The EPA ‘whistleblower’ YouTube

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This video, by Laurie Williams and Allan Zabel, two veteran Environmental Protection Agency staffers based in California who specialise in emissions trading, is causing a small commotion in the US – as the EPA has now demanded that they either remove, or substantially re-edit the film.

Writing as someone who’s also done a stint in officialdom working on emissions trading (though only of a few months rather than Williams and Zabel’s few decades between them – I was seconded in to Defra in 2002 to co-ordinate the offsets part of the now defunct UK Emissions Trading Scheme), I think they are totally right about the disastrous train crash that is allowing ‘offset’ permits in to cap-and-trade schemes (see this post I did back in September arguing same).  And they’re also right that phase 1 of the EU Emissions Trading Scheme ended up giving windfalls to utility companies for no real emissions cuts.

But I think these are arguments for doing cap-and-trade properly, rather than doing away with it altogether. The critique about utility windfalls can be dealt with fairly easily, I think: the EU should have auctioned permits rather than giving them away.  But the bigger issue is the one about the use of offsets – either at US or at global level.

As they point out, the problem with offsets like Kyoto’s Clean Development Mechanism is that they’re based on the idea that even if you don’t have a cap, you can still do the trade part.  If you’re wondering how the verification happens – to make sure that what you trade is a real emissions reduction – well, so am I. It’s all to do with comparing what did happen with what you think might have happened otherwise, and is hence an exercise in guesswork.

So these offsets shouldn’t be included in US climate legislation.  Even more fundamentally, countries that don’t have binding targets should not be involved in international emissions trading – period.  It’s a recipe for disaster to allow permits from inherently unverifiable projects in developing countries in to the system, and then allow developed countries to claim them as their own “emissions savings”.

The still larger issue is that you can’t solve a global problem with a less-than-global solution – so any “solution” to climate change that lacks targets for developing countries simply isn’t a solution, however compelling the equity arguments.

Of course, developing countries don’t want binding targets – but equally, they don’t want to lose the chance to profit from emissions trading.  This, ultimately, is why we’re in the mess we’re in with the CDM: developing countries were concerned that assets were being shared out and that they weren’t getting any (an analysis that was 100% correct), so the CDM was dreamt up as a way of keeping them happy.  Alas, it came at a high price in environmental integrity terms.

What should we be doing instead? Well, it’s logically very simple: binding caps for all countries, everyone gets to take part in cap and trade, and the global emissions budget is shared out according to some equitable formula (for my money, equal per capita entitlements by some future date – but ultimately, whatever policymakers can agree on is fine by me; the key thing is just to share the damn thing out and get on with it). 

Alas, no-one at Copenhagen is talking about these kinds of brass tacks, and it looks a racing certainty that the awful CDM will be with us for a while yet.  If policymakers are really hellbent on another round of the offsets gravy train, then it may be that the presenters of this video are right, and that a revenue-neutral carbon tax might be the best option.

The window of opportunity on scarcity issues starts to close (updated x3)

I’ve said before that the easing of oil and food prices that followed the credit crunch and the global downturn gave policymakers a window of opportunity to take preventive action on scarcity issues. Now, alas, I think that window is starting to close – without their having done much about it.

To see why, first take a look at what the oil price has been doing over the last year (Brent crude futures, $/barrel; h/t BBC):

Oil_price_12months

Then, put that against the longer term background of what’s been happening since 2000 (slightly older data here, via Mongabay, but usefully puts the BBC graph above in context):

oil_10_yrs

As the second graph shows, today’s level of just under $80 per barrel already brings us back to where we were in around July 2007 – and that’s during a still shaky recovery from what’s generally agreed to have been the worst global recession since the early 1930s.

This is a striking rebound in such weak economic conditions – and calls to mind the consistent warnings from the IEA over the past 18 months that the collapse in investment in new supply during the financial crisis and subsequent downturn has set the stage for a new oil price crunch as soon as recovery gets underway (not to mention the fact that IEA’s chief economist thinks we’re looking at peak oil as soon as 2020).

With the oil price headed upwards, food prices can be expected to follow – because higher oil prices make biofuels more attractive, and raise the prices of on-farm energy use, fertilisers, transportation, distribution and various other elements of our energy-intensive food supply chains.

Sure enough, if we take a look at the latest FAO food price index, we find that it too has been quietly heading upwards over the last few months – and is now likewise back at where it was in July 2007. At that point, of course, the food spike was already well underway, with the tortilla riots in Mexico City that served as a wake-up call for many policymakers having come almost six months earlier.

FAO_index_1009

On top of this, remember the really key point that the fall in food prices that took place during the global downturn gave minimal respite to the world’s poorest people – precisely because even as prices fell, they were also getting hammered themselves by the downturn.

