Home > Columbia, economics, emissions, indoctrination, Ivy League, private property, rights > A Taste of Subtle Ivy League Indoctrination

A Taste of Subtle Ivy League Indoctrination

As you may have come to expect at this point, I am not entirely fond of the education I have received at Columbia University. One of the major reasons for this is because of the bias inherent in almost every class I have taken here, from the most seemingly apolitical math course to the inherently political social science course. An example of the type of indoctrination one receives at an Ivy League institution was center stage this week in one of my courses.

Having completed a discussion on torts, we moved on to its application in emissions regulation. Emissions prove highly relevant because one party may cause damage to another party’s property because of the pollution one gives off. However, according to my professor, there is a solution to this that is equitable for all sides. My professor proclaimed, “It is the job of future economists like yourselves to solve these types of problems…otherwise what’s the point of studying economics?”

What was my professor’s solution? Well, since the typical Pigouvian tax wouldn’t work, of course we could follow the “market-based” solution of tradable carbon credits. The logic that my teacher put forth seemed infallible – the government can set the emissions level they so choose, and by creating carbon credit shares tradable on an open market, firms could buy or sell off their right to emit based upon their polluting needs. At the aggregate level, pollution will be reduced. Regardless of the initial allocation of carbon shares, trading will allow companies to emit at the level they so choose. Not only this, but the government won’t even intervene in this free market, and there will be total transparency to boot. Even more remarkable to my professor was the fact that this market was able to set the price, without necessary fixing by the regulator. Hooray for the central planners!

To be fair, my teacher did say that it is not necessarily easy to figure out the optimal level of emissions. But leaving out the fact that of course no government official nor any person period can know the optimal level of emission (especially given that this differs for every single individual), there are myriad other reasons why this solution is not “market based,” or socially beneficial. First, the market for carbon credits is being determined by government fiat. The government determines how many shares should be initially allocated to companies, and enforces the market on private companies. To whom does the burden ultimately fall to either pay for producing pollution, or build new plants that emit less? Why the consumer of course. This was not mentioned in the lecture. The question then becomes, are the social benefits of an emissions cap and market imposed by the government greater than the cost consumers will bare as a result of these policies? This writer happens to think not. Not to mention, of course there are going to be certain businesses that will increase their profits off of the push to decrease emissions as well, meaning government intervention will divert the natural flow of capital to specific sectors in the market.

There is of course as always the philosophical issue as well. Why should the government be in the business of controlling emissions? Of course, I’m sure any good politician, or economist for that matter would make the argument that it is for the public good. However, as always, I would argue that the free market provides a better alternative. First, if people are outraged by the emissions in their communities, they can take their cases to the courts and seek compensation from the company. If one’s private property is damaged, it is their right to seek just compensation, and the job of the courts to arbitrate in these disputes. Second, if this proves insufficient, and the company truly is tearing a community apart, the people in the community can boycott the company, making it financially impossible for the company to operate, and thus forcing the company to change its production techniques to emit less pollution. In an age where information is more readily accessible and transmittable than ever before, it should be easier than ever to rally people against a company. For those who challenge this, even with multinational companies, if the consumers are so angry at the producers for their treatment of the environment, it should be worth the effort of citizens to take shots at the bottom line of the polluting producer, or to rally lawyers and interest groups against the firm, as the firm like any defendant is deemed innocent until proved guilty. Further, if there was ever a time that citizens could rally against corporations easily, given the speed at which information can be disseminated today, people are more easily able to rally behind their causes than ever before.

Unfortunately, the professor of this particular class believes that if a divine central planner could accomplish the aforementioned “elegant” solution, this would be perfectly acceptable as well. It is all about “efficiency,” and “optimal allocations” to university professors. But there is never the question of right and wrong. Simple morality, and respect for natural rights is not a factor. It is always the obligation of politicians and economists to solve our problems, not private individuals. The left is able to veil their interventionism in the cloak of the free market. As long as academia continues to pander about the virtues of government, our future leaders will continue to make the mistakes of their predecessors.

  1. Anonymous
    February 4, 2009 at 3:20 pm

    You should probably do something about your subtitle to the blog: “DEFENDING THE COUNTRY FROM THE NEW RED SCARE”You’re defending from a red scare? Wasn’t the red scare where we were afraid of communists? First communism isn’t socialism and second, it doesn’t sound like you are defending the country from the red scare, you’re trying to start a new red scare. I don’t like to be pedantic but you’re a columbia student, you should know better.

