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Saturday, January 09, 2010

A modest proposal for climate change treaty

Important Kitty Tip by fofurasfelinas from flickr (CC-NC-ND)
For a moment, let's forget questions like whether rapid reduction of greenhouse gas emissions would be sensible or even possible, and about alternative approaches. What can we do if we're serious about reducing emissions really fast? Let's use perfectly logical method of elimination to see what's left once we eliminate the impossible.

First, it should be obvious that no country has either interest or ability to do it on its own, or even together with a small group of other countries. Let's say even as much as half of the world, at enormous cost, overhauled its economy to be entirely emission-free by the next year. Suddenly the world would have immense amounts of oil, coal, and gas without anyone there wanting to buy them. The price would drop, demand from the still-emitting part of the world would increase, and new equilibrium would be established - not necessarily at emission levels so significantly lower. As an added bonus, a lot of manufacturing and other carbon-intense industries would simply move - yes there are tax solutions to reduce this part, but modern governments are incapable of dealing with even outright tax fraud by major corporations, so I'm highly skeptical about that; and in any case it's only one part of the problem.

Parfait by meantux from flickr (CC-NC)
Kittens in poor countries will emit more CO2 as they get basics like fresh water

What's worse - however small was the interest that the emitting countries had before, now their economies are much more dependent on cheap fossil fuels than before; they have new carbon-intense industries; and with emissions reduced by someone else they care even less about global warming than before. Just in case you think this scenario is purely hypothetical, stupid, and there's no chance of it happening - we had a mild version of it called Kyoto Protocol. Some developed countries agreed to barely stop increase in their emissions, and everyone else took advantage of the suckers. Total world emissions increased by 41.7% 1992-2008, with China's and India's more than doubling. America had a boom for SUVs and increased its emissions by 16.8% even though they could have cheaply avoided it all by just better fuel standards. Meanwhile a lot of manufacturing moved to countries without emission limits (Kyoto Protocol wasn't the main reason for it, but its clear which way its influence went on the margin).
cat car by Friar's Balsam from flickr (CC-BY)

Meanwhile kittens in rich countries emit CO2 by driving big cars

And don't even hope for voluntary drastic reductions in emissions - China promised to increase its emissions by only 40% by 2020... and that's considered major progress. India won't even promise constrained increase - anyone wants to bet how much time it will take till their emissions double? Obama is free promise whatever he wants, he won't be able to pass anything meaningful through lobbyist-dominated Senate, and whatever little he manages to get passed, Palin's administration will revert anyway.

Such piecemeal solutions just won't do. We need to have everybody on board - either voluntarily or by force. We can temporarily excuse very small or very poor countries, but there's simply no way to have a meaningful reduction treaty without developing countries like Indonesia and Pakistan on board. Unfortunately we cannot really force them to comply. If everyone else was cutting their emissions except for Sierra Leone, they could be beaten into submission with some economic sanctions or a few cluster bombs. Oh yes, I'm curious how willing are pro-emission-cutting folks to bomb countries which continue emitting? But even if we're willing to bomb, short of World War III there's no way to force China or India to do anything, and good luck with even mid-sized countries like Algeria and Brazil.

Unfortunately the set of countries hardest to force into agreeing to severe emission limits is almost exactly the set of countries which emit the most and whose agreement we most need. Now while it wouldn't be entirely impossible for such countries to agree to severe limits out of concern for planetary common good, it's about as likely as a bird baguette-bombing LHC. One such event per century and we already had ours. No, any realistic treaty must pander to biggest emitters. And here's my modest proposal:
Let's make the best estimate of what everyone's 2010-2020 emissions would be without a treaty. Subtract desired percentage. That's how much permits everyone gets, now go and trade.

