You Have My Permission to Solve Global Warming

But not that of the EU Commission. At least not yet.

I am talking about the solution of giving fossil fuel producers the power of scaling down production in a coordinated way.

For example, if oil production was already scheduled as bitcoin production is (cutting production by half every four years), obviously emissions would go down fast. Oil left in the ground can’t cause CO2 emissions.

Obviously that would be very good news for the owners of those oil resources, since they would go up massively in value.

So these producers have a massive incentive to introduce some kind of schedule.

Unfortunately, that might be in violation of antitrust rules, which were introduced to a world which had no reason to worry about producing too much oil. For example, the Standard Oil case of the American Supreme Court was decided in 1911.

It follows that these antitrust rules are blocking this solution. It follows that they must stand back. Solving global warming is much more important than keeping gasoline prices low for consumers. Drivers should switch to electric vehicles anyway. Rising gasoline prices are a good thing to accelerate that change, not something that should be fought with antitrust law.

So here is my permission. Anyone who sets up a coordinated production plan for oil can be certain that I am not going after them for antitrust law violations.

I am sorry to say that the EU Commission, which actually has the power to enforce antitrust rules, has not issued a similar declaration.

So the oil industry might still need to find some way to deal with antitrust law before they can go ahead and solve the problem.

One way would be to fight. Tell the EU that they can go ahead and start some antitrust procedure or other. Tell them too that as a consequence, no oil from companies affected by such a move will be sold to the EU, so as to stop that oil from influencing the EU market (the pretext the EU uses to order all producers world wide to follow their rulebook).

Another way to fight would be to found some companies for the purpose. Give them some of the oil resources and have them start production schedules on those resources as a model case. Watch as the EU Commission makes fools of themselves by fighting this scheme while pretending to care about global warming. Use the precedent of winning that fight for expanding the scheme to the whole industry.

Bitcoin may be useful in any such scheme.

For one, it is an accounting scheme that can be trusted by all participants.

It may also be very useful to distribute and trade the production rights. It should be not too difficult to figure out exactly how to do that.

Anyway, the main problem is to get the road blocks from antitrust law out of the way. Bitcoin is not necessary for that and can not help much either.

But once the EU commission (and other antitrust enforcers) join me in giving permission to actually solving the problem, progress might be very fast.

Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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