Tuesday, July 07, 2009

Sacrificing to the Earth Goddess: Political Environmentalism HARMS the Environment

An argument I have over here in Germany nearly every day: Environmentalism HURTS the environment. Recycling, the car buy-back program....almost everything we do to try show our support for the environment, HURTS the environment.

And the only counterargument I usually get is, "But the government wouldn't do this unless there is a good reason!" A variant, in other words, of "I was just following orders!"

Look, I admit that the U.S. has had some problems lately, blindly following our leaders into an unjust war, the Patriot Act, and the insane war on drugs. But...Germany? Are you kidding me? I would have thought the whole early-to-mid century experience would have made citizens skeptical of the claims of government.

It has had the opposite effect.
Germans simply assume that anything the government tells them to do must be (1) good for the individual, (2) good for the society, and (3) good for the environment. No need to check, no evidence counts, it is simple and abject faith that the government is always right. (Karl Marx famously said that if Germans were going to stage a protest to shut down a train station, they would buy a train ticket first.)

Then, when we come to an obvious clusterf**k, like the "Abwrackprämie" program, they say, "Ah, we need to have some reforms, and spend more money. Then this program will work. It is a good idea, it just hasn't been implemented correctly."

Um...no. It is a BAD idea, and spending more money on it will only make it worse. Here is a really insightful article on the "buy back," which has been a disaster in nearly every way. It is expensive, it has not helped the German auto companies, and it is BAD. FOR. THE. ENVIRONMENT.

Government is dominated by organized interest groups, out for profit. That's it, that's all you need to know. Everything else is just eyewash. The buy back program is a payoff to the car companies, and labor groups. It has nothing to do with the environment, except when it comes to selling the program to you saps who pay the bills.

To their credit, real German environmentalists, who actually DO care about the environnment, have come to this realization also. It makes no economic sense to scrap the cars, when they have lots of useful life left (first reuse, THEN recycle, right?). The problem is that if the cars are not scrapped, then they continue to pollute, in other countries where they will probably last for another 200,000k kilometers.

Jürgen Resch, who heads a German environmental group called Deutsche Umwelthilfe, said he expected "hundreds of thousands" of scrapping-bonus cars to be exported. "They will go on damaging the environment with emissions," he said, and wind up disassembled in countries where the scrapping standards are "far lower than ours."

Don't reform, folks. Abolish. Stop the madness.

Now the U.S. has a similar, perhaps even more ambitious, program. Not surprisingly, the German program has had some....

"... unintended consequences. First, the obvious car to buy, when an owner turns in a clunker, is small and cheap. That means sales of Hyundais, Dacias, Skodas and European-model Fords have been better stimulated by the scrapping bonus in Germany than sales of Mercedes sedans or BMWs. By the end of March, only about 24 percent of the bonus money had gone toward German-made vehicles — above all Opels and VWs. In May the German share had risen to 40 percent, according to a report by the German Association of the Automotive Industry (the Verband der Automobilindustrie).

The other problem, though, is regulating what happens to old cars. These schemes are no good for the environment if the clunkers don't get junked. A newsmagazine called Monitor, a sort of German 60 Minutes, examined the fate last February of a decent but down-at-the-heels 1994 Mercedes turned in for the scrapping bonus. The avenues for a junk dealer to re-sell a car that wasn't, in fact, junk, were numerous and tempting.

"It's an invitation to fraud," said Michael Wacker, a burly auto-parts dealer who pointed to a halfway decent VW resting on a hydraulic lift in his yard. "That's only got 62,000 miles on it. Plenty of people would like to drive something like that."

The market for slightly used, slightly gas-guzzling cars in Poland and the Czech Republic, not to mention Africa or Russia, is a lucrative reason for some junk dealers not to scrap still-drivable cars. The Monitor journalists had no trouble finding people to export their Mercedes from Germany in spite of documents claiming it should have been scrapped locally; and of course it's just as easy to pollute the climate from Russia or Africa as from Germany or the United States."

I have to admit, I am pretty excited about the US program. Here is the list of cars owned at Haus Mungowitz (yes, we have six cars. Ask NeanderBill):

1. 1999 Dodge Grand Caravan (170k miles) (18 mpg)
2. 1995 Ford Mustang (185k miles) (16 mpg)
3. 2001 Lincoln Town Car (105k miles) (22 mpg)
4. 2006 Ford F-150 full size pickup truck (40k miles) (15 mpg)
5. 2001 Ford E-150 conversion van (80k miles) (12 mpg)
6. 2005 Toyota Corolla (48k miles) (35 mpg)

The sum of the values of 1, 2, and 3 is about $1,000, maybe. But I am happy to do my public duty, and sell them three or four times their value to Barack Obama, as long as he pays me personally. My scruples would prevent me taking actual TAX dollars, of course. Of course, now that I know that it is my public DUTY to take the tax money, for the good of the environment...I'll have to think about it.


Justin M Ross said...

When someone in the U.S. buys a new car, chances are it is cleaner than the car it is replacing. The car it is replacing often gets exported to a developing country like Mexico, where it replaces a car that was dirtier than it.

Norman said...

Look at it this way: the tax dollars are going to be spent on something, and by someone. You obviously don't think Obama is a good steward of the public funds, so logically, those funds would be better utilized if you were in charge of how they are spent. Sounds like your public duty is to retrieve these dollars from government bureaucrats and put them to better use.

Anonymous said...

I think you miss the point Norman. Don't want to put words into anyone's mouth, but based on the authors' free market views, he would not want any central figure to spend money taken through taxes for programs like that mentioned in the article. It's Hayeks' calculation problem that makes such artificial spending inefficient. Seems not to be refuting how the tax dollars are spent, rather that we are even being taxed fro such failed programs.

Tim said...

Only speaking to the US plan, the cars are scrapped by definition. The $3500 or $4500 you get is in lieu of the trade-in, so Dr. Munger is probably even on #3 and up 2k on #1 and #2.

The US plan is limited to years since 1981, so none of mine qualify. Well, that, and there's not much that gets better than 31mpg (28+3) in a full-size sedan, but that's a different problem.

The money is only good on a new new car, and the dealer knows you're getting it, so I'm guessing that means there will be a small rise in the used market, a modest drop in the dealer discounts to buyer, and a large increase in new-car depreciation, if anyone uses the program. The problem, of course, is that Munger doesn't need three brand new cars this year, and I'm not sure average folks trading in a '00 Daewoo on an '09 Kia are the ones likely to get credit approvals.

To be fair, from what I read the environmentalists were pushing for a real increase in MPG originally, but honestly the vehicles just don't exist. How can you add 10 MPG to a 25-mpg Volvo without losing the utility of the station wagon? So the 3MPG gain, $3500 payment was kind of a compromise with reality, but it also stripmined the environmental aspect of the bill IMO.