What crystal ball does the government have that tells it what and how much to extract for the use of the people?

This says that the people are just too stupid to know what they need and require overseer “experts” to tell them what they need.

In other words…central planning. The real goal of the warmers and econuts.

Blind consumption today isn’t within our even selfish interest as it effects our future standard of living and economic productivity. If you believe in a public interest, then it’s the governments obligation to ensure this remains preserved. If not, I would like to hear how private sector deference will bring about the proliferation of efficient infrastructure which benefits everyone. Historic examples only show the removal of streetcars for the automobile. If gas prices hit 4-5 dollars a gallon tomorrow, whether due to increased consumption (unlikely), a terrorist attack, natural disaster, or the cartel colluding to increase profits, what would the private sector do in response to these increasing prices?

Externalities, like global warming through pollution, are a major facto why we subsidize energy efficient appliances. I don’t understand how you think energy efficiency will be rolled out, especially the transition to alternative fuels, without government action. The transition from wood to coal took many decades. This isn’t something the private sector will invest in, but rather keep drilling deeper wells and increase exploration in other areas such as ANWR.

So energy efficient cars or automobiles increase demand or allow it to remain constant at your equilibrium? If I purchase a Hybrid, then I’ll move even farther away from my job and drive more, since I am seeing a cost savings per mile? I don’t think you factor in consumer preferences and why, independent of cost, people would chose green. They do so because they are conscious of their impact upon the environment. Many can’t afford to go green presently and a subsidy brings them greater access to the green market. It might be a “transfer” to the manufacturers, however I think that’s a worthwhile industry to invest in given the decline in traditional manufacturing and that it’s our future. Given the revenue needed to purchase green capital, the government should encourage demand — that is if we want to complete globally with other countries who have no problem creating dead-weight losses by investing in their domestic green entrepreneurs.

Wealth is a stock, not a flow. If it is the case that your answer to the above question is yes, does the same hold true for income?

Let me rephrase. You present a partial equilibrium model of a good in a market. Let me ask you if there are nonlinearities that exist (and if your analysis accounts for that) when we incorporate this specific market into a more general equilibrium model.