The “job-killing” carbon tax

Tony Abbott hasn’t exactly covered himself in glory on his overseas trip. But he has found one ally: Canadian PM (at least until next years election) Stephen Harper, also a climate denialist. They made a joint statement denouncing carbon taxes as “job killing”. I didn’t notice any massive destruction of jobs when the carbon price/tax was introduced in 2012, but rather than do my own analysis, I thought I’d take a look at the government’s own Budget outlook, to see how many jobs they claim to have been destroyed by the carbon tax, and what great benefits we can expect from its removal. Here’s the relevant section of the summary (note that the outlook is premised on the Budget measures being passed)

The Australian economy is in the midst of a major transformation, moving from growth led by investment in resources projects to broader?based drivers of activity in the non?resources sectors. This is occurring at a time when the economy has generally been growing below its trend rate and the unemployment rate has been rising. During this transition, the economy is expected to continue to grow slightly below trend and the unemployment rate is expected to rise further to 6¼ per cent by mid?2015.

In this environment, the Government is focused on implementing measures to support growth and jobs while putting in place lasting structural reforms to restore the nation’s finances to a sustainable footing. The timing and composition of the new policy decisions mean that the faster pace of consolidation in this Budget does not have a material impact on economic growth over the forecast period, relative to the 2013?14 Mid?Year Economic and Fiscal Outlook (MYEFO).

Since MYEFO, the near?term outlook for the household sector has improved. Leading indicators of dwelling investment are consistent with rising activity, while household consumption and retail trade outcomes have improved recently, consistent with gains in household wealth. This is partly offset by weaker business investment intentions, particularly for non?resources sectors.

The outlook for the resources sector is largely unchanged from MYEFO. Resources investment is still expected to detract significantly from growth through until at least 2015?16, as reflected in the outlook for investment in engineering construction which is forecast to decline by 13 per cent in 2014?15 and 20½ per cent in 2015?16. Rising resources exports are only expected to partially offset the impact on growth. Overall, real GDP is forecast to continue growing below trend at 2½ per cent in 2014?15, before accelerating to near?trend growth of 3 per cent in 2015?16.

The labour market has been subdued since late 2011, characterised by weak employment growth, a falling participation rate and a rising unemployment rate, although outcomes since the beginning of 2014 have been more positive. The unemployment rate is forecast to continue to edge higher, settling around 6¼ per cent, consistent with the outlook for real GDP growth. Consumer price inflation is expected to remain well contained, with moderate wage pressures and the removal of the carbon tax.

The reference to the CPI effects of the carbon price (around 0.4 per cent) is, as far as I can tell, the only mention in the whole of the Economic Outlook statement.

155 thoughts on “The “job-killing” carbon tax

  1. @Ken Fabian

    I agree, he’s not abnormal in his ‘culture’. His personality is disordered only in the judgement of those of us who don’t want the culture he and his are forcing on us.

    He is actually the ‘great leader’ that has always been admired above other types of personality in our culture, so why would he even contemplate the idea that he might not be the most valuable personality type? Why would one choose to cultivate insight when it is so clearly dysfunctional to the desire for status?

    It would be psychologically impossible for this type of man, raised as he was to believe in his capacity to rule, to accept any criticism and in his philosophy of what makes a good person, it is a necessary and even an admirable trait to have “a hide as thick as an elephant”. That’s an old wives tale or folk wisdom ‘diagnosis’.

    I do see the creeping desperation you mention, in the photographs of our leaders that we see on social media; it is a subtle thing but apparently some people can read expressions better than others and these images our betters being quite stupid and ugly are very ‘informative’ to people. They can see the ‘ordinariness’ of our leaders who are supposed to be ‘better’ than us.

    l’m pretty sure that the conservatives I live among are realising that society is not going to get better with this government; that something is wrong. They are very very confused and looking for some explanation of what has happened to our society over the past few decades and the marketing is not working so well.

    They won’t vote for the ALP but independents who rediscover their agrarian socialist roots will do well I think, in the next election.

  2. @Tim Macknay

    I strongly disagree with Abbott’s policy on this matter. However, is it a concern if some offended countries elect not to take our food exports? Prices are high, food is short worldwide. We need fear no buyers’ boycotts.

    In an approaching world of resource shortages, we need not be abject, subservient and pleading to get buyers for our food and resources. They will sell themselves. We could rather conserve our land and resources and move towards self-sufficiency and sustainability. Other countries would be well advised to do the same.

