Or we could tax consumption. VAT's work very well in Europe. This avoids tax competition concerns very well, and makes tax evasion quite a bit harder, as well as simplifying the tax code.
"If a government wants to yank up additional revenue by gouging commuting in the same way it gouges everything else, then at least have the balls to be straightforward about it."
Suppose you are a social planner and have a limited supply of apples. How do you distribute them to your population?
We could give away apples to everyone who wants them, but it's pretty easy to see that we will run out of apples pretty quickly. In order to prevent crippling shortages, we would have to produce so many apples, that nobody could possibly want anymore.
Or, we could charge for the apples. And we could raise the price until supply is equal to demand.
"In a perfect world, you also need to factor in the costs of the police to track down and arrest the person, the prosecutor to convict the person and the prison to hold the person in the case they don't pay their fine. Complete justice would involve the cost to society being 0, not the criminal'
Not really, those things need to be funded anyway in order to make the threat credible. The lawyers and prosecutors would be paid anyway, though I suppose you could factor in danger pay.
"Over-fining is much better then working this out. Especially if you don't know the correct percentage that the person will be caught."
How? It's a bit complicated for a back of the envelope calculation, but it wouldn't take an applied mathematician more then a day or two. And considering the costs of over-fining, the investment would be worth it. And if you look at crime data, it is extremely stable. We can estimate the probability of getting caught pretty well.
From a purely economic point of view, money taken from fines are just as damaging to society as money stolen. Once you take this to account, and assume a Pareto income distribution(and assume that people commit a crime when the expected value of the crime is above their wage rare), it's surprisingly easy to find a fine that minimizes the total amount of money stolen(by criminals or government).
It's x/p-c/p, where c depends on income inequality. So actually, an optimal fine would be less than what I naively calculated earlier.
That's not justice either. You want to make penalty so that the total benefit from stealing is 0, not negative. So let n be the pentalty, and p be the probability of being caught. You want the payoff from theft, 500-p*n=0, n=500/p. At a 30% chance of getting caught, that makes the penalty $1200.
1) interpret it as a military expenditure, the constitution allows the federal government to spend money toward the national defense.
2) The research effects the economy, whether or not it's more beneficial leaving it in the hands of the tax payers than is a matter of debate(Research is a market failure that we try to fix with patents, but even they don't provide enough incentive for very long-term research). This research effects multiple states, and so we then can justify it by the interstate commerce clause.
The constitution is much more flexible than you imply.
Not true. At least according to the Supreme Court, the 14th amendment insures that states are bound by nearly all of the constitution just as strongly as the federal government.
Not only that, but the university most likely receives an enormous amount of federal funds.
"I guess you could even find (historically only maybe) some terrorists-Christians."
There are Palestinian Christians active against Israel. Nigerian Christians regularly hack their Muslim brothers to pieces. And of course, abortion bombings and white supremacy.
"It is about one group of people not excepting the beliefs or ways of other group of people, to the extent that they will risk anything for it."
No, it's not that at all. There are no large scale terrorist organizations that operate for that reason. The biggest problem with the terrorist's in Al-Qaeda, the Tamil Tigers, and other such organizations, are that it's members are completely sane(This is according to the FBI, not me). Sane people do not blow themselves up because they "don't accept the beliefs of other people", they do it because they feel that they have been wronged.
Terrorism is a tactic, that is all. It's about instilling fear in a population, so as to manipulate them to act in a favorable way. You know, like our bombing runs in World War II.
"We will never be able to make everyone happy."
We will never be able to make everyone happy, but we have a long way to go before we reach the point of diminishing returns.
Out of a sample of 50-150 people on the plane, atleast one will.
But this discussion is pathetic. You couldnt allow people to bring in their own guns. Otherwise a terrorist could just get some armor piercing rounds and depressurize the cabin. This most likely would not destroy the plane, depending on atmospheric conditions, but it would throw the plane into panic, and easily allow the terrorist's partner to sneak into the cabin. He can then break into the cabin(if the entire plane is in panic, this wouldn't be particularly difficult).
