The US will announce a target for reducing greenhouse gas emissions before next month’s UN climate summit, according to a White House official.

The target is expected to be in line with figures contained in legislation before the Senate – a reduction of about 17-20% from 2005 levels by 2020.

This is a reminder of two sobering realities about climate change. One is that this kind of target is, by most accounts, pretty grossly inadequate. The other is that by all accounts it will be extremely difficult to get the United States Senate to agree to even doing this much.

Corporate front groups and large business trade associations are funneling their resources into defeating health reform. Even though health reform will lower costs for small businesses and boost worker productivity economy-wide, it appears that corporate entities influenced by major polluters are hoping that the defeat of health care legislation will slow President Obama’s agenda and derail their true enemy: clean energy reform.

The West Virginia Chamber of Commerce, which is largely backed by the coal industry, candidly revealed this strategy in a letter released today to Sens. Jay Rockefeller (D-WV) and Robert Byrd (D-WV). The Chamber of Commerce demanded that the senators use “their clout and seniority” to obstruct the health reform debate until cap and trade legislation is taken off the table and the EPA is barred from regulating carbon dioxide as a pollutant. As Ken Ward of the Charleston Gazette noted, Rockefeller has already rejected a similar proposal of blocking health reform unless the EPA stops reviewing mountaintop removal permits. The coal lobby has also pressured West Virginia state legislators to pass resolutions opposing clean energy reform.

Part of what’s interesting about this is that, as a matter of logic, you could easily imagine trying to run this play in the other direction. The WV Chamber of Commerce could be working with Senators Rockefeller & Byrd to cement a broad, bipartisan alliance between WV legislators in which the Republicans join with the Democrats to support health reform and the Democrats join with the Republicans to protect the state’s coal interests. There’s nothing, in other words, particularly obvious, natural, or inevitable about this kind of linkage. But American business has a very strong tendency toward forming a broad ideological alliance against all forms of regulation and public services. You might, for example, think that “real economy” firms would want a well-regulated financial system but business groups show no signs of anything other than hostility to efforts to better-regulate the main banks.

(cc photo by Clinton Steeds)

Better-insulating your home can save money and is good for the environment. So why doesn’t everyone do it? David Leonhardt explains: “Even so, we are still trying to figure out which weatherization projects we should do. The whole package would probably cost $4,500 and save us something like $400 a year. We may not stay in the house nearly long enough to justify the investment.”

The rationale of a “cash for caulkers” idea is that a short-term government subsidy to have this kind of work done would work as stimulus, and also solve some other problems, while getting around this issue. But the problem of people under-insulating their homes is really something that deserves a long-term solution. After all, the weird thing about Leonhardt’s explanation is that while he may not stay in his house the 15-20 years or so it would take to really make the full weatherization package worthwhile, the house will almost certainly still be there. In principle, having money-saving improvements to the house made ought to increase its resale value and be worth doing no matter how long Leonhardt stays in the house. In reality, when people are shopping for houses the question of how energy efficient it is tends to be an extremely low-salience issue and exactly the sort of thing someone is likely to overlook.

One potential solution to this would be to make an “energy audit” of some kind a necessary part of the process of selling a home. Make the basic factsheet include some information about both the relative and absolute energy efficiency of the home. That way people who invest in efficiency would have a better chance of getting rewarded for it.

I think this is a great example of the shortsightedness of alternatives to carbon pricing:

Two senators unveiled legislation Monday to double U.S. nuclear energy output in 20 years and foster clean energy options with “mini-Manhattan Projects” named for the original U.S. atomic bomb push.

Sen. Jim Webb (D-Va.) and Sen. Lamar Alexander (R-Tenn.), noting they cannot support the cap-and-trade climate bill now churning through the Senate, said their plan could cost $20 billion over 10 years. It would include $100 billion for carbon-free electricity loan guarantees, expected to chiefly benefit the U.S. nuclear industry.

It would also offer $750 million per year for 10 years to fund carbon-capture-and-storage technology—sometimes known as “clean coal”—as well as biofuels made from non-food crops, advanced batteries for electric cars and trucks, solar power, and recycling of used nuclear fuel.