  3. @Ikonoclast

    There isn’t a world food shortage. The world produces enough food to feed everyone, but there are systems that prevent that happening in practice.

    Remember AWB, US subsidised wheat and mysterious ‘iron filings’ found in Australian wheat. If buyers of our wheat and meat decide to buy from elsewhere they would likely be able to do that.

  4. I’ll be very happy if countries offended by Abbott’s culture-war led decision to abandon calling the occupied territories by their right name has a silver lining — a disinclination to accept Australian agricultural exports — especially if that includes live animals.

  5. @Julie Thomas
    The blogger cites the work of David Graeber as authority for that explanation of the origin of money.

    I found online an interview with Graeber where he explains this part of his findings in his own words, and although it does emphasise the contextual importance of military conquerors, his account is different in subtle but (I think) important ways.

  6. @J-D

    That doesn’t surprise me.

    I don’t know much about that blogger; but there is a lot of speculation and even fantasy at the site from the usual suspects, and people do play fast and loose with ideas.

    Somebody has to do that sort of thing to begin with, and then people with a different more focused way thinking can point out the inaccuracies and problematic reasoning so that we all get closer to an explanation that is inclusive.

    I would appreciate the link you found but not if I have to listen to anyone talking. Is there a transcript available? Or you might have the time and inclination to explain.

    Do you think that the culture war and the class war could be one and the same thing?

  7. @Ikonoclast
    This is the bit that interested me:
    “Even growth of knowledge and technology will have a limit in the biosphere. Knowledge and technology growth equals growth in complexity. Growth in complexity and manitenance of complexity require energy available for useful work. Thus ever more complexity will require ever more energy use and the ever growing waste heat that will accompany it. This will place limits eventually even on knowledge and technology complexity albeit these limits (on knowledge and technology solely) may well still be a long way off.”

    I would be interested to know if this is backed by some published research work. I am not convinced, at first glance, that “ever more complexity” is necessarily a problem, especially if it is complexity in doing things without using lots of non-renewable physical materials. Indeed I am not convinced that advances in science and technology are all leading to increased complexity rather than, in the ways that are relevant to your argument to greater simplicity.

    Besides that theoretical questioning I think you are premising your doomsaying on the world’s population problem not being got under control. “Under control” is no doubt a misnomer but the population declines of Japan and Russia and the reduced fertility even in Muslim countries like Iran suggest that there could be a lower population of the world in 2100 than in 2060 (my rough approximations as to dates).

  8. @Midrash
    With the greatest disrespect, Midrash attempts to hold othersto a standard higher than they themself observe, I.e. they ask for evidence to back an assertion.

  9. @Val

    @Patrickb

    @Megan

    Well I certainly didn’t take the trouble with you lot that I did when my essay on “The Sentence from Gibbon to Hemingway” won what was then a quite valuable prize but I don’t apologise for neglecting to indulge the limitations of people who give every sign of being isolates who have far few well informed and active people to talk to.

    Thank goodness that JQ is eventually going to publish his book on Opportunity Costs. If he gets it right and explains it well he will give you the opportunity of making a leap of some centuries in your thinking (about 300 not to be seen as loosely rhetorical).

    It is fundamental. Beyond the “choice” that libertarians like to make much of, with some justice, there are the choices we have to make when it eventually dawns on the politcians of the Junior Common Room that the college actually cant’t spend the same $1 twice.

    Why not come clean and say you want to be part of a worldwide movement that will do no good to Australia (and maybe anyone in practice) [and note that I did say “net” in an earlier post because it is obvious that solar, if not wind, tide and waves, is going to be very big and beneficial to us even if China is the source of the advance with many of its manufacturers go broke in China instead of here as would have happened if some Greens had had their way]?
    You are probably not grand enough to argue for that (with very little real argument) because you are fringe great and good who feel embarrassed at dinners with Fellows of the Royal Society to be from backward Hicksville. But you think that it is the moral thing to do. That however needs arguing. After all utilitarianism isn’t a right wing doctrine and, whatever its logical and other limitations, it does usefully require one to attend to trying to do some real good.

    Incidentally, the point about Tuvalu or Kiribas or whatever Pacific Islands where the actual problem is over population now and for the forseeable future was dealt with succinctly by an engineer who calculated that it would cost, from memory, $300 million to raise 26 square K by one metre. If you don’t see the point of knowing that and comparing that cost with what it costs to push wind farms in Australia and also calculating what temperature differences and what sea level differences may result from different policies then you really do need to do Year 11 economics or just try running your own business.