So instead, imagine five terrorists are temporarily given their government issue firearms(Most likely the ones the air marshals use, since they cant break the fuselage) as they enter a plane. Half way through the flight, four of them put a gun to the head of another passenger. Since we have four people with guns, it would be impossible to shoot at them without killing the hostage.
They then take their hostage to the cabin, and have their fun.
Bar that, it's not particularly difficult to obscure the source of a gunshot. At that point, the passengers start killing each other. Let the rest of the terrorists wait in the bathroom.
I can think of some methods that could determine which ballots are most likely to be fake, but that is not really acceptable for democracy. We could make a ballot box that mechanically counts the number of ballots submitted, that would pick up the issue in real time.
That is a rather naive way of looking at crime, race and trust have very little to do with it. Criminals tend to be poorer than the general population, simply because their time is worth less, and so a large amount of time in prison is not as large a deterrent as it would be for richer individuals(Notice, it is still a large deterrent, but a smaller one.) Black people on average, have much lower incomes then white people, and so, they commit more crime. Living conditions in the inner cities are squalid, so there is not much we can do to prevent crime from the deterrence point of view. On the other hand, attacking the causes of black people's lower incomes would do a lot more to help the problem.
But I want to reiterate, once you adjust for income, Black people commit about as much crime as a white person of the same income level, so race and perception have little to do with it.
"if you define "certain urban areas" with enough specificity, then you can demonstrate that any kind of person you want makes up the overwhelming majority of criminals."
Could you tell me which neighborhoods you would draw such that Jews make up the overwhelming majority of violent criminals? I say that without sarcasm, I was thinking about it, and it would be interesting to see your logic.
Ok, New York, DC, Atlanta, LA, and nearly every other city with a large population of poor black people. In nearly every urban area, poor people tend to be responsible for most violent crime. In most Urban areas with significant African American populations, they tend to be poor. This is a result of centuries of discrimination, bad education, and the network effects of poverty, but it is there.
The solution is to pour more money toward schools, maybe implement school choice programs, increase the earned income tax credit, etc.
"COPS made the young black man the national face of crime; it needs no "white supremacist plot" to reinforce in the minds of people that different is bad and scary."
I don't dispute that COPS was heavily distorted, but is there any evidence that the show really had any effect on racial perception? As a result of structural historical and economic reasons, black people make up the overwhelming majority of criminals in certain urban areas.
I would imagine the perception was already there because of this.
"The chinese government are like most governments in most modern nations - they by and large want to do what is best for the people, or what they think is best."
No, they are not. They want to stay in power, and keeping to people from starving is necessary to do that. Everything they do for their people is to keep them from rebellion.
"The big problem they have is that they have an incredibly vast country to control and simply not enough resources;"
If they wanted to help the people, they wouldn't spend huge sums of money on monitoring their population, torturing dissidents, and building the world's most advanced censorship regime. India has a billion people too, but they seem to run their country without wide scale torture.
Their big "problem", is that their people are only being kept from rebellion because of unsustainable economic growth, which the Chinese government is pursuing by inflationary monetary policy and environmental degradation on a scale unseen since the industrial revolution.
At some point, the growth will stop, and China's ethnically fractured population, made insane by generations of propaganda, will assert their power. I don't imagine it will be pretty.
"Try to be fair - criticize where there is genuinely something to criticize, praise where that is due. That's what we expect for ourselves, isn't it?"
Hitler did an amazing job building Germany's Autobahn network, Pinochet lead Chile to a path of economic prosperity, and China has build a great deal of infrastructure. We don't talk about these things, because they are far outweighed by the overall evil of the perpetrators.
"In spite of much PR and many executions, corruption remains as widespread as ever. The death penalty certainly doesn't seem to be a deterrent against corruption."
All he is saying is that executions don't seem to effect corruption. Zheng Xiaoyu was just one of those executions.
Learn to read, then I might take your opinions "serious".
And what is this market failure? And don't mention Global Warming or Traffic. CAFE standards are horribly inefficient ways to deal with either of those. The only things that can deal with Global Warming or Traffic are Cap and Trade Schemes, and Road pricing.
