There’s another rip in the economic fabric heading our way. So in a Potpourri Politics and a Pint, we’ll talk a little about cap-and-trade, unintended consequences and the economic house of cards we find ourselves hiding under.
Details:
What: Lively discussion and good company
Where: Politics and a Pint at the Contented Cow in Northfield Minnesota
When: 6-7:30PM, 21 Jun 2009
References:
- Guest Post: Cap and Trade Draws An Ace – Rebuilding The House of Cards, by Doug Williams, Bogus Gold
- Dude, Where’s My Cap-And-Trade Primer?, by David Kestenbaum and Steve Inskeep
- Meet Cap ‘n Trade, “Cap and Trade is the linchpin of the government’s effort to curb carbon emissions. Senior Editor Paddy Hirsch explains how the cap and trade model works.”
(More)
My comments at the House of Cards:
You [the author] nicely wrote: “But now, suddenly, through clever use of modeling against a particular set of climate data, we now have that previously elusive formula by which we can take a single variable – in this case carbon dioxide emitted – ignore every other related factor and state with certainty what its proper impact in the overall “global warming” scheme will be! Amazing!“
It’s deja vu all over again. It’s just like when Kansas declared pi was 3.0 (as opposed to 3.14159259(etc)). The government will set a function as the standard for measuring the impact and predicting outcomes of changes in carbon emissions. The fact that the equation is not connected to reality does not impact the trading and money exchanging, but it sure makes for an ugly moving target when the real mathematics drive the system away from the predicted (and bought and paid for) behavior. Li’s equations are the latest example, but my favorite mathematics of hope winning out over the mathematics of reality is the former Soviet Union’s use of “Leontiev equations” in an attempt to plan their economy. As an analyst schooled in statistics and mathematics I tremble when “too big to fail” governments worship at the altar of hopes and dreams and ignored the realities beneath. As I tell people, “it is fun to dream of flying, but if I am at 30,000 feet I want a correctly engineered plane around me, and that usually means ‘engineering safety margins’ built in because sometimes 2+2 is just not quite accurate enough.
