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A CARBON TAX FUELED SOCIAL SECURITY SOVEREIGN WEALTH FUND; 2.0 macroeconomic effects on a Nuclear power plant build program

July 6, 2014

                                              macroeconomic effects of Nuclear power plant build program

Carbon tax social security sovereign wealth fund builds nuclear power plants to generate cash flows to pay down capital and to pay a future supplemental social security benefit decades in the future

We will use principles of UM Flint Economics course ECN 201 to study a nuclear build program this blog entry is an example of economic theory or  idea of,

 Normative statements

–Attempt to prescribe how the world should be

–Prescriptive

This log post is also an extension of my original college honors project that has evolved over time here,

https://yellowdragonblog.com/2014/01/28/a-carbon-tax-fueled-social-security-sovereign-wealth-fund/

 

”                                            A CARBON TAX FUELED SOCIAL SECURITY SOVEREIGN WEALTH FUND

To industrialize the inner solar  system. Only a Carbon tax can both stabilize and reduce atmospheric CO2 and sustainably fund a social security system invested in the world capital markets on behalf of Future new-born children.

A Carbon Tax Fueled Social Security Sovereign Wealth Fund

       State pension and social security schemes, including the American social security system are under stress due to demographics and underfunding, and  in the same breath according to measurements conducted by Keeling our planetary civilization is placing into the atmosphere more CO2 than has been present in the atmosphere in the recent geological past( Keeling 4 ). [TU1] Investing carbon taxes in the world’s capital markets for newborn children in a new transitional social security system holds out the promise of shoring up the existing social security system, but also creating a new sustainable social security system. A sustainable social security system is one that would not require tax increases so large in the future as to consume the entire federal budget, which is spent on defense, education, infrastructure and research and exploration, together called the discretionary budget. Failing to create a sustainable social security system means in the future retirees not receiving the full promised benefit. Investing taxes over time puts to work the magic of compounded growth rates in the worlds capital market places instead of taxing future taxpayers for future social security benefits. Only a tax on carbon is uniquely able to stabilize and reduce both the rate we are producing CO2 and to prefund existing and future social security schemes.  Failing to enact a carbon tax will result in a century’s time, flooding of the worlds coastal plains where most of the Earth’s population lives and in climatic changes that might lead to crop failures and mass starvation. The American Social Security system is a pay as you go system with distinct parts ”

 

 

We use as a base line the idea that the NRC will not able to ever approve more than one nuclear reactor site per year and that each reactor will cost $20 Billion each.This means at the end of 10 years there will be 10 reactors under construction with one nearing completion and one new start.

if each reactor costs 20 billion to build and takes 10 years this is $2 billion per year per reactor that yields a $20 Billion per year program.

the intended consequence of the carbon tax is to set a price on carbon emissions so that consumers will purchase less of products with a high carbon foot print and buy more products with a lower carbon foot print. Ironically the governments own carbon tax would make the power sold from the nuclear power plants competitive with high carbon emitting coal-burning power plants.The Carbon tax calculator show this effect on CO2 emissions.

The Intended consequence of the nuclear build program is also to reduce emissions as well as to use the employment from a $20 Billion per year program to off set possible unintended consequence of unemployment from the higher carbon taxes I.E a coal miner to construction worker retraining program. The  higher level skills and value added  nuclear technology  should push the Production Possibilities Frontier further out than coal mining would alone.

Do Government training programs constitute changes that can push the   Production Possibilities Frontier?

Possibly the reduction of the employment rate from such a massive construction project might add to the intake of cash flow to the existing social security system.This would be an Intended consequence of investing carbon taxes to benefit future generations.

Picture1\

From Gregory Mentiw

examples of technology advance to could move the Production possibilities further to the right are the low tech idea of burning spent nuclear fuel again in a Canadian design heavy water reactor using the DUPIC idea.DUPIC processing of spent fuel would incur a capital cost but the avoided cost would be the immediate need for the geological disposal.

unintended  effects of the $250 Billion per year carbon tax is the additional cost of the concrete used in building 300 plus nuclear reactors,concrete uses a high quotient of carbon  based fuels to make.

 

So we propose the sovereign wealth fund should build a fleet of 200 heavy water reactors to burn spent fuel and to sell power.knowledge and skills gained should bring down the costs of each nuclear reactor over time.$ 20 Billion X 200 reactors would be $4 Trillion over  200 years at one new start every year but we would go to two new starts every  year after ten years, and that implies a $40 Billion per year project.As each reactor goes online cash flow will offset the need in part for the carbon tax to capitalize further construction so as to deploy those monies to investments to the worlds capital markets.

each reactor should produce power over 60 years and amortize its capital over those 6 decades and provide cash flow to the  carbon tax social security sovereign wealth fund.it would take a century to build it all out and a century to feed through the heavy water reactors  the spent PWR/BWR fuel.

The heavy water reactor program would have a sister program of a fleet of molten salt reactors that would burn spent heavy water and PWR/BWR fuel. Each heavy water reactor and molten salt reactor would be built on the site of an existing PWR/BWR reactor or a site of collected spent fuel.

 

 

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