Before you mention either Regulation or a Carbon/Gasoline tax, answer this question: If scientists tell you that you need to lower CO2 emissions to level X, at what level do you set CAFE standards or a Gasoline tax in order to do so, and how do we do it in a way that minimizes economic damage for a given level of CO2 emission? There is no way to reliably predict the effects of Regulation or Carbon/Gasoline taxation ahead of time with any accuracy, and the resource allocations are not efficient.
A carbon credit scheme on the other hand, does not have this problem. CO2 emission is directly equal to the number of credits we auction off every year. And Coase's theorem ensures allocation efficiency.
I could debate you point by point, but that would defeat the purpose. I think we have the same overall goal, decreased CO2 emissions. Gasoline taxes are not a very efficient way to reach this goal, in terms of damage of the economy per level of CO2 production reached.
First, you miss an important point. Transportation only accounts for 14% of human produced CO2 emissions. If we are going to prevent Global Warming, we need an approach to control the other 86%. But the numbers of services that produce CO2 are staggering; it would be impractical to levy a separate tax on all of them. But let's ignore this for a moment.
Suppose scientists inform us that we must decrease CO2 emissions to a certain level next year. At what level should we set our Gasoline tax? That is a good question, and one that any Economist would have difficulty answering. In order to make this decision, we would need quite a bit of information that even the best Statisticians and Econometricians could not acquire (Price and income elasticity, which can not be determined with any acceptable accuracy)
And even if we somehow managed to do so, there is nothing that ensures that this allocation of CO2 is optimal.
Instead, lets consider a Carbon Cap and Trade scheme (Which also works for every other CO2 emitting good in the economy as well). Carbon credits will be auctioned off by governments at the beginning of the year, where they will be sold on a stock exchange. If any CO2 is produced, it must be covered by a carbon credit. With such a scheme, the Carbon produced would automatically move to the most profitable usage possible, ensuring the least economic damage for a given amount of economy-wide CO2 emission.
At the same time, companies have a direct financial incentive to develop technologies that decrease CO2 production (No matter where it's source.).
Most importantly, if we want to decrease the amount of CO2 emissions, all we need to do is decrease the number that we sell every year. The Market automatically sorts out everything else. We don't need any taxes or regulations or subsidies or public transit systems (though those might be a good idea for other reasons, depending on the city) to combat global warming. All we will need to do is lower the number of credits.
Right, but CAFE standard regulations do not allow us to regulate CO2 production very well. This is because once people have invested in more fuel efficient cars, the marginal cost to consume is lower, and they drive more. This can undo much of the effect of the increases efficiency.
This effect is extremely difficult to predict, and could only be done retrospectively, with a great degree of uncertainty. Global warming is an emergency, and we need something that works quickly and predictably. The only thing that fits that description is a carbon credit scheme.
In carbon-trading schemes it is critical to evaluate where the money is going.
No it is not. By Coases Theorem, the long-run market equilibrium does not rely on initial allocation.
"In carbon-trading schemes it is critical to evaluate where the money is going. The first thing to evaluate is who gets the credits in the first place. Are they given to the industries already producing CO2 emissions, who can then sell them off as they close plants and take in a windfall? This is what happened in Europe. Are they auctioned off by the government? Are the credits everlasting? Do they shrink every year so that CO2 targets are hit? Are a new set of credits auctioned every year?"
Because of income elasticity effects, the money from the auctions should go to the government, where it presuming will be spent on positive externalities. I have never seen any everlasting CO2 proposal, as they make transitions utterly impossible. In every proposal I have seen, they are sold every year.
"Some companies that are in favor of the CO2 trading schemes are those that burn massive amounts of coal."
Not if the government auctions the credits. In that case, the US coal industry may well disappear.
"Clearly buying more efficient appliances, such as a fridge furnace or lights would save me energy. These appliance efficiency standards are mandated by government. Higher standards would save consumers lots of money over the long term. They would also reduce CO2 emissions. Notice, under this regulatory scheme, I have saved money, while under the market-based approach, I have lost money."
