1.  With concern to the energy industry, where do you stand on the argument that free markets will provide the most economically efficient solution possible?

Libertarians agree with this argument. Knowledge is distributed in society, and thus it is logically impossible to consolidate it into a central planning authority that can make right decisions. Only with a pricing system free from government constraints can an economically efficient solution emerge.

2. It has been argued that intervention in markets, through the imposition of subsidies, results in misallocation of resources and wastes taxpayer money. Is this true with regard to the energy industry? Why or why not?

This is absolutely true. There is no exception for the energy industry that allows it to circumnavigate the problems of economic interventionism. Thus, libertarians advocate the deregulation of the energy industry to allow for free competition, stricter enforcement of property rights to de-incentivize pollution by companies (i.e. full restitution of damages), and abolition of all industrial subsidies whether for alternative energy or traditional energy companies.

3. In regard to economic welfare and prosperity, is there a distinction to be made between what is beneficial from a social and environmental perspective, and what is beneficial from a business perspective?

There is no distinction to be made, because on a truly free market actors operate to harmonize other actors needs with their own. This is the essence of trade — that we voluntarily exchange goods and services with each other and thereby make our lives better. The social and environmental problems that arise are primarily the result of governments not enforcing property rights, such as permitting pollution that hurts people or stealing people’s rightfully owned property with eminent domain.

4. In economic language a good is said to have a negative externality when the private cost to producers or consumers do not reflect the total social costs resulting from the production or consumption of the good.
a) Would you consider climate change to constitute a negative externality tied to the production and consumption of energy?
b) If so, what is your position regarding the efficacy of alternative energy subsidies in dealing with the problem of climate change?
c) Are there alternative solutions to the problem of climate change and the externality problem more generally?

Assuming that climate change is anthropogenic (you’ll have to forgive me, as a scientist I am inherently skeptical), it is indeed possible for it to constitute a negative externality, but as with all negative externalities it is caused by a lack of adequate property rights protections. See my recent peer-reviewed work on transportation pollution.

Given that climate change is a negative externality, that still does not indicate that the government should tax either corporations or individuals in order to provide monies for alternative energy subsidies. If climate change truly is an issue of property rights violations, than this provides a super-incentive for energy producers to be investing into alternative energy research from the outset, and need no subsidies to motivate them.

Finally, as many scientists have noted, especially Bjorn Lomborg, climate change may have positive externalities as well as negatives. How are you going to determine which to focus on?

The most general solution that I can proffer, and that I promote in my peer-reviewed article, is to get back to strict property rights enforcement via nuisance laws and pollution laws. In other words, damage someone’s property and you pay them restitution.

5. Can alternative energy incentives be an effective tool for reducing dependence on foreign oil? Why or why not?

If by incentives you mean subsidies, then I would say NO. Subsidies tend to discourage competition on the free market for such goods and services.

6. A separate solution to subsidizing alternative energy would be to tax carbon dioxide emissions. The implementation of a “carbon tax” could bring the private costs of CO2 intensive energy more closely in line with total resulting social costs, and thus make alternative energy more competitive with conventional production methods.  Where do you weigh in on the implementation of a carbon tax as opposed to subsidization of alternative energy or reliance on the free market?

On the carbon tax question, I would answer absolutely not! Given the hazards of interventionism as outlined above, carbon taxes are completely and utterly useless toward actually accomplishing anything given politicians and the laws of economics. Carbon taxes will not work and never will work.

7.        Which values have served you best, in your analysis of whether financial incentives for alternative energy are desirable?

I’m not entirely sure what you mean in this question, but if you are asking what informs my views the most on this issue then I would say economic law. Trying to circumvent the laws of economics in this arena is like trying to defeat gravity by throwing things up in the air. It is patently impossible.

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Libertarian Answers to Alternative Energy Questions

Anita Acavalos has an article at the Cobden Centre on the provision of science by the free market. Her conclusions are very similar to my own in my paper on Science and the Free Market in the Journal of Liberty and Society.

I love books like Malcolm Gladwell’s Outliers that describe how extraordinary people accomplish extraordinary things. The Mises Institute released a reprint book this week in this genre: How They Succeeded. It looks really cool.

There is no law in America anymore.

Austin people are smart. Challenge accepted.

Finally, my favorite comic of the week. As you have probably noted in these links, I’m a big fan of Pearls Before Swine.

Share your news and links in the comments!

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News of the Week: Jan. 2-8, 2011

There are plenty more reactions to Wikileaks to keep track of.

And somebody even has a reaction to my Students for Liberty article. (My response will be forthcoming next week…)

Apparently, NASA has discovered arsenic-based life (though some doubt). If I said this was kick-As, would you get the pun?

Lifehacker has a cool article about getting answers online (without using Google).

And finally, my favorite comic of the week.

Just FYI, there will not be a “News of the Week” post on Christmas Day next week.

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News of the Week: Dec. 12-18, 2010

Sooooooo, one more milestone down, about 250 experiments more to go. Better get cracking. Anyway, yay for me, blah blah blah. I’m excited.

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One more step toward a PhD…

When I consider your heavens,
the work of your fingers,
the moon and the stars,
which you have set in place,
what is man that you are mindful of him,
the son of man that you care for him?
You made him a little lower than the heavenly beings
and crowned him with glory and honor.

You made him ruler over the works of your hands;
you put everything under his feet:
all flocks and herds,
and the beasts of the field,
the birds of the air,
and the fish of the sea,
all that swim the paths of the seas.