Completely leaving aside the merits of these projects, this costs money. Where are you going to get the money from? Well, one potential source of revenue would be to tax greenhouse gas emissions or else to impose a cap on them and auction permits. Of course you could get the revenue some other way—tax people’s income, or their consumption in general. But a tax on climate pollution would be at least as economically efficient as any alternative, and would increase the environmental efficacy of any of these ideas. I wrote this back in a review of Nordhaus & Shellenberger’s Break Through and I think it still holds up today:

But whatever the shortcomings of their rhetoric, environmentalists have a very good reason to push for some limits, however much of a downer that message might be. Global warming is caused by carbon emissions and can be contained only by reducing them. Nordhaus and Shellenberger’s preferred alternative — huge investment in alternative energy — doesn’t really stand up to scrutiny. For one thing, without mandatory curbs on emissions, it might not work. For another thing, emissions caps would effectively provide a subsidy to less polluting alternatives, one that would be harder for lobbyists to manipulate and that wouldn’t require lawmakers to pick winners among various possible technologies. Finally, even as a matter of crass politics, Nordhaus and Shellenberger neglect a basic point: the hard part about gaining support for a new initiative isn’t convincing people of its value but finding the money to pay for it. The conventional solutions to global warming posed by the “politics of limits” — taxing carbon emissions, or issuing tradeable emissions to carbon-producing firms — conveniently raises revenue that could be used to pay for the very projects the authors wish to see.

If you think that human industrial activity isn’t causing climate change, that is a good reason to oppose limiting climate pollution. But we’ve seen this kind of proliferation of false alternatives to the mainstream carbon pricing agenda from within a group of people who claim to recognize the basic shape of the problem. But whatever it is that you think the “real” answer is—even if it’s artificial trees or more nuclear subsidies or a crash carbon sequestration research problem—you still come around to the fact that the best way to pay this stuff is to make the emitters of greenhouse gas pollution subsidize your preferred version of the clean energy agenda. Someone, after all, will have to pay the bill.

The tomb of the ancient Egyptian vizier Khentika (also known as Ikhekhi), for example, contains the inscription: “As for all men who shall enter this my tomb … impure … there will be judgment … an end shall be made for him. … I shall seize his neck like a bird. … I shall cast the fear of myself into him.” It’s possible that the vizier’s contemporaries took Khentika at his word. But 20th-century archaeologists with wildly different religious beliefs had no reason to take the neck-cracking threat seriously. Likewise, a scavenger on the Carlsbad site in the year 12,000 C.E. may dismiss the menace of radiation poisoning as mere superstition. (”So I’m supposed to think that if I dig here, invisible energy beams will kill me?”) Hence the crux of the problem: Not only must intruders understand the message that nuclear waste is near and dangerous; they must also believe it.

The good news is that insofar as we manage to avoid a major civilization-collapse and the attendant loss of knowledge, future people will probably be able to figure out that the danger is real. And if we can’t avoid a major civilization-collapse, then the collapse, rather than the post-collapse nuclear waste incident, is the really the main problem.

From 1980 to 2004 the fuel economy of U.S. vehicles has remained stagnant despite apparent technological advances. The average fuel economy of the U.S. new passenger automobile fleet increased by less than 6.5 percent, while the average horsepower of new passenger cars increased by 80 percent, and their average curb weight increased by 12 percent. For light duty trucks, average horsepower has increased by 99 percent and average weight increased by 26 percent over this period. But there’s more to this story: in 1980, light truck sales were roughly 20 percent of total passenger vehicles sales — in 2004, they were over 51 percent.

In Automobiles on Steroids: Product Attribute Trade-Offs and Technological Progress in the Automobile Sector (NBER Working Paper No. 15162), Christopher Knittel analyzes the technological progress that has occurred since 1980 and the trade-offs that manufacturers and consumers face when choosing between fuel economy, weight, and engine power characteristics. His results suggest that if weight, horsepower, and torque were held at their 1980 levels, fuel economy for both passenger cars and light trucks could have increased by nearly 50 percent from 1980 to 2006. Instead, fuel economy actually increased by only 15 percent.

Of course this was just manufacturers and consumers responding to market incentives. During this period the price of gasoline was generally falling, personal income was generally rising, and the massive negative externalities associated with burning gasoline were largely unpriced. In a different, better, policy regime taxation of gasoline would have risen so as to make the price of fuel grow relative to personal income, creating incentives for this technology to be deployed in a socially useful way.