You lost money in both cases. The cost of the energy efficient appliances is higher than it otherwise would have been, and now you have the opportunity cost of where else you could have spent that money. It's fully possible that buying a more efficient machine saves money in the long run, with the gains being larger than if you had invested the extra cost elsewhere.
But if that were so, the regulations would have been useless, as you would have bought the machine anyway.
"Let's look at cars. Under CAFE standard we get a pretty definite idea how much CO2 will be produced by passenger vehicles every year."
No, we don't, and this is the main problem with your approach. Suppose that our scientists tell us that CO2 needs to be at a certain level. At what MPG standard do we set the CAFE standards, in order to minimize cost to the economy while preserving the environment?
There is no way to know. This is because of "blowback". If we increase the mileage of a car, then the marginal cost of operation decreases, and if you are forced to make the investment, you have an incentive to drive much more than you otherwise would have.
Because of this effect, efficiency controls often decrease consumption much less than expected. The amount of Blowback varies from good to good, and is dependent on variables that only exist in the mind of Economists. Sadly, these variables can only be computed with a great deal of uncertainty, and even then, only retrospectively. To do it for every carbon producing good in the country would be impossible.
And this is just to decrease CO2 emissions to a desired level. If you wish to do so in ways that harm the economy in the least, we would need to begin a massive program of income transfers, assuming perfect information of the past future and present.
In a Carbon Credit scheme, both of these goals can be achieved trivially. If one wishes to decrease the level of CO2 emissions, just decrease the number auctioned at the end of the year to your desired amount.
Because the good is auctioned, each credit of carbon will go to the person willing to pay the most for it. Because of this, Carbon credits will be immediately allocated to the most profitable uses of CO2, ensuring that we will have the maximum GDP for a given level of CO2 emissions.
As a bonus, companies now have an incentive to research more carbon efficient processes, as less carbon produced translates directly into higher profits.(A problem with regulation is that once the company reaches the standard, they have absolutely no incentive to exceed it, this does not occur in a cap and trade scheme).
"he poor in America often falls into two categories: city dwellers [no car anyway, or have mass transit options]"
No... Most cities in the US do not have reliable public transit. Poor people drive cars, just shitty ones(And none of them fit the CAFE standards).
"So, it seems to me the way to do it is to raise the gas tax a penny. Each month. Indefinitely. This will ratchet up the demand for fuel efficient vehicles in a way that allows the new car market and the used car market a little time to adap"
This is not a valid economic policy. If there truly is an externality from Gasoline consumption(and there is, but one that I think could be handled better by a carbon tax/cap and trade scheme), then there is a fixed amount of taxation that would produce a social optimum. That level of taxation is the only one that makes sense, slowly working up to this level is just pointless.
"hose other things: mass transit, car pooling [more HOV lanes!], staggered work time, encouraging tele-commuting, improving intra city rail... all great things on which tUSA should be spending more money IMO."
How about this, directly charge people for the carbon they use, in some way(Cap and Trade Scheme, Tail-pipe emission control, or Carbon tax, though I prefer the first). And then let the Market sort it out. I would not support any additional measures beyond that.
Slashdot Mirror
Or we could tax consumption. VAT's work very well in Europe. This avoids tax competition concerns very well, and makes tax evasion quite a bit harder, as well as simplifying the tax code.
Suppose you are a social planner and have a limited supply of apples. How do you distribute them to your population?
We could give away apples to everyone who wants them, but it's pretty easy to see that we will run out of apples pretty quickly. In order to prevent crippling shortages, we would have to produce so many apples, that nobody could possibly want anymore.
Or, we could charge for the apples. And we could raise the price until supply is equal to demand.
What would you choose?
Not really, those things need to be funded anyway in order to make the threat credible. The lawyers and prosecutors would be paid anyway, though I suppose you could factor in danger pay.
"Over-fining is much better then working this out. Especially if you don't know the correct percentage that the person will be caught."
How? It's a bit complicated for a back of the envelope calculation, but it wouldn't take an applied mathematician more then a day or two. And considering the costs of over-fining, the investment would be worth it. And if you look at crime data, it is extremely stable. We can estimate the probability of getting caught pretty well.
