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Category — Reconstructing Climate Policy (AEI)

‘Reconstructing Climate Policy: Beyond Kyoto’ (AEI: 2003) Revisited

Reconstructing Climate Policy: Beyond Kyoto By Richard B. Stewart and Jonathan B. Wiener 193 pp., Washington, D.C.: American Enterprise Institute Press, 2003. This review was published in Regulation magazine (Cato Institute). MasterResource revisits Mr. Singer’s book review and asks: how does it read today?

What is it about academic economists that makes them salivate like Pavlovian dogs whenever they hear the magic words “market solution”? Sure, market-based solutions are always more efficient and less liable to be politically influenced than those based on command-and-control. But before we apply solutions, should we not first ask if there is a problem that needs to be solved?

And so it is with this book. The authors confidently assert the existence of a future climate problem more or less on faith, but they also see many difficulties with the 1997 Kyoto Protocol that is supposed to reduce emissions of greenhouse gases. So they propose a clever alternative to Kyoto — yet another solution to a non-problem.

They visualize a U.S.-China bilateral deal to limit emissions (mainly of carbon dioxide from fossil-fuel burning) that would operate in parallel with the Kyoto Protocol (which neither country plans to ratify). In their plan, the United States buys emission rights from an arbitrary excess quota allotted to China. The authors call it “headroom” but I call it a subsidy. The United States pays, China gets, and the atmosphere does not benefit because emissions continue essentially unabated.

Eventually and somehow, this U.S.-China deal is supposed to merge with Kyoto. Every nation in the world would then actually limit its emissions, and thereby save the climate, humanity, and Lord knows what else. What a pious hope!

Gentlemen’s Agreement

What else is wrong with the Stewart-Wiener scheme? Plenty, although it may be no worse than another dozen or so clever schemes thought up by other lawyers, economists, and policy analysts that are duly referenced in this volume but never critically discussed. Is there some kind of gentlemen’s agreement here? [Read more →]

January 11, 2012   8 Comments