Saturday, August 01, 2009

Obama's Cap and Trade and Other Regulations will make Environment Worse

When I think of Cap and Trade and government efforts towards a better environment, I think of an interesting encounter I had while conducting seminars on Free Market economics. When I traveled Eastern Europe and the former Soviet Union, I was horrified by the pollution levels. Poland was particularly bad. I remember escaping to a large park because of the trees there actually made it easier to breathe. Much of the time my eyes simply watered and I coughed. It was miserable. I had a meeting with an economist in the Polish government and he noticed my distress. "What's wrong?" I said politely, "well, it seems I have caught something in your country." "Yes, we call it pollution, what do you call it in your country?" and smiled. I said, "why is it so bad?" He said, "well, it isn't because of the laws, we have the toughest environmental laws of any country in the world." Sure enough, I did my homework, and that was true at the time. He went on to say "the problem was recognized long ago by Aristotle who said 'What is common to the greatest number gets the least amount of care. Men pay most attention to what is their own; they care less for what is common; or at any rate they care for it only to the extent to which each is individually concerned. Even when there is no other cause for inattention, men are more prone to neglect their duty when they think that another is attending to it.'" He went on to say that he hoped that the moves the country was making towards free markets would lead to more ownership and better care of the environment.

Later, in another meeting he said, "the answer to these environmental problems are found in technology, not regulation." I liked the sound of that, so I asked him to elaborate, "as we recover economically, have more ownership, we will enjoy greater capital formation, which will lead to better and more efficient technology. That, more than anything else will reduce pollution." I casually responded, "I have never seen a poor country that wasn't polluted" and he responded back, "neither have I."

I have done further research on other government efforts to reduce pollution and found more stories that point to private, and not government, solutions. For example, according to the National Center for Policy Analysis, 90 percent of all dollars spent on the Super Fund has actually gone to lawyers and not clean ups.

The Obama Administration's multi tiered policies of Cap and Trade, CAFE Standards, and "Cash for Clunkers" (which largely benefits foreign auto makers, rather than domestic) while taxing wealth and job creation (which will only lead to more poverty), will actually contribute to more pollution in the years to come. One may be able to argue that one could pursue the aggressive regulations he desires in a strong economy, but in our current situation he is begging for immediate economic ruin and long term environmental disaster.

Kevin Price is Host of the Price of Business, the longest running show on AM 650 (M-F at 11 am) in Houston, Texas and on AOL Radio. His articles often appear in Chicago Sun Times, Reuters, USA Today, and other national media. Steve Moore of the Wall Street Journal calls Price the “best business talk show host in the country.” Find out why and visit his blog at www.BizPlusBlog.com and his show site at www.PriceofBusiness.com. You can also find Price on Strategy Room at FoxNews.com.

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