Sunday, December 20, 2009

After Copenhagen

Copenhagen was a disaster, but it was a disaster foretold, the cul-de-sac for a strategy that was flawed from its inception. The only question now is whether climate activists and political leaders will sink another year or two of our precious time into repeating the errors of the past, or whether we can all make a clean break.

There are more flaws with the Kyoto-Copenhagen agenda than I can enumerate, but here are the big ones:

1. There is an inherent conflict between the environmental requirements for greenhouse gas mitigation, as those policies are currently posed, and the constraint of political feasibility in a world of electoral democracies (or even tolerated dictatorships, as in China). We need deep, deep cuts in fossil fuel use. The only way to get there is to raise the price of these fuels far beyond anything the world has ever seen. But democratic polities will punish any politician who acts to impoverish them. This is not about the economic cost of forestalling catastrophic climate change; it is about the distributional impact. When carbon prices skyrocket, those who pay suffer and those who receive flourish. This problem is not addressed by sidestepping the issue with bland, distribution-blind capping commitments. Rather, those commitments are revealed as false when governments refuse, for obvious political reasons, to carry them out.

2. The strategy of buying off developing countries through payment for forest preservation or “clean development” is ultimately incoherent and unmanageable. (a) There is no scientific basis for treating a ton of carbon temporarily “fixed” in a forest the same as a ton sequestered for virtual eternity as fossil fuels left in the ground. It violates elementary understanding of the carbon cycle, and no forest ecologist I know defends the idea. This means that science cannot provide any formulas to resolve political disputes over which forest practices to reward and by how much. (b) And there is no political resolution either, because there are too many types of forests and other sinks, too many practices, over too many countries, with too much money on the line. (c) The notion of offsets to finance clean development is self-contradictory. The economic challenge is to fundamentally change what development means by decarbonizing it. This can only happen if prices rise to prohibitively high levels from the standpoint of current practices. Offsets seek to suppress price increases and delay this transition, so at best all they can hope to achieve is to replicate current best practice in developing countries—although their actual performance is far below even this standard.

The contradictions of Kyoto-Copenhagen were buried under layers of diplomatic verbiage, but they never went away. The closer we got to the point at which we had to devise a real, working agreement, the more intractable they become.

This is not the place to spell out a new strategy in detail, but the flaws of the existing one point the way.

1. Revenue recycling must be built into the fundamental architecture of any GHG mitigation scheme in order to sell it to a democratic electorate. All, or nearly all, of the money people pay in much higher energy prices must be returned to them, and the promise to do this must be credible. It cannot go to oil producers, government coffers, or even the fine projects advocated by environmental groups. No politician will dare to impose such prices if households see the money going out but not coming back in. Some version of a rebate program is imperative. This means, in turn, that carbon caps or taxes cannot be used in a substantial way for payments to the developing world.

2. The goal of mitigation policy must be brutally simple: to phase out, as rapidly as possible, the use of coal, then petroleum, then natural gas. Everything else, although important, is secondary. Yes, we need energy R&D, better agriculture and land use policies, infrastructure investments and the rest, but the central mechanism that ratchets down our climate forcing must apply specifically to fossil fuels. Leave them in the ground. Politically, I believe this prioritizing is coherent; it is only in a world of extraordinarily high fossil fuel prices that we will get the electoral support we need for public spending to shift our development trajectory.

As a practical matter, I recommend separating adaptation from the mitigation framework; it really doesn’t belong, and it shouldn’t be an obstacle to emergency preventive action. Rather, funding for adaptation should be combined with Millennium Development Goals, biodiversity preservation and similar “global public goods” within a new framework of global public finance. The United States should, as a matter of extremely high priority, join in the work of the Leading Group on Innovative Finance for Development, and together we should put into place financial transaction taxes, taxes on international shipments of goods that present negative externalities (like arms and scarce nonrenewable resources), and solidarity levies like the already-existing airline ticket tax. Together, these mechanisms could raise funds of $100B or more. Add expanded debt relief, shutting down tax havens and a few other virtuous actions, and we could have the financing to meet all the most urgent global goals, including adaptation to unavoidable climate change.

