I was in a conference in Tokyo last week on the topic of advancing the use of well-being indices throughout the world, hosted by the very generous, civil, and well-organised Japanese. One of the great things about such conferences is that you get to exchange views with smart people from other countries. A particularly memorable example was a conversation about what was really happening with climate change policies around the world, between myself, a Maldives scientist and an Indian senior civil servant. The key question was whether or not the Maldives should count on the rest of the world to save them from rising sea levels. Allowing for my imperfect memory, the conversation roughly went like this:
Maldives: so, when are you guys going to get serious about preventing my country from flooding?
Aus: you come from the Maldives, right? Haven’t you got any hills?
Maldives: no, our highest point is about 3 meters.
Aus: so low? Why aren’t you already flooded by the occasional hurricane or tsunami?
Maldives: we have a ring of coral around us sheltering us from the worst of the storms. So the real worry is the overall sea levels.
India: you have that prime minister who became all emotional at the last talkfest, dont you?
Maldives: yes, that is him. Our prime minister is very vocal at conferences.
Aus: so he should be. You guys are f*cked. We are just pretending to be interested in averting climate change. We dont actually care at all.
Maldives: do all Australians swear so much? You are joking though, right? Havent you guys just agreed to introduce the world’s highest carbon tax and promised a reduction in your emissions?
Aus: (snort) yeah, that fib was quite the media success. It even made the BBC. Dont be fooled though, we are not going to diddely squat. I challenged the climate scientists to an open bet on all the key promises saying that none of them were going to happen. No takers and plenty of endorsements. All the smart money in our country says we are not going to do anything of substance anytime soon. Neither is the rest of the world.
India: yeah, forget about asking us. You rich guys have had your turn. Now that it is our turn to zoom you shouldn’t ask us to worry about emissions.
Maldives: what do you mean you are going to do diddely squat? You have legally binding emission reductions, havent you?
(Aus and India both look with a mixture of incredulity and pity at Maldives)
Aus: look, this is how the con is played. Firstly, we havent actually promised to reduce our own emissions. We promised to reduce Australia’s contribution to world emissions.
Maldives: why does that matter? What is the difference?
Aus: that allows us to pay someone else to pretend to reduce their emissions. For instance, suppose you cut down your forests today and replant them tomorrow. We Australians pay you some money tomorrow because those re-growing trees are taking CO2 out of the air. We count that re-growth tomorrow as our achievement: a means of doing our bit for the planet. We conveniently dont count the cutting down today because we pretend we are not to blame for it. By the way, the Maldives really should get into that game. The Indians do stuff like this. It is a great scam. See it as development aid.
Maldives: I see. You pay for reductions tomorrow that only arise because of increased emissions, the cut-down trees, today, and then you say you have achieved something. Doesnt anybody know this is what you do?
India: of course someone knows, but the people interested in knowing this level of detail are already committed to this political party or another, so they dont count. The average voter has no clue and goes with the headline debate so that’s the one that matters for policy makers. What geeks and academics say doesn’t matter.
Maldives: huh. You guys are so cynical. What are the other tricks?
Aus: well, another trick is to pretend we are reducing domestic emissions via increasing the price of carbon emissions. Economic modelling by our own Treasury shows that’s not likely to achieve much. Yes, we force the electricity companies to pay for the emissions caused in the generation of electricity, but their best reaction is to simply take the hit and pass the price increase onto consumers. It is still way cheaper to burn coal than anything else as a means of electricity generation and the consumers’ reaction to the increased price is absolutely minimal. So the consumers pay the tax increase. The share of electricity in people’s overall bills is so small that they wont change their behaviour at all.
Maldives: and what about this business of sequestration?
Aus: (smile) the most beautifully sequestered forms of carbon are called coal, gas, and oil. That’s all you need to know about what a con the sequestration debate is.
Maldives: so do the Australians intend to reduce domestic emissions at all?
Aus: oh, we do a bit. We mandate some windmill farms, though the mileage in that is limited. Mainly, we bribe selected high-energy usage industries. We give them some extra cash so that they switch from, say, coal burning to gas burning. It is still carbon emission intensive, but slightly less so and we count the difference as due to the policy. In fact, as I understand it, we expect more reductions from that than from our so-called carbon pricing, though you dont hear about it much in our media. Of course, by the same token we are giving these industries money to invest in technology that will endure decades, so the whole thing is a con. Hand-outs with small and un-repeated reductions in emissions predicated on the ‘hint-hint nudge-nudge’ agreement that we are not really going to make life difficult for our industries in the long run. If you look at our long-run projections, the only way the Australian modellers think we will achieve significant further reductions is by paying others countries to reduce theirs. And all the other countries are projecting their own increases, looking for ways to hide it….
