Schwarzenegger "Sells Out" the environment

[Jerome Scuggs]

http://thinkprogress.org/2006/06/28/...r-environment/

I think this is bullshit... why should Oil Companies be forced to pay a tax funding the very thing that might directly compete with them, one day? I'm glad Ahnold didn't pass this initiative...it really would have been a slap in the face for the free market (oh, yeah... I'm an Ayn Rand fanatic).

I think people automatically assume that because a company doesn't want to pay a tax that could potentially lead to the own companies' downfall - perfectly logical, why would anyone dislike that? - that it means that the oil biz hates the environment.

What they should do is, offer incentives for oil companies to donate money to alternative energy research (tax breaks etc), or even offer them some sort of incentive to start up alternative energy research themselves.

I think people are trying to play a socialist game in a free market - you can't just slap a government regulation down and make everything better, you have to do it like business do it - offer money or incentives in exchange for good and service.

I guess this got me wondering - do people really think "big business" should have to carry the burdens of this sort of thing? That we can at once persecute them for all their wrongs and then depend on them to fund us (in essence - have our cake AND eat it, too)?

People are looking to the government more and more, really forgetting the spirit of how economically viable the free market is - instead of complaining about the environment - but doing nothing except protesting for someone else to do something - an entrepreneur could really pull some profit in if he started a biz that specialized in environmental cleanups...he'd have alot of clientele. And before a smartass asks why -I- don't start said business, well, quite frankly, I'm only 17, and I don't really give a fuck about conservation (but not in the ignorant 'fuck da trees' way, but you know, reading in-depth about environmental sustainability and that sort of stuff).

[Nickname]

8:jerome> i make a very political thread that raises a small point about liberals and their weird legislation, and of course no-one replies to it
8:jerome> maybe next time i should either change the thread title to GOD HATES FAGGOTS, or something

[genocidal]

Haha Jerome, you're an Ayn Rand guy? I have a real problem with objectivism myself but one of my friends is a big Rand guy too; we have some interesting discussions.

Maybe Rand will be strategic on this year's college topic.

EDIT: But as far as the actual thread's substance goes, I completely agree. Incentives over regulations.

[Liquid Blue]

I understand why the oil companies would be against it, why Arnold refused to support the ballot measure, and why people are angry about it.

Like you said, the oil companies don't want to fund something they might be competing with one day, that's basic common sense. It's not hard to see why Arnold didn't support the ballot- because the oil companies (Chevron in particular) have been funding his political career and it would be a giant slap in the face to them. Not only a giant slap in the face, but it would also piss them off and he wouldn't be able to rely on them for any money in the near future.


People are angry about it because of selfish reasons. Honestly, I can guarentee that 85% of the people that are angry, aren't angry for the right reasons (this could help the environment in the near future). People are far too selfish, especially Americans these days. They have been paying out the ass for gas in the past year, they see the oil companies making ridiculous profits, and they are pissed off because they want to see the oil companies lose some money.

That's it.

They've spent more money than they used to, they see someone getting rich off their money, and now they want the rich person to pay. While there are a few people that actually care about the environment, most couldn't give a shit- they hear the oil companies are involved and the first thing they think about it how much on gas they've spent, or " yep another fatcat company making money off of the little guy".

edit- sorry it took so long to reply, I was at work until 8 and then watched this badass old movie called " toy soliders", with the guy who plays sam from LOTR.

[Epinephrine]

In case you don't know, the exact same penalties were imposed on the cigarette industry a few years back. No one with any credibility has any problem with that.

The fact is, global warming is something which is hurting our planet. I don't care if you don't believe in global warming, it is happening and it's due to our industrial civilization. Will this bill stop global warming? Probably not, but the amount of money that could have been pumped into making alternative energies economically possible can do a good part in helping, especially in the richest, largest and most technologically minded state in America.

The fact is, America depends on imported oil to run. By reducing the amount of imported oil (by using alternative energies), America will buy a bit more leverage in the world stage. Sure America is the only superpower, but they are still completely beholden to oil. Will this bill change the balance of power in the world? Probably not, but then again, it could definately help. California has more cars than any other state in America.