    Incidentally a casual reference to the Sk[c]epticalScience blog is more than useless. It not only shows how limited your sources of scientific information are but woeful and perhaps willful ignorance of basic economic reasoning. Ah, but it’s all about being part of the Elect as one’s tribe isn’t it? It’s a moral thing which somehow you can’t get across to the unbelievers. Shia or Sunni are evenly matched. Just feel sorry for the Ba’hai, and the Ahmadis because they can’t shout as loud. Off with their hands! At least that should keep them from the keyboard.

  10. @Midrash

    The Laws of Thermodynamics guarantee my statements are correct. It takes energy applied as useful work to create local complexity. Complexity is a high degree of order. Any manufactured object or grown object has a high degree of complexity. The increase in local complexity is matched by an equal or greater increase in disorder (entropy is a measure of disorder) elsewhere in the system or in the universe.

    Earth is technically an open system. Energy and matter can enter it or leave it. All the incoming energy from the sun means that complexity could theoretically increase in the biosphere until the sun dies. However, wastes including waste heat will become a problem long before that point.

  11. @Midrash
    Er … pretty much all of Midrashs output. Hence my suspicion that it’s a machine. Those phrases are stored in a database and retrieved by an algorithm based on input. It’s the NSA I tells ya.

  12. @Ikonoclast
    I suspect we are not talking about the same thing. I may check it out with my favourite consulting physicist. Reminds me a bit of Barry Jones giving an ad hoc lecture on entropy which from memory was to be found in the Hansard of one of the Parliaments he graced.

    What you don’t seem to factor in is a return to a nice comfortable two billion people kn the planet with all those who haven’t benefited from genetic engineering to guarantee an IQ > 120 being employed in the wildlife maintenance and restoration scheme (only the seriously bright will be allowed to invent *new* dinosaurs). Jobs as waiters? Don’t make me laugh! Even the maitre d’ will be a robot whose ethnicity, personality and style via the smart watch pinned to your ear on the way to the restaurant.

  13. @Patrickb
    Last output but one still “awaiting moderation” but, absent references to ill-governed African countries, and because I’m not as rude as you, the Professor’s somewhat eccentrically prudish algorithm msy release its grip eventually.

  14. Re carbon tax on steroids I pointed out on another thread a month or two ago that the fuel excise is much heftier than c.t.. If a litre of petrol burns to 2.5 kg of CO2 plus water vapour etc we need 400L to get a tonne of CO2. Dividing $24.15 by 400 we get 6c per litre but the excise for now is a tad over 38c.

    I understand the excise for jet fuel was increased by 5.8c per L as a carbon tax in lieu. It was that component that Qantas referred to as ‘carbon tax’ when they lobbied the govt for its removal or rebating. Think of that as you fly in a kerosene burner over tracts of El Nino scorched landscape this summer.

  15. @Midrash
    Midrash, don’t ignore me – like the dreaded one whose name I will not speak, I’m here to help.

    This is the kind of problem I’m talking about:

    What you don’t seem to factor in is a return to a nice comfortable two billion people kn the planet with all those who haven’t benefited from genetic engineering to guarantee an IQ > 120 being employed in the wildlife maintenance and restoration scheme (only the seriously bright will be allowed to invent *new* dinosaurs). Jobs as waiters? Don’t make me laugh! Even the maitre d’ will be a robot whose ethnicity, personality and style via the smart watch pinned to your ear on the way to the restaurant.

    What? And why? Have you been drinking?

    As a kindness to you, I tried to puzzle out what you were talking about. Obviously there’s some words missing in the last sentence, and a small but weird typo in the first one, but I think I got the gist.

    You’re suggesting that when the population of the planet returns to 2 billion, everyone whose IQ has not been genetically engineered to over 120, will be employed in the wild life maintenance and restoration scheme. (Why?)

    Those whose have a very high IQ will be able to invent new dinosaurs. (Why?)

    There will be no jobs as waiters, because people will book and order via smart-phones attached to their wrists. (We could do that now if we wanted to). However rather than waiters, there will be machines who take our orders and presumably later serve our food. Presumably these will be robots, since they have an identity which includes ethnicity, personality and style. (Given the ever-increasing popularity of actual cafés staffed with real people, this seems counter-intuitive at best.)

