Stuart Eizenstat posed of 2,500 scientists worldwide, warns that global warming will harm human health and cause significant loss of life. Potential problems include a rise in the sea level, the spread of infectious diseases, droughts, and floods. For a preview of the type of severe weather in the warmer, wetter world that climate change would bring, look at the devastation wrought by this winter's El Niño. Without policy intervention, the IPCC warns that average global temperatures will increase between 2 and 6.5 degrees Fahrenheit by the end of the next century. By then, average July temperatures in Washington, D.C., will have risen by 5 to 15 degrees, with greater humidity. By comparison, average global temperatures during the last ice age were only about 9 degrees colder than today. Many, including Cooper, have noted the significant uncertainties associated with global warming, the impact of which will vary from region to region. What is clear, however, is that unless we take action, we will be conducting an unprecedented experiment with our planet. We risk endangering our children and grandchildren. Rational policymakers do not wait until every doubt is resolved before moving. The Kyoto protocol is like an insurance policy: its modest premiums protect against risks that will cost much more to mitigate if the world waits to act. A GLOBAL TAX WON'T WORK Cooper's tax proposal is politically impractical and substantively unsound. The United States fought hard and successfully at Kyoto to avoid mandatory measures like an international tax. To my knowledge, no international agreement has ever imposed an obligation on countries to tax their citizens. This is hardly surprising. An internationally mandated tax would combine two unpopular ideas: paying more of one's money to the government and surrendering part of national sovereignty to an international body. Moreover, energy taxes are anathema in the United States. It would be hard to find a policy that would face greater political hurdles. Even putting political reality aside for a moment, a common international tax is a bad idea. Countries with existing energy taxes could reduce them while a new international carbon tax was imposed on countries without preexistent energy taxes. The net effect would be little, if any, reduction in emissions. Assuming such behavior is not prohibited by the international regime, the United States, which has relatively low energy taxes, would face a disproportionately large share of the burden. And even if the international system were to prohibit reductions in energy taxes, countries could offset the impact of a new carbon tax indirectly, through other changes in tax or subsidy policies (say, rebates on specific taxes or increases in highway construction financing), while ostensibly maintaining their existing energy taxes. Distinguishing permissible from prohibited policies would be extraordinarily difficult and could bring unacceptable international scrutiny to domestic tax decisions. Moreover, Cooper fails to see that a system of tradable permits can be as efficient as a tax. If one firm is able to reduce emissions cheaply while another finds it difficult to do so, the first will be able to sell permits to the second, thereby reducing the overall cost of achieving the environmental objective. According to the 1997 Economic Report of the President, the choice between Stick with Kyoto fees and marketable permits is of secondary cation of emission rights nor to con economic importance. Over 2,500 econo- KYOTO'S VIRTUES Kyoto is still the best basis for action, for three reasons. First, the protocol adopted differentiated targets, recognizing that each country must address climate change based on its own national energy profile and circumstances—a particularly crucial point for developing countries. Second, Kyoto lets countries pursue their own paths to lower emissions. In one country, that might be an energy tax. In the United States, President Clinton has called for a domestic trading system (to begin by 2008) of the kind that has worked so well, both environmentally and economically, in reducing acid rain. Third, Kyoto embraces market-based international mechanisms. As noted above, emissions trading is central to achieving Kyoto's goals at modest cost. In addition, the Clean Development Mechanism-which will allow compa nies in the industrialized world to invest in "clean technology" projects in developing countries and share the credits from reduced emissions has the potential both to lower costs for U.S. companies and to encourage the transfer of environmentally friendlier technology to developing nations. Cooper argues that the Kyoto approach cannot work without the participation of developing countries, who will not join in because they will agree neither to an allo straints on their economic growth. He is half right. Kyoto cannot succeed, either environmentally or politically, unless key developing countries participate. Climate change is a global problem and requires a global solution. Indeed, the president has stated clearly that he will not submit the treaty for ratification without participation by key developing countries. But Cooper is overly pessimistic about the chances that developing countries will join in. Despite the difficulties at Kyoto, several key developing countries did indicate an interest in participating. A comprehensive diplomatic strategy will engage still more. To be sure, winning over developing nations will not be easy, but Kyoto contains several incentives for them. Efforts to mitigate climate change will help address their more immediate pollution problems. Furthermore, developing countries are the most vulnerable to the dangers of global warming and the least able to protect themselves. Perhaps most important in the short run, the worldwide effort to address global warming can help developing countries economically as well as environmentally. Whenever developing countries take on Kyoto commitments, they will be able to participate in the international emissions trading system, reducing costs and perhaps even generating revenue. Kyoto can help developing nations grow sustainably, without constraints, and by a