A Message To Obama: Incentives Move People
There’s a basic economic concept: incentives. The best way to get someone to do something is by giving them a reason to do so. Advertisers do this by providing a “free” issue of a magazine before they charge, or giving a massive discount to the first purchase of a product, only to charge full price in the next bout.
America’s energy consumption isn’t sustainable, and it’s one of the aspects that ties every issue together. Our involvement in the Middle East and the environmental disaster in the Gulf both reflect the consistency of energy in our political storyline, as does the coincidence that most prominent conservative politicians for the last generation (including GOP poster girl Sarah Palin) have come from large oil-producing states.
President Bush made several speeches about America’s problem, declaring that “America is addicted to oil.” No presidential declarations can change individual behavior, however.
In his speech last night, Barack Obama made several comparisons to our need for clean energy: our building a large degree of planes and tanks during World War II and our putting a man on the moon. These are apt analogies, but as he presented them, they lacked historical context. We went into massive industrial capacity during WWII because we had to destroy Nazi Germany and Imperial Japan, and we built the first nuclear weapon in just years because it was imperative that we do so before Germany, Japan or Russia did it first. We put a man on the moon because, starting with Sputnik, we were in a massive space race that was a public relations war for the hearts and minds of the world. The incentive to compete with other powers were incentives to end all incentives.
As far as energy goes, Americans don’t feel an imperative need to change their lives. Sure, intellectually they may think that it’s sustainable in the long run, but gas is still affordable. Companies still find it cheaper to package their materials in plastics (we’re not calling for government to artificially increase the price of these good to discourage use). Eventually, the rising competition with the Chinas, Brazils, Japans and Indias of the world may catch up and really change our behavior. Despite all the talk of economic devastation, we do seem to be in an era of an equilatiralizing international status quo. It will be that increased competition and levelling of the playing field between the world’s prominent economies, with Americans no longer the only people capable of living lavishly, that will eventually shift our behavior toward sustainability, not artificially increasing prices or other mandates. Fortunately, that increased competition with other powers is happening and will (by necessity) result in voluntary adjustments on the part of consumers.