I was saying this morning that I thought conservative affection for nuclear power was a bit odd in light of the fact that only massive socialism seems capable of financing nuclear power plants. David Frum has a post in response that I don’t totally understand:

Nor is it true, as Matt contends, that only an active state can deliver nuclear power. The United States already draws 20% of its power from nuclear. Until recently, it’s true, the stock market has preferred utility companies that generate their power from coal. Coal is cheap and reliable. But if a carbon tax increased the price of coal, nuclear would come back into vogue – and the regulatory changes needed to facilitate that shift would not have to be very dramatic. Probably more important would be mergers in the utility industry. The rule of thumb in the industry is that a new nuclear plant would cost some $10 billion and start yielding revenue only after 5 to 7 years. That’s a big check to write when the largest utility in the United States, Exelon, has a market capitalization of only $35 billion. Electricite de France by contrast has a market cap of some $85 billion.

We seem to me to be in agreement here. Even though carbon pricing ought to make nuclear power profitable on an operating cost basis, it would be prohibitively expensive to raise the capital necessary to construct nuclear plants. I think you could resolve this by having the state step in and do the financing. He thinks, I guess, that some counterfactual private utility could do it if it were far larger than any existing utility. But how would you make these mergers happen? That sounds to me like you need an active state.

Note that many of these same considerations apply to windmills. They generate electricity quite cheaply on an operating cost basis, the problem is building the windmills. But the scale of the investment in a windmill is much smaller, so it’s easier for the private sector to mobilize the risk-bearing capacity necessary to build one. That said, obviously you need a certain amount electricity that can be relied upon irrespective of how windy it is or whether the sun is shining. So I’d happily see the nuclear share of the pie grow at the expense of coal and oil as the provider of that baseload electricity. But from where I sit, making it happen requires a pretty forceful state intervention. Or perhaps what I should say is that the cleanest way to make it happen would be to bite the bullet and engage in forceful state intervention. I’m afraid that what we’re going to do instead is try to subsidize the operating profits of nuclear power to such a sky-high level that the private sector can’t help but jump in with the financing even though the deadweight loss of doing it that way will wind up being a lot higher.

Brad Plumer has an interesting piece about the American right’s strangely passionate love affair with nuclear power and the impact it’s having on the climate debate in congress. What I find especially odd about it is that it’s so at odds with American conservatives’ ardor for the free market. You see this mismatch in a small sense in that their nuclear agenda in congress consists basically of asking for subsidies. But in a larger sense the issue is that the big example one can find of a country living the nuclear dream is . . . France. And it’s not just an irony or a funny coincidence, nuclear power in France is deeply tied to the genuinely socialistic (i.e., not just high taxes and a generous welfare state) aspects of the French economy.

When the French nuclear network was being built out Éléctricité de France was wholly owned by the French state and had a statutory monopoly on the distribution of electrical power. What’s more, of the different kinds of French state-owned companies (yes, there are several) it was an Établissement Public à Charactère Industriels et commercial (EPIC) which meant it was fully guaranteed by the state and could, in effect, raise capital at a sovereign rate. This solves the big economic problem with nuclear power. The projects are so big, so long-term, so risky, and have such high up-front costs that financing the construction of these things is a nightmare. As the MIT interdisciplinary project on the future of nuclear power wrote in its 2009 update:

While the U.S. nuclear industry has continued to demonstrate improved operating performance, there remains significant uncertainty about the capital costs, and the cost of its financing, which are the main components of the cost of electricity from new nuclear plants.

The nuclear industry is eager to find ways for the US government to intervene in the market to resolve these issues, but the easiest way to do that is to actually have it undertaken by a publicly owned company.

These days EDF has been “privatized” in the kind of only-in-France way that many large French firms are private—it’s a standard Société Anonyme with shareholders, but the majority of shares are owned by the state. Areva, the engineering company that does the actual building, is also owned by the state. In Finland, there’s a somewhat problematic big nuclear project underway and the utility doing it Teollisuuden Voima Oy, also involves a hefty share of public ownership. In the United States, too, we used to build nuclear plants back when our economy was much more dirigiste.

At any rate, I have fairly equivocal views as to whether this is a good idea or not. But I think it should be seen for what it is. If you’re interested in reading more on the subject of nuclear power, I recommend the MIT interdisciplinary study on The Future of Nuclear Power.

Seth Borenstein of the AP has a pretty great piece knocking down all the nonsense about “global cooling” that the Washington Post op-ed page and others have been pressing:

Have you heard that the world is now cooling instead of warming? You may have seen some news reports on the Internet or heard about it from a provocative new book. Only one problem: It’s not true, according to an analysis of the numbers done by several independent statisticians for The Associated Press. [...] In a blind test, the AP gave temperature data to four independent statisticians and asked them to look for trends, without telling them what the numbers represented. The experts found no true temperature declines over time.

