Solar Power, the 2018 Nobel Prize in Economics & What My Economics Degree Left Out

Two economists were just awarded the 2018 Nobel Prize in Economics. Of course that isn’t a newsflash, because it happens every year, but the work for which they were recognized is both newsworthy and urgent. The dwindling window of opportunity to decarbonize the global economy and literally save the biosphere, combined with the fact that some economists are plying their trade to help solve that problem is encouraging. I did an economics degree back in the 1970’s (and was never going to win a nobel in economics!). Cementing my mistrust of “education” (versus “learning”), my degree completely ignored the “cost” side of the GDP ledger. I kid you not when I quote this line in my intro to macroeconomics textbook– natural resources are the “free gifts of nature.” I was expected to believe this uncritically all the while my professors pounded the phrase “there ain’t no free lunch” into our young brains.

My 1972 economics textbook. I’m quoting from page 23– “What does the economist mean by land? Much more than the layman. Land refers to all natural resources–all ‘free gifts of nature’ which are usable in the productive process.”
That’s a Milton Friedman axiom, who was a deity as far as I was “taught” then, and a couple years later won the economics Nobel himself. I attended a Friedman lecture that semester and it was a combination of evangelical tent revival and divine doctrine. (Monetary Theory wasn’t some natural law, like gravity is, although I wasn’t taught the difference by my professors back then.) Now, I ask- who got the free lunch and who paid the cost? A lot of suffering, cruelty and outright immorality surrounds that brand of economics. That’s a dark history. Among other authors, Naomi Klein describes it well in the Shock Doctrine in case you don’t know the history and are curious. And then there’s the climate problem. Since AIRE works to help organizations go solar, we have to recognize the contexts (climate being just one of them) within which we’re working toward solutions.

People who argue against solar power and renewable energy often claim that it “just isn’t economic.” Nordhaus at Yale has done groundbreaking work on the price of carbon, and to him his due with this recognition. I hope that the Nobel news will raise the awareness that the cost is high (that “lunch” is NOT free by any means). My gut says the Nordhaus numbers are WAY low and other academics think so too. Indeed, philosophically, can we even price this since a “hot house” planet won’t be a nice place to live. That’s why we keep working for solar at schools, houses of worship, homes, and public places. We know that to be sensible, urgent and economic! We’re all economists.

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