The Zero-Sum Society by Lester C. Thurow

Author:Lester C. Thurow [LESTER C. THUROW]
Language: eng
Format: epub
Publisher: Basic Books
Published: 2012-02-13T16:00:00+00:00

The Distributional Conflicts

While environmentalism could easily lead to a higher-average real standard of living, it will not do so for everyone. For those who place a low value on a clean environment and must share in the costs, their real standard of living will fall. If a high-quality environment is purchased with ZEG, very sharp income reductions will be allocated to those who carry the greatest unemployment burdens. If a high-quality environment is purchased with effluent charges, income reductions will be allocated to those who now consume high proportions of polluting goods and services. If a high-quality environment is purchased with tax collections, income cuts will be allocated to those who pay the most taxes. In none of these three options is the payer necessarily the person who places the highest value on a clean environment.

The allocation of large income losses could be avoided if costs were allocated to those that place a high value on a clean environment, but this is difficult both economically and politically. Exactly who places what value on a clean environment and how should the necessary revenue be extracted from them? Even an approximate economic answer to this question is difficult but trivial compared with the political problem.

Environmentalists are not suggesting that they should pay for a clean environment because it is going to raise their real standard of living. They see pollution generated by someone else, and that someone else should pay the necessary cleanup bill. But that someone else” thinks environmental cleanup costs more than it is worth. Yet we cannot raise the necessary revenue to clean up the environment unless we can agree on who should pay the bill.

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