different energy path than that of countries that industrialized earlier. Sustainable economic growth must be environmentally sound. Global warming is not a problem we will solve in this decade or this generation. The innovative Kyoto framework should be built on, not discarded.2 Kyoto's Unfinished Business Henry D. Jacoby, Ronald G. Prinn, TAKING THE LONG VIEW ON GLOBAL WARMING Even WELL-INFORMED observers disagree about what the Kyoto Protocol on Climate Change will accomplish. Some gaze at its text and see a battle won. They cheer the fact that the generally richer nations participating in the protocol agreed to cut their collective emissions of the greenhouse gases that cause global warming to about five percent less than 1990 levels by early in the next century. These optimists also applaud features of the Kyoto accord designed to hold down the costs of achieving these reductions. In computing their emissions, nations can include changes in the six major greenhouse gases emitted because of human activity, not just carbon dioxide, the most important of the six. In addition, countries can factor in reduced carbon dioxide levels from changes in land use and new forestry techniques that take the gas out of the atmosphere. Groups of participating nations may comply jointly and reallocate commitments among themselves, as the European Union (EU) plans to do within a European "bubble," and there HENRY D. JACOBY is the William F. Pounds Professor of Manage- Kyoto's Unfinished Business is agreement in principle to some form of emissions trading. Joint implementation, under which agents in one country can get credit for reductions they achieve in another, is to be permitted between participating nations, and a new Clean Development Mechanism will provide access to these opportunities in nonparticipating countries, mainly in the developing world. Finally, emissions targets are not rigidly tied to a single year, but to averages over a five-year "commitment period" from 2008 to 2012. Pessimists, on the other hand, see Kyoto as a costly defeat. They note that there is no solid proof that human-induced climate change will occur or that its adverse effects would be serious were it to happen. At the same time, the expense of reducing greenhouse gas emissions to meet the Kyoto targets will be substantial, and pessimists believe that the effort will make participating countries less competitive. In the darkest interpretation, the Kyoto agreement is a pact among rich nations that will cripple their economies for decades to come, made simply because today's political leaders needed to burnish their environmental credentials. Neither of these schools of thought is correct. Still a third group, whose views are much closer to the mark, believes that Kyoto mainly postpones much-needed work on what may prove a very serious long-term challenge. To them, Kyoto is a quick political fix for a problem created at the First Conference of Parties to the Climate Convention held in Berlin in 1995. The so-called Berlin mandate instructed negotiators to seek short-term, legally binding targets and timetables for emission control for participating countries only. In the run-up to Kyoto, many leaders publicly committed themselves to this idea. Not surprisingly, avoiding embarrassment on this score became the dominant focus of the negotiations. As a result, this group argues, the Kyoto agreement allows political leaders to declare success, but it does not address the larger climate issues at stake. Even worse, these skeptics fear that by following the Berlin mandate, negotiators at Kyoto may have made it harder, not easier, to meet the long-term challenge. Now the next decade may be spent haggling over these short-term commitments, thereby diverting attention from more important century-scale issues and postponing the involvement of the developing world. The Kyoto agreement might fail to meet Henry D. Jacoby, Ronald G. Prinn, and Richard Schmalensee even its immediate goals if the lack of domestic support in the United States prevents ratification, which in turn would rationalize inaction by other participating nations. The entire international response to climate change could be discredited, thus increasing the difficulty of collective action in the future, no matter how serious the problem turns out to be. To some degree, these widely divergent analyses of the Kyoto achievement reflect differing interpretations of its text, key parts of which are still the subject of strong and sometimes bitter international disagreement. Some of these points will be taken up again at the Fourth Conference of the Parties in November, but others may take years to resolve. What is in dispute is not merely the Kyoto text, of course, but the underlying science and economics of global warming. Above all, for the journey from Kyoto to succeed, policymakers will need to spend more time thinking of the long term. A GLOBAL WARMING PRIMER TO START with the basics, climate change can be driven by an imbalance between the energy the earth receives from the sun, largely as visible light, and the energy it radiates back to space as invisible infrared light. The "greenhouse effect" is caused by the presence in the air of gases and clouds that absorb some of the infrared light flowing upward and radiate it back downward. The warming influence of this re-radiated energy is opposed by substances at the surface and in the atmosphere that reflect sunlight directly back into space. These include snow and desert sand, as well as clouds and aerosols. (Aerosols are tiny, submicroscopic solid or liquid particles suspended in the air, such as smoke and fog.) Water vapor and clouds, which typically remain in the atmosphere for a week or so, are responsible for most of the re-radiated infrared light. Central to the climate change debate, however, are less important but much longer-lasting greenhouse gases, most notably carbon dioxide. Atmospheric concentrations of carbon dioxide and other long-lived greenhouse gases have increased substantially over the past century. As this has happened, the flow of infrared energy to space has been reduced, so that, all else being equal, the earth receives slightly more |