O LORD, our Lord,
how majestic is your name in all the earth!

Psalm 8:3-9

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What is man, that you are mindful of him?

At any rate, I decided that I need to take a break this week from recording the Christianity and War Audiobook. This will give you a chance to get all caught up with everything thus far, and I’ll have a fresh podcast for you next Monday or Tuesday. For a glimpse at what life has been like here the past few weeks, see the following PHD Comic:

Actually, this isn’t quite accurate. My advisor *does* have confidence in my competence… Hehe.

By the way, here’s something else for you… A couple of people have asked me what the music is at the beginning of the podcast. That music, my friends, is by my favorite fingerstyle guitarist of all time: Michael Hedges. The song is called Ritual Dance. Incidentally, it was featured in the film August Rush, played by Kaki King (in the guise of the main character).

Michael died in a car accident in 1997, and thus the world lost one of the most innovative musicians of our time. He literally revolutionized the way guitarists practice their craft, and Michael’s work has influenced my own music quite a lot. He often was categorized as a “New Age” musician, but this is mainly because there really wasn’t a way to categorize him (and that he was on the Windham Hill label). Michael would often in response describe his music as “Heavy Mental”, “New Edge”, ““Acoustic Thrash”, “Deep Tissue Gladiator Guitar” or “Savage Myth Guitar,” amongst other terms. The wiki article says Michael was affectionately known as “The Guitarist from Another Planet.” yeah, he was a bit weird…

Here is the essential chronological discography of Michael Hedges with links to Amazon… I recommend every album but Road to Return, which is kinda kooky but has some great songs like Sister Soul and Communicate.

• Breakfast in the Field
• Aerial Boundaries (MP3) <– In my opinion, this is his best album.
• Watching My Life Go By (MP3)
• Taproot (MP3)
• Live on the Double Planet (MP3)
• Road to Return
• Oracle (MP3)
• Torched (published posthumously)
• Some compilations of his best stuff:
  • Beyond Boundaries
  • Pure Michael Hedges (MP3)
  • Platinum and Gold Collection (MP3)

You can also, of course, find many videos of him playing on Youtube. Most of them are live concert videos which prior to Youtube were extremely rare. It’s actually quite extraordinary that we have the opportunity essentially to watch and learn from the master himself whenever we want! Here’s one of my favorite songs, Aerial Boundaries, from a DVD Windham Hill made a while ago:

A toast to musical enjoyment!

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Taking the week off from recording the Christianity and War Audiobook…

It’s exactly 15 minutes and 30 seconds long, so I hope you’ll take a few minutes to listen in. I noticed early on that I was not always clear in my pronoun references, oops! The majority of the time when I used the pronoun “they” I was referring to the government bureaucracy. Oh well, it’s still pretty good!

Please feel free to offer comments. I definitely would appreciate it! Enjoy!

Right click here to download the entire audio file. [mp3]

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My ASC 2009 talk is now available!

• Acting in a very timely manner with my post yesterday, Nature reports that scientists are getting in line for their own part of the Obama stimulus package. And to top it off, these scientists think they should be planning the economy too: “The fact that we are invited to sit at the table with the economists when we are talking about the future of the US economy — it’s like a new day.” Pathetic.
• Republican Senator Rick Santorum continues to be an embarrassment to the decent conservatives everywhere, now even he is shilling for Obama. Quote: “There is an air of something big, something grand, something electric about to explode upon us. Barack Obama’s visage is everywhere. His relaxed and reassuring – even beatific – smile is omnipresent. So are his irrepressibly cute girls and their together mom.” Eeeewwwww.
• Lew Rockwell writes about the plane crash yesterday and the heroic pilot.
• Scott Ritsema (recent guest poster) reports that the 4th Amendment of the Bill of Rights has been effectively repealed by the Supreme Court, and by the SC “conservatives” no less. Will the nonsense ever stop?
• My wonderful friend Jaired writes about how the UN may try to interfere with parents and their children.

Now for some fun link goodness…

• Two of my favorite web personalities, Leo Babaua and Tim Ferriss, come together for an interview.
• Extremely geeky flash game (for my brother).

Last but not least, this is an insanely funny video of a gal who has only seen “bits and pieces” of the Star Wars trilogy trying to retell the story. I’m a huge Star Wars fan, so I laughed my socks off.

Star Wars: Retold (by someone who hasn’t seen it) from Joe Nicolosi on Vimeo.

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Speedlinking and fun stuff for January 16

My paper this year has to do with science and economics again. The talk will be called “Science and the Free Market: How the Government Distorts Scientific Research Through Public Funding.” Here’s the abstract:

Scientific advancement is said to be limited in the free market because no incentives exist to encourage fundamental research, and therefore the government should intervene by funding worthy scientific endeavors at national laboratories and universities through taxation of individuals and businesses. This assumption is not only based upon a flawed understanding of economics, but also introduces numerous problems in the production of scientific knowledge. As with all socialistic means of production, publicly-funded scientific research is subject to the Misesian calculation problem, the Hayekian knowledge problem, and perverse incentives, as well as other problems unique to scientific research such as ownership of knowledge and profits, political agendas masquerading as good science, and moral hazards and ambiguities. The conclusion is that publicly-funded research should be eliminated in favor of free market-sponsored research, and in this paper a model is proposed to answer objections to free market sponsorship.

Tune in on March 14th to the Mises Institute’s webpage and you will be able to see me give the talk live. I’ll remind you again as the time draws near.

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Austrian Scholars Conference 2009