Free Markets to Combat Climate Change

One of the concerns about climate change is that it may generate more natural disasters such as hurricanes and forest fires. People living along the Atlantic and Gulf Coasts or in forested areas of California may face higher risks if pessimistic climate predictions come true.That is disagreement about large-scale policy actions we might take to try and reduce future climate risks. Washington State voters, for example,soundly rejected a carbon tax on the ballot in 2018. People are skeptical of big government solutions to climate change.There are, however, many pro-market reforms we can take to reduce the risks to life and property from natural disasters. We can cut subsidies thatinduce people to live in flood and hurricane zones, and we can reform policies thatinduce people to live in fire-prone areas.    A 2010 World Bank / United Nations study “Natural Hazards, Unnatural Disasters” discusses market-based reforms that governments worldwide should take to mitigate risks. The report was endorsed by a very impressive group of liberal and conservative economists and experts.Here are some highlights:… governments should permit land and housing markets to work, supplementing them with targeted interventions when necessary. When land and housing markets work, property values reflect hazard risks, guiding people’s decisions on where to live and what prevention measures to take.… But markets, when smothered, dampen the incentives for prevention. In Mumbai, where rent contr...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs