Category: Contrarian Economics

Raise the Gasoline Tax? Funny, It Doesn’t Sound Republican – New York Times:

A piece about the  “Pigou Club,” economists who favor taxes on things that have significant externalities, in this case, fossil fuels.

In late September, as [Alan Greenspan] spoke to a group of business executives in Massachusetts, a question was posed as to whether he’d like to see an increase in the federal gasoline tax, which has stood at 18.4 cents a gallon since 1993. “Yes, I would,” Mr. Greenspan responded with atypical clarity. “That’s the way to get consumption down. It’s a national security issue.”

Mr. Greenspan isn’t the only Republican-aligned economist to have discovered, or rediscovered, a fondness for higher energy taxes since leaving government service. N. Gregory Mankiw, the Harvard economist who served as chairman of President Bush’s Council of Economic Advisers from 2003 to 2005, favored a higher gas tax before going to Washington, and has been banging the drum loudly for it since he left. On his blog, Mr. Mankiw has formed the Pigou Club, named for Arthur C. Pigou, the British economist credited with introducing the notion that taxes could be used to correct imperfections in the market. The roster of what Mr. Mankiw calls “economists and pundits with the good sense to have publicly advocated higher Pigovian taxes, such as gasoline taxes or carbon taxes,” includes some of the usual suspects — Paul Krugman, a columnist for The New York Times, and Al Gore, for example — as well as unusual suspects like Gary S. Becker, the economics professor and Nobel laureate at the University of Chicago.

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The few, the proud, the very rich « The Berkeley Blog:

“Upon closer inspection, the Forbes list reveals that six Waltons—all children (one daughter-in-law) of Sam or James “Bud” Walton the founders of Wal-Mart—were on the list. The combined worth of the Walton six was $69.7 billion in 2007—which equated to the total wealth of the entire bottom thirty percent!”

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School Lunches and the Food Industry – NYTimes.com: An increasingly cozy alliance between companies that manufacture processed foods and companies that serve the meals is making students — a captive market — fat and sick while pulling in hundreds of millions of dollars in profits. At a time of fiscal austerity, these companies are seducing school administrators with promises to cut costs through privatization. Parents who want healthier meals, meanwhile, are outgunned.

Each day, 32 million children in the United States get lunch at schools that participate in the National School Lunch Program, which uses agricultural surplus to feed children. About 21 million of these students eat free or reduced-price meals, a number that has surged since the recession. The program, which also provides breakfast, costs $13.3 billion a year.

Sadly, it is being mismanaged and exploited. About a quarter of the school nutrition program has been privatized, much of it outsourced to food service management giants like Aramark, based in Philadelphia; Sodexo, based in France; and the Chartwells division of the Compass Group, based in Britain. They work in tandem with food manufacturers like the chicken producers Tyson and Pilgrim’s, all of which profit when good food is turned to bad.

Here’s one way it works. The Agriculture Department pays about $1 billion a year for commodities like fresh apples and sweet potatoes, chickens and turkeys. Schools get the food free; some cook it on site, but more and more pay processors to turn these healthy ingredients into fried chicken nuggets, fruit pastries, pizza and the like. Some $445 million worth of commodities are sent for processing each year, a nearly 50 percent increase since 2006.

The Agriculture Department doesn’t track spending to process the food, but school authorities do. The Michigan Department of Education, for example, gets free raw chicken worth $11.40 a case and sends it for processing into nuggets at $33.45 a case. The schools in San Bernardino, Calif., spend $14.75 to make French fries out of $5.95 worth of potatoes.

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To save pennies on food and fuel, we let industries poison our children:

In 2005, researchers at Mt. Sinai Medical Center in New York released their finding that mercury air pollution was costing the U.S. economy $8.7 billion a year in lost earnings due to diminished IQs of children exposed to mercury in the womb.

Mercury is well known and well understood as poison — to both children and adults — but it also is a developmental toxin. It affects developing fetuses and children in a way that it doesn’t affect adults, and its effects are permanent and irreversible.

Lowered IQ. Lessened ability to learn. Reduced capacity for life. Why?

Because we like cheap electricity, and in today’s market coal-fired electricity is the cheapest. When coal is burned, mercury is released into the air. Then it makes its way into the nostrils, lungs and brains of our children.

The solution is simple: Require all coal-fired power plants to install equipment that captures mercury before it escapes into the air.

Try that idea out on the power and coal companies. You won’t have long to wait for the denials, evasions, knee-jerk rejections of data, lobbying and the charming PR that is churned out by the industry resistance machine.

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Charts: 6 Big Economic Myths, Debunked | Mother Jones: #1: The stimulus failed.

Everyone from the nonpartisan Congressional Budget Office (PDF) to private-sector forecasting firms have concluded that the 2009 stimulus package increased economic growth, reduced unemployment, and put millions of people back to work. It just wasn’t big enough, or long-lasting enough.
Bust or Boost?

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Study: Well fees still aren’t enough:

Plugging an abandoned Marcellus Shale gas well in Pennsylvania could cost $100,000 or more, and well bonding changes proposed by the Corbett administration could stick taxpayers with almost all of that bill, according to a study from Carnegie Mellon University.

The CMU study found that the new Marcellus gas well bonding fees, recommended by Mr. Corbett’s Marcellus Shale Advisory Commission and now under consideration in the Republican-controlled Legislature, would require drilling companies to cover only a fraction of the costs of plugging and decommissioning old, nonproducing and abandoned gas wells.

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Commitment to Development Index : Center for Global Development:

Just in case you were wondering how the US does in foreign aid.

2011 Commitment to Development Index

Which wealthy nations are helping poor ones most? Rich and poor are linked in many ways. Each year, the CDI scores wealthy governments on helping poor countries via 7 linkages: aid, trade, investment, migration, environment, security, and technology. It averages over the 7 for an overall score.

Here are the graphics for foreign aid, by itself. We in the US are 17th.

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