The fact is, because individual consumption rarely ever has any real effect on a global scale, capitialism fails in addressing the root causes of world problems, this is known as the 'tragedy of the commons' and is a well known economic term. In fact the negative externalities which are felt by everyone cannot be accurately measured and thus no one ends up bearing the costs individually, but as a group, everyone ends up bearing the costs. This bill addresses this problem, by taxing the oil companies (which like cigarette companies promote a product which is widely liked and widely used, but which also can harm everyone when used).

The fact is California a few years back suffered a huge problem with rolling brownouts and not enough power. Although most powerplants are coal driven, it is politically not palpable to tax utilities because then everyone's power price would go up. Oil is a perfect target for such a tax because they have record profits from something which they don't really control (world oil prices). Many countries have nationalized oil companies, where profits directly go to government coffers (or in Canada, some of the profit of private oil companies goes to the government as part of a resource tax). America only has standard corporate taxes to address this. This extra money isn't going to do anything but just encourage oil companies to do more oil exploration or have their CEOs spend it on private jets. The fact is a small tax from record windfalls can have huge benefits for all of society.

The fact is, alternative energy is going to be one of the largest markets in the future. Surely as oil runs out and prices go up, all forms of alternative energy will become extremely affordable even without any subsidies whatsoever. Currently it is countries like Holland and Japan which have the edge on many such technologies. With some government incentives, California could conquer this field too just as they have conquered the world of computers. This in the end is good for the economy.


Now you say, "but it's still wrong to subsidize alternative energy! Artificially proping up alternative energy which is unsustainable is stupid and not in the spirit of America!" Well America does it all the time. Look at the agriculture industry. Look at the steel industry. Look at the automobile industry. I'm not going to argue whether subsidies are right or not, but the fact is this is something that in the future could immensely benefit Californians, Americans and the rest of the world.

Then you say "still, it's wrong to just target the oil industry. GOOOO capitialism!" To that I can only say you are a bit naive. It's true that these taxes would just add to either less windfall for producers or higher prices for consumers (most likely), but that's not a big deal. Aside from major oil producing countries and China's messed up oil policy, the entire world pays much more for oil than Americans do. This is not really one of the largest factors in America being more competitive in the world (there are many other structural things at play). Similarly, everytime there has been an oil shock in the past where prices shot up (such as the oil crisis in the late 1970s), the free market responded by becoming even more efficient in their use of oil and got prices to stabilize yet again. The fact is, the market will adapt.

Sure in the short term you may pay a bit more for gas, but in the long term things will balance out with your next car which will be much more fuel efficient, and also in the fact that you're creating more jobs in alternative energy by paying higher prices, alternative energy will lower the prices of all your other energy needs (as traditional energy becomes increasingly expensive), and society as a whole has contributed to helping the environment.

Finally, I don't agree 100% with just taxing the oil companies. The tax should actually be a bit more reliable. The oil companies via clever accounting and cyclical oil cycles will not end up paying that much in the end. Everyone should be taxed for this problem, and I completely agree with Thomas Friedman in the New York Times, that a gas tax should be imposed on all Americans just as we have in every other country in the industrialized world.

Just some final thoughts... California has a long and proud history of being a pioneer in the environment, and the rest of the country has historically followed. From catalytic converters, to tougher rules on emissions, California has long been at the forefront, and hopefully with this as well, where California goes, America goes too.


P.S. In a time of growing inequality and a lessening of ability to transfer from different economic classes, I'm baffed why people want to protect the fact that the mega rich are getting increasingly richer in some skewed view of capitalism and the American dream. 99.9% of people will never reach those levels of wealth (or alternatively in relation to this thread, be a wealthy investor that benefits from the windfalls of big oil), yet so many seem to support those policies which favour this. Do they just brainwash you guys really well down there, or are people really this ignorant?

[Jerome Scuggs]

I definitely agree global warming is something affecting our world, but you make it seem as if we are the reason it's happening - utterly oblivious to (communist) China's insane power industrialism. It's been shown that becoming "green" is economically profitable, but in a noncapitalist or even socalist country, that incentive doesn't play up.

That being said, let me define what capitalism is: a free market. By this very definition, it needs to be stressed that America is NOT A CAPITALIST NATION. I will use "capitalism" in conjunction with America simply because it's a widely held belief that America is a free market - while we once WERE, the plethora of regulations has since morphed into a weird perveted socialist system - the fact that this California bill was even suggested should be evidence enough here.

