YOU have promised to help Americans suffering from the financial crisis, to tackle global warming and to bring about genuine change. Well, there is a way to achieve all these goals.
This week diplomats from around the world are meeting in Poznan, Poland, to continue negotiating a successor to the Kyoto climate treaty, which expires in 2012. The world will doubtless be told that Kyoto is on track and that its successor will be based on more of the same. Many hope that under your leadership the US will now join. In fact Kyoto is a . We must tear it up and start again.
The show that the amount of carbon dioxide in the atmosphere is rising as fast as ever. The higher it rises, the hotter it will get. And the hotter it gets, the more danger there is of passing a point of no return. Those who talk about adapting to a changing climate rather than preventing it don鈥檛 seem to understand that if we carry on as we do now the ice caps will melt, flooding many major cities. We don鈥檛 know how long it will take, but New York, London and hundreds of others will be doomed without vast engineering schemes to protect them.
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At best, Kyoto is noble but ineffective; at worst, it is a deadly distraction, wasting time we cannot afford to lose and blocking better policies. You are the only leader who can persuade the world to change tack.
Kyoto鈥檚 fundamental flaw is that it is based on 鈥渃ap and trade鈥�, the same approach you plan to introduce in the US: a target is set for emissions, and countries or companies that beat their targets gain carbon credits they can sell to those that don鈥檛.
Cap-and-trade schemes might look good on paper but they are doomed to fail when it comes to weaning the world off its addiction to fossil fuels. For starters, without a strong enforcement regime, any cap is meaningless. Under the Kyoto protocol, for instance, countries that do not meet their targets just increase them next time around. It is a .
What鈥檚 more, the approach is a bureaucratic nightmare, needing complex regulation and providing all sorts of opportunities for corruption, particularly when attempted on a global scale. For example, under Kyoto鈥檚 鈥渃lean development mechanism鈥�, companies in China are claiming carbon credits for hydroelectric schemes, which they鈥檒l sell to polluters in Europe. But these schemes were going to be built anyway, so the overall change to emissions is zero. The UN is , but many think the .
So what鈥檚 the alternative? In the US, there is growing support for a on fossil fuels. Such a tax can be adjusted to reflect the harm done by different fuels: coal would be taxed far more heavily than natural gas, for instance, unless burned in a power station that sequesters the carbon. The tax should be raised each year to make fossil fuels ever more expensive and renewables relatively cheaper.
There are many arguments in favour of this approach, but perhaps the strongest is that a carbon tax will be hard to dodge. It鈥檚 more difficult to smuggle oil or coal than cigarettes and cocaine. Those who use fossil fuels will immediately pay a higher price.
Your advisers will tell you this is political suicide: the last thing we need in a global financial crisis is higher fuel prices. Well, here鈥檚 the clever bit that should make this tax popular with most voters: every penny raised from the carbon tax should be divided equally among a country鈥檚 citizens. This is called the 鈥渢ax and 100-per-cent dividend鈥� approach, and it is advocated by leading climate scientist James Hansen of NASA.
鈥淵our advisers will tell you this is political suicide. Well, here鈥檚 the clever bit that will make it popular鈥�
People who live in a huge house, drive gas-guzzling cars and fly lots will lose out under this regime. The dividend they receive will be outweighed by what they pay for fuel, flights and heating. Most people, however, will be richer. Families and retired people struggling to make ends meet would gain far more from the dividend than they lose in higher bills.
Instead of meaningless targets, let鈥檚 have a climate treaty in which countries agree to a tax-and-dividend system and promise to increase the tax each year. Those who sign it should impose a 鈥渃arbon tariff鈥� on goods and services from countries that don鈥檛 join up or don鈥檛 meet their obligations. That will encourage countries like China to take part, and protect jobs and companies in member countries.
Of course, cap-and-trade schemes and the tax-and-dividend approach are not necessarily exclusive. But there is no doubt which is superior. The tax-and-dividend approach is easier to implement, harder to cheat and provides a stronger, more immediate incentive to change. It applies to everyone, not just big companies, and rewards those who genuinely emit less CO2, rather than lawyers and accountants. It鈥檚 bold, simple and of averting catastrophe.
Change we need indeed. You have a chance to become one of the greatest leaders in history. Please take it.
