Cap-and-Trade Is Not Like the Space Race

KPC lays the beatdown on this Thomas Friedman column:

Even dumber than the notion that China, the world's biggest polluter, has gone green is the notion that going green is a zero sum competition. Friedman doesn't even try to argue for this point, he simply assumes it as self evident.

Actually, it's worse than that. If China (or any other country) reduces its emissions without the U.S. having to follow suit, that is a good thing for the U.S. Basically, Friedman is arguing that it is a bad thing for the U.S. if someone else pays the cost of reducing global emissions. That is... not the right way of looking at things.

If Friedman's view was right, there would be no coordination problem on climate change, since every state would be competing to lower their emissions. Bargaining over climate change would look nothing like the way it looks. It would resemble the space race, which (coincidentally) is the analogy Friedman uses. But bargaining over climate change doesn't look the space race in real life. One might think that this would lead Friedman to re-think his argument. It doesn't.

Also, we get a re-imagining of the Friedman Unit. It used to be a six month window into the future; apparently that left him too little wiggle room, because he's now trebled it and switched the direction:

I believe future historians may well conclude that the most important thing to happen in the last 18 months was that Red China decided to become Green China.

The fact that the modification doesn't improve his logic would be funny if it weren't so tragic.

Comments

[Hazel Hende...:]

Good analysis ! Much better than all the wrangling over caps, targets for emissions , trading carbon derivatives which INTERPOL says will be the next global white collar crimewave,. There is evidence for agreement in Copenhagen on a minimum world price for carbon , even if as low as 10 euros a ton !
Likely that China,India and Brazil would agree and collect a domustic carbon tax ( see Dr. Paul Werbos analysis at pwerbos.com ). Then the mounting support worldwide for the Climate Prosperity Alliance and Climate Bonds ( see globalurban.org and EthicalMarkets.com , click on Climate Prosperity ) can address re-industrialization toward the low-carbon economies we all seek and can be ramped up , with laddered bonds held by the world's pension funds. The global green market has been estimated at $45 trillion . Climate Prosperity investments are already exploding .
Copenhagen can turn into a global agreement to ramp up solar, wind , energy efficient infrastructure in developing countries . They can never afford nuclear, oil or coal ( even without including theri huge external costs ). This aligns with 21 UN agencies now promoting the Global Green New Deal and the goal of $1 trillion per year for the next 10 years , i.e. $10 trillion is less that what's been spent on the bailouts and only 10% of the world's pension fund assets of $120 trillion.

Oct 04 09:37 AM

[Mad Hedge F...:]

rty I spent the evening speaking to Gao Jie, a Beijing civil judge who left the bench to join China’s growing environmental movement when her kids came home from school one day coughing and wheezing. You only have to inhale in the capitol city these days to understand that they have a huge problem there. One of the dirty little secrets of international trade for the last three decades has been the offshoring of high polluting industries from the US and Europe to China, which then vociferously complain about the emerging country’s toxic environment. “Cancer villages” are now proliferating throughout the landscape. China gets 80% of its power from coal, compared to only 50% in the US. As a result, scientists figure that China became the world’s largest emitter of CO2 in 2006. The central government is now asking the provinces to achieve both GDP and energy conservation goals. Government policy dictates that air conditioners only kick in at 79 degrees. It is also pushing headlong into alternative energy, with an eye to exporting low cost platforms to the US. It is no accident that two of the most competitive solar companies in the world, Suntech (STP) and Yingli Green Energy Holding (YGE), are Chinese (click here for my piece on the Chinese solar wars). China is also negotiating to have Phoenix based First Solar (FSLR) build the world’s largest thin film solar power plant in Western China, which, it turns out, looks a lot like Arizona. The mammoth, 25 square mile facility will supply power to three million homes. China’s problems give one an inkling of how we might have ended up if we hadn’t passed the Environmental Protection Act. I first visited China during the Cultural Revolution, when they doused piles of bodies of those who died in the famine with kerosene and burned them, and anyone educated had to endure being paraded down a street in a dunce cap. I had to pinch myself after seeing a sophisticated and well educated woman like Gao Jie openly pursue her liberal goals, unfettered by a totalitarian regime.

Oct 04 09:59 AM

[NEOCON47:]

???

tHE TITLE OF THE ARTICLE IS "CAP TRADE IS NOT LIKE THE SPACE RACE"?

WE HAD THE SPACE RACE BECAUSE WE HAD TO BEAT THE COMMUNISTS BEFORE THEY TRIED TO CONTROL THE SPACE WAVES.

