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Climate change, passing the pain.

Written By: - Date published: 10:15 am, July 6th, 2009 - 22 comments
Categories: climate change, International - Tags:

The US has finally managed to pass a bill through the house of representatives dealing with climate change (sort of). It is laden with pork-barrel initiatives because the congress members realised that they could treat carbon credits as a type of free-money boondoggle. It still has to pass the senate and get approval from Obama, and neither is likely to be a shoo-in. But it will probably pass. It has some significant implications in the future for New Zealand’s trade if we are not doing our part on climate change.

As the Economist says

The House’s climate bill is a masterpiece of obfuscation. Buried somewhere in the 1,200 pages of the American Clean Energy and Security Act (also known as Waxman-Markey, after its sponsors) is a sensible cap-and-trade plan to curb emissions of carbon dioxide (CO2). But it is so weighed down with giveaways, loopholes and needless complexity that many environmentalists hesitate to support it.

This much the same kind of stuff that every special interest group like farmers has been submitting into the ‘review’ of the emissions trading scheme here that ACT forced as part of its coalition agreement.

However what is of note for New Zealand is this..

It gets worse. A new provision, added just before the vote, would oblige the president to impose tariffs on goods from countries that do not limit greenhouse-gas emissions. This is probably illegal under WTO rules and could start a trade war with China and India. Even Mr Obama choked on it. ‘I think we have to be very careful about sending any protectionist signals out there,’ he said. But would he veto?

Obama is unlikely to veto the bill. It will probably be toned down a bit by the senate. But in any case, this has been signalled by the US administration previously that they want action (and aren’t happy with free-loaders on climate change). At the Bonn conference earlier this year the US envoy said :-

You will not get one member of my delegation questioning the science of climate change, nor the urgency. The science is clear, the threat is real, and the facts on the ground are outstripping the worst-case scenarios. The costs of inaction or inadequate action are unacceptable.

I suspect that Obama will take what he can get. The tariff provision doesn’t kick in until 2020. When it gets tested in the WTO there is the defense that along with the goods, high-carbon exporters are also modifying the worlds atmosphere and exporting that as well.

What it will do is to make it easier for the legislators in other countries add the same provision to their climate change bills. This makes it important for our ETS act, when it gets out of Rodney Hide’s ‘review’ to be actually doing something. Otherwise we’ll find barriers going up to our trade. Not something that can be favoured in a exporting nation.

22 comments on “Climate change, passing the pain. ”

  1. It sounds like the tarriff issue, while fundamentally at odd with principles of free-trade, could actually be a great idea in the long run. It would force countries that trade with the US to get their act together – surely a good thing.

    I have heard a lot of people say that a better path for the USA to go along would be to use existing provisions of the Clear Air Act to regulation CO2 emissions. Does anyone have an opinion on that issue?

    This legislation should mean that the US brings something concrete to the Copenhagan discussions at the end of the year. That puts even more pressure on New Zealand to also act, which is a damn good thing.

  2. Good post.

    This basically matches the debate over here. I have this awful feeling that in the year 2050 those of us who are still here (if Earth survives) will still be debating along the lines of:

    1. Yes climate change is a reality,
    2. No we cannot do anything about sector a, b, or c because of x, y, or z,
    3. The goal is too aggressive and ignores the damage that will be caused to the economy.

    Helen Clark’s desire for “carbon neutrality” has to be the approach adopted and National’s “50 by 50” means that our contributions to global warming will be continuing but at a slower rate in 41 years time. This will not solve the problem.

    The tariff threat is a neat encapsulation of the Republican position that the US should not have to do anything while China and India did nothing.

    It reminds me of my children arguing “but (s)he didn’t have to do it” when trying to get them to do something completely reasonable.

    Elected representatives sometimes behave like children.

    • George Darroch 2.1

      The Clark Government was full of hot air, and saw no urgency in their response.

    • gingercrush 2.2

      “Helen Clark’s desire for “carbon neutrality’ has to be the approach adopted”.

      Yes Helen Clark was very good on rhetoric. But where was the action. Carbon neutrality was nothing more than a PR exercise.

      • jarbury 2.2.1

        As much of a fan as I was of the previous government, I have to agree with George and ginger here. Labour certainly were “lots of talk, no real action” in this regard.

        Though that is better than “very little talk, even less action” which seems to be the motto of this government.

        • mickysavage 2.2.1.1

          I don’t disagree. The Renewable energy strategy and the Transport strategy formulated by the last Government were ok but underwhelming in terms of their goals and no doubt reflected the makeup of the government. NZF had a few deniers and with the Nats opposing everything as a matter of course and “Mr middle course” Peter Dunne being present things did not go as well as they should have.

          Dare I say it but it is a hell of a l lot better than what we have now. In the first 100 days the nats kneecapped the ETS, undermined biofuels, even managed to unban thermal lightbulbs on the basis of “choice”. Things have not improved since.

          The principle of “carbon neutrality” itself is a good one however and ought to be the basis of a policy approach. Natural processes (eg the growth of trees) does allow for the production of some CO2 but as a planet we need to work out how to make the output of carbon dioxide no more than this.