I am very familiar with the Tragedy of the Commons, I read Ophuls alot and even Hardin (who wrote the essay proposing the Tragedy), and you are misinterpreting it - Hardin suggests three solutions for the tragedy: regulation, compensation, and privitization. We've tried regulation - and because of it, we have oil shortages (imagine if we were allowed to drill offshore, or in ANWR), brownouts, and the other 'energy problems' that are driving this very issue. Imagine if the government regulated shoes...we'd all be fucked, and barefoot. We've also tried compensation - let's look at your cigarette company analogy. People are still dying, and smoking, no? The one thing we rarely, if ever, try, is privatization - letting the free market come up with an answer. This option is the most flexible - not held down by law or tax, and progressive as well, able to utilize technology at a faster pace. Let's use Hardin's own metaphor, the pasture with the livestock - now, if a private company owned the pasture, it would try to keep the pasture as abundant and clean as possible, to maximize profits from the shepherds who pay to use the fields.

And taxing energy is very palpable - federal excise taxes are 19 cents per gallon of gas, and state taxes make the total per gallon nearly 40 cents. Severance taxes add even more. Just paying for the right to bid to get the right to drill on federal lands is taxed...electricity and natural gas are both taxed as well. America hasn't nationalized oil/energy, but it might as well, seeing the stranglehold it has on the business.

Subsidizing - you mention argiculture, automotive, and steel industries. Well, I am not an expert on these subjects, so I took to google to find a few articles on the subject. What I found, basically concluded: government intervention ruined each industry: Agriculture (1, 2) Automotive (1) Steel (1). [All the articles are from LewRockwell.com - a source I read alot, but each article has a different author and their credentials are listed as well]

I'm at work, and I'm having to dodge prying eyes and such, so in interest of me not getting fired I'll go ahead and group the rest of your positions - because I do believe that yes, oil will run out, and yes, we will have to use alternative energy - but seriously, why spend all this money now when we have a massively viable option, right in front of us...Nuclear Power? Seriously, we have only had one meltdown - Three Mile Island - and even then, noone was injured or killed. Since then, no troubles at all. Two-thirds of France is powered by nuclear energy, and me having to use France as a model for comparison should show you how ridiculously far behind we are. Nuclear energy would make a fantastic transition from dependence on oil to having economically viable alternative energies.

And as the last post-script, I made an argument to that sort of myth in Liquid Blue's post. But if you want to read into it, Here's all the literature I read on the topic (as you can see by the results, lewrockwell.com is fairly unbiased in terms of topics discussed, which is why I depend on the site alot in economic discussions)

[genocidal]

Complete free market capitalism has been proven to fail. Think about monopolies and oligopolies. They are a natural part of the free market economy but are competition stifling; that is why government intervention via anti-trust laws is very appropriate to guide the market.

I'm a firm believer in market-sustaining and market-guiding measures - not market-repressing. I believe that the subject of this thread, forcing oil companies to invest in alternative energy, is market-repressing because it forces an unnatural investment. Like Jerome said earlier, incentives and taxes make perfect sense to invest in alternative energy in a market-sustaining way. Government should be an actor in the economy - it should not be THE actor though. Governments have the unique ability to tax and create large incentives (like tax breaks, preferential credit treatment, etc.) that can help the market grow while guiding it in an environmentally sound direction.

Granted this will take time, but at least it won't be at the expense of successful industries like oil. It's not just big business that has stakes in oil companies; it's us too (or your parents). Forcing investment in alternative energy creates false competition with the oil companies that will probably result in the failure of alternative energy industries or, if those industries do become profitable, will spell doom for oil companies and nations. Neither of those options is good, but it is important to recognize the need for alternative energy sources.

[Jerome Scuggs]

Complete free market capitalism has been proven to fail.

when/where?

All I can think of is a city that, oddly enough, was in China. I've posted the article here before but can't find it anymore - China lifted all economic regulations, and within a decade, the place doubled the size of NYC (it was a remote fisshing village prior), it's still going strong.

I think the monopoly argument is flawed, in that you load the dice - monopolies ARE evil! I don't believe it. Look at Microsoft, which people said was a monopoly - prior to it, Apple and Linux were able to still gain alot of footing. I think even if Microsoft hadn't been broken up, they would have still lost even more ground, due to intense campaigning by Linux, apple, firefox, Open Office, etc.

