The Free Market Helps the Environment

...this time. Living in San Diego for the past 30 or so years, I've seen the free market pave the place with tract homes so the free market is a mixed bag when it comes to the environment. Anyway, on with the story...

Today's Wall Street Journal (WSJ) describes how rising gas prices are curtailing driving and therefore, the emission of pollutants.

As gasoline prices continue climbing, demand has been heading in the opposite direction. So far this year, Americans have used less gasoline than they did in 2007, with demand since January dropping 1% from last year

It turns out that high gas prices have other, long-term beneficial effects.

During the energy crunch of the late 1970s and early 1980s -- the last time gas prices were close to current levels in inflation-adjusted terms -- consumers sharply cut back their gas consumption. When prices dropped, demand rose again, but at a slower pace because of the embrace of more-fuel-efficient foreign cars.

Those Cadillac Escalades won't be coming back any time soon. Here's the part that's silly.

But the steep run-up in oil prices and the prospect of them remaining high has prompted consumers, industry and lawmakers to make bigger, longer term changes that could reduce consumption for decades. Drivers are buying smaller cars, legislators are enforcing stricter rules on fuel efficiency, the market for alternative fuels is growing and people are shunning the far-flung suburbs to live closer to where they work.

And the reason I need a legislator to tell me I want a more fuel-efficient car is...what? Seriously. Why pass laws when the market is doing it anyway?

I'll bet these are on sale big time.
This hearkens back to the glory days of Gray Davis when California removed only part of its Byzantine subsidies and price controls for electricity. They allowed electricity generation to be priced by the market, but the consumers' prices were regulated. When generating electricity grew more expensive, we began to suffer blackouts as the utility companies couldn't pay their bills. The politicians were afraid to allow the market to set prices all around - prices which would have curtailed energy use just like the environmentalists want. It was ridiculous.

In this case, I would think that the economic forces at work here are vastly larger than anything the government can control. Of course, this won't prevent them from trying.