[...] Statisticians who analyzed the data found a distinct decades-long upward trend in the numbers, but could not find a significant drop in the past 10 years in either data set. The ups and downs during the last decade repeat random variability in data as far back as 1880.

Unfortunately, I see the piece bylined as “By SETH BORENSTEIN, AP Science Writer” which makes me worry it’ll be buried in newspapers’ science sections (or not seen at all since lots of papers barely do science coverage at all these days) rather than front-and-center in politics sections where it belongs. This story is about a key piece of propaganda being put out by political actors in order to win a political fight. It’s a political story.

Grist has, alongside its environmental policy news and commentary, a running feature called “Ask Umbra” in which people ask for advice on ecologically responsible consumption. The answer almost invariably turns out to be “this hinges on an impossibly complicated set of considerations.” For example, is it better to buy frozen vegetables or steamed ones:

Grade A frozen foods are harvested when ripe and quickly taken to the freezing plant, where they are (even more quickly) flash frozen at extremely low temperatures. The modern industrial freezing process retains almost all the original nutritional value of the food (according to nutrition guru Marion Nestle’s helpful book What to Eat). Good to go on the nutrition angle. But it’s important to have an efficient freezer. One study using 1970s data found that the longer frozen foods sit in the freezer, i.e., are using energy in storage, the more they fall behind canned goods in the efficiency smackdown.

The canned goods are a bit less nutritious, but a study that looked closely at this issue found the differences between frozen and canned carrots to be insignificant. Carrots in syrup, or whatever they might put carrots in, would of course fall in to the category of dessert or a processed food, and cannot be favorably compared to fresh. As you know, the ecological issue with canned carrots is the steel can itself, which has high embodied energy costs. If a study assumes the recycling of the steel can, then canned vegetables can compete favorably with frozen vegetables on the sustainability index.

From a political perspective, this sort of thing underscores the need for collective action in the form of public policy that will put a price on greenhouse gas pollution. To realistically assess the total environmental impact of the choice between frozen carrots and canned carrots, you’d also want to know something about the land-use impact of your decisions, the transportation of the goods, the energy costs of keeping frozen food frozen in the supermarket, etc. You can’t really do this sort of thing through back-of-the-envelop calculations.

Meanwhile, James Inhofe says:

Perhaps the most interesting finding in this poll aside from the precipitous drop in the number of Independents who believe global warming is a problem, is that the more Americans learn about cap-and-trade, the more they oppose cap-and-trade. And this explains quite clearly why Democrats don’t want the public to know about it.

These are curious uses of the terms “know” and “learn” which are generally reserved for instances in which people form true beliefs. On the specific issue of cap and trade, the evidence has always been that the term “cap and trade” is barely in circulation outside the Beltway. Public support for clean energy legislation under different descriptions tends to be high. You can get poll results as good at 72 percent in favor of the American Clean Energy and Security Act under one favorable description.

They wouldn’t let us take pictures inside their factory so as to discourage industrial espionage by the Chinese (or so they said), but I can assure you that what they were manufacturing was blue solar panels. But if you look at their website you can clearly see that they’re blue. During the tour someone even asked why the solar panels are blue. We were told that you can make them any color if there’s some particular desire for funny-colored ones, but they determined that this particular shade of blue is the most efficient one to use. And that’s why most solar panels are blue.

So two quick takeaway lessons from that chat. One is that solar panels are usually blue. The other is that contra Levitt, Dubner, and Nathan Myhrvold the guys who build solar panels aren’t idiots who’ve never considered the fact that different colored material has different light-absorption properties.

Remarkably, however, Levitt and Dubner choose not to simply admit that quoting Myhrvold as saying that solar panels are black was a sloppy error that they’ll correct in the future. Instead, they had him write a post on their blog in which he digs in his heels on the black point, insisting (really) that blue solar panels are in some sense really black so his statement that “[t]he problem with solar cells is that they’re black” was accurate even though it’s not, in fact, true that solar cells are black. Then as Nicholas Weaver points out he adds new errors:

He compares the cost of running a coal plant with the cost of building a solar plant, neglecting that we need to construct vastly more power plants to both meet growing demand and to deal with end-of-life on old, inefficient plants. Even then, the break even point is less than 3 years, by his inflate-the-cost of solar figure!