Then again, I guess after living under the biggest bastard of monopolies - the government - I guess you tend to get a sour taste in your mouth towards monopolistic practices.

Though when it's all said and done, I consider myself more of a 'minarchist', in that a government is necessary, but should remain hands-off (unless a scenario like gen described occurs).

[Epinephrine]

when/where?

All I can think of is a city that, oddly enough, was in China. I've posted the article here before but can't find it anymore - China lifted all economic regulations, and within a decade, the place doubled the size of NYC (it was a remote fisshing village prior), it's still going strong.

I think the monopoly argument is flawed, in that you load the dice - monopolies ARE evil! I don't believe it. Look at Microsoft, which people said was a monopoly - prior to it, Apple and Linux were able to still gain alot of footing. I think even if Microsoft hadn't been broken up, they would have still lost even more ground, due to intense campaigning by Linux, apple, firefox, Open Office, etc.

Then again, I guess after living under the biggest bastard of monopolies - the government - I guess you tend to get a sour taste in your mouth towards monopolistic practices.

Though when it's all said and done, I consider myself more of a 'minarchist', in that a government is necessary, but should remain hands-off (unless a scenario like gen described occurs).

The city you are refering to is Shenzhen and it's directly adjacent to Hong Kong, which is by far the most capitalistic place on the face of the planet. While free of many controls, Shenzhen is definately in a communist country, and if you think otherwise you need to get your eyes checked. Meanwhile, to be sure, Hong Kong works quite well and is an amazing city, but even in the most capitalistic place on Earth (as ranked by the Economist many, many times over) government policies still support many things such has social housing for the poor, very good government services and a very well paid civil service.

The fact is, if things were left only to the free market, almost everyone would lose out. Why is this? Because the system naturally favours the most intelligent and the most greedy. Eventually these people will figure ways to squeeze as much profit as possible from everyone else while getting ever more rich. Look at the age of the robber-barrons in the late 1800s and early 1900s if you want more proof.

The biggest confusion people have with the idea of the free market is about what it means exactly. Put simply, the free market is an amazing way to introduce healthy competition and healthy innovation in the economy because of incredible incentives to make things better (i.e. money). In a way it is like evolution. But just like evolution, the free market isn't is a free for all, there need to be constraints or else things will get out of hand. Evolution on Earth is limited by the Earth itself, and the free market must be regulated or else eventually the interests of the richest citizens will simply completely overwhelm everyone else because of their power and wealth.

As for your specific argument, you list many things.
1) Oil companies shouldn't be taxed to pay for this because we have enough taxes.

Fair enough. I agree that this was probably a bad way of going about things, and I proposed a gas tax which would tax everyone for the greater good.

2) The very idea of taxing companies in specific industries is stupid and is againt the free market.

Well it's done all the time in many industries, and on the whole it doesn't affect people that much. While you might actually be against taxing of all kinds, it's pretty silly to argue when most people out there see the reasons why these things are done.

3) The very idea of taxing an industry to fund something that is directly opposite to that industry is stupid.

I gave the cigarette company example, and you brushed it off. I don't know why, because the cigarette companies have to pay HUNDREDS OF BILLIONS of dollars for anti-smoking campaigns and rehab programs. Sure smoking hasn't stopped, but in the same vein, this bill woudln't have make oil companies go bankcrupt and make us all stop using oil. Less people are smoking now, and less people will use oil if alternatives are found which are viable.

4) The idea that I somehow thought the USA was responsible for all the world's global warming and oil problems.

I never said such a thing nor did I even hint at it. Reread my post. I merely said, this would be a good first step in addressing many of the issues. The USA is by far the single largest greenhouse gas producer in the world (responsible for 25%). The USA is also the wealthiest country in the world, and could readily afford trying to be even more environmentally friendly. Because of it's clout and power, if standards were changed in the USA and technologies were available, other countries would adopt it more readily than if America held out indefinately.

5) Somehow government intervention ruins industries, but somehow having tax incentives is okay.

They're the SAME THING. Either way, government is using money (or losing money from lost tax revenues) in order to stimulate development in something. You are directly contradicting yourself if you think it's bad but you still support it.

6) The idea that if left alone business is benovelent.

