Sunday, November 23, 2014

Working the Economic Levers

People think capitalism doesn't work because of how twisted some industries have become.  The levers of capitalism work today as they did one hundred years ago.  Except the markets have been able to rig the conditions so they don't work properly.

For some unknown reason environmental protesters thought it would be a good idea to bury their heads in the sand.

I can't see how anyone thinks this would work.

When the economic levers are set up properly, then it works the way it should. When you allow polluters to self-regulate and bail out banks that should fail that's the reason why it doesn't.

Look at this graph showing emissions:

During the economic crisis, around 2008, US emissions took a plunge to mid-1990's levels.  There was no change in regulations.  There was no political intervention, in fact quite the opposite people were worried about jobs not the environment. The environment fell off the top of mind status. It wasn't as important to everyone.  All that previous time the environmental movement was pushing for change, it took the banks almost going out of business to slow emissions growth and even reverse the trend. Demand dropped and emissions dropped the way it's supposed to work.

That means capitalism does work if you allow it to work.  If you want to change work habits, punish polluters with fines and punish worse polluters more.  That forces businesses to change how they operate.  If you are a person that wants change, don't buy products from the worst polluters.  That is more helpful than burying your own head in the sand.