Early Night  

I've got the flu, so no post tonight.

There is plenty of fresh stuff in the link bucket if you're after some news though.

Plus here's a quote from a Lester Brown interview in Wired last month.

Wired News: The real cost of gas, you argue, is $11 per gallon. How do you get that figure?

Lester R. Brown: Part of that cost is being deferred; part is being paid now. The study that I cite is the most detailed one I've seen. It parallels in methodology the study the Centers for Disease Control did on (the) social cost of smoking cigarettes. The costs to society of smoking a pack of cigarettes they calculated at $7.18. And they included two costs: the cost of treating smoking-related illnesses and the cost of lost worker productivity from those illnesses.

In the case of the cost of a gallon of gas, they included a number of costs: the cost of treating respiratory illnesses, the damage from acid rain and climate change. And that's a very difficult thing to do. There's a quote by Oystein Dahle close to a decade ago now, after the collapse of the Soviet Union. He was for many years Exxon's vice president for Norway and the North Sea. He said, "Socialism collapsed because it did not allow the market to tell the economic truth. Capitalism may collapse because it does not allow the market to tell the ecological truth." That's a lot of wisdom distilled into those two sentences.

WN: The world, you write, needs more economists who think like ecologists. Please explain.

Brown: One of the most interesting manifestations of realizing this at the government level came in China in the summer of 1998, when there was extensive flooding in the Yangtze River basin. It went on for weeks and weeks.

It eventually caused $30 billion worth of damage, which is roughly the value of the annual rice harvest in China. This was a big hit on the economy. After some weeks of this, the government held a press conference in Beijing. And they said we've been saying this is an act of nature, and that's true. But we've now determined that there's a human contribution to this. And they then said they were going to ban all tree cutting in the upper reaches of the Yangtze River basin. They soon thereafter extended it to the entire country. They justified it in economic terms, and they said the value of trees standing is three times the value of trees cut. And what they were recognizing is that the flood-control services provided by forests are three times as valuable to society as the timber in those trees. In a sense, that's what the world needs to see.

And one from a note on the passing away of John Kenneth Galbraith - whose book on the leadup to the Great Depression is an interesting read for those of a libertarian bent - it explains where all the farm subsidy programs came from, for example.

John Kenneth Galbraith died yesterday. I spent several weeks earlier this year reading the Parker biography which I enjoyed (although it was surely a little prolix). He comes across as having been a surprisingly patrician character for someone who grew up in a small town in rural Canada – he enjoyed hugger-muggering with the powerful, and according to his biographer never once changed a nappy for any of his several children. But for all that, he was prepared to risk serious damage to his career in pursuit of truth, issuing, for example, a quite damning indictment of the Allied bombing of civilian targets in Japan when he was director of the United States Strategic Bombing Survey and might have been expected to toe the official line. He also showed himself entirely willing to break with political friends when he thought they were in the wrong. Whether he was a first rate economist or not (and he may very well have been; Brad DeLong for one has suggested that his contribution has been sorely under-rated), he was surely an absolutely first rate public intellectual, and genuinely witty to boot (Dan is fond of quoting his dictum that “The modern conservative is engaged in one of man’s oldest exercises in moral philosophy; that is, the search for a superior moral justification for selfishness. “) Someone who will be missed.