    Maybe you’re writing some kind of poetry which I don’t get. The weird view of a dystopian future? But what has it to do with Ikonoclast’s comment, or anything else for that matter?

  16. @Tim Macknay
    Yeah why does the ALP do that? Why do they make responses that validate their opponents?

    Vote for us! We’re like them only not so much!

    Because they got captured by neoliberalism in the 80s and they’ve never escaped, I suppose.

  17. @Julie Thomas
    The important thing is ending the stranglehold that the climate obstructionists have on Conservative politics – or more correctly, on mainstream politics; Labor having a huge gap between their rhetoric and commitment to policies that are adequate to such a task. The gap between word and policy substance may not be so large as with our Conservatives but it’s huge all the same. Abbott, meanwhile, is merely the tip of a very big iceberg and, whilst understanding why he holds so strongly to dangerous convictions may help fashion arguments that might reach past his willful refusal to take climate science seriously I don’t see who has the access and the necessary conservative creds to push past apparently well built defenses. Wasn’t some Ancient, renowned for his persuasiveness, told when he asked if he could reason with his captors that they simply would not listen?

    I still think all Abbott’s utterances of acceptance of a serious climate problem lack conviction and yet they can be interpreted as sincere if the climate problem he is referring to is that of a long running conspiracy of “alarmists” and “catastrophists” that keep infecting the community with fear that there is a serious problem with global climate. By such means outright lies can be presented with a lot of sincerity.

    Unwavering conviction that he is right to reject the science on climate can be used to justify extreme tactics to undermine the ‘alarmists’ and “clobberers” and can lead quite logically to the conclusion that the ends really will justify the means, and that history will see him as prescient, wise and strong when global warming just stops all on it’s own.

    Mmm… perhaps there is something to questioning the psychology of such a leader.

  18. @Val
    Thank you for your prosaic response (and yes I did omit “can be chosen”). It reminds me of George the Fifth’s alleged advice to his family never to tell a joke in public (to which he might have added “or engage in a flight of fancy”) “because someone will always take you seriously”.

    But I am perhaps being a bit unfair because I was wrapping in flippant guise a serious response to a deficiency often exposed on this blog, and exemplified by Ikonoklast, namely a difficulty with accepting and living with uncertainty and related inability to see just how unpredictable the future is. Even what you or Ikonoklast might suggest is the single most likely scenario according to your current knowledge, common sense and existing momentum has quite low probability if you flesh out its specifics beyond the near certainty that human beings will still exist and still engage in a lot of heterosexual sexual activity.
    Having started with the thought that Ikonoklast hadn’t conceived of a world in which population declined quite rapidly for a long time I sought to embellish the thought with some stimuli to the imagination. (And besides, it got me out of boring myself and everyone else by reading his essay thoroughly and responding in detail clause by clause).
    As it happens I have just read a good letter to the Financial Times by, from memory, one Richard Moore of Bangor in Ireland (maybe Northern) which sketches intelligently what adjustments a world of robotics might be going to require.

  19. @Midrash

    #25
    Expression a bit better but the fourth sentence in particular is still too long and too wordy. I would also suggest using a bit more white space between paragraphs. These are particularly relevant points if you’re actually wanting people to read what you write.

    The assumption that you’re smarter than everyone else here is also unhelpful.

  20. Right now it still looks like i will live long enough to see the day when human induced climate change and the need to do something about it becomes undeniable. I am eagerly awaiting the mass apologies and resignations from public life, and collapse of political parties and organisations that will logically ensue . This is about logic right ?

    Is Midrash failing his Turing test ? Unnecessarily wordy ,but single mindedness with lots of tangents seems convincing.

  21. @Hermit

    But indexation of excise is a tiny increment to a price inelastic product, when bought by consumers rather than producers, and price volatility mutes its visibility. It’s also a tax for other purposes – roadbuilding and budget support. Effect on consumption zip.

  22. @Ken Fabian

    Oh sure, I agree that a psychological understanding of individuals is very useful, but in the long term, it is how the society ‘manages’ or ‘organises’ the different individual psychologies that provides the foundation for an egalitarian society. I think.

    There are stories about how hunter-gatherer societies just did away with people who would not conform to the group norms, but I wonder if this happened all that often. It seems to me that an alternative might be that they spent an awful lot of time and effort raising their children so successfully that the different types of personalities were able to cooperate without one type being valued over others.