The starkest indication of that is in the global total of undernourished people (shown here in a graph from the FT); when you realise that we haven’t just lost the progress of the last few years, but are in far worse shape that at any time since the last 60s, you start to see just what a catastrophe the combination of  food / fuel price spike followed by global downturn has been for development:

FT_undernourished

As I’ve argued in numerous previous posts, we were never out of the woods on the food / fuel pincer movement; it was the collapse in prices following the credit crunch that was the blip, not the price spike that preceded it. And what’s most frustrating now is the extent to which policymakers have frittered away the chance we had to get onto a more secure footing.

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UN to develop Nigerian Lego car

Wrong on so many levels:

The National Automotive Council (NAC) is collaborating with the United Nations Industrial Development Organisation (UNIDO) to fine-tune the concept for a made-in-Nigeria car…

“Once the bill is passed and the budget proposal before the National Assembly is passed, we will come up with the concept of the made-in-Nigeria car with a road show,” [Aminu Jalal, the Director General of the Council] said.

The automobile needs of Nigeria can only be met when all the stakeholders in the industry work towards meeting international standard, Mr. Jalal said, adding that the agency’s main focus is to encourage local manufacture of auto components. The council is equally wooing Nigerians in the Diaspora, who have indicated interest in investing in the manufacturing of auto components and ancillaries.

Unlike other emerging economies, Nigeria is yet to witness a revolution in its automobile industrial sector. As at today, the dream to have a made-in-Nigeria car has remained exactly that – a dream.

Apparently, “the absence of local source of raw materials” has delayed progress to date. From the look of early designs, this obstacle has been solved through judicious use of Lego. Presumably, the full power of the UN system will now be thrown behind the project.

United Nations Nigeria Lego Car

The UN University wants to be anarchy

The United Nations University Office in New York sends us an invite:

The United Nations University Office at the UN, New York(UNU-ONY) is organizing a panel discussion entitled “Sexed Pistols: The Gendered Impacts of Small Arms and Light Weapons”. Every day, small arms and light weapons (SALW) kill and maim, wound and threaten millions of adults and children. The impacts of these weapons can be vastly different for women and men, girls and boys. A careful consideration of gender and age is rare in the formulation of small arms policy, of planning small arms collection or control, or even in small arms research.

We look forward to forthcoming UNU events including “I am the Anti-Christ: Secular Movements in Conflict Scenarios”; “I Wanna Destroy: The Dynamics of Violence in Small Wars”; and “Who Killed Bambi? Analyzing Threats to Fauna in Civil Wars”…

What to make of Gordon Brown’s conversion to the Tobin Tax?

“Very substantial drawbacks.” “Big problems attached to it.” “It is very difficult to advocate a tax that has been, in a sense, rejected by the person who put the proposal forward.”

Just three of the observations that Gordon Brown has made in the past about the Tobin Tax. All the more surprising, then, that the Prime Minister should have come out in favour of it in a surprise speech at this weekend’s G20 Finance Ministers – at least until fierce opposition from Tim Geithner forced the UK to back off. (No mention of the idea in Gordon Brown’s FT op-ed on financial institutions this morning, you’ll notice.)

Now that the dust is settling, two questions stand out. First, why the Damascene conversion? And second, how – if at all – does this alter prospects for implementation of the tax?

Start with the reasons why.  Of course, some argue that Brown’s endorsement of the idea is no more than ‘tough on banks’ political positioning. Fraser Nelson, for instance, sees it as “the desperate vote-seeking move of a Prime Minister who knows he’s going down”. Beating up on the banks may be part of the story, but it doesn’t sound convincing enough on its own: you have to wonder whether anything as nerdy as an international currency transaction tax is really going to resonate with the public at large.

John Hilary, the Executive Director of War on Want – the UK NGO that, more than any other, has led the charge on the Tobin Tax – argues that to understand the move, you have to look further back than FSA head Adair Turner’s advocacy of the idea in August: back, in fact, over the last two years, during which several European governments (in particular Norway and latterly France) have been analysing the Tobin tax in detail.

Two weeks ago, John told me this morning, French Foreign Minister Bernard Kouchner hosted the first meeting of a new Task Force on international financial transactions (terms of reference here), which Financial Secretary to the Treasury Stephen Timms attended for the UK. When John met Stephen Timms after that meeting,  Timms told him that the UK’s previous resistance to the tax had been misplaced – and the UK was now on board.

Now, you might think that Timms’s reversal of long-standing HM Treasury policy was probably the result of prodding from Downing Street, and you’d probably be right.  But that’s not at odds with the proposition that Brown’s reversal is primarily because he’s become persuaded of the idea’s merits and feasibility. After all, Brown has more form on global Marshall Plan ideas than most: whatever reservations people have about his International Finance Facility (and I have a few), you can’t doubt the seriousness of his personal commitment to the idea.

As to the style of the announcement (of which Chris Giles justly observes, “just imagine if Tony Blair had arrived uninvited when Gordon Brown was chairing a G7 finance ministers’ meeting and upstaged the agenda by talking about things that had been kicked into the long grass. Brown would have exploded”): well, since when did Gordon Brown ever unveil radical new global proposals in a consultative way?

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