March 7th

It’s time to step back and take stock of where I am. 

BAU scenario

Working well. The GDP climbs for about 20 years, then climate change costs start to add up and everything goes to hell.

BAU scenario (no taxes of any kind)

C500 + R100

This is the full-bore taxation scenario, meant to show that overdoing the taxation kills the economy. The carbon tax and the radioactive emissions tax are both run up to their maximum values, killing both fossil fuels and nuclear. This forces everything to go to renewables overnight. This shouldn’t work: the economy should go into a death dive. Instead, it declines for a while then stabilizes without losing too much:

C500 + R100

I need a deeper dive at the outset. There’s another problem with this: I have temporarily turned off the Piggy Bank, so that the revenues from the taxes aren’t used for anything. When I turn the Piggy Bank back on, those revenues will do all sorts of good things for the GDP.

The GDP is controlled by the following lines of code:

double energyPrice=tc.getValue("Energy Price");
double previousPrice=tc.getPreviousValue("Energy Price");
double previousGDP=tc.getPreviousValue("Global GDP");
double climateChangeFraction=tc.getValue("Climate Change Costs");
double discountRate=tc.getCoefficientValue(title,0);
double priceImpact=tc.getCoefficientValue(title,1);
double ccEffect=(1-climateChangeFraction)*(1-climateChangeFraction);
double priceEffect=((priceImpact+energyPrice)/(priceImpact+4))*Math.pow(energyPrice/previousPrice, 0.95);

The key element is the exponent at the end of the priceEffect definition. I have tried many different values, and anything strong enough to get a steep dive after the taxes are applied is also strong enough to obviate any GDP growth in the BAU scenario.

Taxes injure the economy by raising the effective price of energy faster than would otherwise be the case. I need to obtain the strongest differentiation between the effect of price rises due to diminishing resources and price rises due to taxation. That means that I need to increase the supply of fossil fuels, so that you can get along fairly well using solely fossil fuels – except for the carbon they release.