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7 of 7 people found the following review helpful:
5.0 out of 5 stars
Review by Dr. Jay Lehr, Environment & Climate News, 11/2002, December 5, 2002
By A Customer
A Page-turner on Economics (!?)Book review by Jay Lehr
Published: in Environnment & Climate News, November 1, 2002 Why Energy Conservation Fails
by Herbert Inhaber, PhD
Quorum Books, paperback, 237 pages Why Energy Conservation Fails is, in many ways, the most readable book on economics you will ever read. It is so innovative and fascinating in its approach that it is a page-turner. Dr. Inhaber uses basic economic theory coupled with our well-known human nature to prove in dozens of ways that no artificial coercive strategy aimed at conserving anything can ever succeed. Through simple prose, supplemented with detailed illustrations and ample calculations, he makes his premise as certain as the law of gravity. In making his case, Inhaber stands on the shoulders of giants of the past. These truths have been illustrated and handed down for centuries ... and yet the folly of coercive conservation runs rampant even today. Sadly, those who do not study the failures of the past are destined to repeat them, and that we do again and again. Over the past two decades, Americans have been subjected to an unprecedented barrage of government edicts telling them to save energy, water, natural resources, and many other substances. If we trade in a large car for a small one, surely we use less gasoline ... or do we? If cars are smaller and driving is cheaper, families may own two cars instead of one, and they will drive more miles with their cars. The counterproductive end result is that people will ultimately use more gasoline. Simple economic reasoning makes it clear: When the price of a commodity falls, more of it will be used than if its price had remained constant. Conservation on a national scale does not and cannot exist. In the case of gasoline, its use has risen, not fallen, since the imposition of strict mileage standards in the late 1970s. According to those who advocated those laws, gasoline use should have declined. In our homes, when we attempt to save electricity through improved insulation, our electric bill goes down ... so we tend to use more electricity in other ways, such as by raising our indoor temperature in the winter or lowering our indoor temperature in the summer. Inhaber points out that Karl Marx made a similar mistake when he reasoned capitalism would fail when production efficiency increased, thereby making many employees redundant. He failed to see that with increased efficiency comes a decline in the effective price of a service or commodity and that in the face of a lower price, increasing demand will require more workers. The statues of Karl Marx have come down all around the world, but the conservationists who say that saving a kilowatt hour here and there will reduce the total amount of energy we use still have a loyal following. Inhaber feels strongly that their efforts should be-and can be-thwarted by teaching simple economics to coercive conservationists. Inhaber explains clearly how conservationists have always assumed that man would run out of this or that resource, though it never happens. Why? Because brain-power followed by improved technology leads to better ways to find and refine everything or to replace it with even better substitute materials in even greater abundance. Fiberglass, for instance, is formed from silica dioxide, the most abundant mineral in the Earth's crust. While many of us try to save energy at home, we may imagine waste occurs frequently at the industrial level. At home we replace light bulbs when they burn out. In a factory, bulbs are replaced on a timed schedule to coincide with the average life of a bulb. Many perfectly good bulbs are discarded in this way ... but a tremendous amount of labor, and thus cost, is saved. Waste is in the eye of the beholder. For a manufacturing company, labor is too valuable to be wasted. These examples are but a small illustration of the meticulous and comprehensive manner in which Dr. Inhaber dissembles the ill-fated do-gooders' desire to conserve a wide variety of resources that never were, are not now, and never will be in short supply. They overlook at every turn man's indomitable intellectual creativity, which allows him to expand or replace every imaginable resource. Dr. Jay Lehr is Science Director for The Heartland Institute
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