The New Global Warming Paradigm

On global warming, the 2008 election will have a paradigm that is quite a bit different than most years. That's because John McCain agrees with the Democrats that global warming is a serious issue. Whereas previous campaigns were about the Democrats painting the Republicans as money hungry capitalist who were willing to sacrifice the economy for the sake of profits, and Republicans would paint the Democrats as eco alarmists. This campaign the issue of the existence of global warming won't be an issue. As such, I believe this campaign will likely come down to a re hash of the debate between John Kerry and Newt Gingrich on global warming.

In that debate, Newt argued that the way to resolve global warming is through a series of tax breaks to encourage private entrepeneurs to develop technologies that effectively deals with global warming. The Democrats want to create a plethora of new regulations to force business into being more eco friendly.

Last summer, I went to see John Rowe, CEO of Exelon, speak about global warming. Even then, Rowe made mention of a few studies and concluded that the existence of global warming is beyond debate, but rather a reality. Rowe then spent the better part of a half hour enumerating a plethora of regulations that must be installed in order to combat global warming. He even himself pushed a plan to create nuclear power which would cost half a trillion dollars. (paid for by the government of course)

The crux of the global warming debate will come down to this, and this debate will also be a part of a larger debate about how we see our economy and the government's role in it. If you are John McCain, you recognize a serious looming problem and you think the best way to deal with it is by encouraging private industry to innovate eco friendly products. If you are the Democrats, you don't believe there is enough time to wait for the free market to innovate new products, and so you mandate them through a series of regulations.

The global warming debate will frankly come down to a microcosm of a more general economic debate. On the one side, you have John McCain who believes that by limiting government, waste, and taxes, the free markets will find the best solution to any problem. On the other side, we have the Democrats who believe every problem can be solved with more government action and regulation.

That is exactly what we have seen with the debate in dealing with the real estate crisis. McCain believes that we had a speculative market and the market must correct itself. The Democrats, on the other hand, believe the free market won't help enough struggling families and they want to mandate government action. This action involves more taxes, more regulation, and larger government role (leading of course to more bureaucracy).

The exact same thing is in play in the debate over health care. The Democrats see 40 million uninsured, and they want significant government action. All their universal health care ideas involve three commonalities: more taxes, more regulation, and larger bureaucracies. McCain, on the other hand, wants to give tax breaks and create personal health savings account. McCain believes that less governmentinvolvement and more free market options for each individual is the best way to fix our health care system.

We largely have the same principles in play in the global warming debate. Just like most domestic policy debates, it is a choice between large nanny state solutions, and free market solutions, combined with tax cuts, and decreasing the size of government.