    I don’t think that there is anything really ‘wrong’ with Abbott’s brain functioning; he seems too average to have any interesting dysfunctions.

    My diagnosis is that he was a very average child who was inappropriately socialised in a privileged environment in which his abilities were over valued and there was no mechanism for a more realistic assessment of his abilities.

  23. @J-D

    Thanks for that link. Yes the original blogger did not include Graeber’s understanding of the implications of ‘violence’, nor did he mention the dynamics of the interaction between women and men in past societies and how this might have changed when money allowed men to persuade or force women to become ‘property’.

    The relationship between men and women in hunter-gatherer societies is speculative of course but there is an idea that women and children were not property in these societies, that interpersonal violence went both ways with women as prone to killing people as men but probably with less lethality. Is that a word?

    Women were economically independent in the Australian hunter gatherer groups; they brought in more food than the men and this changed with agriculture or the introduction of money.

  24. @Ike

    Appliances and machinery and cars powered from solar-derived energy (pv, wind, hydro etc) don’t contribute any waste heat.

    Hence, why it’s so important that we shift to a renewable economy.

  25. @Julie Thomas

    He is a bit unbalanced, witness the comment that you can’t love job creation yet hate the businesses that create them. Where did he get this from? No-one in public life has said this, is he responding to something he saw on a placard at a demo? He has strong and long-standing beliefs but they’re visceral, he can’t argue them, we just get the three word conclusion. Again, where’s the Rhodes scholar intellect, or do I misunderstand how these are awarded?

    Does he fantasise that he is still waging tribal warfare at Sydney Uni OBO Santamaria? I

  26. Are there any other intellectual gurus? GKC, Hilaire Belloc? I’m trying to get a fix on this throwback.

  27. @sunshine
    I wish that the mass apologies etc would happen. But given what has happened since the GFC, it may be that we will get more of the same instead. However I don’t believe it can go on forever.

    It may be that what we are seeing is the last desperate throw of the dice – this government is putting all their political “cash” on backing their masters, the fossil fuel corporations and other wealthy barons of contemporary society (big Food, big Pharma, big Gambling etc).

  28. @kevin1
    Given that world crude petroleum peaked in 2005 and refining margins are squeezed it’s likely petrol-diesel-jetfuel prices will rise faster due to depletion than the indexed excise. At some point the usual suspects will ask for an excise cut ‘to help the economy’. Case in point Qantas. I expect $2/L petrol perhaps in 2016 to have quite a sobering effect on the public.

    It follows that improved highways and airports will be less necessary if we fly/drive less so hypothecating excise for transport infrastructure becomes less relevant. My understanding is that a goal of the NBN was to reduce physical transport with telecommuting, online retail and the like. That doesn’t seem to fit with Abbott’s world view.

  29. @Hermit

    Retired cashed-up baby boomers do not look like a stay at home lot to me so a lot hangs on your price projections- are pre-tax real petrol prices up or down since 2005?

  30. @Julie Thomas
    Yes, there is such a word as ‘lethality’.

    According to Graeber’s account, as cited, people valued gold and silver before marauding warbands entered the scene and not just at the arbitrary fiat of warlords, and the first coins were produced not by conquerors nor by governments but by non-government moneychangers as a way of facilitating their gold/silver transactions with soldiers. This is not the same as the blogger’s account that warlords initiated coinage and then forced people to accept the coins in exchange transactions, a version which doesn’t make sense when you look at it closely.

    Relationships between men and women in foraging societies are not purely speculative, as they have been studied in the recent past by anthropologists, although there is an element of speculation in extending the observations of recent foraging societies to general conclusions encompassing earlier periods.

    The relative contribution of male and female labour in agricultural societies varies depending on what kind of agriculture is being practised; in particular, plough-based agriculture places a premium on the marginal upper-body-strength advantage of adult males.

  31. @kevin1
    I need to re-find some ATO database to check earlier fuel excise rates. Assume it has been about 38c per litre all this time. The metropolitan price on a litre of unleaded petrol was about $1.14 in August 2005. Last week it hovered around $1.54 an increase of 36%.

    However crude oil (West Texas Intermediate) was about $50 a barrel in 2005 and was $95 recently, an increase of 90% hence the margin squeeze. However it did nudge $148 in 2008 thought to be a trigger for the GFC. We’re driving about 5.5% less or 800 km a year less than in 2005.

    As the limbo dancer asks ‘how low can you go?’. Reduced driving that is. I’d almost bet there is talk of an excise cut before the 2016 election if the crude price escalates.

