> Every time a hurricane knocks out a town's electric grid and federal funds are used to repair it, that's a subsidy. When government authority to exercise eminent domain acquires easements or land to erect power distribution, that's a subsidy.
This is anti-government fervor carried to absurdity. No man is an island. What is the point of government if not to provide care in disastrous situations? And yes this is the peoples self-interest in carrying on a stable society. I support this kind of "subsidy" 100%.
Precisely. Government manipulation of the energy marketplace strongly impacts the economic viability of some energy sources over others.
Current market conditions mean people will choose traditional grid-backed energy (most of the time) for economic self-interest reasons.
Whether these subsidies are good or bad is up to the reader to decide. There are plenty of people on the internet that are willing to tell others 'what to think.' I just like to highlight what I believe to be the causation so we can achieve an optimal outcome instead of endlessly parroting dogmatic beliefs of any political party.
Then I support this intervention. This idea that there is some "pure" form of undisturbed economics that is practiced outside the framework of achieving some larger social objective is also an absurd myth.
> Oh then, is the subsidy for fossil fuels and roads driving increased intensity of hurricane storms?
I am unable to reply to this directly due to comment depth.
Public highways provide certain economic incentives. Land that would be of marginal utility due to transportation costs without public highways now has greater economic utility. This utility provides economic incentives to private automobiles to capitalize on that land. These public highways create traffic and pollution via suburban sprawl that would otherwise be much less. Public utilities also help subsidize suburban sprawl.
Increased economic destruction by hurricanes (whether worsened by fossil fuels or not) is due to government providing economic incentives to construct in coastal areas subject to hurricane damage. The federal government subsidizes flood insurance for properties in these areas, make the actual cost of ownership lower for the developers and higher for others (tax payers). Perhaps it's cheaper to not erect suburban neighborhoods in areas prone to flooding in the first place.
It's all interconnected. Government subsidies in their various forms impact economic decisions for better or for worse.
> If you think so then what should we do with the increased destruction of property who at perhaps only peripherally participated in that subsidy?
Don't subsidize the reconstruction of properties damaged by hurricanes and flooding. The market will equalize the situation by
1) Insurance will be more expensive
2) Property value will decrease due to increased insurance cost (total cost of ownership)
3) Builders will be highly incentivized to build more hurricane resistant buildings in order to obtain lower insurance rates
4) Hurricanes will have less economic impact due to the aforementioned facts
> Increased economic destruction by hurricanes (whether worsened by fossil fuels or not) is due to government providing economic incentives to construct in coastal areas subject to hurricane damage.
No, infrastructure built to hurricane standards 50 years ago might be perfectly strong to stand against current storms of the time. If increased storm strength is cause by fossil fuels (and that likelyhood is strongly supported by scientific studies), then the fossil fuels (with or with subsidies) will have incurred costs to a lot of other externalized actors. Shouldn't that industry have to pay?
> Don't subsidize the reconstruction of properties damaged by hurricanes and flooding.
By leaving "the market" to contend with increased hurricane resistance alone you have just caused increased expenses for everyone building homes for ignoring fossil fuel externalities (some of which was encouraged by gov't subsisdy). And it's not just homes, it's maybe reworking entire metropolitan areas sewer or housing zones.
All of this underlines that the practice of "economics" has no such neutral starting point. Any action, even the action of letting "the market" decide is a social and political decision of helping some parties over others (or, better, helping many parties together). And these decisions often can't be disaggregated into neat isolated and individualized transactions or responsibilities.
The US government says they shouldn't have to pay. I doubt there is enough data to state empirically that storm 'intensity' has increased substantially over the last 50 years relative to the last 1000.
We don't have a system in place to account for every environmental impact made by people. Is everyone that has ever dug a hole in the ground responsible in some small way for soil erosion to contaminate waterways?
Similarly, what about crop irrigation and water rights? Farmers use public waterways to the detriment of estuaries and deltas. This might cause economic and ecological problems down stream. This may cause destruction of property such as an oyster farm.
It's clear at this point that coastal environments are subject to change, and sometimes dramatic change, irrespective of human influence. This should factor into the cost of the property and its insurance.
> By leaving "the market" to contend with increased hurricane resistance alone you have just caused increased expenses for everyone building homes for ignoring fossil fuel externalities (some of which was encouraged by gov't subsisdy). And it's not just homes, it's maybe reworking entire metropolitan areas sewer or housing zones.
The cost of homes is not necessarily rising but being more fairly distributed to those who choose to live in high-insurance areas. The marginal value of the land will decrease, more money can be allocated towards home construction quality versus merely owning the land, and the cost of housing will normalize.
Higher cost to insure will place deflationary pressure on housing prices to normalize total cost of ownership.
So which is it? Do we have to carefully consider "subsidy" of some activities, or are we throwing up our hands and saying "we don't have a system in place to account for environmental impacts"? I would say economic impacts (instead of environmental) made by political decisions?
> The cost of homes is not necessarily rising but being more fairly distributed to those who choose to live in high-insurance areas.
I would dispute that claim. If a 200 year old plantation house in the south now has to be rebuilt to handle more extreme weather due to expanded areas of storm incursions are we to blame the "choice" of the current owners? This is to some degree a pretend level of market "choice" by people living in regions of the nation. What if a family has handed down that house for generations. Did they make a choice of any sort? But they'll have to bear the cost of the upgraded durability of the building beyond that of regular maintenance. Public city infrastructure is the same way - incurring completely unneccessary upgrade costs due to non-choice climate change.
The future always holds some level of uncertainty. At this point, most people believe climate change is a certainty, so they have to operate based on those assumptions.
I don't think anyone had this information 50 years ago, so who are we going to hold accountable?
Oh then, is the subsidy for fossil fuels and roads driving increased intensity of hurricane storms? If you think so then what should we do with the increased destruction of property who at perhaps only peripherally participated in that subsidy?
This is anti-government fervor carried to absurdity. No man is an island. What is the point of government if not to provide care in disastrous situations? And yes this is the peoples self-interest in carrying on a stable society. I support this kind of "subsidy" 100%.