Yes we can afford to curb climate change

Today's editorial by Paul Krugman on cap-and trade is very well written and exposes the fallacious arguments on both sides of the cap-and-trade argument. On the left, you have greenies saying that limiting greenhouse gas emissions will involve no pain on the part of consumer. On the right you have arguments that the consumer's pocketbook will catch on fire. Neither is true. Though I don't always agree with Krugman (not that my opinion matters much; he has a Nobel and I have a blog) I do think we occupy a similar chasm; we are not joiners. People do not come to us for support but the media likes to ask us for our opinions. I was thinking about this in my own case and wondering if I could find a better way to be part of a movement but I think my drive for independent thinking continually keeps me on the outside.

Anyway, Krugman argues that the costs of cap-and-trade will be borne by anyone who uses fossil fuels that are regulated. This is only common sense. It is also common sense that these costs would not be more than the price of carbon per ton. He also explains how these costs will be phased in over time, and how the price pressures might encourage investment in substitutions. None of this is new and we have talked about it since forever. But he did say the following novel thing (emphasis mine):

To put it another way, a commitment to greenhouse gas reduction would, in the short-to-medium run, have the same economic effects as a major technological innovation: It would give businesses a reason to invest in new equipment and facilities even in the face of excess capacity. And given the current state of the economy, that’s just what the doctor ordered.

I like it when people make me think.