From a purely economic point of view, money taken from fines are just as damaging to society as money stolen. Once you take this to account, and assume a Pareto income distribution(and assume that people commit a crime when the expected value of the crime is above their wage rare), it's surprisingly easy to find a fine that minimizes the total amount of money stolen(by criminals or government).
It's x/p-c/p, where c depends on income inequality. So actually, an optimal fine would be less than what I naively calculated earlier.
That's not justice either. You want to make penalty so that the total benefit from stealing is 0, not negative. So let n be the pentalty, and p be the probability of being caught. You want the payoff from theft, 500-p*n=0, n=500/p. At a 30% chance of getting caught, that makes the penalty $1200.
1) interpret it as a military expenditure, the constitution allows the federal government to spend money toward the national defense.
2) The research effects the economy, whether or not it's more beneficial leaving it in the hands of the tax payers than is a matter of debate(Research is a market failure that we try to fix with patents, but even they don't provide enough incentive for very long-term research). This research effects multiple states, and so we then can justify it by the interstate commerce clause.
The constitution is much more flexible than you imply.
Not only that, but the university most likely receives an enormous amount of federal funds.
There are Palestinian Christians active against Israel. Nigerian Christians regularly hack their Muslim brothers to pieces. And of course, abortion bombings and white supremacy.
"It is about one group of people not excepting the beliefs or ways of other group of people, to the extent that they will risk anything for it."
No, it's not that at all. There are no large scale terrorist organizations that operate for that reason. The biggest problem with the terrorist's in Al-Qaeda, the Tamil Tigers, and other such organizations, are that it's members are completely sane(This is according to the FBI, not me). Sane people do not blow themselves up because they "don't accept the beliefs of other people", they do it because they feel that they have been wronged.
Terrorism is a tactic, that is all. It's about instilling fear in a population, so as to manipulate them to act in a favorable way. You know, like our bombing runs in World War II.
"We will never be able to make everyone happy."
We will never be able to make everyone happy, but we have a long way to go before we reach the point of diminishing returns.
You know, 9/11 was an anomoly. Most hijackers just take the plane to Cuba.
But this discussion is pathetic. You couldnt allow people to bring in their own guns. Otherwise a terrorist could just get some armor piercing rounds and depressurize the cabin. This most likely would not destroy the plane, depending on atmospheric conditions, but it would throw the plane into panic, and easily allow the terrorist's partner to sneak into the cabin. He can then break into the cabin(if the entire plane is in panic, this wouldn't be particularly difficult).
So instead, imagine five terrorists are temporarily given their government issue firearms(Most likely the ones the air marshals use, since they cant break the fuselage) as they enter a plane. Half way through the flight, four of them put a gun to the head of another passenger. Since we have four people with guns, it would be impossible to shoot at them without killing the hostage.
They then take their hostage to the cabin, and have their fun.
Bar that, it's not particularly difficult to obscure the source of a gunshot. At that point, the passengers start killing each other. Let the rest of the terrorists wait in the bathroom.
It's not impossible, there is a rapidly converging series that approximates it. But there is no general and nice closed form solution.
Failing that, a re-vote.
The solution? Skin Firefox and change the icon, they couldn't tell the difference.
That is a rather naive way of looking at crime, race and trust have very little to do with it. Criminals tend to be poorer than the general population, simply because their time is worth less, and so a large amount of time in prison is not as large a deterrent as it would be for richer individuals(Notice, it is still a large deterrent, but a smaller one.) Black people on average, have much lower incomes then white people, and so, they commit more crime. Living conditions in the inner cities are squalid, so there is not much we can do to prevent crime from the deterrence point of view. On the other hand, attacking the causes of black people's lower incomes would do a lot more to help the problem.
But I want to reiterate, once you adjust for income, Black people commit about as much crime as a white person of the same income level, so race and perception have little to do with it.
Could you tell me which neighborhoods you would draw such that Jews make up the overwhelming majority of violent criminals? I say that without sarcasm, I was thinking about it, and it would be interesting to see your logic. Ok, New York, DC, Atlanta, LA, and nearly every other city with a large population of poor black people. In nearly every urban area, poor people tend to be responsible for most violent crime. In most Urban areas with significant African American populations, they tend to be poor. This is a result of centuries of discrimination, bad education, and the network effects of poverty, but it is there.
