Monday, October 15, 2007

Stop Ordering People Around

A while back there was a blogospheric blip about washing machines. It seems that the feds mandated greater energy efficiency, and as a result, Consumer Reports found that the newer machines (at least ones that cost less than $900) don't get clothes particularly clean. As John Tierney observed, this was the predictable result of the new standards. Indeed, it was predicted, but the advocates of more regulation just shrugged it off. Alex Tabarrok makes even more interesting point: the new regulations might not even save energy if, as a result, everybody washes their clothes twice.

This is why Megan McArdle gets it exactly right when she argues in favor of a carbon tax. A carbon tax (or cap-and-trade system, which she argues against on other grounds) doesn't require any government official sitting around in Washington to figure out how much energy a washing machine ought to use, and whether it's worth trading some level of cleanliness for cost savings. It doesn't require somebody in Washington to decide whether the energy savings of compact fluorescent bulbs outweigh the ugly light, or the best way to calculate gas mileage.

All it requires the government to do is to set the tax rate, measure the output, and collect the taxes. The market can take it from there.


MikeT said...

That would result in no new powers for the government, therefore it would have no reason to pursue such a simple plan. On top of that, it would "tax the poor," which would get politicians in trouble. Personally, I am all in favor of taxing the poor, since they draw significant benefits from the government, and make much of the policing by the state necessary in the first place, but it wouldn't go over well with the bleeding hearts who think that only the middle and upper class should be taxed.

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