Economics and Politics

Tackling Global Warming

Jeremy Feder, '24

As the impacts of global warming have become more evident, the harvesting and use of fossil fuels have been increasingly scrutinized. The U.S. Government has addressed these issues with Biden expressing that “we’ve already waited too long to deal with this climate crisis and we can’t wait any longer” and America must lead “the world in a clean energy future” Biden claims the United States is dedicated to facilitating the creation of renewable energy and reducing the consumption of fossil fuels, what economic incentives has the U S implemented?

The first way that the U S has attempted to impede the use of fossil fuels is through Carbon pricing Carbon pricing creates a financial incentive to lower emissions by placing a tax on GHG emissions and requires economic actors to pay for every ton of carbon pollution emitted This tax encourages companies to switch to more efficient processes or cleaner fuels to lower their carbon tax. While this may seem like a viable solution, Carbon pricing is still relatively ineffective, as the global average for a ton of emissions is only fifty dollars.

To encourage the growth of renewable energy the government has implemented federal tax incentives, or credits, for qualifying renewable energy projects Approved government spending on clean energy reached USD 480 billion as of October 2021 The USD 45 billion allocated to renewables – including electricity, heat, and fuels (biofuels, advanced biofuels, and biogas) –accounted for about 9% of announced public spending on clean energy The majority of global clean energy stimulus is expected to be spent over 2021-2023. While the United States is encouraging renewable energy, as of October 2021, almost three-quarters of public spending on clean energy was allocated in Europe, followed by the Asia Pacific region and then North America It is still estimated that approximately USD 42 billion of approved public spending on renewable electricity could mobilize USD 380 billion in additional private investments This strong investment forecast could allow the U S to catch up to the European clean energy economy

Falling Oil Prices

Fisher Angrist, '24

In the past 12 months, Crude oil has demonstrated wild price fluctuations Crude oil, which is around $67 per barrel today, is a globally sourced commodity and plays a pivotal role in many consumers’ daily lives In February of 2022, a singular barrel of oil was $93 The first drastic change in price occurred when Russia invaded Ukraine and as a result, oil skyrocketed reaching a high of $128 Why did this have such a huge impact on the price of Oil?

The answer to this question is simple Russia’s role in the exportation of oil is vital to the global economy supplying 40% of Europe’s supply. Once Russia invaded, however, they closed the pipe, ceasing all exports of oil. According to the fundamental law of supply and demand, a shortage in the market equilibrium quantity due to restricted supply increases the price of the good

The price elasticity of oil, however, renders the good an inelastic good meaning large price increases have minimal effects on quantity due to the products necessity Inelastic goods have steeper demand curves Consumers do not typically alter their gasoline (a derivative of crude oil) consumption when oil prices fluctuate; they buy oil whenever they need it This is why you saw gasoline prices at ludicrously high prices.

After the world economy adapted to Russia’s absence in the global commodity market, oil and gas prices started to decline. This sell-off can be attributed to the lack of consumption resulting from a stagnating world economy due to rising inflation, unemployment, geopolitical tensions, and the banking turmoil To combat inflation, the Federal Reserve (Fed) is raising interest rates, thereby increasing the cost of capital Additionally, year-over-year inflation has outpaced year-over-year wage inflation, thus eroding the intrinsic value of most Americans’ dollars Due to the stagflation in the US economy, oil producers anticipate a decrease in demand as more inelastic goods, like food, occupy a larger percentage of consumers’ income If this is true, why is oil not continuing to go down? Why is it staying in the $69-76 range and not dropping to $50?

