I neglected to mention Al-Daini’s newer article on the question, which was published with the title “Climate Change: Governments Must Act To Reduce CO2 Emissions” at Huffington Post on May 6.
There he addresses two potential problems with this idea.
For one, people might object because this causes inflation. Al-Daini counters that the risk of inflation is minor compared to the risk of global warming. He says that inflation may not happen, since the GDP will be boosted as well as the money supply. And he says that without printing money, he expects that nothing will happen.
The other objection would be that this kind of government action is undesirable. Things should be left for the markets to figure out.
I partly agree with that objection. The Phaseout Profit Theory I am preaching all the time on this blog says that the global warming problem will be solved easily and quickly once the fossil fuel companies (and the climate activists) understand that reducing the supply of fossil fuel increases fossil fuel companies’ profits. High prices for fossil fuel would solve the problem.
But on the other hand, there is no such thing as a free market for energy. Most of it is decided by regulation. And subsidies. The idea that energy policy is decided mainly by free markets is not based in reality.
Anyway, I don’t agree with these objections. And here are a couple of other thoughts to support the original proposal (print money to pay for renewable energy).
For one, Central Banks can print money. They can’t print Arctic ice, once it is gone.
Anyone understanding the scale of the damage expected from global warming should agree that we need to do whatever is possible. If this is one simple way to find a couple of trillion dollars a year for speeding up the transition to renewable energy, anyone objecting is making climate change worse. There is no need to make it worse. It will be a disaster anyway.
Another point: In the long run, transition to renewable energy faster will always be cheaper. Printing the money now and getting rid of fossil fuel a couple of decades earlier will save a fortune in fuel costs down the road. And it will of course reduce the damages from global warming.