My God, it's like gravity in space. It's always there, but at distance squared it starts to be a LOT less important the further you get from a gravity well.

And you KNOW it doesn't prevent win-win because you said Proctor and Gamble may have been right in their decision!

I'll tell you another one from the real world, to do with environment and not specifically Global Warming:

Our local back-bay has a long history but most recently has gained value as a wildlife refuge, for its scenery, and for recreational activities. The latter two uses are somewhat dependent on the former. No one wants to look out on, or walk along, a polluted swamp.

It was recently discovered that runnoff from nearby greenbelts and parks was contributing to algae bloom through their irrigation and "additions" (fertilizer and *cides).

A local company proposed a solution. They could make a moisture sensor and wire it into the electronic sprinkler systems in the greenbelts for less that a $100 per. Was there an "opportunity cost" for the city and associations to persue this? Certainly, but what happened when they did?

They made their money back on the first month's water bill. One association saved $150,000 in water fees a year, while reducing water runnoff and improving the water quality in the back-bay.

Everyone was so happy with this win-win that they made a segment for local cable, and ecouraged everyone to buy the gizmo, save money, and help the environment at the same time.

You I'm not grasping? What am I missing, really?

Forget it, you just aren't grasping the point of my comment. Opportunity cost is always there. I don't care about your last two comments, they are just bafflegab to try and cover your lack of undertanding.

YHL
HAND

For your convenience:

“There are cases where we save money, aid our economy, improve national security, reduce known pollutants (SOx, NOx), and as an added bonus reduce greenhouse gas emssions.”

In my hypothetical, I assumed that someone needed/wanted a refrigerator, to illustrate a case when opportunity costs were equal.

This is closer to the meat:

"The point, is that turning down the thermostat was not “costless”, “free”, or “doesn’t cost anything”. This is true for virtually everything. Rarely there might be cases where the opportunity cost is zero, but those are the exception not the rule. So to say something is “free” is in almost all cases misleading."

First of all, I don't use the word free quite as ... freely as you do. It is an imprecise word and conveys something different than I wish to say. In fact, you are pretty close to using it as a strawman, even though I don't say "free" myself.

I did say "don't cost us anything" and explained that in terms of ROI.

Again, you are playing around the edges. None of this disproves that there are some cases ... I never said "in almost all cases" ... another strawman ... none of this disproves that there are cases where a win-win is possible.

You ARE sniping from the edges of the argument.

I don’t get where you are coming from anyway. If you aren’t trying to disprove my central statement, what are you trying to do? Just snipe from the edges?

I don't have to try and disprove your central thesis, I've already done so. Lets use your example,

Story: I’m sitting on my couch watching TV. A commercial comes on and I decide I’m going to do something I’ve thought about. I get my lazy bottom up, walk outside, and turn down the thermostat on my water heater. At the end of the month I discover that my showers have still be hot, I don’t run out of hot water, and my gas bill is a touch lower.

There is an opportunity cost here. You have, lets say 1 minute for the commercials. What is the best thing you can do with your time other than turning down the thermostat on your water heater? Maybe fix yourself a snack. Lets say, for the sake of the discussion, you save $5 on your heating bill and you'd be willing to pay $3 for the snack. What is the opportunity cost of turning down your thermostat? $3. Now, in this case the benefit from turning down the thermostat exceeds the value of the snak, so you turn downt he thermostat.

The point, is that turning down the thermostat was not "costless", "free", or "doesn't cost anything". This is true for virtually everything. Rarely there might be cases where the opportunity cost is zero, but those are the exception not the rule. So to say something is "free" is in almost all cases misleading.

Further, this is why people, with limited budgets, don't always rush out to buy a whole house fan, the latest and most efficient fridge, or a Toyota Prius, even if they have the money to do so.

Oh, and the pop quiz questions were not "loaded" other than they were designed to test your grasp of opportunity cost. In both cases, the answer is "d".

Story: I'm sitting on my couch watching TV. A commercial comes on and I decide I'm going to do something I've thought about. I get my lazy bottom up, walk outside, and turn down the thermostat on my water heater. At the end of the month I discover that my showers have still be hot, I don't run out of hot water, and my gas bill is a touch lower.

Do you need to attack this because the opportunity cost, missing the commercial, was too high? What's your point?

"There are cases where we save money, aid our economy, improve national security, reduce known pollutants (SOx, NOx), and as an added bonus reduce greenhouse gas emssions."

I'll add a word, for clarity, to that sentence above:

"In some cases ROI is immediate, [as] in the case when you choose between two $500 refrigerators – one Energy Star and one not. In that case your [extra] opportunity costs, your risks, your extra investment, are all zero. Your ROI is immediate."