This can be attributed to the United States government’s oil reserve, the Strategic Petroleum Reserve (SPR). During the period of unusually high gasoline prices caused the the RussiaUkraine war, the Biden Administration emptied the SPR in an effort to try to lower gas prices The Biden Administration is now trying to fill the SPR back up again and set a price ceiling in the $60-$65 range Oil virtually has a price floor because it would be economically illogical to sell below this price when the United States is willing to pay more In conclusion, the price of crude oil is expected to remain in the range it is in, given the combination of inelasticity, reduced demand, and the US government's SPR floor price

Capitalism Vs. Communism

Seth Abraham, '25 CommunismandCapitalismaretwo oppositeeconomicmodelsbutwhatare their origins? Who are their strongest proponentsandwhatarethestrengths and weaknesses of each form of economy?

Communism originated from the writings of Karl Marx, who lived in Prussiaintheearlytomid-1800s His “Communist Manifesto” outlined his principles in regards to labor and privateproperty.Themostbasictenet ofcommunismisthatthe“state”owns the means of production and private property is eliminated The word “state”, in this context, is intended to mean the community of people Marx wanted to set up a completely egalitarian society – one in which personal desire and greed serves as a non-factor,thuscreatingasocietywith equal opportunity and outcome

Communism is characterized by high government intervention in the economy, also known as a command economy Furthermore, in such an economy, prices and production of goods is set by the government The overarching theme we can see is that these ideas serve as a way to put the needsofagroupovertheneedsofan individual While these ideas seem dandyintheory,theyhaveneverbeen practicedsuccessfullyinhistory These attemptshavealwaysledtoaformof dictatorship Only five countries currentlyhavecommunistgovernments: China, North Korea, Cuba, Vietnam and Laos. As you probably inferred, mostofthesecountriesareinshambles economically,withnosignofabounce backanytimesoon

At the opposite end of the spectrum is capitalism, which was defined and explained by Adam Smith in his book, “Wealth of Nations” Adam Smith was a Scottish economist and philosopher who lived in the mid to late 1700’s His vision for society was that it should be one reliant on the “self-interest” of human beings and this pursuit being a vehicle for the betterment of society as a whole His argument was that if every person does what’s best for himself, all will in turn succeed A capitalist society thus promotes private property and private enterprise. This view leads Smith to placing high value on the idea of minimal government intervention, letting each dictate his own decisions. For example, prices and production of goods are controlled by supply and demand and are allowed to fluctuate. To put it simply, a capitalist society revolves around the idea that one’s individual liberties are more valuable than ensuring the success of the group This may seem harsh, but I believe it comes from a root of practicality As we have seen before, ensuring the success of the group usually leads to individual greed corrupting the entire system

Both communism and capitalism have their pros and cons, and I think a mix of both is best While the aspects of communism are beautiful in theory, we must compromise for the practicality of capitalism. How do you think the economy should be regulated?

George Santos Campaign Violations

Zachary Kochin, '25

George Anthony Devolder Santos is a United States politician who is currently serving as the U.S. Representative for New York's 3rd congressional district. He was elected to

In October 2020, the Federal Election Commission (FEC) began investigating Santos' campaign after reports surfaced of questionable fundraising practices According to the FEC, Santos' campaign had accepted illegal contributions and failed to disclose others The FEC found that Santos' campaign had accepted contributions from corporations, which is illegal under federal law In addition, the campaign failed to disclose all of its contributions, as required by law Furthermore, Santos' campaign was accused of fraudulently using funds for personal expenses. The campaign allegedly used donations to pay for Santos' rent, car payments, and other personal expenses, rather than campaign expenses.The FEC's investigation resulted in Santos' campaign being fined $10,000 for accepting illegal contributions and failing to disclose others In addition, the campaign was ordered to repay more than $30,000 in misused funds Santos has denied any wrongdoing and has stated that he was not aware of the illegal contributions or the misuse of funds However, the FEC'sfindings have raised questions about the integrity of Santos' campaign and his ability to serve as a representative forNew York's 3rd congressional district.The violation has also raised concerns about the influence of money in politics and the need for greater transparency in campaign finance Campaign finance laws are designed to ensure that politicians are not unduly influenced by special interests or wealthy donors However, violations such as Santos' undermine the public's trust in the political system and the integrity of elected officials.