We’ve discussed climate change deniers on here before.  But two Mondays ago, the column from the New York Time’s Paul Krugman (Princeton Professor and Nobel Prize winner in economics) takes on a different breed: those who say it’ll, “cost too much,” to do anything about climate change.  These folks deny the cost-effectiveness of action (usually while ignoring or downplaying the costs of inaction).

Before telling you more about the column, let me just say that I have a great deal of respect and admiration for this columnist.  Krugman is no ideologue — though his blog is titled, “Conscience of a Liberal,” he is no hardline Democrat — meaning, he has no problem coming out and saying when a Democrat has been or is wrong.  He has been a tough critic of President Obama, both during the election and after.  But that didn’t stop Obama from having him over for dinner within the last week, along with another Nobel prize winning-critic, economist, Joseph Stiglitz.  Obama’s a unique case of someone welcoming the outside perspective.

I was first introduced to Krugman’s work over four years ago by one of my professors in a public policy course I took as an undergraduate.  I have since followed his twice-weekly column in the New York Times.  I once fortunately received word that he was giving a talk about the economics of healthcare and was able to attend, during which he said that that was what he expected to chiefly write about while at the New York Times.  And while he covers it remarkably well, he thankfully does not stick to it.

I once received a call from my mother who had just heard Krugman for the first time on a morning political show from the other room and thought to herself, “that guy sounds like my son.”  Coming back into the room to see that it was indeed Krugman.  It makes sense: his thoughts and ideas have shaped my political and economic standpoint for years.  

I’m pretty sure I’ll be bringing work by Krugman back up again in the future, so I wanted to point out  to readers how much his work has meant to me.  But enough about me.  You get it: I have a lot of respect for this man.  On to that column!

That’s right, luckily, Krugman steps out and will talk about other issues for which his economic expertise and viewpoint is invaluable.  Joseph Romm actually wrote a nice highlight piece of the column on the Huffington Post.  I’ll share what stood out to me:

Krugman tends to write fitting titles, and An Affordable Salvation does not disappoint.  He starts off letting us know that with the new administration, we’ve seen an end to junk science ruling our public policy.  He then criticizes those who want us to believe that doing anything about global warming will have devastating affects on the economy.  He refers to these projections as, “junk economics.”

In discussing the costs, Krugman is honest about the fact that there would be a cost to consumers:

If emission permits were auctioned off — as they should be — the revenue thus raised could be used to give consumers rebates or reduce other taxes, partially offsetting the higher prices. But the offset wouldn’t be complete. Consumers would end up poorer than they would have been without a climate-change policy.

But how much poorer? Not much, say careful researchers, like those at the Environmental Protection Agency or the Emissions Prediction and Policy Analysis Group at the Massachusetts Institute of Technology. Even with stringent limits, says the M.I.T. group, Americans would consume only 2 percent less in 2050 than they would have in the absence of emission limits. That would still leave room for a large rise in the standard of living, shaving only one-twentieth of a percentage point off the average annual growth rate.

Then Krugman digs in good, showing the irony of those who say that actions to reduce global warming would constrain the economy are the same who say that the free market is able to transcend all of these other limits:

To be sure, there are many who insist that the costs would be much higher. Strange to say, however, such assertions nearly always come from people who claim to believe that free-market economies are wonderfully flexible and innovative, that they can easily transcend any constraints imposed by the world’s limited resources of crude oil, arable land or fresh water.

So why don’t they think the economy can cope with limits on greenhouse gas emissions? Under cap-and-trade, emission rights would just be another scarce resource, no different in economic terms from the supply of arable land.

Needless to say, people like Newt Gingrich, who says that cap-and-trade would “punish the American people,” aren’t thinking that way. They’re just thinking “capitalism good, government bad.” But if you really believe in the magic of the marketplace, you should also believe that the economy can handle emission limits just fine.

And putting it in light of the economic downturn:

Right now, the biggest problem facing our economy is plunging business investment. Businesses see no reason to invest, since they’re awash in excess capacity, thanks to the housing bust and weak consumer demand.

But suppose that Congress were to mandate gradually tightening emission limits, starting two or three years from now. This would have no immediate effect on prices. It would, however, create major incentives for new investment — investment in low-emission power plants, in energy-efficient factories and more.

Krugman rarely weighs in on this debate, but voices of reason, such as his, are invaluable to remind us that not only should we do everything we can to take care of the problem of global warming, it’s economically feasible to do so.  

Or, in his words:

So can we afford to save the planet? Yes, we can. And now would be a very good time to get started.

Related posts:

1. Bill McKibben Discussing Feedback Loops and Global Warming I’ll probably be adding more posts like yesterday’s and today’s...
2. Op-Ed from the NY Times: Running Out of Planet to Exploit Here’s an Op-Ed piece By Paul Krugman of the New...
3. NY Times: Obama Admin to Regulate CO2 [caption id="attachment_795" align="alignright" width="300" caption="How will regulating carbon dioxide affect...