It's how much emissions are reduced, not where
As an example, I give you the Liberals’ Kyoto implementation plan. Lord knows there are all sorts of things wrong with this document. It is late, for starters, eight years after the federal government agreed to the accord, three years after it officially signed on and weeks after the treaty came into effect. It is vague in places, needlessly detailed in others. It relies far too little on market mechanisms like carbon taxes and tradeable emissions permits, far too much on a hideous array of subsidies and regulatory edicts that either won’t work or will work at far too high a cost. Indeed, the plan’s estimated cost to the treasury has doubled -- since the budget! -- amid serious doubts that it will achieve anything like the required reductions in emissions.
But what has attracted the fiercest scorn of the critics? The proposal that Canada should meet its target in part by purchasing credits from countries that have exceeded their own targets, through the $1-billion (or is it $5-billion?) Climate Fund. Seldom can any policy have been so little understood by so wide a swath of the commentariat. Okay, I expect the Toronto Star to get it wrong (“It is akin to someone paying an Olympic sprinter $1 million for his gold medal without even running the race.”).
But listen to the Globe and Mail: “Even if [Canada] manages to [meet its targets] by becoming a major buyer of emission credits, the world's air quality will not improve one iota.” Or Margaret Wente: “The emissions cuts we promised to deliver are so impossibly huge that we'll have to buy quotas, at a cost of unknown millions. This will enrich New York and Tokyo trading houses and some of our international business competitors with quota to sell. But it won't reduce greenhouse-gas emissions by a single tonne.”
Even my own beloved National Post fell into this trap: “Not only will [the plan] prove expensive for Canadian taxpayers,” the paper observed, “it will achieve no meaningful environmental result whatsoever. Instead, our country will essentially be subsidizing other nations -- notably Russia, which is expected to easily make its targets simply by virtue of having less industry, not cleaner industry, than it used to.”
If even the people who are paid to understand this stuff get it so wrong, you can imagine how it’s playing with the general public. I’ll bet it tests just miserably in the focus groups, to judge by the evident glee of the opposition, who insist the credits amount to purchasing “hot air.” Sneers Conservative spokesman Geoff Norquay: “Tell me again how this helps the environment in this country.”
But it isn’t about helping the environment “in this country.” It’s called global warming, remember? Now, whether you believe this is a problem or not -- I’m an agnostic, but say I believe in it for now -- what’s certain is that it’s a global issue, not a Canadian one. What is required to address it, therefore, is a reduction in CO2 emissions worldwide, which is why the Kyoto accord sets a global target.
They left out some pretty important players, of course -- China and India never signed, while the United States dropped out -- which is a legitimate criticism of the agreement. There’s nothing sacroscanct, either, about the global quota, or how it is allocated between countries, just as the choice of 1990 as the reference year is entirely arbitrary. Canada’s commitment, in particular, to reduce its emissions to 6% below 1990 levels seems to have been chosen for no reason other than because it was more than the Americans had pledged. And yes, Russia did luck out, in a way: the collapse in output it suffered when Communism fell -- conveniently timed for just after 1990 -- achieved much of its required reductions on its own.
All very true. But having settled on a global target for emissions reductions, however imperfect and whatever the grubby deals that may have gone into it, it’s still that global target that counts -- its how much emissions are reduced, not where. This being so, it is only sensible that it should be achieved at least economic cost, both to the world and to each country. If it is cheaper for us to purchase credits from other nations than to make reductions at home, that is exactly what we should do, both for their sake and for ours.
As it happens, it is, especially in the Third World. Older technologies, of the kind found in poorer countries, tend to emit more CO2 per unit of output; inversed, that means it costs less to achieve a given reduction in emissions. The smart thing, then, at least in the early going, is for advanced industrial nations to buy credits from less advanced economies: in effect, the rich paying the poor to clean up.
Over time, as more of this “low hanging fruit” is taken out of production and further global reductions are negotiated, the cost of the credits will rise. Past a certain point, it will become more economical for Canada to reduce its own emissions. But there’s no sense doing it until then, whether out of some misplaced sense of fairplay or a theological insistence that, unless the reductions take place on Canadian soil, they don’t count. I’m no climatologist, but I’m guessing the atmosphere is ignorant of national boundaries.
4/16/2005