The solution is to pour more money toward schools, maybe implement school choice programs, increase the earned income tax credit, etc.
I don't dispute that COPS was heavily distorted, but is there any evidence that the show really had any effect on racial perception? As a result of structural historical and economic reasons, black people make up the overwhelming majority of criminals in certain urban areas.
I would imagine the perception was already there because of this.
Free Speech is not included in GDP calculations.
Yes, fully. Sadly, the equilibrium level of welfare for the population is lower for dictatorships then democracies.
No, they are not. They want to stay in power, and keeping to people from starving is necessary to do that. Everything they do for their people is to keep them from rebellion.
"The big problem they have is that they have an incredibly vast country to control and simply not enough resources;"
If they wanted to help the people, they wouldn't spend huge sums of money on monitoring their population, torturing dissidents, and building the world's most advanced censorship regime. India has a billion people too, but they seem to run their country without wide scale torture.
Their big "problem", is that their people are only being kept from rebellion because of unsustainable economic growth, which the Chinese government is pursuing by inflationary monetary policy and environmental degradation on a scale unseen since the industrial revolution.
At some point, the growth will stop, and China's ethnically fractured population, made insane by generations of propaganda, will assert their power. I don't imagine it will be pretty.
"Try to be fair - criticize where there is genuinely something to criticize, praise where that is due. That's what we expect for ourselves, isn't it?"
Hitler did an amazing job building Germany's Autobahn network, Pinochet lead Chile to a path of economic prosperity, and China has build a great deal of infrastructure. We don't talk about these things, because they are far outweighed by the overall evil of the perpetrators.
Yes, that would be great. This is China, a lot of people died the last time they tried the "common sense solution".
All he is saying is that executions don't seem to effect corruption. Zheng Xiaoyu was just one of those executions.
Learn to read, then I might take your opinions "serious".
A carbon credit scheme on the other hand, does not have this problem. CO2 emission is directly equal to the number of credits we auction off every year. And Coase's theorem ensures allocation efficiency.
First, you miss an important point. Transportation only accounts for 14% of human produced CO2 emissions. If we are going to prevent Global Warming, we need an approach to control the other 86%. But the numbers of services that produce CO2 are staggering; it would be impractical to levy a separate tax on all of them. But let's ignore this for a moment.
Suppose scientists inform us that we must decrease CO2 emissions to a certain level next year. At what level should we set our Gasoline tax? That is a good question, and one that any Economist would have difficulty answering. In order to make this decision, we would need quite a bit of information that even the best Statisticians and Econometricians could not acquire (Price and income elasticity, which can not be determined with any acceptable accuracy)
And even if we somehow managed to do so, there is nothing that ensures that this allocation of CO2 is optimal.
Instead, lets consider a Carbon Cap and Trade scheme (Which also works for every other CO2 emitting good in the economy as well). Carbon credits will be auctioned off by governments at the beginning of the year, where they will be sold on a stock exchange. If any CO2 is produced, it must be covered by a carbon credit. With such a scheme, the Carbon produced would automatically move to the most profitable usage possible, ensuring the least economic damage for a given amount of economy-wide CO2 emission.
At the same time, companies have a direct financial incentive to develop technologies that decrease CO2 production (No matter where it's source.).
Most importantly, if we want to decrease the amount of CO2 emissions, all we need to do is decrease the number that we sell every year. The Market automatically sorts out everything else. We don't need any taxes or regulations or subsidies or public transit systems (though those might be a good idea for other reasons, depending on the city) to combat global warming. All we will need to do is lower the number of credits.
This effect is extremely difficult to predict, and could only be done retrospectively, with a great degree of uncertainty. Global warming is an emergency, and we need something that works quickly and predictably. The only thing that fits that description is a carbon credit scheme.
No it is not. By Coases Theorem, the long-run market equilibrium does not rely on initial allocation.
