Cod fishery restrictions

Nice article in today's WSJ (available on Blackboard for class members) about how to optimize fish stocks: restrictions on cod fishing have helped but, some say, not enough: restrictions may need to tighten, putting further pressure on New England and Eastern Canadian economies. (We'll talk more about fishing in a few months.)

Update: looks like many of the restrictions have passed. In response the NYT made a nice little video right here that makes good economic points about elasticities, opportunity costs, and other relevant concepts. It's short; take a look!

Carbon taxes: back in the spotlight?

Farm supports and subsidies cost taxpayers hundreds of billions of dollars each year, particularly when erratic weather destroys crops. To address climate change, a force that may be behind some of the erratic weather, it's important to raise the cost of energy (as we talked about a bit in class today) to facilitate the development of alternative. However, farmers also use huge amounts of energy not only for their equipment but also to produce their fertilizers and pesticides. Raising taxes would raise the amount of money farmers need to cover their costs, which would send them hat in hand to the government in a vicious cycle. Nice summary of this loop in today's NYT.

Retroactive subsidies

I think this one must be purely handing out money to friends of some Congressional representative: the fiscal cliff bill includes retroactive subsidies, meaning that people get paid for doing things last year that they didn't know warranted government support. Huh? 

Biodiesel sounds like a good idea, and in some cases it is. If we can make use of grease leftover from barbecue restaurants by turning it into fuel, I'm all for it. However, turning crops into a weak gasoline substitute turns a good into two bads: overpriced fuel and more expensive food. Not something that seems to me like a good investment.

Your government at work, ladies and gentlemen.