  32. @Hermit

    Original question was: is restoration of excise indexation a de facto carbon tax as Albo suggests. I can’t see it having that function; it’s good policy though for Abbott to bring it back straight after the election subverts democracy. Auto use ranks about 4th or fifth for pollution share doesn’t it?

  33. @kevin1
    Indexation of fuel excise in a low inflation period is less than an equivalent carbon tax.
    The carbon tax on petrol should be 6c a litre. If we have say 2.5% inflation on 38c excise it goes up to 39c a measly 1c which is well short of 6c. The PM errs.

    According to the Dec 2013 update of the national greenhouse accounts transport creates 17% of emissions. I guess that includes domestic planes, trains, coastal shipping, buses, trucks and cars. Power generation is 33%.

    If we had an ETS not carbon tax generators and petrol refiners would have to bid against each other for the finite amount of CO2 allowed. Other things being equal that would mean the more coal fired electricity we used the more the carbon charges on petrol would increase to stay under the cap.

  34. Who said “an obsessive care for relevance is the hobgoblin of little minds – and a killer of relaxed conversation”.

    Yes I did. And I offer it to you JQ and every moderator as an antidote to the obsessive thinking of those who actually think they might have an argument on a blog and not only win it but change their opponents minds. So with that preamble let me say here something I couldn’t say on the Piketty thread because it had died of exhaustion (and congratulations are due to J-D for being there at the last to close its eyes and draw curtains).

    Simply that there is an interesting Washington Post article by Nancy F. Koehn which attributes much of the ridiculous pay levels of business superstars to a Great Man theory of leadership which she traces back to Thomas Carlyle. She gives a glancing acknowledgment to the influence of people like remuneration consultants who would see themselves as being part of the CEOs peer group but ends with her most important point which is that the great man theory of history is baloney in this context and that teams and teamwork matter a lot.

    Getting back to my hypothesis that we may have got to a stage where inducing people with high cognitive abilities who could have an enjoyable academic career to choose business now needs more of whatever incentive moves them than say 50 years ago a truly relevant thought hit me.

    I was remembering a friendly acquaintance of mine who had done many good things and no bad ones that I ever heard of yet managed the distinction of being the first head of an Oxbridge college in 300 years at his university to be ousted by the Fellows.
    That emphasised to me what a joy it can be to have academic tenure which gives security and at the same time to be able to oust your superior which just doesn’t happen in business.

  35. Academics at Australian universities do not have the power to oust Vice-Chancellors and Deans, although I suspect the idea would appeal to many of them. And why not?

  36. @J-D
    You asked for “evidence” that one can’t spend the same $1 twice.

    A (self) send-up I presume. And not some thought prompted by considering velocity of circulation or multiplier effects.

    The rhetorical usage – a single dollar – relied of course on the logic of the situation where you have spent the last of your cash – assuming you don’t borrow more – on buying a lawnmower and therefore cannot also buy the post-hole digger unless and until you have earned more cash at which point you hope you won’t also have to remind people of the time value of money or remind them that Nicholas Stern’s choice of a 1 per cent discount rate deserved to be controversial.

    Interesting topic. Perhaps Prof JQ can enlighten us. What discount rate is appropriate when considering costs and benefits to and for one’s descendants in 75 or 100 years time? And is the answer different if one is considering oneself, personally without prospect of much genetic connection to later generations, as merely part of the forefather generation?

  37. In my opinion we should plan for 0-20 years ahead without discounting and ignore everything after that. If the discount weighting factor is (1+r)^-t then r is 0 for t up to 20 and infinite after that. Plenty will happen between now and the year 2034. Things will get hot. Consumers won’t have enough income to pay for the high costs of oil production. There’ll be more of us each wanting a turn of the century (ca 2000) Western lifestyle. I’m saying forget discounting just think medium term.

  38. @Hermit

    The logical problem in your claim is obvious. If the window of concern today closes on 21/6/33 then tomorrow it advances by one day i.e. 22/6/33.

    Today we know that we will be obliged tomorrow to think of the day following the last day in the temporal sequence, and so forth. The following day’s condition will be very much affected by the condition of the day preceding it so there is no good reason not to be almost as concerned with it now as we will be tomorrow. That’s why there’s a discount rate. It’s a best guess, but if it is composed by resort to some robust paradigm and salient data, it is certainly better than an arbitrary line in the sand.

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