"In carbon-trading schemes it is critical to evaluate where the money is going. The first thing to evaluate is who gets the credits in the first place. Are they given to the industries already producing CO2 emissions, who can then sell them off as they close plants and take in a windfall? This is what happened in Europe. Are they auctioned off by the government? Are the credits everlasting? Do they shrink every year so that CO2 targets are hit? Are a new set of credits auctioned every year?"
Because of income elasticity effects, the money from the auctions should go to the government, where it presuming will be spent on positive externalities. I have never seen any everlasting CO2 proposal, as they make transitions utterly impossible. In every proposal I have seen, they are sold every year.
"Some companies that are in favor of the CO2 trading schemes are those that burn massive amounts of coal."
Not if the government auctions the credits. In that case, the US coal industry may well disappear.
"Clearly buying more efficient appliances, such as a fridge furnace or lights would save me energy. These appliance efficiency standards are mandated by government. Higher standards would save consumers lots of money over the long term. They would also reduce CO2 emissions. Notice, under this regulatory scheme, I have saved money, while under the market-based approach, I have lost money."
You lost money in both cases. The cost of the energy efficient appliances is higher than it otherwise would have been, and now you have the opportunity cost of where else you could have spent that money. It's fully possible that buying a more efficient machine saves money in the long run, with the gains being larger than if you had invested the extra cost elsewhere.
But if that were so, the regulations would have been useless, as you would have bought the machine anyway.
"Let's look at cars. Under CAFE standard we get a pretty definite idea how much CO2 will be produced by passenger vehicles every year."
No, we don't, and this is the main problem with your approach. Suppose that our scientists tell us that CO2 needs to be at a certain level. At what MPG standard do we set the CAFE standards, in order to minimize cost to the economy while preserving the environment?
There is no way to know. This is because of "blowback". If we increase the mileage of a car, then the marginal cost of operation decreases, and if you are forced to make the investment, you have an incentive to drive much more than you otherwise would have.
Because of this effect, efficiency controls often decrease consumption much less than expected. The amount of Blowback varies from good to good, and is dependent on variables that only exist in the mind of Economists. Sadly, these variables can only be computed with a great deal of uncertainty, and even then, only retrospectively. To do it for every carbon producing good in the country would be impossible.
And this is just to decrease CO2 emissions to a desired level. If you wish to do so in ways that harm the economy in the least, we would need to begin a massive program of income transfers, assuming perfect information of the past future and present.
In a Carbon Credit scheme, both of these goals can be achieved trivially. If one wishes to decrease the level of CO2 emissions, just decrease the number auctioned at the end of the year to your desired amount.
Because the good is auctioned, each credit of carbon will go to the person willing to pay the most for it. Because of this, Carbon credits will be immediately allocated to the most profitable uses of CO2, ensuring that we will have the maximum GDP for a given level of CO2 emissions.
As a bonus, companies now have an incentive to research more carbon efficient processes, as less carbon produced translates directly into higher profits.(A problem with regulation is that once the company reaches the standard, they have absolutely no incentive to exceed it, this does not occur in a cap and trade scheme).
No... Most cities in the US do not have reliable public transit. Poor people drive cars, just shitty ones(And none of them fit the CAFE standards).
"So, it seems to me the way to do it is to raise the gas tax a penny. Each month. Indefinitely. This will ratchet up the demand for fuel efficient vehicles in a way that allows the new car market and the used car market a little time to adap"
This is not a valid economic policy. If there truly is an externality from Gasoline consumption(and there is, but one that I think could be handled better by a carbon tax/cap and trade scheme), then there is a fixed amount of taxation that would produce a social optimum. That level of taxation is the only one that makes sense, slowly working up to this level is just pointless.
"hose other things: mass transit, car pooling [more HOV lanes!], staggered work time, encouraging tele-commuting, improving intra city rail... all great things on which tUSA should be spending more money IMO."
How about this, directly charge people for the carbon they use, in some way(Cap and Trade Scheme, Tail-pipe emission control, or Carbon tax, though I prefer the first). And then let the Market sort it out. I would not support any additional measures beyond that.