This is absolutely false. Business is concerned with the results of the next quarter. If they are a very far-looking company, they might have 5 year or even 10 year projections. But that is it. Global warming, and the impending end of oil will not happen so quickly. Furthermore, various industries will be affected differently. The real estate and insurance industries will be devestated by global warming and the climate changes and rising water they will bring. Big oil won't really have much trouble. Therefore business cannot be counted on because they only look out for themselves in a very narrow specific interest. If you believe otherwise I don't know what to say but that you are completely wrong.

7) Finally you mention nuclear power.

Fine, that's fine. My province has just pledged to make sure that 50% of our power remains from nuclear sources for the forseeable future and I think that was a good idea. I don't dispute nuclear power, but I also am not blind to the fact that we have no real place to store nuclear waste (in the US the Nevada site keeps getting protests, and Canada has no real strategy whatsoever) which is a huge issue. There's also the issue that even nuclear won't last forever. Contrary to popular belief we don't have unlimited uranium, and if all the world's power were nuclear we'd run out in ~20-40 years (I read this in popular mechanics a few months back not sure how completely accurate they are). We also can't build these plants that fast. The best way is to encourage multiple ways of obtaining energy and thus encouraging alternative energy.

[genocidal]

when/where?

First, I would argue that free market reforms have hurt most Latin American nations moreso than helped. The numbers in certain instances point in a different direction but the numbers don't take into account circumstance; like for example the Sandinista Revolution in Nicaragua. Invariably any type of reform would improve Nicaragua's economy after such a destructive war. The point now is that Nicaragua remains one of the poorest nations as well as being completely dependent on crop or mineral exports. Since being privatized, those industries now have a huge amount of political leverage that can and will stifle any kind of economic reform that would make it an industry-based economy.

Second, I would argue that free market reforms are what hurt Indonesia and South Korea so badly in the Asian economic crisis. These countries grew so fast because of economic-sustaining reforms (like preferential credit treatment for very large conglomerates [chaebols], temporary subsidies, and targeted intervention into sectors like technology where upgrades can be prohibitively expensive without government aid).

The late 1980s saw a move to privatization that in turn continued growth because of the newfound capital mobility. Investors could now invest very large amounts of money and then remove their investments within hours - and they did it. What happened then was the companies would rely on this investment to pour in and out and wouldn't curtail their spending on new industries and takeovers to adjust to the increased unpredictability. It was all fine and good until the capital mobility created economic uncertainty as opposed to risk. Investors would see others pulling out large sums of money and would have to react within minutes to avoid losing money for shareholders.

The result was a massive pullout of money that ended up causing a lot of harm to these economies. Since then, they've reverted back to a more state-oriented economy instead of free-market, hands-off capitalism. Banking reform has been a key part of this because, in free-market capitalism, the conglomerates could start their own banks and then grant themselves very large and risky loans. This is anything but economic competition.

I think the monopoly argument is flawed, in that you load the dice - monopolies ARE evil! I don't believe it. Look at Microsoft, which people said was a monopoly - prior to it, Apple and Linux were able to still gain alot of footing. I think even if Microsoft hadn't been broken up, they would have still lost even more ground, due to intense campaigning by Linux, apple, firefox, Open Office, etc.

My response is in my description of Korean chaebols' failure in the above paragraph. I'd be willing to bet that if the government hadn't stepped in on the Microsoft case they would have acquired Apple; especially after the success of iPods.

Though when it's all said and done, I consider myself more of a 'minarchist', in that a government is necessary, but should remain hands-off (unless a scenario like gen described occurs).

I think I agree with you here, though. Government ownership of industry is typically a bad thing except in some special cases (none of which happen in the US). Unless by "hands-off" you mean no credit incentives, loans, or bailouts (e.g. Chrysler) whatsoever - which I don't think you mean since you proposed it yourself.

I think countries in different stages of development need to use different tools at their disposal. A less developed nation needs to be more hands-on but should be very careful not to step into ISI gray areas (which I consider market-repressing because it creates artificial competition way out of the league of the artificial competition that incentives provide in the short-term).

[Jeenyuss]

for fuck's sake why don't we just rename the "political thread where multi-paragraph responses are the only responses that won't result in the user being papercut on the gooch, please"

[genocidal]

Write me a paragraphed response about the relative importance of goochs in the male anatomy.

[Cig Smoke]

dam u guys could start some sorta book store with all the books u guys writtin in this thread.

[megaman89]

only understood 2 words