The problem was staggering, even existential. Global emissions of greenhouse gases — especially carbon dioxide — were rapidly driving up global temperatures, transforming the lives of humans. If those temperatures reached 2°C above pre-industrial levels, scientists said, the results would be catastrophic. An international conference was called in Paris under the auspices of the UN. Politicians declared that the world must curb carbon-dioxide emissions to avoid exceeding the 2°C threshold — and since then, nothing substantial has happened.
The 2015 UN climate conference in Paris was supposed to be different. It produced a document, signed by 197 parties, containing general guidelines for climate policy and memorializing a global commitment finally to address the problem.
However, as usual, emissions have continued to rise steadily, increasing the concentration of atmospheric carbon dioxide at an alarming rate. Last year’s climate conference in Katowice, Poland — which focused on making the Paris commitments more specific and binding — did nothing to change this.
The reason that UN climate conferences keep failing is straightforward: Their agendas — centered on voluntary, quantitative targets — are fundamentally flawed.
Agreeing to quantitative, universally applied emissions-reduction targets at a UN conference is easy, but countries automatically regard adherence to those targets as a sacrifice: In the effort to reduce emissions by x tonnes, the country would lose y million jobs and GDP would fall by US$z billion. Because there are no actual sanctions or penalties for non-compliance, when push comes to shove, governments can simply change their minds.
Even if a government does try to uphold its commitments by imposing, for example, new regulations on high-emitting industries, it might not obtain the desired results. Businesses, too, want to avoid making sacrifices, so they seek any way to avoid regulations, including bribing government officials to look the other way.
Questions of fairness can further weaken incentives to fulfill UN climate commitments. Why should a poor developing country make the same reduction, whether in absolute or proportional terms, as a rich Western country? After all, on their path to high-income status, Western economies emitted with abandon.
Poor countries not only face constraints on development that their rich counterparts never did; it is also much harder for them to cover the costs of creating a low-carbon economy. Compensation is discussed, but countries consistently fail to agree on who should receive how much support, and who should pay — so the debate is pushed to the next conference. Meanwhile, the volume of atmospheric carbon dioxide keeps increasing.
The voluntary quantitative restrictions that underpin the UN climate agenda amount to a weak foundation for a solution to the crisis. A better approach would begin with a uniform tax on carbon-dioxide emissions worldwide — for example, US$100 per tonne.
Virtually all economists agree that, from an economic perspective, such a tax would create a much firmer foundation for climate action, not least because it would generate immediate revenue for governments.
A global tax would also be politically more feasible than national measures — such as the French fuel tax that triggered widespread protests against French President Emmanuel Macron — because consumers would not bear the full cost.
To be sure, prices for consumers would still rise, with the precise amount depending on the price sensitivity of supply and demand. If the supply of oil were completely inelastic (that is, if the world had a fixed number of wells from which oil could be pumped at no cost), the market price would fall by exactly the amount of the tax. In such a scenario, the full cost of the tax would be borne by the owners of the oil wells.
However, supply is not completely inelastic. If the market price is high, new oil deposits (with higher extraction costs) would be developed. If it is low, some existing production would be closed down. The extent to which oil companies adjust to shifting demand would thus shape the effect of a global carbon-dioxide tax on consumer prices.
Because supply is not completely elastic, producers and consumers would share the burden of the carbon-dioxide tax, meaning that both would have an incentive to reduce their fossil-fuel production and use — and thus their emissions.
If the billions of dollars in new tax revenue, at least partly funded by oil producers, were channeled toward broadly beneficial or otherwise popular investments, voters might be more than accepting of a carbon-dioxide tax.
A carbon-dioxide tax would also go a long way toward resolving the corruption problem raised by quantitative emissions restrictions, because governments would have less incentive to accept bribes from companies, especially if officials were held accountable for meeting revenue targets.
Even governments that are skeptical about climate change might find the added revenue sufficiently appealing to support the tax. In this sense, a carbon-dioxide tax is “incentive compatible”: All governments — corrupt or honest, dictatorial or democratic, climate skeptic or climate leader — have a motive to impose and enforce it (provided that all other countries do the same).
As for fairness, the issue would be resolved in an ad hoc way: All oil-consuming countries, rich or poor, would receive tax revenue that is partly covered by oil-producing countries, which include the richest (and, in some cases, most corrupt) economies in the world.
This might not be the optimal way of redistributing wealth across countries, but it is a feasible one. The inclusion of any element of redistribution could ease resistance to climate action among developing countries frustrated by the advantages enjoyed by their wealthier counterparts.
The next UN climate conference is to take place in Santiago, Chile, in December. That gives the world eight months to prepare a new agenda focused on coordinating a worldwide carbon-dioxide tax.
Oil-producing countries will vote against it, because it would be much harder to avoid implementing than current commitments, but if most of the international community stands behind the measure, a UN conference could, at long last, bring genuine progress toward reducing global emissions and curbing climate change.
Mats Persson is professor emeritus at Stockholm University’s Institute for International Economic Studies.
Copyright: Project Syndicate
French firm DCI-DESCO in April won a bid to upgrade Taiwan’s Lafayette frigates, which has strained ties between China and France. In 1991, France sold Taiwan six Lafayette frigates and in 1992 sold it 60 Mirage 2000 fighter jets. To prevent arms sales between the nations, China negotiated an agreement with France and in 1994 in a joint statement, France promised that there would be no future arms sales to Taiwan. From China’s point of view, the DCI-DESCO deal constitutes a breach of the agreement, but the French stance is that it is not selling Taiwan new weapons, but instead providing a
Chung Yuan ChristiaN University is clearly in bed with the People’s Republic of China. This can be the only explanation why the school’s authorities have done their utmost to shield a student, who lodged a complaint against an associate professor, and then used thuggish tactics to compel the teacher to issue two separate apologies to China. The original complaint, filed by an unnamed Chinese student, was for remarks by associate professor Chao Ming-wei (招名威) during a class on the origin of COVID-19. A second complaint was filed by the same student after Chao, during an apology, stated that he was a
President Tsai Ing-wen (蔡英文) in her inaugural address on May 20 firmly said: “We will not accept the Beijing authorities’ use of ‘one country, two systems’ to downgrade Taiwan and undermine the cross-strait status quo.” The Chinese government was not too happy, and later that day, an opinion piece on the Web site of China’s state broadcaster China Central Television said: “While Tsai’s first inaugural address four years ago was read by Beijing as an ‘unfinished answer sheet,’ the one she presented this time was even more below-par.” Speaking to the China Review News Agency, Shanghai Institutes for International Studies vice president
The COVID-19 pandemic continues to wreak havoc worldwide. Despite countries being under pressure economically and from the novel coronavirus, China’s National People’s Congress last month passed national security legislation for Hong Kong, a decision that has shocked the world. Let there be no doubt: This move is the beginning of the end of China’s plans for “one country, two systems” in Hong Kong and Taiwan. Proposed amendments to extradition laws last year ignited massive protests in Hong Kong, with millions of participants, shocking the world and making confrontation between government forces and those who opposed the change a permanent part of Hong