  3. Peter Johns - bigoted troll in jerkoff mode 3

    yep, Cap & Tax and Green jobs will send the world into a further depression. In 2050 the climate will have changed from now, but tax is not going to affect the climate much at all, but we sure will have no jobs at all due to un economic things such as green jobs. 1 Green Job = 2 other jobs lost in the economy + more taxes + lower std of living + lower wages.

    Just socialist ideology getting in the way of proper science & economics.

    And before you rant on about deniers etc I see Buzz Aldrin has seen the light & has become a sceptic.

    • bill brown 3.1

      Yeah, but Buzz Aldrin also sits on his knees on Sunday mornings mumbling to voices in his head.

    • Draco T Bastard 3.2

      The proper science has proved, beyond reasonable doubt, that our economy is what’s causing climate change. So, yeah, we need to actively decrease our economy from what it is. Economist may not agree but then todays economics has enough logic holes in it you could drive a truck through without hitting the sides.

      Here’s the simple fact: Our economy needs to fit within the limits of the ecology. If it doesn’t then this nice, temperate and stable climate we have will be replaced by one that’s not nice, decidedly on the hot side and will give the chaos theorists a nice practical example of what chaos really is.

      • Murray 3.2.1

        Is that “The proper science” according to Al Gore?

        • lprent 3.2.1.1

          Al Gore is a politician. I expect him to be as accurate on science as other politicians. Dipshit ignorant – just like Rodney Hide or John Key.

          Capable of being as credulous a fool as you.

          • Ag 3.2.1.1.1

            That is terribly unfair. There are very few politicians who are as intelligent as Al Gore and who feel the need to be as informed about the current state of scientific research as Al Gore. One of the reasons that Republicans caricature him is that they can’t counter him intellectually.

            Very few politicians have done as much for climate awareness as Al Gore. Surprisingly, one of the others is Margaret Thatcher (a trained chemist), who spoke about it in front of the Royal Society and the UN.

            Here’s the Iron Lady herself, from her speech at the opening of the Hadley Climate Centre (which she championed) in 1990:

            As the Panel’s Report itself makes clear, we should have a better understanding of many of these things in ten or fifteen years time, say, by about the year 2005. By then, we shall have benefitted from new measurements from satellites, from new and more powerful computers and the results of work now being done on ocean circulation, in which this country is playing a considerable part, but we can already draw some broad conclusions from the work which has been done:

            First, the climate changes which we have witnessed in the past have been mainly the result of natural factors, changes in the Earth’s orbit or in the amount of radiation given off by the Sun, for instance—Man’s activities had only a small part to play. In the future, this can no longer be assumed. Man’s activities are already adding greenhouse gases to the Earth at an unprecedented rate, with inevitable consequences for our future climate. The annual accumulation of carbon dioxide reaching the atmosphere is of the order of three billion tonnes and half of all the carbon dioxide emitted since the Industrial Revolution is still in the atmosphere—and all this while we are at the same time destroying tropical forests, which are a vital way of taking carbon dioxide out of the air and storing it.[fo 4]

            It stands to common sense that these figures are going to go up as the world’s population increases, with greater consequent intensity of agriculture, more destruction of forests and woodlands and more use of fossil fuels. At the time when I was born, the world’s population was some 2 billion people. [ Michael Thatcher] My grandson is going to grow up in a world of more than 6 billion people and the predictions are that we shall have 10 billion people by the middle of the next century. Whichever way you look at it, problems are bound to arise as a result of going from 2 billion to 10 billion in such a short time. The world has never known anything like it. Putting the problems right will be all the harder until we succeed in curbing that rate of population growth.

            The second conclusion that can already be drawn is that more than ever we are one world. The fact is that you cannot divide the atmosphere into segments and say: “All right! We will look after our bit and you look after yours!” We shall only be able to deal with the problems by a giant international effort in which we all cooperate and that leads on to the third conclusion:

            We would be taking a great risk with future generations if, having received this early warning, we did nothing about it or just took the attitude: “Well! It will see me out!”[fo 5]

            I remember saying in my Royal Society speech that we had a full repairing lease on this Earth. With the work done by the Inter-Governmental Panel on Climate Change, we can now say that we have the Surveyor’s Report and it shows that there are faults and that the repair work needs to start without delay. The problems do not lie in the future—they are here and now—and it is our children and grandchildren, who are already growing up, who will be affected.

            I can’t stand most of Thatcher’s politics, but she has been proven absolutely and undeniably correct. Whatever the other problems she is responsible for, there will always be a gold star by her name because of her climate activism.

            So if the righties think that AGW is a leftist plot, perhaps they would care to account for Thatcher’s views.

  4. StephenR 4

    “It sounds like the tarriff issue, while fundamentally at odd with principles of free-trade, could actually be a great idea in the long run. It would force countries that trade with the US to get their act together surely a good thing.”

