T HE P ENNSYLVANIA S TATE U NIVERSITY E CONOMICS A SSOCIATION P RESENTS :

T HE O PTIMAL B UNDLE
S PRING 2014:
WEEK OF

A PRIL 24 TH

E DITOR : C OLE LENNON P RINT EDUCATION COORDINATOR C ONTRIBUTORS : L EAH G ALAMBA , J OE K EARNS , C OLE L ENNON , R YAN S OSNADER , E LEANOR T SAI

Upcoming Events: General Body Meeting: 4/24

Consumer Sentiment Report: 4/25

Psuea.org EA Homepage Psuea.org/blog Education Blog

REDIRECTING THE CONVERSATION ON CLIMATE CHANGE

This week, the Intergovernmental Panel on Climate Change issued a report reiterating its call for nations to enact drastic policy changes that will reduce carbon emissions. Environmentalists in the United States cite this report in their opposition to the Keystone XL Pipeline, and the Obama administration has since delayed a final decision on the oil transport project. Yet, research by the State Department and Bloomberg suggest that even rejecting this pipeline will have negligible long-run impacts on climate change if the U.S. takes no other action to reduce fossil fuel consumption. Along with rejecting the Keystone XL Pipeline, the federal government must act boldly to encourage a transition toward cleaner energy. Such a strategy is not only environmentally necessary, but also increasingly economical.

First, energy-efficient technology has made alternative energy more affordable, defying the conventional wisdom that there is a trade-off between economic growth and sound environmental policy. Renewables now occupy 8.5% of the global electricity-generation market, and are increasing their share of the market relative to fossil fuels. They even out-compete fossil fuels where geothermal, wind, or solar resources are abundant. Across the world, photovoltaic systems are less expensive today, with the average price of installing solar panels dropping by 75% since 2008. Economist Paul Krugman affirms, The science is solid; the technology is there; the economics look far more favorable than anyone expected. At the same time, the federal government can implement more environmentally-friendly policy. It can push firms by insisting on higher energy efficiency standards; ensure rural areas have access to modern energy, including the electricity grid; and implement more energy oversight and innovation-based partnerships with other agencies, nonprofit organizations, and universities.
In sum, rejecting the Keystone XL Pipeline alone will not sufficiently advance the climate change cause. Rather, the United States should utilize recent advances in energy-efficient technology to strengthen its entire clean energy sector and infrastructure. Indeed, as the worlds largest economy, it must keep up with worldwide trends towards alternative, renewable energy sources and lead the way in making energy sustainability a top priority.ET
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T HE M ARIJUANA M ULTIPLIER E FFECT

Colorado is experiencing massive changes, given the legalization of recreational marijuana and subsequent economic boom. The state has seen record traffic levels on roads and a 25% rise in online searches for Colorado hotels. 4.5 million square feet of additional warehousing space is also being built to house and produce marijuana. Tickets were also sold-out for the large My 4/20 Tours and World Cannabis Week events. The legalization of marijuana alone will hardly guarantee economic stability, but it is taking Colorados economic activity to a new high. More states should consider allowing marijuana into their states to reap marijuanas benefits beyond simple medicinal use.JK
Check out the articles: onforb.es/1pnhpBW ; wapo.st/1f1yvB0

Such is the new Rocky Mountain Way.

A L ESS T AXING S TART

This tax season marked a record number of tax returns across the U.S., as over 100 million returns were processed through April 4th. The returns also came earlier this year, with more paid out in February and March than previously. The government paid out almost $5 billion in refunds, a 2.5% increase from 2013. Economists believe the resulting increase in disposable income will help offset the slow sales that the colder -than-usual winter inflicted. The additional spending will soon give the U.S. economy a needed boost. More tax returns and refunds show that more Americans are employed and that fewer are underemployed, proving that labor markets are making important progress.RS
Check out the Article: on.wsj.com/1i98BG3

Taxation, likely being represented here.

E XPECT THE U NEXPECTED I NFLATION

American consumers felt a pinch in their wallets this month as the CPI rose 0.2%, slightly higher than the 0.1% increase that economists predicted. The price increases were especially prevalent at the grocery store as beef prices reached a record high. Milk and vegetable prices were also higher than usual and the official food index increased 0.4%. Other price increases could be seen in medical care, clothing, and airfare. In contrast, the energy index actually went down this month. Declining prices of oil and gas fuel more than offset the increases in electricity and natural gas. Instances of unexpected inflation, like ones in this past month, can hurt American consumers and stifle the economy if they continue.LG
Unexpected inflation is the kind of inflation economists tend to worry about.

Check out the Article: cnnmon.ie/RG41Kk