In the Financial Times (which really is the best newspaper in the world), Larry Summers writes:
FT.com / Comment & analysis / Comment - We need to bring climate idealism down to earth: With the accumulation of scientific evidence and its persuasive presentation to the public, the global warming debate has reached a new stage. Those who still deny that human activity is warming the planet, or claim that “business as usual” can continue indefinitely without profoundly adverse consequences, are increasingly seen as the moral and intellectual equivalent of those who deny that tobacco has adverse consequences for human health.... [T]here are huge opportunities to reduce emissions with economic benefit or negligible economic cost... [with current] worldwide subsidies to energy use... [of perhaps] $250b [a year].
The real question for debate is not whether something should be done – that debate is over among the rational. The crucial question now is what should be done so as to leave our descendants with the highest possible quality of life. Answering it effectively requires vision and ambition. But, as the example of Woodrow Wilson’s League of Nations teaches painfully, utopian vision and ambition unmoored from political, economic and social reality can be counterproductive....
[T]he global cap and trade approach directed at achieving the rapid emissions reductions enshrined in the Kyoto protocol... could be ineffective or even counterpoductive by substituting for more realistic approaches.... Kyoto is... the only game in town for those who do not want to be ostriches.... But it is surely useful to try to be clear about the potential pitfalls....
[T]he Kyoto approach depends on the questionable premise that nations will, in fact, be bound by binding targets.... [C]onsider the history of the Maastricht Treaty.... It broke down almost immediately when it looked like the targets would not be binding for big countries....
Whatever evidence there is of impressive emissions reductions comes from countries such as the UK, Germany and the former communist states, where coal use was being phased out for other reasons. The limited impact of Kyoto is evinced by the fact that carbon permits are now selling in the range of a negligible one euro a ton....
[C]arbon markets are invitations to engage in pork-barrel corporate subsidy politics on a massive scale. If greenhouse gas emissions are to be substantially reduced, the value of the associated emissions rights will be in the tens of billions of dollars.... [B]usinesses that can pass on carbon costs to their consumers are excited about schemes that compensate for these costs by allocating them permits related to their existing emissions levels. As investigations by this newspaper have highlighted, the clean development mechanism has resulted in substantial payments for emissions reductions that would have occurred anyway or could have been achieved at negligible cost. There is even reason to think that certain industrial gas emissions may have been increased so that credit could be claimed for their abatement.
[T]he most serious problem with the Kyoto framework is that it is unlikely to generate substantial changes in developing country policies... [which] are not likely to accept binding targets on their energy use or greenhouse gas emissions that fall way short on a per-capita basis of emissions levels in the industrial world. Nor is it reasonable to expect them... to commit to energy use goals that fall short of patterns observed in the rich countries....
[D]eveloping countries are where most of the future action has to be. They will account for 75 per cent of the increase in emissions over the next quarter century and are now making the infrastructure investments that will shape their future economies.... [A]ny international regime that does not include them will [simply] not work... as energy intensive activities relocate to the developing world....
Perhaps these problems and others... can be overcome with goodwill and extensive thought. But next month I shall suggest [alternative] approaches that... may over time provide a more secure foundation for the progress that the world must have.
