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Pell on Earth!

I know my puns need a little work, but I get excited from time to time and cannot help it. Hell on Earth is what we are told is coming down the pike if we don’t implement very strict emissions reductions and do it in a very short time. The EPA recently estimated that the worst case cumulative costs of a carbon cap-and-trade program in the US from now until the year 2050 would be about $1 trillion (that estimate seems far smaller than the IPCC’s estimate of between 1% and 2% of GDP annually).

This would mean something like $25 billion per year in costs for what we are told are going to be tremendous health and planet-saving benefits. So let’s take that seriously for a moment. We also know that last year, the federal government alone spent $34.8 billion on the Pell Grant program alone. Pell grants are grants of up to $5,500 that are given on a need-basis to lower-income persons attending accredited colleges and universities in the U.S. Now lest you think I hate the poor, suffice it to say that it is not at all clear from basic economic theory (or the actual evidence on Pell grants – google the term “Bennett Hypothesis”) that giving a subsidy to someone improves their lot by very much.

But when we want to compare the very mixed evidence of the effectiveness of Pell grants in promoting college access (it drives up costs too) with what we are told is a sure torching of the planet, it would seem to be a no-brainer to eliminate the Pell Grant program entirely tomorrow and institute a carbon cap-and-trade program. This way you couldn’t have pseudo-conservatives running around saying that cap-and-trade is going to destroy the economy and you couldn’t have pseudo-liberals defending a barely successful program. Heck, one could even take the revenues from the cap-and-trade program and give cash transfers to low-income people – if they value their education enough they could choose to spend the money like they would have the Pell grants in the first place – and it would be that much harder for the for-profit schools to “milk the taxpayers” by enrolling disproportionate amounts of students who get Pell grants (not that I have any particular problem with this once the Pell grant program is already in place).

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