This is really insane. The obvious problem with solar power is that it doesn’t work when the sun isn’t shining. Thus barring some really miraculous developments in energy storage, we’re going to need a lot of non-solar power. But that still leaves plenty of room for the deployment of solar panels, especially in places that tend to be sunny. Germany uses a lot more solar power than we do, despite being a very non-sunny country, and nonetheless manages to exist as an advanced industrial society. There are limits to what can be realistically done in this regard, but we’re not currently pushing up against them. There’s no reason for this to be controversial and certainly no reason for people to be making ludicrous claims about the color of objects.

A non-artificial tree

Will Wilkinson and Ryan Avent further bat around the geo-engineering subject, with Wilkinson in comments mentioning super-carbon-eating trees as the kind of technological fix to which he thinks environmentalists are giving short shrift. For basically Popperian reasons I don’t think it makes sense for political pundits to spend a lot of time debating the relative difficulty of developing different hypothetical future technologies. Instead, I would just say that the best way to find out whether human ingenuity is better at keeping atmospheric CO2 concentrations at a sustainable level by developing artificial trees or by developing better windmills is to . . . implement a binding emissions reduction scheme that puts a price on CO2 emissions.

This isn’t, in other words, an either/or choice. If you had a cap-and-trade system in place, that would put a range of modalities—better efficiency, more clean energy production, more trees & algae, and carbon-scrubbing machines—in a competitive framework. One assumes we’d be looking at some kind of mix. But defining the correct mix in advance seems very hard. Hence the appeal of a basically market-esque mechanism that creates incentives to work on these various ideas without unduly prejudging the appropriate level of investment in speculative technology.

What I think is remarkable is the extent to which people on the right, in their zeal to avoid a market mechanism that the business establishment happens to hate, have a tendency to talk up what instead amounts to a kind of Five Year Plan approach. Instead of regulating carbon, let’s just direct scientists of invent miracle trees! Let’s turn the sky red! The greenhouse gas problem is one of the largest political crises the liberal/democratic/capitalist order has ever faced, but unlike something like Hitler the basic shape of the problem is something we’ve seen and dealt with before. The whole “sometimes there are negative externalities and you need to charge people for them” thing is in basic textbooks. Maybe the result of such a scheme will be a technological miracle, or maybe not but the shape of the policy environment that will let us find out isn’t mysterious.

Guess who said this?:

We have a vision of a different America. It is a vision of an America in which our cars run on electricity; high speed trains whisk us from North to South in less time than it takes to get across greater New York; we produce much more but use much less energy to do it; our power suppliers no longer depend to any great extent on imported oil and gas; our homes require less energy, produce far more of their own energy and are heated by gas we produce from our own agricultural and domestic waste.

It is a vision of a United States which leads the world in new green technologies. Secured against interruptions of supply and volatile prices, our industry can plan for growth. Our national security is guaranteed, regardless of decisions by volatile governments elsewhere to close pipelines or restrict supply. It is a decentralized vision rather than one in which all decisions about our energy future are vested in the government. Through it we play our full part in protecting our planet against the effects of man-made climate change.

Well, nobody said it. Instead I changed the words “Britain” and “centralised” to “America” and “centralized.” But it comes from the UK Conservative Party’s low-carbon economy white paper.

I mention this because David Brooks has a pretty good column urging Republicans to learn from David Cameron that, disappointingly, doesn’t mention anything about climate and energy issues. But if you want to make the point that at the moment European center-right parties are both much more politically successful than the GOP and also much more substantively sensible, then climate and energy is probably the topic where you’ll find the biggest contrast. After all, it’s not just that the Conservatives’ climate and energy issues page looks very different from the Republican one—the Republicans don’t have one at all.

Oil shale (National Archives photo)

One of the odder things about the tendency of politicians who like to espouse free market principles to oppose efforts to reduce American dependence on dirty energy sources is that the way the status quo works is that fossil fuel producers are actually pretty heavily subsidized. And, naturally, it got worse while George W. Bush was in office. Jim Tankersley and Josh Meyer report for the LA Times:

The Obama Interior Department is reviewing a decision made by the Bush administration in its final days that attempted to lock in lucrative royalty rates and favorable regulations for oil companies holding leases for oil-shale development on public lands.

The decision, which came in the form of amendments to existing leases, drew little public notice at the end of the Bush administration in January. But since then, congressional watchdogs, environmental groups and state officials in Colorado, where most of the leases are located, have denounced the amendments as a massive giveaway to the oil industry.