So where can this new politics come from? The road from here to there probably passes through the major social and environmental NGO’s, but they are unlikely to change course on their own. There needs to be pressure from below. I hope the failure of Copenhagen spreads the message that time is very short, and politics needs to be focused on solutions. The day has passed for vague mantras like “another world is possible”. The only world we have is in serious danger, and those who understand what is at stake need to be militantly practical.


Min said...

"The economic challenge is to fundamentally change what development means by decarbonizing it."

Amen, brother! But it is not obvious how to get there from here. Ultimately, we have to learn how to live in energy balance with our environment. But we have forgotten how, in the past few centuries. And if we look back to history as a guide, we find economic systems built on peasantry and slavery, not much help there. Nor are the urban slums of the nineteenth century an attractive model.

Perhaps we are headed for another Dark Age. The odds of that are increased, I think, if we have an ecological catastrophe. In the short run, there may be technological "fixes", such as the clean combustion of natural gas, or climate engineering, but in the end we have to change our behavior. Difficult as it may seem, that probably means penalizing emissions so much that it really hurts. Then, and perhaps only then, will we rise to the challenge. said...

You are correct, Peter. Copenhagen was pretty disappointing, although given that Obama went there with nothing passed by the Congress, it meant he had little to offer when the dickering got tough, which apparently it did. There are a lot of very serious differences among nations on this matter. Of course, the people in Congress holding things up would argue that they wanted to see something worthwhile coming from Copenhagen, an unpleasant chicken-egg situation.

Maybe the only useful thing to come out of this is that there was some serious negotation between the major emitters, and between the biggest one in the developed world and the biggest ones (minus Indonesia for some reason, the forestry issue?) in the developing world. This was completely ignored at Kyoto, which took place after the Byrd-Hagel resolution made it clear there was no way the Senate would approve Kyoto. So, here we are facing the ugly realities and not playing with some papered over agreement that does not deal with hard problems.

I know, I know; Kyoto became globally legal, even though the US never ratified and even unsigned it. But making it so involved the Europeans putting a kink in their cap and trade system by giving gobs of credits to Russia for their decline in emissions due to a decline in GDP in the early 90s, not such a good idea. But what is a good idea here, anyway?

Actually, I became aware of how far we were from an agreement when I read not too long prior to the conference that the US and China were discussing this monitoring issue. That China does not properly monitor its own emissions is a sign of how far we were from an agreement. I do not think this is baloney. I remember well that there was a disagreement of about three years regarding when it was that China surpassed the US as the world's largest emitter. We really do not know what their emissions are, and the official numbers one sees are loose guesstimates.

TheTrucker said...

I am personally convinced that the carrot trumps the stick. While the cost of hydrocarbons needs to be increased by taxation and rebates in the form of lower middle class stimulus (or even equal stimulus checks to all on a quarterly basis), there is a need to move on to _S_A_F_E_ nuclear power. All of the touchy feely moonbat stuff with the sun and the wind are very "comfortable". But modular, molten salt, thorium reactors seem to offer a lot of advantage. Seems that we can stop burning coal if we can make electricity a lot cheaper with these reactors.

If nothing else, our illustrious government should be DISproving this technology and getting on with fast breeder reactors to be placed _*INSIDE*_ of Yucca Mountain with HVDC power backbones to the coasts.

gordon said...

I certainly agree with several of Peter Dorman’s suggestions, including the need to return higher carbon costs, his support for “energy R&D, better agriculture and land use policies, infrastructure investments and the rest”, rolling adaptation responses into a package also including “Millennium Development Goals, biodiversity preservation and similar global public goods”, and “financial transaction taxes, taxes on international shipments of goods that present negative externalities (like arms and scarce nonrenewable resources), and solidarity levies like the already-existing airline ticket tax”. All good stuff as far as I’m concerned.

But I’m surprised that Peter Dorman only considers a huge price rise as the only mechanism for promoting energy efficiency. What happened to the sort of improved accounting so well advocated in “Natural Capitalism”? NC was the 1999 book published by some people associated with the Rocky Mountain Institute. There is a Harvard Bus. Rev. summary downloadable from here:

And what happened to regulation? I agree with the following comment by Geo. Monbiot: “The truth ... is that government regulations are among the main drivers of technological innovation”. See here for the quote; the whole post is worth reading: