Dr. Ben Ho’s piece in Tuesday’s New York Times entitled “The Conservative Case for Solar Subsidies” is certain to raise a few eyebrows amongst the conservative crowd. But Ho asks a valid question that I’m not sure conservatives have seen fit to fully address in the last few years: What, precisely, should free market denizens hold true about energy policy?
The facile response–that there should simply be no government role–doesn’t quite work here. To be fair, few conservatives suggest such a thing. Ho points out that when there are negative externalities to the production of a good or service the economically efficient policy response requires a tax, and our carbon-based fuels emit a variety of pollutants when burned. This holds true regardless of one’s opinion about the verities of carbon emissions and climate change: Smog–which results mainly from automobile emissions–remains a key contributor to myriad health problems in the United States, and particulate matter resulting from coal burning bedevils asthmatics.
But the libertarian solution is not quite as simple as imposing a tax that covers the socialized pollution costs of burning fossil fuels. We have a nationwide energy grid, one that the federal government played an integral role in conceiving and constructing. Without eminent domain, such a thing would have been all but impossible. The federal government’s regulatory apparatus also has an integral role in regulating power providers, and since the provision of power is a natural monopoly, it’s hard to conceive of an alternative, at least for the moment.