Yes, it means rich countries get to emit a lot more than poor countries. And less efficient countries like Australia get to emit more than more efficient counties like Japan. And countries which were going to cut anyway like EU get to emit less than countries which weren't that committed like USA. It really sucks. But do you think you can have them agree to such limits otherwise? If poor countries want to increase their emissions - and they'd all love to do that, they will have to buy emission permits, with hard money. By the way targeting 2020's emissions or such is necessary as there's no way to get India to agree to 2010's emissions, let alone EU's favourite 1990's level - well we could bribe them, but then we can as well give them emission permits as a bribe.

It would have to be enforced hard - every country which tries to emit past their limits must be made to suffer. Because the treaty is advantageous to all powerful countries, as long as the poor countries are divided it wouldn't be too hard to enforce - definitely not anywhere as hard as enforcing it against China or USA. Threat of economy-crippling trade sanctions would absolutely necessary, they would most likely have to be actually applied a few times or the threat wouldn't work. It might very well require some bombing or even an outright invasion every now and then. But surely, there will be plenty of volunteers to fight for the planet, right?

Volunteers to invade countries emitting too much CO2, artist's conception

Now the Guardian/New York Times reading crowd will surely reply "what about social justice" and nonsense like that. But first - how likely is it that Chinese Politburo or American Senate or Indian voters wanting to finally get their Tata Nanos are going to care about your idea of social justice? You can probably guilt them into parting with some of their money or emission permits, but there are hard limits on how much you can get - they have all the power, and countries like Tuvalu have none. And second, I find social justice arguments unconvincing and annoying. Some arbitrary class of people - in this case those who happen to be born in developed countries now - are blamed for what their grandparents did. Somehow this is always selective liberal self-hatred - you'll never see the New York Times blaming modern Arabs for their ancestors running African slave trade, but affirmative action following the same logic against white people is somehow considered fine. And only negative externalities of Western economic growth are considered!

What are total externalities of Western economic growth, starting from Industrial Revolution and its coal? Yes, carbon dioxide levels in atmosphere increased, and so did sea levels; but standards of living of everyone are drastically better than they were in 1800, not only in rich countries. Back then an average Indians lived 25 years (it's 65 now), one baby in three didn't last until its first birthday, hereditary dictators ruled the world, nobody could read, people were forced to marry their cousins at age of 12, and wars were a constant fact of life. Now we're all healthier, richer, safer, longer-living, and more free than ever. We're even far smarter than our ancestors, all thanks to modern economy!

You think it would be better to be a Medieval serf in a low-carbon economy than live with some temperature increase? If so, there are still a few places where you can fulfill your serf dream. If not, stop the bullshit that industrial development had net negative externalities. They were highly positive, and in fact it would be more "socially just" for poor countries using technology developed by us to pay us - something they will actually do if my modest proposal passes.

Poverty begets corruption. Corruption begets poverty.
On the other hand giving poor countries huge emission permits is not only politically unrealistic, it would also have severe consequences. Poor countries have almost all highly corrupt governments. Giving Angola free money or valuable emission permits wouldn't do much good to an average Angolan, but would surely make their politicians rich. It might also start a few coups, as which general could let an opportunity to get a tens of billions of dollars pass just like that. We have long history of throwing money at the problem - and it doesn't matter if it's aid, loans, or payment for oil and other resources - the end result is authoritarian corrupt governments and frequent military coups.

There's one more issue here. With perfect knowledge carbon tax and carbon permits are equivalent. But our knowledge of the future is highly uncertain - carbon tax means unknown emissions but known price - and is in every way better for the economy, as predictable long term prices make investments in reducing emissions safer; while carbon permits make emission known but price highly unpredictable. Now's the good bit - if technology optimists like Krugman and the entire Guardian/New York Times crows are right, permits will get very cheap very quickly, so amount of money poor countries will have to pay will be fairly insignificant - they might be even better off on the net thanks to new technology developed thanks to incentives for emission cutting. It's not entirely implausible, as that's what happened with sulphur dioxide cap and trade. On the other hand if energy pessimist like me are right, and technological progress will be too slow, poor countries will have to pay a lot. But that shouldn't concern you because you don't believe it could possibly happen, right?

1 comment:

Anonymous said...

tldr; kitteh picturz r awesome!