Away from my computer last week, I thought I had come up with a new idea to save the world. Suppose everyone is given the right to buy only a certain number of gallons of petrol/gasoline a month; somewhat less than average current usage. You can use your allowance, or if you would prefer, sell it in whole or part on the free market either to those who want more than the allowance, or to brokers. Of course there might have to be extra allowances for those living in rural areas, and so on, but these are details, details ...
What I particularly like about this idea - and how it differs simply from a scheme of high tax - is that it is not obvious how on this scheme you win yuppie bragging points: should you keep your big fast car and be a net purchaser or, go by bike and be a net seller? Which sounds 'smarter'? Which is the way to 'beat the system' and win the admiration of your friends? But in any case, it provides people with an incentive to cut personal comsumption, which would be the sensible thing to do, given that the further twist in the scheme is that the allowance would decline over time, so as to make it increasingly costly to maintain the same consumption level.
It appears, though, that the idea has already been 'anticipated', and while I was away David Miliband, UK Minister for the Environment has experimentally floated a very similar idea. I saw this reported in a publication The Week, which styles itself as follows:
All the best writing from the British and foreign pressTHE WEEK IS A UNIQUE DIGEST which distils the best of the British and foreign press into just 44 succinct pages — ideal for today’s busy lifestyle. What’s more, The Week is a joy to read, keeping you entertained as well as informed.
The Week was launched in 1995 as an antidote to media clutter and information overload. Today The Week is one of the most influential and best–loved magazines covering current affairs in Britain.
This blurb is, actually, a pretty good description. Just what you need when you haven't looked at any news this week.
Miliband's version generalises to all energy sources and so is called a 'carbon allowance'. The trading is, in Miliband's scheme, handled by a central agency rather than the free market. Miliband suggested this in a speech, and then mentioned it on his own blog where it has attracted a number of comments, many rather dull and worrying about government's ability to handle the 'buy-back' scheme. A more extended argument along the same lines is here. But if a free market version came into being, what would happen? Would it be a way of giving the poor greater command over resources, or would it just provide a new way of ripping them off? And could we be weaned on to lower energy use this way? Comments welcome.
