Thursday, October 13, 2011

Privatize the Air!

The ACT party would like to scrap the emissions trading scheme (ETS) that was implemented by the National government. This is one of our few disagreements.

For a party that believes in a market solution for everything, the fact that an ETS is a market solution is being ignored. Libertarian thinkers such as Milton Friedman have advocated for a sort of ETS, with pollution controls being an effective market solution and an inefficient government solution. The ACT party is full of climate change skeptics, and while I don't believe in climate change 100%, what does concern me is the amount of air pollution there is. People forget that the same emissions causing global warming is also causing acid rain, environmental degradation, breathing problems for people, and dirty brown skies. 

Auckland and Wellington far from the dirty brown skies famous in New York City or the blood red sunsets of Los Angeles, and definitely nowhere near the pea-soup smog now prevalent in Beijing; but this does not mean we shouldn't uphold our 'clean green' aspiration, the unique selling point giving us a competitive edge for our exports, now highly desired by markets such as Britain and the PRC. We all got scared when a botched report said that Auckland's air quality is comparable to the heaving megalopolis of Tokyo, to which the WHO has later apologized and said we're not doing so bad after all. Len Brown's vision of making Auckland the most livable city in the world and our export economy which sells the country as clean and green; will not survive if our air pollution gets any worse.

Tragedy of the Commons

I have a lot of respect for David Syemour (ACT-5, candidate for Auckland Central) who spoke at a University of Auckland Economics Club meeting, where one of the concepts he raised was 'tragedy of the commons.' The idea that things left in public ownership always fare badly because it will inevitably lead to someone abusing it for their own gain, summed up by a Milton Friedman quote "no one treats someone else's property as well as their own." In this talk, Seymour explained that most environmental issues were the result of a 'tragedy of the commons' scenario, as they are usually seen as either government or no-one's property, and so they are left to abuse by private activities.

The solution to most 'tragedy of the commons' issues is to privatize the commons. Simple. To solve air pollution problems, it's as simple as privatizing the air, as scary as that sounds. Obviously, this does not mean paying someone to breathe, or being denied the use of air for breathing. What it does mean though, is setting up a not-for-profit organization that sells the right to pollute the air to those that can afford to do so, as they can justify polluting the air by gaining the most utility from doing so. The revenue made from this can then go to negative pollution emitters, such as forestry. This encourages replanting and forest retention, while pricing air polluters out of doing so. 

The most common argument against this is that it will hurt industry and farming. This is only true if they're slow or reluctant to adapt. Farmers can pay for air pollution and then be aid for keeping trees on their property. A few trees on a paddock than collect revenue to bring down costs, and can even become cost neutral if they can plant enough trees. Forestry as an industry can gain from this significantly, encouraging less productive farmland to be reforested to earn money. As for industry and transport, who create most of the air pollution in urban areas, switching to less emitting technologies, and only using dirtier technology where it is economically necessary. Environmentally friendly technology will become more prevalent, adding to our image and competitive edge. Public transport and more environmentally friendly transport will improve air quality and bring Auckland closer to Len Brown's vision of the world's most livable city.

Fast Followers of the Biggest Polluters

Don Brash has this idea that we should not be 'world leaders' in this sort of thing, but 'fast followers,' mentioning that our biggest trading partners are yet to implement this sort of thing. Our biggest trading partners include Australia, the PRC and the United States; all of which are ridiculed on the world stage for having terrible environmental records, this is not something we want to follow fast, especially when our reputation and quality of life depend on the opposite of this. A poll on the ALP (Australian Labour Party) Facebook page showed that 57% of Australians supported a carbon tax, meaning Julia Gillard is not unpopular because she is bringing in this policy, but because she's an outright liar. The fact Australia is bringing in a carbon tax shows that our neighbor across the ditch, who we want to follow fast, is doing exactly what we're trying to do.

The part that gets me though is obviously that Don Brash doesn't want us to be world leaders. I think this an awful gaffe, when we should be celebrating the talent, intellect, creativity, and ingenuity of this country, that prides itself on being the inventors of No 8 wire and other contraptions. World leaders are market leaders too, it's only obvious that if we lead the world in something, we have a competitive edge over the entire world. 

I'm all for privatizing things, which includes the air. I differ from much of the ACT party in that I have a more environmental focus, and I know there are many market and economical solutions to environmental issues. This is one of them. The ETS could of course be better implemented, refined, redesigned, and modified in all sorts of ways. Not going to happen if we don't rise up to the challenge and become a world leader in this field, otherwise we'll just have to wait until someone else does it.

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