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Market Meltdown: Understanding Climate Economics
James K. Galbraith, Mother Jones
…The market’s real failure is that it allows for no signal from the future to the present, either from the conditions that will exist 30 years hence or from the people who will be alive and working then. The question becomes: Can we really create a market in which those far-off voices are effectively heard?
Mainstream climate change economics assumes so. “Establishing a carbon price, through tax, trading or regulation, is an essential foundation for climate-change policy,” the Stern Review posits. This makes some sense. After all, markets and taxes encourage cheap solutions, and there is plenty of low-hanging fruit. For a start, why not replace state sales and federal payroll taxes with carbon taxes? A cap-and-trade system would lead industry to use low-emissions technologies more and high-emissions technologies less. Business leaders are rallying behind a “carbon price.” Fine. Give it to them.
But is tinkering with the market enough? According to the Stern Review, stabilizing atmospheric carbon at 550 parts per million requires cutting total emissions by a quarter by 2050, in the face of population and economic growth. Many experts, including nasa’s top earth scientist, James Hansen, favor even more drastic reductions. Goodstein simplifies bluntly: We have 30 years to get the gasoline out of cars and the coal out of power plants, a goal beyond the power of markets.
Market policies rely on competition, and are responsive only to prices. But corporations such as ExxonMobil and txu like to run the world as they see fit. Should we guarantee to them the kind of profits they earn in a carbon-based energy world, as carbon pricing might do? Can they be trusted to invest those profits correctly? No. A real climate solution must shrink some industries and grow others, and that means changing the distribution of profits. Exactly how is something we need to plan.
“Planning” is a word that too many in this debate are trying to avoid, fearful, perhaps, of its Soviet overtones. But the reality of climate change is that central planning is essential, and on a grand scale. It would start with tens of billions of dollars in research to determine what is feasible, what is socially tolerable, and at what cost.
(July/August 2007 issue)
Bush calls meeting on global warming for September
Reuters
China and India are invited to the conference, together with Japan, Canada, Brazil, South Korea, Mexico, Russia, Australia, Indonesia and South Africa. The EU will include representatives from France, Germany, Italy and Britain.
Secretary of State Condoleezza Rice will host the meeting, and U.S. officials are confident all invitees will attend.
“We welcome U.S. engagement in the international efforts to combat climate change,” British Prime Minister Gordon Brown said.
But John Coequyt, a policy analyst with Greenpeace, expressed concern the Washington talks would be used to “erode support for the process that’s strengthening at the U.N.”
White House spokesman Scott Stanzel insisted the administration is trying to supplement global efforts.
(3 August 2007)
Bush Sets Emissions Summit
World Powers Are Invited to Discuss Climate Change, Growth
Michael A. Fletcher, Washington Post
President Bush yesterday formally invited top officials from the world’s leading economic powers to take part in a climate change summit aimed at establishing voluntary goals for lowering greenhouse gas emissions while sustaining growth.
The meeting follows a May pledge by Bush to convene the world’s leading economies — and most prolific polluters — to find a solution to the problem of climate change that would both promote energy efficiency and encourage prosperity.
“Science has deepened our understanding of climate change and opened new possibilities for confronting it,” Bush said in the letter of invitation.
Long wary of the effectiveness of global environmental agreements, Bush tried to seize the initiative on global warming with his pledge to initiate a series of meetings to set flexible, long-term goals for reducing greenhouse gas emissions. He said his approach would allow countries to find their own best paths to reducing pollution. The proposal marked a clear shift for Bush, who had come under international criticism for his opposition to participating in the Kyoto Protocol, a United Nations-led environmental agreement that expires in 2012.
(3 August 2007)
Bush pushes climate meeting, shuns solution
Joseph Romm, Gristmill
Kind of a good news, bad news story:
President George W. Bush has invited the European Union, the United Nations and 11 other countries to the September 27-28 meeting in Washington to work toward setting a long-term goal by 2008 to cut emissions.
Yet it turns out just to be a meeting full of sound and fury, signifying nothing: “But a senior U.S. official said the administration stood by
its opposition to mandatory economy-wide caps.”
A meeting aimed at (1) developing voluntary or aspirational targets, (2) for the long-term, (3) by 2008 [i.e. Bush’s last year in office]. Three strikes and you are out.
Bush’s last chance to be a small part of the solution rather than a large part of the problem came and went at the G-8 meeting, where Bush nixed an effort to set realistic and binding long-term targets.
The only interesting question that will be answered by this meeting is whether the media will be suckered into giving the President the one outcome he truly wants — positive press coverage on climate change, an area of such catastrophic failure by this administration that it will probably ensure (even more than Iraq) that history judges Bush a failure.
This post was created for ClimateProgress.org, a project of the Center for
American Progress Action Fund.
(3 August 2007)