  2. dr. nick
    February 4, 2009 at 3:34 pm

    Just out of curiousity…. What happens when the legal remedy fails (poorly worded laws, indifferent judges, blizzards of paper and years of appeal) and the community doesn’t have enough financial clout to affect the company? It’s been pretty well documented that many corporations are fine with breaking the law as long as they think the ultimate punishment is an economically viable option.

  3. Andrew Mellon
    February 4, 2009 at 3:52 pm

    Anonymous…the point is that we are now entering a time like that under FDR where socialism takes over for capitalism, and our most cherished rights are threatened. To be sure, there is some jest in my blog…sometimes it is very serious, and other times not. Hence the subtitle. Dr. Nick, to be sure courts are complicit in what I view as the failure to protect private property rights. Judges and lawmakers are apt to make mistakes because they are fallible human beings. As was noted in the Federalist Papers, men are not angels. That does not mean however that we cannot strive for something better. Point taken nevertheless.

  4. The Cold Equations
    February 5, 2009 at 1:18 am

    Your professor probably didn’t mention that the costs would ultimately be borne by consumers because it’s too obvious to bear mentioning. I have no great respect for the Ivy League, but presumably even people in the Ivory Tower have some clue that TANSTAAFL.As for your “market-based” solutions, they’re neither solutions nor really market-based. Suppose I live in Miami, and I judge (based on imperfect information) that there’s a 15% chance that my beach house will flood in 50 years due to anthropogenic global warming, reducing its present value by (say) $15,000. Who do I sue? Everybody who is currently emitting carbon, for a value equal to their proportion of global carbon emissions X $15,000? This is obviously impractical, and if people actually did it, it would be far, far more expensive than any heavy-handed regulations a Soviet planner could have thought of. It would create jobs for judges and lawyers, at least.I would argue that regulation-by-lawsuit is no more free-market than any other kind of regulation, because you still need courts to compel the defendant to pay the judgement. If you’re going to go pseudo-Coaseian, why not go all the way and require me to pay everybody in the world to stop emitting carbon, and if I can’t, the economy is better off with carbon emissions than the current sea level? And why do you trust judges more than regulators to determine the value of my beach house, anyway? The only difference is that the judge has a JD, while the people at the Bureau of Carbon (or whatever) have phDs in Physics and might actually know something about the subject.As for the boycott, by the time the house floods the people who emitted the carbon will be dead anyway. Maybe we can dig up their bones and hang them. The real problem here is that we don’t know exactly what the impact of carbon emissions will be, but it will probably be too late to do anything about it when we find out empirically. It seems wise to proceed cautiously, and no, I don’t give a rat’s ass about the “right” of those who disagree to proceed recklessly. If they had a planet to themselves, it would be OK.

  5. MrCooperWandling
    February 5, 2009 at 7:49 am

    I am beginning to see that somehow economic minds tend to overdo their thought processes.For you Andrew, it sounds like educational thought, and those who profess it is your main issue. And it is valid, because there are agendas they will need to keep in mind, especially if they receive any of the proposed 68 billion dollar education stimulus package.Who cares about the planet? If we did, we would issue a moratorium on population growth for the next 25 years. Recycling is not the problem. Overpopulation is. Emissions are here. Because of the population. Quit trying to make a solution where there isnt one when 7 billion people live on a planet habitable for somewhere in the neighborhood of 4.5 billion, max.And anonymous’s best word was pedantic? Come on dude?

  6. Joseph Mises
    February 20, 2009 at 2:14 am

    Anonymous is a blithering idiot.Bush was a socialist for Christ sakes! Even Milton Friedman was a socialist!

  7. Joseph Mises
    February 20, 2009 at 2:17 am

    **It would create jobs for judges and lawyers, at least.****And why do you trust judges more than regulators to determine the value of my beach house, anyway? The only difference is that the judge has a JD, while the people at the Bureau of Carbon (or whatever) have phDs in Physics and might actually know something about the subject.**Try rebuttling those to comments from a Libertarian perspective. Only Rothbardians can.

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