I actually saw that muddle in the text after I typed it, but I didn't think you'd be so childish as to go for that missing word, and hang extra meaning on it.

Grow up man. Of course opportunity costs exist in the world, but when you need a widget (be it a refirgerator, car, or television) it is not guaranteed that efficiency will have a higher cost.

There are fortunate examples where efficiency costs less. An easy one to point to is the Toyota Echo ... a very inexpensive car that is also reliable and high efficiency.

You have won a free vaction to Santa Barbara, but you can't resell your free vacation. A friend offers to go with you to San Francisco which will cost $500, but you'd be willing to spend $750 to go to San Francisco with this friend. So what is the opportunity cost of passing up the San Francisco trip--i.e. taking the "free" Santa Barbara trip (assume no other costs involved)?

a) $0
b) $500
c) $750
d) $250

You have $500 and are looking at buying either refrigerator or a flat screen television. Your choices are an Energy Star fridge for which you'd be willing to pay $800, but costs $500. Also a non-Energy Star Fridge that also costs $500, but for which you'd be willing to pay $650. The television also costs $500, but you'd be willing to pay $750. What is the opportunity cost of buying the fridge (assume no other costs)?

a) $800
b) $750
c) $500
d) $250

I'm now convinced you are a fool. A complete blinkered fool who is too taken with his own arguments.

In some cases ROI is immediate, an in the case when you choose between two $500 refrigerators – one Energy Star and one not. In that case your opportunity costs, your risks, your extra investment, are all zero. Your ROI is immediate.

Tell the truth, you flunked basic economics, didn't you. And no, the opportunity cost is not zero.

Unfortunately that does not dispose of my moderate position that there are some cases where a true win-win is possible. There are cases where we save money, aid our economy, improve national security, reduce known pollutants (SOx, NOx), and as an added bonus reduce greenhouse gas emssions.

Really, if you want to argue against that moderate position, you have to go further. You have to prove that there is never a win-win.

Or you can just accept my moderate position.

They cost us nothing, after they achieve their ROI.

In some cases ROI is immediate, an in the case when you choose between two $500 refrigerators - one Energy Star and one not. In that case your opportunity costs, your risks, your extra investment, are all zero. Your ROI is immediate.

Geez, you don't think playing around with corner cases like you do really affects the central argument, do you?

Steve, I’ve understood these economic terms for decades. I’ve also understood, throughout this discussion, that they don’t affect the general argument. They are peripheral. There may indeed be cases where opportunity cost, or risk, or ROI, or anything else may argue against a specific plan or installation … but that doesn’t mean those factors weigh negatively in all cases.

Do you think you need to make Proctor and Gamble understand opportunity cost, so that they will understand that there $1 million dollar savings was not “free?”

No, you don't understand the argument at all. The fact that opprotunity cost is present does not mean you don't do something. Opportunity cost is present in all decisions/actions. Every.Single.One.

The point was that what you consider "free" is far from free. In some cases it still makes sense to engage in the activity, but to call it "free" is misleading.

Take Proctor and Gamble; to save that money they have to do something. They have to have employees working on that issue. Those employees could be working on something else that could concievably make money for the company. Hence, there is still an opportunity cost there. This does not mean that Proctor and Gamble is making a bad deicision. I never claimed that. You made up a position for me and keep trying to get me to claim it.

I think they know that, but I think they’ve probably taken these factores into consideration and found something that benefits them, and us and the environment at the same time.

Do you see where I’m coming from now?

Yes, I see you coming from a position where you have tacitly agreed to my point, but you can't bring yourself to acknowledge it.

BTW, I just serched this thread for the word “free.”

It is interesting to note that while you’ve used it many times, to argue that I shouldn’t beleive it, I have never actually used the word free in my posts (or position) until just now.

Oh really? I draw your attention to this post of yours. You wrote,

Here’s where I’ll float my common sense, and explain why I think people who take the hard-line, no-action, position are being political:

There are responses to global warming that not only cost us nothing, they actually save us money.--emphasis for the reading impaired

Consider yourself corrected.

I’ve never argued that this was “free” – what I did say was that there are things that save us money – as Proctor and Gamble has done.

Your admission of error and backpedalling are duly noted.

It is interesting to note that while you've used it many times, to argue that I shouldn't beleive it, I have never actually used the word free in my posts (or position) until just now.

I've never argued that this was "free" - what I did say was that there are things that save us money - as Proctor and Gamble has done.

Do you think you need to make Proctor and Gamble understand opportunity cost, so that they will understand that there $1 million dollar savings was not "free?"

I think they know that, but I think they've probably taken these factores into consideration and found something that benefits them, and us and the environment at the same time.

Do you see where I'm coming from now?