

The grain of truth in Josh’s post is that shoppers are involved with inflation because inflation is too much money chasing too few goods. Shoppers are part of the inflation process. Charles CW Cooke at NRO  is closer to the truth when he says

Since January 2021, everything the Democrats have done, have tried to do, or intended to do has been inflationary. 

We say closer to the truth because Charlie leaves out monetary policy where Ramesh Ponnuru tells us that the Fed is printing too much money and the supply side where, among other things, the Democrats are trying to choke off the supply of fossil fuels. As Thomas J. Duesterbert at the WSJ says:

President Biden’s energy program is crystal clear: an all-of-government assault on the domestic fossil-fuel industry to further a green agenda.

Thomas is not the only one to notice. Americans not only think the Democrats are reducing the supply of gas but they think they are doing it on purpose to reduce the use of fossil fuels. The Frontrunner and the Democrats have all the bases covered. Inflationary monetary policy, check. Inflationary spending, check. Inflationary supply-side actions, check. It is an impressive performance that Josh is trying to explain away by blaming shoppers. Ramesh is not the first to call shenanigans on the Democrats allegations but we think his phrasing is worth a quote:

This sort of nonsense, which seeks to explain a variable (the inflation rate) by reference to a constant (the desire for profit), can only distract from what is truly necessary to restore price stability.

But the Democrats could be first in trying to do it twice (profit motive and shoppers) with the same variable (inflation) in such a short time. We don’t think that Josh’s grain of truth will save The Frontrunner or the Democrats. Could this turn the remaining Democrats serious after 2022? The GOP has been happy to watch the disaster unfold with precious little to offer as an alternative. We are in desperate need of serious people in the Congress, in the administration, and reporting on them. Is either party up for nominating serious people and will Josh work on his economics?

Spinning Inflation Causes

The best spin has an element of truth and comes from an unexpected source. Josh Boak writes for the Associated Press as the White House reporter and economics writer. So Josh is familiar with our president, The Frontrunner, and economics. We were unimpressed for the latter by his post on the front page (above the fold) of our local paper: [The Frontrunner’s] Inflation Crunch: Too Much Shopping. We’ve linked to a different paper as the local daily has paywall restrictions. We think you should read it to see the astonishing lengths that Josh goes to to absolve The Frontrunner. He also uses the expected inflation rate:

Friday’s report on consumer prices is expected to show that annual inflation slowed ever so slightly to 8.2% in May from 8.3% in April. Economists surveyed by FactSet indicate the decline will largely be driven by expenses other than food and energy, as Russia’s invasion of Ukraine has led to higher prices in those categories worldwide.

The actual inflation rate came in at 8.6 percent so it was increasing (choose your adjective) rather than slowing ever so slightly. Josh is right that gas and food prices are up substantially. He is wrong to suggest that Putin and the Ukraine are the major cause of gas price increases.

The grain of truth in Josh’s post is that shoppers are involved with inflation because inflation is too much money chasing too few goods. Charles CW Cooke at NRO  is closer to the truth when he says

Since January 2021, everything the Democrats have done, have tried to do, or intended to do has been inflationary. 

We say closer to the truth because Charlie leaves out that Ramesh Ponnuru on the Fed is printing too much money and the Democrats are trying to choke off the supply of fossil fuels. Americans not only think the Democrats are reducing the supply of gas but they think they are doing it on purpose to reduce the use of fossil fuels. The Frontrunner and the Democrats have all the bases covered. Inflationary monetary policy, check. Inflationary spending, check. Inflationary supply side actions, check. It is an impressive performance that Josh is trying to explain away by blaming shoppers. Ramesh is not the first to call shenanigans on the Democrats allegations:

This sort of nonsense, which seeks to explain a variable (the inflation rate) by reference to a constant (the desire for profit), can only distract from what is truly necessary to restore price stability.

But the Democrats could be first in trying to do it twice (profit motive and shoppers) with the same variable (inflation) in such a short time. We don’t think that Josh’s grain of truth will save The Frontrunner or the Democrats but it does harm his viability as a reporter.