Any time you talk about oil shale it’s also a reminder that though messages about “energy independence” tend to poll well, it can be a risky gambit for clean energy advocates to rely too heavily on talking points that can also support very dirty undertakings.

I have slightly mixed feelings about some of the national security arguments that I’ve heard advanced about the need to prevent catastrophic climate change (I have my own national security arguments that I like better). But you evaluate a political strategy based on how well it actually works, not on how you feel about it personally. And via Brad Plumer, Darren Samuelson suggests that these arguments played a big role in persuading Lindsey Graham (R-SC) that it made sense for him to start wading into the issue.

That’s a big win. And Operation Free, the veterans-oriented coalition group that’s been set up to push precisely this argument, is really just getting up and running this month.

Burning methane gas is a relatively clean way of generating power compared to other fossil fuel options. But directly releasing methane gas into the atmosphere is a climate catastrophe. Methane packs far more greenhouse punch per unit than does the better known carbon dioxide. Thus, as Andrew Revkin and Clifford Kraus write in The New York Times plugging various kinds of leaks in our infrastructure for storing and transportation methane is a highly effective way of mitigating climate change. What’s interesting, as they also observe, is that in many cases this isn’t just cost-effective, it directly saves money. The cost of the leaks, in other words, is higher than the cost of plugging them.

In addition to illustrating the specific point, that kind of thing highlights the efficacy of so-called “complementary policies” alongside a hoped-for basic mechanism of putting a price on greenhouse gas pollution. In a kind of black box rational agent model, the price mechanism alone should provide all the incentive people need. In practice, agents with a limited amount of time and attention can often find themselves neglecting small problems with large cumulative impact. Methane leakage is a striking example, but home insulation is probably a more broadly applicable one. Normal people simply don’t take the time to do a cost-benefit analysis on investing in better-insulating their homes and the problem of attenuated attention to this issue gets even worse when you consider things like rental apartments and office space. Under the circumstances it makes a lot of sense to try to push the level of evaluation up to a more macro scale and then hand down new building codes and direct financial incentives for retrofitting. Over the long term, there’s no substitute for carbon pricing to create incentives for both efficiency, innovation, and investment in existing clean energy technology. But in the short-term, our best bet is almost certainly the efficiency-enhancing properties of these kind of complementary policies.

At any rate, today is Blog Action Day and the issue is climate change. Tell your friends! When people look back one or two hundred years from now on American politics in the early 21st century, they’re probably not going to care about the ups-and-downs of health care policy or derivatives regulatives. They are going to care about what we did or didn’t do to forestall an ecological catastrophe.

Michael McKeever, executive director of the SACOG, and Peter McLaughlin, a commissioner of Minnesota’s Hennepin County, agreed that the upcoming congressional climate change bill is essential to achieving land use reform.

If the climate bill “does some fairly simple things and requires … high quality [MPO planning] to be done as a pre-condition of getting federal funds,” local development can become a more transparent and rational process, McKeever said.

Legislators, recognizing this, included language to that effect in the original Waxman-Markey bill. But it wound up getting stripped out. Now it’s back in the Kerry-Boxer draft, but the U.S. Senate is generally less friendly than the House to sound urban planning and land use policy so one should be nervous that it will be removed again. However, with these kind of relatively low-profile issues things like preference intensity make a great deal of difference. If Senators get word that their offices are being contacted by people who are interested in something as obscure as MPO planning, that would get noticed. Of course as a DC resident I’m not allowed to be represented in the governing bodies of the United States of America so I can’t contact anyone.

Saudi Arabia is trying to enlist other oil-producing countries to support a provocative idea: if wealthy countries reduce their oil consumption to combat global warming, they should pay compensation to oil producers.

It’s interesting to look at the range of policy responses different countries have had to oil wealth. Norway has been incredibly far-sighted, while Abu Dhabi and Qatar also score quite well. All the way on the other end of the spectrum are Nigeria and Equatorial Guinea. And then there’s Saudi Arabia, kind of the oil exporters and apparently world champions in chutzpah.

One reason for skepticism is that I’m actually skeptical that a properly implemented set of worldwide carbon border adjustments would actually achieve its intended purpose of boosting American manufacturing. After all, despite all the China hype we do much more trade with developed countries—countries with considerably less carbon-intense economies. Combining data from here and here I present the following chart of leading trade partners:

The EU, Canada, and Japan are in the aggregate much more significant trade partners than China/Mexico/Brazil. And the case for them charging us carbon tariffs seems about as good as the case for us charging the Chinese.