"Properly addressing climate change requires us to address the issue of consumption. We do that by making consumption more expensive."
Give Rep. John D. Dingell (D-Mich.) credit for cutting to the heart of the matter (OGJ, Sept. 3, 2007, p. 28).
His two sentences contain all the ingredients of wrong policy on climate change and energy. "Wrong" here means wasteful and ineffective.
First the congressman presumes to know how "properly" to address climate change.
What does he mean? Moderating emissions of greenhouse gases, which is feasible but expensive? Or influencing global average temperature, which might not be feasible and therefore should elicit caution with regard to cost?
From this ambiguity Dingell concocts a requirement that government "address" consumption, which means telling people how much and what types of energy to use.
Past intrusions of this type have come to expensive grief.
Governments can have only one notion about ideal levels of energy consumption: less than current levels. The extended pursuit of such a target represents an economic death spiral, the only escape from which is a return to market principles.
These days, alas, attention to market principles in energy politics is scarce. In the US, political allegiance to markets weakens as fuel prices rise.
So Dingell shamelessly lurches to a fanciful need for the government to make "consumption more expensive." This, of course, means relieving consumers of cash they would rather spend on something other than energy.
When markets divert consumers' funds in such a manner, consumers ferociously complain. They should complain louder when elected officials propose to hike prices.
In fact, consumers always should prefer price increases occasioned by the market to those forced upon them by the government.
The market tensions that raise energy prices eventually relax. The taxes and mandates essential to government control of consumption never subside until consumers recognize what's happening to them.
The oil and gas industry should wonder how much money Americans would waste on Dingell's version of classic energy folly before they woke up and demanded an end to his raid on their wealth.
(Online Sept. 7, 2007; author's e-mail: firstname.lastname@example.org)