ALSO, WE STARTED A NEW INDUSTRY (SPACE TECHNOLOGY) AND PROVIDED JOBS FOR THE THREAT TO WORLD PEACE.

AS TO CAP AND TRADE, IT IS A HIGHLY TAXING SYSTEM MUCH LIKE A VAT TAX AND IS INTRUSIVE IN PERSONAL AND BUSINESS LIVES.

THERE IS DEFINITELY NO COMPARISON AS TO THE SPACE RACE; THIS BILL WOULD RESTRICT DEVELOPMENT OF BUSINESSES AND PERSONAL DEVELOPMENT FOR THE SAKE OF INCREASING BIG GOVERNMENT AND BIG BROTHER.

Oct 04 11:14 AM

[jerrydd:]

Friedman will not look as bad in 2 yrs when oil will double, coal will triple in price whether we tax it or not. The only difference is who gets the money, Iran, Russia, oil dictators, terrorists, big oil coal or the government. Which would you prefer?

At least if the gov gets it we can get a tax cut, help switching to more eff cars, homes and balance the budget.

Facts are much RE is already cost effective and out and out cheap if all the real costs are in coal, oil.

If we don't tax oil next yr oil will be $150/bbl anyway. And we will pay $1T/yr for imported oil. What do you think will happen to our economy then?

You, repubs and others better get your heads out of the sand or we will be broke and in oil wars forever. Or until we become independent of imported oil.

So who do you support, our enemies or our Gov, country our jobs?

Oct 04 12:59 PM

[tripleblack:]

Cap and Trade is a bad idea, presented at the worst possible time, with a goal based upon questionable science, and with a supporting train of logic that derails somewhere between New Delhi and Beijing.

Oct 04 01:04 PM

[jerrydd:]

Neocon or new con?

We are already taxed for oil, coal, they are just socialized. The subsidies are huge and in our income, state taxes and health care costs, etc.

What do you call the cost of Persian gulf military or the oil wars costs? .What does the $500B last yr we spent for imported oil cost?

What about the pollution from mining, burning coal? I can't eat fish more than 1/wk costing me $50-100/wk is just 1 example of why we need to stop using coal.

Facts are much RE is less costly than either oil or coal.

My EV 's I drive every day get 250-600mpg for my 2 seat sport wagon and Harley size 3wh MC trike. So if built correctly EV's are far cheaper than gasoline or diesel cars. Sadly car companies only seem to want to build uneconomical EV's.

The tech is here for both more eff vehicles and for low cost RE power. There is no shortage of energy, just a shortage of equipment to make, use it.

Oct 04 01:22 PM

[Alan Young:]

Your position may be true according to "game theory"; but it is morally bankrupt.

If we are too absorbed in our greed to prioritize a reversal of the Greenhouse Effect, it will be a "crime against humanity" on a scale that will make all previous holocausts be forgotten.

That said, however, I agree that 'cap and trade' as currently proposed is an inadequate response to the problem. A direct tax on carbon fuel would be more effective.

Would it be too costly? Only briefly; the economy will adapt quickly with alternatives. THINK now: if we had decided to "save the whales" in 1850 (instead of 1990) by imposing a whale-oil tax (at a time when whale oil was a major source of fuel), would it have ruined the economy? Or simply provided a boost to the new competitor, kerosene?

I don't generally agree with Friedman, but perhaps the point is that the last society to adopt a new and necessary technical change will end up at the bottom of the new economic ladder.

Oct 04 01:30 PM

[BIOWOLFF:]

Failed comment.
The point of the Friedman article for those who bothered to read it is that clean technologies will become the high value technologies of the future. There is simply no doubt that China is taking the lead in developing these technologies and will export them.
As for those who wish to turn this into another tedious tirade against cap and trade and "socialism" remember that cap and trade worked successfully when it was unleashed against SO2 by Republicans.

Oct 04 02:02 PM

[terravario:]

Friedman is spot on. He was also spot on in Hot, Flat and Crowded. Rather than ostriches with our heads in the tar sands, we could embrace the new green technology and out compete China in an instant, if we have the will to do so. That was the point of Friedman's op-ed piece in the New York Times. IF we have the will to do so. Tripleblack's backward thinking above or a positive investment in a promising green energy future? I think I will invest in green.

Oct 04 03:52 PM

[James Lewis:]

I question how the USA truly feels about changing its source of energy away from oil. After it has spent the last 60 years building up reserves of oil. How many wars has it had for oil security. And now we are talking about changing consumption patterns of oil

Scary....

Oct 07 11:43 AM