    The answer seems to be in — the WTO is going to treat cap-and-trade the same way it treats VATs, with border taxes allowed if they can be seen as reducing distortions.
    http://krugman.blogs.nytimes.com/2009/06/26/the-wto-is-making-sense/

    That’s me for now, I’m off to ask Buzz Aldrin how to cure cancer.

  5. gingercrush 5

    I’ve long thought that blocking trade would be inevitable with global warming. Hence, why I’ve always maintained despite my belief it doesn’t exist we need to do something about it. But as far as I’m aware, the United States still isn’t joining Kyoto. Nor will they include their agriculture carbon emissions as part of any package. Why then is New Zealand expected to cut ours? Unless all countries commit to cutting agriculture carbon emissions, why the hell should New Zealand be expected to.

    This is just more bullshit. Rich countries are using greenhouse gases as an issue to block trade. Whilst the US and Europe subsidise their farmers and do not need to cut back emissions on their animals. New Zealand doesn’t subsidise their farmers and expected to cut back on their agriculture emissions. It is simply bullshit.

    • lprent 5.1

      Copenhagen is due at the end of the year, is the replacement for Kyoto. Now that the US has lost the Bu(ll)sh(it) administration, they are likely to be be in the vanguard

  6. gingercrush 6

    That is terribly unfair. There are very few politicians who are as intelligent as Al Gore and who feel the need to be as informed about the current state of scientific research as Al Gore. One of the reasons that Republicans caricature him is that they can’t counter him intellectually.

    The guy makes a documentary oversteps most evidence (that is agreed on). Hence, why the documentary was awash with hysteria and should have been criticised more. Instead, it got an oscar, which goes to show how pathetic the left is.

    Secondly, he is criticised because his owns actions do nothing to offset carbon emissions. Considering the man uses a private jet with very few people on it. We know airlines use up considerable carbon emissions. He criticises most people on their carbon emissions, when he is compared with most people in the world, a heavy carbon emitter. Their are also large suspicions that his actions on global warming have more to do with making himself money than it does actually tackling the problem of carbon emissions.

    • lprent 6.1

      So he managed to bring the issue to the attention of a lot of people. That is useful.

      The hysteria from the right has largely been due to that faact rather than anything else. They’d prefer people being uninformed. Helps with making short-term profits and bugger the consequences. That is the usual mode of operation for any ‘good’ capitalist isn’t it?

    • felix 6.2

      “Instead, it got an oscar, which goes to show how pathetic the left is.”

      Ginger, could you please explain what this sentence means?

    • Ag 6.3

      The guy makes a documentary oversteps most evidence (that is agreed on).

      Poppycock. The objections that had any weight were chicken feed, and did not in any way overcome the overall film, which was more or less accurate and within scientific orthodoxy.

      Secondly, he is criticised because his owns actions do nothing to offset carbon emissions.

      Your argument is completely stupid. His own actions consist in doing what a politician is supposed to do, and that is raising public awareness about an issue and attempting to build a political coalition to address it. I can’t think of any one politician who has achieved more in this respect than Al Gore. So the truth would be something like “despite being the foremost politician to bring climate change to mass public awareness, which is the most necessary condition for decreasing emissions on a global scale, Al Gore has done nothing to offset carbon emissions.

      Considering the man uses a private jet with very few people on it. We know airlines use up considerable carbon emissions. He criticises most people on their carbon emissions, when he is compared with most people in the world, a heavy carbon emitter.

      Yes, Al Gore is a heavy carbon emitter. Big deal, so are most politicians and corporate executives and people who travel frequently. Only a lunatic would want to restrict the travel of such people out of some sense of moral purity when we need global solutions.

      You know what? If global air travel were to be curtailed, corporate and political leaders would still travel more than ordinary people, because their jobs are more important than ordinary people’s jobs.

      Their are also large suspicions that his actions on global warming have more to do with making himself money than it does actually tackling the problem of carbon emissions.

      That’s daft. Gore comes from a wealthy family. If he wanted to make money, he would not have devoted his life to public service, because there is very little money in it.

      Your whole argument is based on ridiculous denier conspiracy theorizing.

      Here’s a friendly warning. You right wingers had better get over this absurd denial phase, or you will be steamrolled into irrelevance, and the left will use climate change to enact a world order that you won’t like.

      You have to realize that you cannot win. Even if you win elections, it will not matter, because the governments, corporations, militaries and public service institutions that actually have to deal with the large scale consequences of climate change will simply do what they have to do, whether you like it or not and by force if necessary. The only thing you can do about it is capitulate and take a place at the table to determine what reforms are necessary.

  7. GC Martin 7

    This is probably illegal under WTO rules and could start a trade war with China and India.

    The above Economist opinion doesn’t stand according to Aussie economist John Quiggin who today says the WTO is aligned with the UN report of last week, which didnae make big media. They, he says, see the carbon scheme as like VATs (GST).

    This itself is interesting because Paul Krugman appears to recommend President Obama reconsider on a basis of future carbon trading as making up for the ‘lost’ economic costs of externality, that remarkable neutral term for pollution.

    With the Supreme Court ruling carbon dioxide an atmospheric pollutant this now looking game, set and matchfor more vigorous global action.

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