Policymakers in NH, like their counterparts everywhere else, fall into a trap of their own making when trying to prepare the state for an unknowable future. They unwittingly (and sometimes wittingly) lock its people and businesses to the past.
Even elected officials with the best intentions can come to think that they should shape the economy or the culture because, darn it, these giant levers of power are right here. Why not use them to accelerate progress?
There are plenty of problems with this way of thinking. For one, those levers aren’t as powerful as politicians often think. For another, unintended consequences often create more problems than politicians were trying to solve in the first place. (Smoot and Hawley really thought their tariff was going to help the country, not worsen the Great Depression.)
Probably the most under-appreciated problem with using the state to accelerate “progress” is that politicians have absolutely no idea what the future is going to look like.
The Problem With RGGI
New Hampshire joined the Regional Greenhouse Gas Initiative in 2008 for the stated purpose of reducing carbon emissions. Since then, carbon emissions in New England have declined, but the decline cannot be attributed to RGGI. As organizations as politically diverse as Vox and the Cato Institute have pointed out, the emissions decline was driven largely, if not entirely, by an industry switch from coal to natural gas. And that switch was made because hydraulic fracturing (fracking) produced such an abundance of natural gas that prices collapsed.
A decade ago, politicians assured us that the energy industry would never voluntarily reduce carbon emissions because it just wasn’t cost-effective to do so. Therefore, state governments had to intervene by creating a separate, heavily regulated market for carbon. They told us this in 2008, a decade after an engineer in Texas accidentally discovered that a more watery mix of hydraulic fracturing fluid could produce vastly greater yields from shale deposits of natural gas, according to a 2013 article in The Atlantic.
The state continues to impose tremendous costs and inefficiencies on the energy sector through micromanagement designed to stop market innovations and replace them with developments favored for political reasons. Government subsidies and preferences created by such policies as RGGI, the Renewable Portfolio Standards and net metering divert resources, impose costs and impede market innovations. Government hostility to supply-enhancing infrastructure, such as pipelines and transmission projects, further inhibits organic progress in a futile attempt to engineer an outcome politicians think will be popular with voters.
Back to the Future?
Many lawmakers want to make the same mistake in transportation. They tell us that a state-run commuter rail line between Manchester and Boston is the only path to a high-tech future for NH. Even though a private company has proposed building a commuter rail line along the same route the state would use (from Lowell, Mass. through Nashua), commuter rail boosters say this is not acceptable. The high-tech economy of the future requires the construction of a 19th century technology, subsidized by taxpayers and controlled by the state, to bring tech workers from the greater Boston metropolitan area to downtown Manchester.
But why would these highly educated tech workers want to take a train from station to station after autonomous cars become common? Given current options (and with no mention of the cost to taxpayers), commuters often say they’d like to take a train to and from Boston. But the private sector is developing alternatives that could make commuter rail obsolete before it is even completed.
GM, Uber, Ford, Google, and more than a dozen other companies are developing autonomous vehicles right now. GM plans to make its self-driving cars commercially available by next year.
Boston startup nuTonomy has been testing self-driving taxis since 2016. Like trains, autonomous vehicles allow riders to work or otherwise multitask while commuting. But unlike trains, they can take riders directly from home to work, with door-to-door stops for meals, shopping or any other activity along the way.
We don’t know what commuters will want in 30 years, or even 10. But based on current trends of personalization (in entertainment, fashion, work, education), it seems unlikely that the hip young tech industry workers of the future will prefer a train to a self-driving car.
And by the way, the train argument rests on other assumptions that no one questions, but we all should. Who says today’s technology industries are the industries of the future? And who says most future workers will commute rather than work remotely?
Government should help create a better tomorrow. But it can’t do that by predicting that future and micromanaging the economy. It can best help by limiting its interventions so it stops getting in the way of the innovators who will actually create that future.
Andrew Cline is president of the Josiah Bartlett Center for Public Policy, a free-market think tank in Concord. For more information visit jbartlett.org.