I was struck by Krugman’s column on greenhouse. I’ve been working myself up into a lather of pessimism on greenhouse. Not only is this a really really hard problem to solve, but the way we’re going about solving it is just so awful from so many perspectives, it’s hard to innumerate all the problems. But the central problem, it seems to me, is that we’re developing massively dysfunctional international institutions to deal with the problem. Start by giving all signatories to the UNFCCC equal votes in determining UNFCCC ‘policy’ or resolutions and then exempt all but a small few from binding commitments.
What do you think might happen? Well the unbound will call for stronger commitments from the bound. And so it’s been going on – for twenty years now. The developing countries have remained intransigent, and the greenies are so wedded to the politics of victimhood that this is a truth that dare not speak it’s name. It’s always about ‘us’ – the developed countries.
Meanwhile the developed countries like to talk tough, but there’s plenty of evidence that the kind of long range targets to which they’re committing themselves are the same kinds of targets to which countries have routinely committed themselves – only to completely ignore them – like the Brandt Commission targets on aid, or dare I say it the latest round of commitments in which we all have rock concerts designed to make poverty history.
Meanwhile in Australia we have locked ourselves into the follies of trying to compensate industries for their emissions of carbon . . . Now if you know anything about economics you know that this undermines the whole point of an ETS. The only way in which one might justify provision of compensatory permits to trade exposed emissions intensive industries is that Australia feels so altruistic towards the rest of the world that it’s prepared to sacrifice some of its well-being to prevent the environmental harm of lower gas production in WA (and implicitly higher coal fired emissions in the region). But we’ll be paying for it – by handing over permits when the most efficient thing we can do (from our own perspective) is to let the plants be closed or mothballed. This is all being defended, not on the grounds of altruism, but on the grounds of protecting Australia’s competitiveness (if ‘Australia’s competitiveness’ means anything, subsidising carbon intensive exports lowers our competitiveness – by taxing all other exports to pay these subsidies).
Then there’s the nonsense from the developing countries of ‘you created this mess, so you should pay to clean it up’. We (the west) created a whole lot more economic value than we destroyed in burning carbon – all the knowhow since the industrial revolution. So that’s not bad as a bit of compensation.
Anyway, perhaps my pessimism is partly the product of being Australian, of coming from a little country that doesn’t kid itself that it has much influence on the rest of the world. Krugman swallows the ‘you created the mess’ line to the extent of accepting that the current situation where we’ve got to pollute the planet is ‘unfair’ and he’s very optimistic about making progress on greenhouse. I agree with him that we should be prepared to impose sanctions on the Chinese (and the Indians) if necessary, thought it’s not the kind of thought that springs naturally to an Australian’s mind.
But even though it’s nice to read Krugman’s optimism, I’m afraid I think it’s a false dawn. How aggressive will Obama be able to be and get stuff through Congress? More ambitious than Australia? I doubt it. And while I think Australia’s position is pretty reasonable in terms of the emissions reductions we’re committed to by 2020 given existing emissions, I doubt we’ll meet the target and it isn’t really enough anyway.
Anyway, here’s hoping I’m dead wrong.