Column: Inflation offers all activists a reality check | Opinion
Climate change is real. Greenhouse gas emissions from human activities such as electricity generation and transportation are a causal factor. Since the net effects of climate change are likely to be adverse, governments should adopt cautious policy responses.
So stipulated. Now let me tell you why these answers won’t include rigid carbon taxes or other costly regulations. My reasoning begins with two statistical uses of the same number: $4 per gallon and 4% of world production.
The first number was roughly the average price of regular gasoline in North Carolina during March, when general inflationary pressures and supply shocks from the conflict in Ukraine conspired to provide a boost to motorists. Prices moderated a bit in April, but are still close to that $4 per gallon figure. By comparison, a gallon of regular gasoline cost an average of $2.63 in mid-March 2021.
The second figure is roughly the best dollar estimate of the total net consequences of climate change if nothing is done to affect the trajectory of global temperatures by the year 2100. This represents 4% of the total production of goods and services of the planet, by the way. It includes the net effects of heat waves, sea level rise and other forecast calamities.
Here is one way to think about this number. A United Nations panel of experts predicts that if current trends continue, average global incomes will increase by around 450% from today to the end of the century. Apply the projected effects of climate change, and that revenue increase drops to 436%. This is a real and noticeable difference, reflecting the proposition that trapping more energy in the atmospheric system will impose net costs on most people.
However, a reduction in the growth of the world standard of living from 450% to 436% has nothing to do with the “existential crisis” that some claim. It is worth trying to avoid if the cost of prevention is less than the added harm of doing nothing. However, if the cost exceeds the benefits, we will be healthier, wealthier and happier if we focus our resources on adaptation rather than prevention.
Which brings me back to that first stat. Most people in North Carolina are worried about having to pay $4 for a gallon of gas right now, a lot of us are really angry and some are really desperate. In the latter case, I am talking about people of modest means who have long journeys or small businesses for which transport and delivery costs represent a significant expense.
Along with rents and grocery bills, increases in gas prices have pushed the issue of inflation to the top of the priority list. In the last two weeks of March, High Point University’s Voting Unit asked voters in North Carolina to rate a series of questions as “very important”, “somewhat important”, “not very important”. or “not at all important”. As expected, the most important issue was inflation, with 74% of respondents rating it as very important. The two lowest ranked issues were climate change and the related subject of public transport.
If there’s one thing a politician can read carefully and take to heart, it’s a poll. That’s why federal, state and even local officials and candidates are promising to “do something” about inflation in general and gas prices in particular. And that’s why even Democratic governors who have run for office in other states promising to fight climate change are now proposing ideas such as suspending fuel taxes, exploiting oil reserves and at least a temporary increase in oil production.
All of this happens with gasoline at $4 a gallon. Can you imagine the political fallout if the price were double or triple?
By all means, let’s invest in research and development. We could achieve widespread adoption of electric cars – powered by a combination of nuclear, renewables and natural gas – because their real running price boils down to a competitive level. But we won’t get there through carbon taxes or other coercive means. The public will never be interested in it.
John Hood is a board member of the John Locke Foundation and author of the novel Mountain Folk, a historical fantasy set during the American Revolution.