So HRC’s request (for the Indians to commit to carbon dioxide reductions) was not well received! i guess the Indians have a different set of priorities (like improving their standard of living).
What does this bode for “Cap and Trade”? What point will it be for the USA to reduce energy consumption, if India and China will not?
I’m buying stock in coal mining companies!
Cap & Trade will only really work if the US and other countries that do abide by it are able to impose tariffs on all goods and services from countries that refuse to abide by it.
Dunno if that is possible via the WTF or some such but it would need to be enacted by all Cap & Trade partners evenly.
If that works then India is the one who will be left pounding sand. See how well their economy grows if their products are taxed to hell and gone by most of the world.
I agree with Wack-a-mole, the US is by far India’s largest recipient of exports (twice that of the next largeset receiver, China). I suspect simply threatening to add oil-tariffs will be enough to convince China and India to eventually sign on to compliance with future national agreements on CO[sub]2[/sub] emissions.
Also, would it kill the OP to include a link?
The point that the Indian government and other third-world governments make is that their per-capita carbon emissions are already much lower than those of first world countries for obvious reasons. Not to mention their per-capita contribution to the stock of carbon-dioxide which is still lower. IMO quite a reasonable point.
A possible solution is to allocate carbon credits according to population in a global carbon trading system. This would give third world countries the incentive to reduce carbon emissions and sell credits without imposing an aggregate cost on their economy until they grow substantially richer. Poor countries would probably agree to this but perhaps rich countries wouldn't. Probably some kind of compromise would have to be found.
And while the WTO will allow border taxes to compensate for cap-and-trade, it's certainly not going to be a case of taxing countries like India and China "to hell". That would be a case of outright protectionism and would be terrible for the world economy. The WTO will never allow that. In the case of India I doubt that the carbon emissions from , say, their software exports is much so the impact on their growth would be minimal.This would seem to enable a perverse effect where it behooves them to maintain a huge and poor class of citizens.
Essentially each poor person becomes a carbon chit that “reduces” their costs. Keep the working poor at near slave wages, build hugely inefficient polluting industries and you’re golden.
Well actually countries like China and India have seen big reductions in poverty as their economies have grown. Wage rates aren’t chosen by governments; they are determined by productivity. As their economies have grown, wage rates have also risen especially in the fastest growing regions.
In any event third-world countries won’t reduce their total emissions from current levels when their per capita emissions are much lower than rich countries. We can take that as given. And no the US won’t be able to enforce compliance by imposing massive tarriff barriers on Chinese and Indian exports; that will only destroy the global trading system. The goal of the border taxes is to prevent third world countries from gaining an additional advantage from cap-and-trade measures in rich countries not to cripple their export sectors. The maximum border tax the WTO will allow will probably be quite modest.
Ultimately a creative solution will have to found involving technology transfer (like the Indo-US nuclear deal) and some kind of emissions trading system which gives poor countries an incentive to reduce emissions without sacrificing growth. Then as they become richer they will have to do more of the heavy lifting.
I did not expect India or China to pitch in to help. Both countries are in a mad frenzy of building coal-fired power plants just as fast as they can throw them together. They are in the stage of reckless, careless industrial expansion the US went through a long time ago. I’m sorry to report that our best dreams of conquering greenhouse gases will be hugely overshadowed by what’s happening in India and China.
It’s not that their scientists are fools. They aren’t. Money is more important than saving the earth to those nations, for the moment. They are going from very poor to a whole lot better off, at a miraculous rate, and nothing else matters right now.
Sometimes I wonder what would have happened if somebody had gone around the US 150 years ago, telling pioneers what a bad idea it was to slaughter the bison and the resident people, or tell them that clear cut logging to power locomotives later on was foolish. No one would have listened.
Matt Yglesias, no right-winger, writes this about carbon tariffs AKA Smoot-Halwey II:
Just because some countries are not on board with saving the earth doesnt mean we should take a cavalier stance towards it. We know there is a problem, but we look like little kids throwing tantrums if we refuse to do something about it just because other countries dont want to hinder their newfound economic prowess. Consider the US lucky that we industrialized at a time when global warming was relatively unknown. We got our prosperity on the back of the suffering earth, now its time to pay the world back a little bit for all that strip mining
If we have to suffer disproportionately in order to create a solution by dialing back our industries and our companies, then so be it
A good place to learn about cap and trade is here.
It is page 7 of a seven page article (worth looking at in its entirety) about Goldman Sachs’ manipulation of the financial and commodities markets. Looks like another windfall for GS.