“Capitalism has a built-in incapacity to generate legitimations of itself, and it is particularly deprived of mythic potency; consequently, it depends upon the legitimating effects of its sheer facticity or upon association with other, non-economic legitimating symbols.”

– Peter Berger, The Capitalist Revolution: Fifty Propositions about Prosperity, Equality and Liberty

In Part 1 of this two-part series, conventional, market-based electricity was described as inescapably lacking an overarching myth that gives it legitimacy against postmodern renewable energy, global-warming ideology, and energy regulation in California. This insight comes from sociologist Peter L. Berger’s 1986 book The Capitalist Revolution: Fifty Propositions about Prosperity, Equality and Liberty.

Given Capitalism’s mythic deprivation, what then can be done, if anything, to re-legitimate cheap, clean or cleaner conventional energy and demythologize renewable energy?

Can Anything Be Done?…

Upon a Congressional declaration of “the public interest” and to “promote the general welfare,” the Department of Energy Organization Act of 1977 centralized the federal government’s energy functions. The new agency was premised on five beliefs:

• an imminent exhaustion of oil and gas;
• problematic oil-import dependence;
• the efficacy of central planning;
• the need to commercialize renewable energy; and
• conservationism.

DOE’s rationale of market failure and government success has flipped. Today, it is government failure and market success. Oil and gas are more abundant now than 37 years ago; oil imports are decreasing to levels thought impossible just a decade ago; politically correct renewable energy remains uneconomic (note the wind industry’s dogged pursuit of the production tax credit); and mandated conservation has present costs and speculative future benefits (hence the coercion).…

“The only good national energy strategy is one premised on private property rights, voluntary exchange, and the rule of law. Not a central, government plan, but a decentralized we-the-people ‘plan’.”

Energy studies, energy plans. They are not new. We saw them in 1938, 1977, yesterday—and in years between.

Now, the smartest-guys-in-the-government-room  will, once again, pontificate and propose more regulation and intervention on top of the tens of thousands of pages of directives that have built up in the last 40+ years. (The modern era of U.S. energy regulation began with Nixon’s wage-and-price-control order of August 1971.)

Usually, such studies come out with recommendations, which then turn into legislative proposals for a Congressional debate and a vote before reaching the President’s desk. But with President Obama legislating via Executive Order, expect the worst.…

“You can rank carbon regulations, carbon cap-and-trade, and carbon taxes however you wish. But at the end of the day we’re better off with no policy rather than bad policy.”

To continue from Part I yesterday, the carbon tax–on paper, on the white board, in the ivory tower–is better policy than cap-and-trade, which is better than ad hoc regulation. We could spend – and have spent – hundreds of hours explaining why cap-and-trade is a horrible idea, and why regulations are often blunt-objects that often cause huge unintended consequences, but that’s beyond this post.

And an ideal carbon tax can be shown to have only modest damage to the economy. 

But where are carbon tax proponents, particularly conservatives, wrong about carbon taxes? The answer provides a much longer list.

First, carbon taxes are not strictly a tax on “bads” (i.e.…