New technologies in our vehicles is important, as well as regulations to drive technology improvements. I usually think the best approach is to affect the market via pricing, without passing too-prescriptive policies (ex: to promote energy security, simply raise taxes on imported oil significantly, and manufacturers will respond by producing more efficient and flex-fuel vehicles).

However, I vigilantly remind people that improved vehicles don’t offer all the health, economic, social, and environmental benefits that walkable, bikable, and transit-oriented cities do: See “Don’t buy the hybrid hype”, my column that appeared in the Eureka Reporter and Times-Standard.

Once again, I’ll say that I have no position on the introduction of Delta Air service to ACV. In fact, I secretly hope they begin serving our area, so I can benefit from increased price competition and service options (on the very infrequent occasions when I do fly).

It’s put me in a classic “Tragedy of the commons” situation. Since everyone else is spewing greenhouse gases, and since there is no cost associated with doing so (beyond the cost of fuel built into the cost of airfare, etc.), it is in my rational self-interest to take advantage of the atmosphere as a free landfill for my greenhouse gases while I still can.

On the list, some folks urged us not to underestimate the ingenuity of the free market to solve problems. However, markets will not solve problems created by invisible costs. The approach we need to take is to use government regulation to create markets designed to achieve appropriate environmental and social goals. For example, a carbon tax would provide incentive for airlines and aircraft manufacturers to reduce their greenhouse gas emissions, and would also spur growth in travel by other modes.

Once such a regulation is in place, we’ll see amazing ingenuity and aggressive competition save the day.

For more, see chapters 12 and 13 of Natural Capitalism, “Climate: Making Sense and Making Money,” and “Making Markets Work.” You can download these chapters online as PDFs.