Capping Emissions, Trading On The Future


Whatever the results of the Copenhagen conference on climate change, one thing is for sure: Draconian reductions on carbon emissions will be tacitly accepted by the most developed economies and sloughed off by many developing ones. In essence, emerging economies get to cut their "carbon" intensity--a natural product of their economic evolution--while we get to cut our throats.

The logic behind this prediction goes something like this. Since the West created the industrial revolution and the greenhouse gases that supposedly caused this "crisis," it's our obligation to take much of the burden for cleaning them up.

Plagued by self-doubt and even self-loathing, many in the West will no doubt consider this an appropriate mea culpa. Our leaders will dutifully accept cuts in our carbon emissions--up to 80% by 2050--while developing countries increase theirs, albeit at a lower rate. Oh, we also pledge to send billions in aid to help them achieve this goal.

The media shills, scientists, bureaucrats and corporate rent-seekers gathered at Copenhagen won't give much thought to what this means to the industrialized world's middle and working class. For many of them the new carbon regime means a gradual decline in living standards. Huge increases in energy costs, taxes and a spate of regulatory mandates will restrict their access to everything from single-family housing and personal mobility to employment in carbon-intensive industries like construction, manufacturing, warehousing and agriculture.

You can get a glimpse of this future in high-unemployment California. Here a burgeoning regulatory regime tied to global warming threatens to turn the state into a total "no go" economic development zone. Not only do companies have to deal with high taxes, cascading energy prices and regulations, they now face audits of their impact on global warming. Far easier to move your project to Texas--or if necessary, China.

The notion that the hoi polloi must be sacrificed to save the earth is not a new one. Paul Ehrlich, who was the mentor of President Obama's science advisor, John Holdren, laid out the defining logic in his 1968 best-seller, The Population Bomb. In this influential work, Ehrlich predicted mass starvation by the 1970s and "an age of scarcity" in key metals by the mid-1980s. Similar views were echoed by a 1972 "Limits to Growth" report issued by the Club of Rome, a global confab that enjoyed a cache similar to that of the United Nations' Intergovernmental Panel on Climate Change.

To deal with this looming crisis, Holdren in the 1977 book Ecoscience (co-authored with Anne and Paul Ehrlich) developed the notion of "de-development." According to Holdren, poorer countries like India and China could not be expected to work their way out of poverty since they were "foredoomed by enormous if not insurmountable economic and environmental obstacles." The only way to close "the prosperity gap" was to lower the living standards of what he labeled "over-developed" nations.

These predictions were less than accurate. World-wide systemic mass starvation did not take place as population escalated. Rather those many millions wallowing in poverty in the developing world, particularly in Asia, lifted themselves into the global middle class. Far more efficient ways to use energy have been developed, and unexpected caches of new resources continue to be discovered all over the planet.

Yet however wrong-headed, Holdren's world view now has jumped from the dustbin of history into the craniums of presidents and prime ministers. President Obama's pledge to "restore science to its rightful place" has morphed into state-sponsored scientific ideology.

The blind acceptance of this agenda threatens the credibility of Obama and other Western leaders. For one, if the crisis is by its nature global why should we allow massive increases in carbon emissions in developing countries--China will soon surpass us in greenhouse gas emissions, if it hasn't already--while we draconically cut ours? Does the planet really care if it's turned to toast by American- vs. Chinese-made gas?

Then there's the specious historical narrative that insists we pay for creating the industrial revolution since it brought on global warming. Should the West pay for the sins of the British who brought electricity and railroads to India? Does America owe carbon penance for making the technology transfers critical to East Asia's remarkable rise? Maybe we should start by making Wal-Mart cancel its China orders. That might help de-carbonize the planet a bit.

There's also growing skepticism about the whole warmist narrative. Climate change now ranks last among 20 top issues in a recent Pew report. There's been a similar rise in skepticism in the U.K., once a hot bed of warmist sentiment.

The reasons for the shift may vary. First, there's a controversy over the temperatures of the past decade, with even some concerned about climate change admitting that there has not been the expected warming. Or perhaps a deep recession has made many "rich" countries feel a trifle less "overdeveloped."

And now we have Climate-gate--where leading warmist pedagogues are trying to suppress unsuitably conformist scientists and perhaps even cook the numbers a bit. Although you won't see too much tough coverage in the mainstream press, the tawdry details have poured out over the Internet and diminished the aura of scientific objectivity of some leading global warming researchers. One recent poll shows that a large majority of Americans believe scientists may have indeed falsified their research data. By well over 4 to 1, they also believe stimulating the economy is a bigger priority than stopping global warming.

Clearly the political risks of giving first priority to the carbon agenda are on the rise. Australia's Senate just voted down that country's proposed cap and trade scheme. The Western center-right, once intimidated by the well-financed greens and their media claque, has become bolder in challenging climate change alarmism.

There's also something of a rebellion brewing, at least toward emissions trading schemes, among some liberals from the South and Midwest, notably Wisconsin's Russ Feingold and North Dakota's Byron Dorgan. As analyst Aaron Renn has pointed out, these areas are most likely to be negatively affected by the current climate change legislation. Feingold recently stated that he was "not signing onto any bill that rips off Wisconsin."

So why do leaders like Barack Obama and British Prime Minister Gordon Brown continue identifying themselves with the climate change agenda and policies like cap and trade? Perhaps it's best to see this as a clash of classes. Today's environmental movement reflects the values of a large portion of the post-industrial upper class. The big money behind the warming industry includes many powerful corporate interests that would benefit from a super-regulated environment that would all but eliminate potential upstarts.

