Monday, December 21, 2009

Of Externalities, or Sticking PG Polluters with the Bill

It was a clear night as I flew back on a recent Sunday evening from Vancouver. You could see Prince George glistening like a jewel (well, a bunch of rhinestones, anyway) even by Quesnel. At the crew's insistence, I put away my iPod on which I was listening to B.J. Harrison's fine rendition of the Moonstone (Classic Tales readings - shameless promotion) and prepared to step out into the -24C crispness that the pilot had announced.

But as we were about to land, simultaneously the cabin filled with the familiar noxious smell of the pulp mills and the engines revved up suddenly. We began to ascend. Things grew quiet among the passengers and after a few minutes of banking and flying about, the pilot announced that visibility had been too limited: there was, he said, "a bit of fog" at the north end of the runway.

By this time we were high enough to have a good vantage for seeing what the real problem was. The mills located on the north side of the Fraser were, as usual, spewing out their filth and in the considerable cold, plumes of vapours, aqueous and otherwise would rapidly condensing. And the winds just happened to be pushing this airborne crap to the south, straight over the Prince George airport.

The pilot tried another approach, this time from the west but with no better outcome. Having had a nice scenic tour over BC's northern capital, we turned south for Vancouver where we recollected our luggage and a fistful of food and hotel vouchers from West-Jet. Having boarded the plane at a little after seven, it was near midnight by the time I settled into the palatial facility at the Richmond Sandman, thinking back to economics 101 and the concept of externality.

To the economist, an externality "... exists whenever one individual's actions affect the well-being of another individual -- whether for the better or for the worse -- in ways that need not be paid for..." In simpler and very crude but apt terms, it means I enjoy a nice shit and you have to smell it. We are all familiar with the game that pulp mills and similarly noxious industries play with local and high-level pols. In essence it is that if such companies are forced to clean up and, thereby, to absorb externalities, to pay fully for the burden they place on the well-being of others, they'll just shut down and move to a more welcoming locale, i.e. some even more desperate community or country where they can get away with figurative and, if it so happens, literal murder.

I did suggest to West-Jet that they ought to invoice CanFor and its malodorous buddies for the substantial cost to the airline of an extra flight and all those meals and beds for the stranded. So far they have only chuckled and sighed and, yet, internalizing such externalities is the exact prescription that economists are making the world over as an alternative to more draconian regulations or, my personal favourite, putting the executives of these polluters in pillories down at the public market.

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