Arguing for economics needs applying economics

This is a short comment on Bjorn Lomborg’s “Green energy a better bet”, an article in the Australian April 30, 2009 on http://www.theaustralian.news.com.au/story/0,25197,25405532-7583,00.html

The author argued for government to invest in green energies and for a need to combine natural science and economic science. The main arguments suggest that it costs more than the benefits it would bring to reduce carbon emissions either through ETS (emissions trading scheme) or carbon taxes, while on the other hand to invest $1 in green energies will bring about $16 of benefits. So governments should be proactive to invest in those energies instead of either doing ETS or carbon taxes. Further it argued that the current actions based on Kyoko will have negligible effects in lowering temperature.

While it seems the logic argued by the author is clear, it appears there are some important missing parts in its whole construct. I confess that I don't have as much hard facts as the author had, such as the costs to human beings of warming and the benefits and costs of green technologies investments. From logic point of view, one would expect that if investing in those technologies has such high returns, basic economics would favour that entrepreneurs will undertake them, if indeed the high costs of either ETS or carbon taxes become reality after their implementations or even at the expectation of their implementations. The point is that while there is a point that governments should be proactive in encouraging those investments, but economics will dictate that it is ultimately good business cases that will have a lasting effect on what will happen. It seems that the author is arguing for economic science without really applying economic thinking, after all!