These people generally also do not fear the loss of millions of factory, truck, construction and agriculture-related jobs slated to be "de-developed." These tasks can shift to China, India or Vietnam--where the net emissions would no doubt be higher--at little immediate cost to tenured professors, nonprofit executives or investment bankers. The endowments and the investment funds can just as happily mint their profits in Chongqing as in Chicago.

Global warming-driven land-use legislation possesses a similarly pro-gentry slant. Suburban single family homes need to be sacrificed in the name of climate change, but this will not threaten the large Park Avenue apartments and private retreats of media superstars, financial tycoons and the scions of former carbon-spewing fortunes. After all, you can always pay for your pleasure with "carbon offsets."

So who benefits from this collective ritual seppuku? Hegemony-seeking communist capitalists in China might fancy seeing America and the West decline to the point that they can no longer compete or fund their militaries. A weakened European Union or U.S. also won't be able provide a model of a more democratic version of capitalism to counter China’s ultra-authoritarian version.

The Chinese may win a victory in Copenhagen greater than anything accomplished so far in the marketplace--and our leaders will likely thank them for it. Forget bowing to the emperor in Tokyo; like vassal states at the height of the old Middle Kingdom, the new requisite diplomatic skill for Westerners will be kow-towing to Beijing.

Yet most people in the developing world will not benefit from the suicide of the West. The warmists' vision is not one of growing prosperity, but of capping wealth at a comparatively low level. De-industrialization means the West falls back while emerging economies grow a bit. The "prosperity gap" may close, but ultimately everyone is left with less prosperity.

In the long run developing countries gain less from harvesting guilt than enjoying a bounty of customers, capital and expertise. The West's experience and technology can assist developing nations in improving their far more greatly threatened environment. Turning the West into a spent force will leave the world poorer, dirtier and ultimately less hopeful.

This article originally appeared at

Joel Kotkin is executive editor of and is a distinguished presidential fellow in urban futures at Chapman University. He is author of The City: A Global History. His next book, The Next Hundred Million: America in 2050, will be published by Penguin Press early next year.

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Coal's Market Share Dropping Without Any Legislation

Short-term, I agree with you, Joel. We run the risk of massive over-regulation with this climate do-gooder nonsense, although I doubt much will happen in Congress anyway.

But slowly, and without any legislation, people are driving more electric cars and hybrids, and coal is losing market share as a fuel source for U.S. electrical production - it was down to 49% last year. Some of this is coming from wind, which will account for about 1.3% of electricity gen this year, up about fourfold since 2005.

Growth in wind isn't occurring because of any well-intentioned meeting among bureaucrats or politicians, but because the economics of deployment have improved with larger turbines that sell for a lower capital cost per watt - around $2,000 per kilowatt. Wind has many challenges, but its slow advancement is allowing market forces, with a small push from gov't, to address this issue regardless of whatever Al Gore or the UN wants. Solar is still much more expensive than wind and has yet to break .1%, although it's a DC source and not much of a power station technology, and fuel cells are still insanely expensive.

It will take a long time, but by 2050, the market, not the gov't, will have pushed a lot of people away from oil and coal consumption, even though there will be plenty of both available. Part of the issue is gas turbines are going up in price independent of any climate legislation, and there's nothing any pol can do to make them cheaper. And R&D into electrics and hybrids is growing, not because of gov't, but because of market share issues. Honda's got a bigger immediate concern than global warming, and that's Toyota's success with the Prius.

i agree

Over time I believe the carbon-intensity will drop naturally. I think the market will or should drive most of it. Certainly research in renewable fuels, conservation, etc are worth-while.

My fear is in the next ten years we may choke our economy so much that our ability to make the transition without a socially and economically disastrous disruption could be hampered.

If we need to do something quickly, a direct carbon tax would be much better than the cap and trade.


Decline of the west

Maybe money will save the west? Unless the new order imposes a carbon tax on the west that generates the money to fund the new "green" technologies those technologies cannot advance. They need decades of subsidies.

The west also has chronic unemployment - unless there is a large new tax, like carbon, a socialist model of society does not have enough funding to continue.

Next comes inflation in the west because the money is not generated by production, but by taxes on non-production at the same time as other regions have their own inflation because of all the "isms" they run into - feminism, consumerism, environmentalism, unionism, etc.

No idea how this will play out over the next 30 years - but one thing is sure: the current and past model of western extractive economics from undeveloped regions and globalization in all areas is spent. Socialism based on new taxes might be tried, but it will fail because there is no industry under it to support the tax.

Fascinating stuff going on.

The West as a spent force


It was that old racist Oswald Spengler who from 1918 onwards articulated The Decline of the West. This Prussian's ideas proved remarkably popular in Germany and Britain.

By 1932 Spengler was arguing for a retreat in the battle with nature:

Spengler, Oswald. Man and Technics. New York: Alfred A. Knopf, 1932

The widespread idea that civilised man should accept defeat in the attempt to industrialise is in large part due to Spengler, who articulated the anxieties of cultural elites after the experience of mechanised warfare throughout the twentieth century.

Green ideas start in the 1960s, as you say with a darker "too many people" argument, which is today the Spenglerian view of the Optimum Population Trust. Brendan O'Neill has written brilliantly on that:

The Clamor for Calamity

OPT: Save the Planet by Preventing African Births

This elite rejection of the industry that has provided them with so much financial surplus, and their romantic love of nature, could fill the political vacuum left after the Cold War ended in the late 1980s.

This is not a Chinese conspiracy. This decline in the West is a self-induced one that starts with a philosophical error.

Just a thought.

Ian Abley

i agree


i agree the chinese are not behind this. but they are smart enough to land a bunch when the adversary lets down his guard.