False Alarm By Bjorn Lomborg III

False Alarm by Bjorn Lomborg is a great book because it makes you think. We, like Bjorn, are big fans of the growth fairy because growth means prosperity. We think government policies can make it more probable that the growth fairy will land on and stay in a specific country. So we think it is wonderful when Bjorn is talking about how to help a city in the Philippines that has been hit by several deadly typhoons and asks a rhetorical question and gives a great answer (p. 151 electronic version):

What if instead of cutting carbon, we helped Tacloban escape widespread poverty, and got more people out from under flimsy, corrugated roofs? That would transform the lives of today’s most vulnerable, making them more resilient, and of course it would dramatically improve the prospects for future generations. [Emphasis added]

We agree that economic growth is great. It is, among other things, an important, useful, and effective policy for combatting the impact of Climate Change as the paragraph above explains. We agree with Bjorn that only rich countries can afford to subsidize ineffective methods of combatting Climate Change like building windmills. Unfortunately, as Bjorn tells us, substantial amounts of foreign aid to poor countries comes with strings that require them to take inefficient actions on Climate Change. The ability to help countries to prosperity that we bolded is the problem.

We are one thousand percent with Bjorn in that we need to encourage economic growth globally to reduce the impact of poverty including those related to Climate Change. We also agree on the great enrichment as popularized by Deirdre McCloskey where economic growth fuels prosperity. We are now in what we would call the second stage of the great enrichment as highly populous countries like China and India moved away from socialism resulting in huge numbers of people being more prosperous and increasing their use of carbon. India just reopened 100 coal mines.

The problem with economic growth is that governments, sometimes with support of citizens, do foolish things. As Bjorn said, rich countries can afford to do foolish things like subsidizing windmills in part because they are rich and in part because they have substantial economic freedom. If we check the 2022 Heritage Index of Economic Freedom we find that just over half of the 177 ranked countries are mostly unfree or repressed while only seven are free. All of the free countries are rich while none of the repressed countries are. OK, I didn’t check all of the 31 repressed countries but China was the one you were thinking of as an economic powerhouse. It is economically powerful because of its huge population but at a per capita GDP of $17,000 is poor as compared to free Taiwan at almost $56,000. It is also true as Heritage China tells us that economic freedom in China peaked in 2020 so they have just moved back into repressed territory.

A recent example of rejecting economic freedom is Sri Lanka as reported by Dominic Pino at NRO. You should read the whole thing and the links he includes. Sri Lanka had a good decade from 2009 to 2019 but then:

The government embarked on a number of wasteful megaprojects. A Times of India report on those projects includes an international airport, a seaport, numerous unnecessary roads and bridges, and a cricket stadium that “has had only a few international matches and is so remote that arriving teams face the risk of wildlife attacks.”

And

But on top of the fiscal troubles, in April of 2021, Sri Lanka announced that it would try to become the world’s first 100 percent organic country. President Rajapaksa banned chemical fertilizer, despite warnings from agricultural scientists and farmers that the country wouldn’t be able to produce as much food without it.

Now Sri Lanka is having trouble with creditors. Germany and the US can shrug off foolish policies on Climate Change or funding stadiums with limited losses but poorer countries are harder hit.

The problem with Bjorn’s thinking on prosperity is that countries don’t understand or don’t want it. We can hardly help ourselves to continuing prosperity and have little influence to help the Philippines (just in the top half at number 80 on the Heritage list) or any other country. Our two examples are economic freedom in poor countries and free trade. Poor countries have the greatest opportunity to increase economic freedom that leads to prosperity.

Of the 89 countries in the Heritage index that are mostly unfree or repressed, only 15 (assuming we counted correctly-but the arrows are overwhelmingly pointed down) increased economic freedom for 2022. Countries with high economic freedom have much less room to improve. Despite this, eight of the ten countries with the highest economic freedom did improve in 2022.

Bjorn’s top policy, meaning most efficient, for prosperity is freer trade (p. 235). As he rightly laments, free trade has enemies on the right and left as we in the US have seen with our last three presidents. Free trade is one way the US could efficiently fight Climate Change globally but we are not buying it.

Government policies are rarely enough to stop prosperity. Venezuela and Sri Lanka are exceptions. The Climate Change hysteria that Bjorn identifies means that the growth fairy will be less welcome and Climate Change will be a bigger problem because the poor will be less resilient. We really need to read and apply Bjorn’s ideas.