Stephen Hickson on the fight against woolly words

I'm loving Stephen Hickson's work lately. In addition to writing about the stupidity of removing GST from food last week (which I posted about here), and co-authoring a piece in The Conversation with myself and others on our 'quick takes' on Budget 2022, he wrote the most hilarious post on LinkedIn yesterday:

Woolly words...

I came across this article today (not sure if you need a subscription to read it or not but the gist of it is in the first paragraph "FIRE-FIGHTING FOAM starves the flames of oxygen. A handful of overused words have the same deadening effect on people’s ability to think. These are words like “innovation”, “collaboration”, “flexibility”, “purpose” and “sustainability”. They coat consultants’ websites, blanket candidates’ CVs and spray from managers’ mouths. They are anodyne to the point of being useless. These words are ubiquitous in part because they are so hard to argue against."

https://lnkd.in/dGmNY_ub

Imagine if the government becomes aware of the damage that the excessive use of these words is causing… there's a good chance that the Government will sign up to an international accord to limit the use of Woolly Words. In an attempt to make good on that commitment they will introduce a Woolly Words Trading Scheme (WWTS). In order to get political buy-in some sectors will initially be exempt despite being the biggest users of Woolly Words, e.g. Marketing companies. Additionally the cap on Woolly Words won’t initially be binding and so everyone will agree that the WWTS is pretty weak. Eventually this will get fixed though it will take a while. But a WWTS isn’t very sexy and doesn’t look like the government is really doing anything. So they’ll start doing things that make little sense and are expensive but look a lot sexier. For example they’ll offer to subsidise at great expense the use of better words in mission statements and annual reports of some arbitrarily favoured organisations in return for them reducing their own use of Woolly Words. Or they’ll simply ban the use of Woolly Words in some sectors such as health. While this makes these organisations and sectors less woolly it doesn’t reduce the overall quantity of Woolly Words available when the WWTS is binding. It couldn't possibly happen could it?

It's not hard to see that this is a satirical take on the emissions trading scheme, including the exclusion of agriculture, and the various tinkering the government undertakes to try and solve problems that would more easily be solved if the scheme were comprehensive. In my ECONS102 class, we characterise an efficient property rights system as one that has four key features:

1. Universal - all resources are privately, publicly, or communally owned and all entitlements are completely specified;
2. Exclusive - all benefits and costs accrued as a result of owning and using the resources should accrue to the owner whether directly or indirectly;
3. Transferable - all property rights should be transferable from one owner to another in a voluntary exchange; and
4. Enforceable - property rights should be secure from involuntary seizure or encroachment by others.

The emissions trading scheme (and the woolly words trading scheme) creates a property right - the right to emit carbon (or the right to use woolly words). The scheme will only be efficient if it is universal - that is, all emissions (or woolly words) must be covered by the scheme. When agriculture (or marketing) is excluded, they can generate as many emissions (or woolly words) as they like, essentially without consequence. If the government is concerned about their emissions (or woolly words), then the government has to create all sort of other regulations to keep them in line. Which is completely unnecessary, since including them within the trading scheme would be much more efficient (lower cost, and simpler all around).

If we really are concerned about carbon emissions (or woolly words), we have the means to limit them. Excluding favoured sectors from the trading scheme is pure politics, combined with a fair amount of fingers-in-the-ears-I'm-not-listening-to-you, and that is going to cost us far more in the long term.