I’m not a global warming skeptic. That is, I accept the general scientific consensus that there has been anthropogenic global warming over the past century.
I am, however, a skeptic of alarmist projections about the dangers of global warming. The consensus views reflected in the reports produced by the International Panel on Climate Change present a range of scenarios ranging from moderate to severe. No one is anywhere near certain that the “severe” scenarios will obtain. In particular, no one knows what sorts of technologies will develop over the next one hundred or so years to mitigate any negative effects of warming. Nevertheless, because we are supposed to be good stewards of the creation and because the negative effects of global warming are unpredictable, I believe it’s wise to take reasonable measures to reduce the emission of greenhouse gas pollutants.
Even more than my skepticism about alarmist predictions, however, I am skeptical of efforts like the Kyoto treaty to create an international greenhouse gas regulatory regime. The European Union’s effort to implement Kyoto, I think, is informative.
The biggest problem with the EU system is that the supply side is decentralized, which allows individual member states and their constituent industries to game the system. In the EU system, a central authority designates the industrial sectors that will be subject to the trading scheme, but each member state is free to allocate allowances from a national allowance budget to affected industries within their borders. As a result (a) supply doesn’t respond efficiently to demand; and (b) strong local industries can capture the national allocation process. (For a good summary of the EU experience, see this report.
This centralized demand / decentralized supply aspect of the EU system makes it very different than most of the cap and trade programs tried in the U.S. The U.S. experiments have been ones in which the same central authority identifies target industries and allocates the tradeable credits, establishing a more unified and efficient market. My understanding is that, while some of the U.S. experiments have succeeded in reducing target emissions, Phase I of the EU program under Kyoto has seen no net reductions in CO2 emissions.
A full-on implementation of Kyoto would make the EU decentralization problem look like child’s play — unless there were a central authority of sufficient strength to regulate both demand and supply of credits. I think the prospect of ceding national sovereignty to such a central authority is the heart of the issue concerning Kyoto or a Kyoto-like regime. Anyone who wants to propose a global cap and trade program must answer this question of sovereignty. I think it’s awfully difficult to argue that the precautionary principle as applied to the current science on global warming justifies devolving sovereignty to an unelected international body comprised of countries like China, Russia, and France.