Maldives: jeez. How does everyone get away with all this lying?
Aus: well, it is not really lying. All this is freely available information. It has all been in the newspapers some time. There is simply this huge difference between what actually goes on and what the mainline public debate on the issue is. The general population is just not interested enough to absorb this stuff. Its too technical and buried in the appendixes of reports that are too hard for most people to understand. And at the end of the day, the population votes for growth before they vote green so they dont really want to know either. The experts all know what is going on, but even if they bother to vent their views in public, the journos have to fit their writings within the dominant story on this which is shaped by the big players. So while the underlying realities are visible for those who want to know, for the vast majority the actual issues are over-shadowed by the shouting between the big boys. And think of the incentives of the big players: the opposition is quite happy to go along with the pretence that its the carbon tax that does the job, rather than the bribes and the foreign pretence-reductions. The reason for this is that the opposition thinks the carbon tax can be spun as a vote-winner for them. The civil servants in the Climate change ministries loves the pretence because it makes it seem they are achieving something and are at the international forefront of things. Instead of being seen to have achieved nothing, they suddenly are in charge of internationally debated policies. Woohoo! Industry is happy their lobbying has paid off and they wont be asked to do anything real, so they are happy investing in the emission booms of tomorrow. The Greens have their token success and can pretend to their voters that this is the thin edge of the wedge. And the government is honouring an election pledge and its deal with their coalition partners. So all the big players go along with it for their own reasons and keep quiet about what’s lurking beneath. Similar things go on abroad. At the end of the day, our populations just don’t really care enough about something that might cause problems in the far future, so they want the politicians to pretend to be doing something as long as it doesnt interfere with business as usual.
Maldives: really? Surely not! What about China?
Aus: ha! They have got the pretence business down to a T. They are building additional coal fire power stations like no tomorrow and they are extending their road and rail network to get ready for all the new cars, aeroplanes and air-conditioning they are going to use. So no bets on the issue of where emissions are going to go there! Their main trick in the international debates is to talk about energy-GDP efficiency rather than total levels of emissions. The key thing to know about the efficiency angle is that they can increase their efficiency overnight by revaluing their currency: that increases their nominal GDP immediately without any change in their production set-up. Given the huge degree to which the Yuan is undervalued, they can keep any promise they want on efficiency by allowing a revaluation the eve before they have to deliver on the promise. Even without a devaluation, they are just a property boom away of any GDP efficiency gain they want without any real adjustment.
Aus: trust me, you guys in the Maldives are so f*cked. And we are not even pretending to push for emission reductions for your sake. You are so small, you are not worth lying to. This whole circus is for domestic consumption.
India: yeah, dont count on us either. People in India have much bigger things to worry about. But look on the bright side, you will have a century before the seas rise 3 meters.
Maldives: 2 centuries we have been told, worst case scenario.
India: so what are you worried about? Even a century is no problem: that’s your kids and your grand-kids. The generations after that have to worry about themselves. You will be fine.
Aus: true, but if you are desperate, the best-guess at the moment is that you might have a chance with artificial dimming. Attract energy-intensive industries and let them belch out large plumes high in the atmosphere with sunlight-reflecting particles. Part of the global warming of recent decades is due to countries cleaning up their coal stations. Think of the irony in that: global environmental problem due to cleaning up the local environment! You can go for artificial dimming though. You should attract the dirtier stations and encourage them to perfect the dirtiness of their emitted particles. You should aim for a plume roughly double the size of Australia, reflecting most of the sunlight.
India: wow, you are telling these islanders to live in a shitty dark place belching plumes and cutting down their forests? You must be an economist! They have a great place. Coral reefs and good weather. Better to tell them to get rich enough now from tourism so that their great-grandchildren will be welcomed as migrants somewhere else in the future.
Aus: ok, but either way, the Maldives are stuffed. No-one is really serious about saving their islands. You guys should team up with the other islands in the same predicament and perhaps the odd truly concerned low-lying country, and make it happen yourself. We are not going to do it for you.
Maldives: yes, we are starting to realise this back home.