Category Archives: Unintended Consequences

“Kind of silly” to debate science

Speaking at the Eco:nomics conference, Al Gore once again sounded his “planetary emergency” alarm even as he refused to discuss the matter with Danish environmentalist Bjorn Lomborg.

he was challenged by Mr. Lomborg, the Danish skeptical environmentalist who thinks the world would be better off spending more money on health and education issues than curbing carbon emissions.

“I don’t mean to corner you, or maybe I do mean to corner you, but would you be willing to have a debate with me on that point?” asked the polo-shirt wearing Dane.

“I want to be polite to you,” Mr. Gore responded. But, no. “The scientific community has gone through this chapter and verse. We have long since passed the time when we should pretend this is a ‘on the one hand, on the other hand’ issue,” he said. “It’s not a matter of theory or conjecture, for goodness sake,” he added.

Reporting from the conference, Kim Strassel interviews big-time CEOs who regret getting on the cap-and-tax train.

In other news, the Washington, D.C. global warming — er, climate change — rally was cancelled due to snow.

Danger Zone

We are in a new, if entirely predictable, danger zone. The State of Illinois and City of Chicago are now ceasing business with Bank of America because BofA declined to extend credit to Republic Windows and Doors, a plant where workers are now engaged in a sit-in. 

The take-over of much of the U.S. financial industry — with health care and maybe energy next — could lead to endless mischief of this sort and much worse.

A friend writes to say: “fascism has come to America.” Alarmist, or prophetic?

We Know Exactly What We’re Doing

With the government doing so many things so quickly to relieve problems it really doesn’t understand very well, what will be the results? Do we know? Do they? Not really. Not really at all. Just one unintended consequence among many cited today by Brian Wesbury:

Take, for example, the extension of unemployment benefits enacted in June. Normally, jobless benefits are available for 26 weeks. The extension, which will last temporarily through early next year, added another 13 weeks. Following this, between June and October – in only four months – the unemployment rate has risen from 5.5% to 6.5%, a full percentage point.
What’s odd about the jump in the jobless rate is that it has been accompanied by an unusual increase in the number of people who say they are looking for work. Normally, when the unemployment rate leaps upward we see a decline in the share of the population either working or looking for work (what economists call the participation rate). Not this time.
In order to receive unemployment benefits, a person must be looking for work, so the extension of benefits is artificially coaxing many people who would no longer be in the workforce at all to say they are still looking for work, just so they can continue to collect benefits. The unintended consequence is that the unemployment rate is boosted faster and further than normal in a recession, making it more likely that policymakers further extend benefits, boosting the deficit and pushing up future tax payments.