In response to the recent financial crisis, the Obama Administration and the Federal Reserve Board are capping executive salaries and bonuses, and imposing a host of new regulations and mandates all in the name of reducing risk. If the rule of unintended consequences applies anywhere, it applies here. Government pay rules have been tried before and have consistently increased the very salaries and special bonuses they intended to curb. Besides, a sense of risk instead of the certainty of taxpayer bail-outs is precisely what would rein in some of the reckless corporate practices rightly decried by the government and American citizens.
p>Politicians and climate activists portray net zero climate policies as a win–win: good for the planet, good for the economy. A recent example is “Mission Zero,” a supposedly independent review of Britain’s net zero target led by the former minister who signed net zero into law. “Net zero is the economic opportunity of the 21st century,” it breathlessly proclaims. “We must act decisively to seize the opportunities in a global race.” Economics isn’t about races or moon shots but about comparative advantage and allocative efficiency. Nonetheless, the message we’re given is that the faster an economy decarbonizes, the wealthier it becomes. Through green alchemy, costs are transmuted into benefits.