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David Dollar: Well both in China and the U.S., a question I like to ask people . . . It is a very almost shallow question. Why can't you cut your energy use in half? Why can't you reduce your environmental footprint?  And then at the policy level, I'm all for campaigns to tell people to change their lifestyle; but as an economist, I think people are basically gonna respond to incentives. So another way of asking the same question is, Well why can't we raise the price of gasoline to $5 or $6 per gallon in the United States? Why don't we set a tax so that whenever the world market price goes down, the tax increases to keep the pump price at about $5 or $6? If the world market price goes up, then you can reduce the tax. Just tell Americans the price is gonna be $5 or $6 dollars per gallon forever, and you should change your purchase of automobiles, and how you use automobiles, and how you heat your home; and just, you know . . . I think we can live a good life with significantly less energy input. And I think on the environmental side, energy is  the most important issue. But there are water issues as well in many developing countries. So the more general question to people is why can't we live a very productive and happy lifestyle, but with just much less environmental impact.

Recorded on: 7/3/07

 

 

 

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