Thursday, December 17, 2009

Why Hopenhagen Turned into Nopenhagen


While it is not over until it is over, on this the penultimate day of the most important international conference on global climate change in this decade, it seems pretty clear that it is going to end in failure. There will be no binding treaty. It is not clear there will even be an agreed framework for such a treaty. There is no agreement or targets or benchmarks. Maybe there will be some progress on REDD and on a fund to help vulnerable nations adapt to some of the predicted effects of global warming. But overall, the COP15 Climate Conference in Copenhagen will go down in history as a failure.

Why did this happen? Did it really have to turn out this way? I am sure there will be lots of post-mortems written in the coming days and weeks. Here is my first volley.

The US never joined the 1997 Kyoto Treaty that COP15 was supposed to come up with a new treaty to extend or replace. At the time the U.S. Congress was controlled by the Republican Party (the GOP -- Guardians of Profit). The nominally Democratic President, Bill Clinton, knew full well that getting this treaty ratified in the US Senate had about the same chances as a snowball in hell. So even with Al Gore as his Vice-President, he caved to Republican opposition and adopted a negotiating position that said that the US would not commit to binding carbon emission reductions until the developing countries also accepted them.

At the time, major developing economies such as China, India and Brazil, were refusing to do so because, they argued, most all of the CO2 in the atmosphere that was causing the problem was the result of historical emissions by the older industrialized countries. most notably the USA, which at the time accounted for roughly 25% of global emissions but had only 5% of the world's population. So there was an "After you Alfonse" type stalemate. The US would not agree to binding emission targets until the developing countries did, and they would not agree to reduce their emissions until the USA owned up to its responsibility.

But things began to change dramatically two years ago at the Bali climate conference when the US representative was heartily booed when she reiterated this tired old position that the Bush administration had stuck with. Moreover, China and other major developing industrial countries announced at Bali that they were now willing to commit themselves to carbon emission targets, removing one of the big obstacles to successfully negotiating a new treaty regime in Copenhagen this December.

So what happened? Well we got a new US President who says he is committed to the US doing its part to address the threat of global climate disruption. And now the US Congress is controlled by members of his own party in both the House and the Senate. Good opportunity right?

Wrong. The US moved the goal-posts. Now they are saying that they cannot commit to any binding agreement with robust emission reduction targets because they are not sure they can get any bill through the Senate unless Senators from coal-producing and oil-producing, and smoke stack industry states can be assured that China, and India and Brazil are not cheating on their claimed emission reductions and taking jobs away from American workers while continuing to pollute the atmosphere.

The developing nations have bristled at the suggestion that they cannot be trusted to keep their words, so we have another "After you Alfonse" type stalemate. This time the US will not say it can commit to binding emissions targets unless the developing nations first commit to a verification scheme of some sort. While the developing nations are saying, we already came halfway on our own, but what have you (the USA) done? Bupkiss.

The emissions targets suggested in the current House bill that form the basis of the current US negotiating position, are terribly weak. They are really only 4% below the internationally accepted 1990 baseline, and they are not even law yet and may never get to be law. The Europeans, the Japanese, and other developed countries, have stated that they will commit to 2020 reduction targets below the 1990 baseline of between 20-25%

Why is the US target so weak? Because, well, you see, we have this stupid procedural rule in the Senate that says that you need 60 senators to end debate on proposed legislation. If you cannot reach the 60 vote threshold you cannot end debate on the floor, and if you cannot end debate it you cannot vote on a bill and perhaps pass it.

That is why Sen. John Kerry went to Copenhagen this week to try to reassure COP15 delegates that the US Senate will pass a bill this spring with binding emissions targets, but only if the Chinese and other developing countries first agree to a verification scheme that they can use to convince recalcitrant and obstructionist Senators (read Republicans, a few conservadems, and of course our friend Joe Lieberman) from filibustering to block it in the Senate just as they have done with Health Care Insurance Reform this fall. So the Fate of the Earth comes down, again, to the dysfunctional US Senate and its stupid filibuster rule.

Or does it? According to the US Constitution, treaties must be ratified by two-thirds of the Senate, that is, by 66+1 Senators.
In the United States, the term "treaty" has a different, more restricted legal sense than exists in international law. U.S. law distinguishes what it calls treaties from treaty executive agreements, congressional-executive agreements, and sole executive agreements. All four classes are equally treaties under international law; they are distinct only from the perspective of internal American law.

The distinctions are primarily concerning their method of ratification. Whereas treaties require advice and consent by two-thirds of the Senate, sole executive agreements may be executed by the President acting alone. Some treaties grant the President the authority to fill in the gaps with executive agreements, rather than additional treaties or protocols.
Currently, most international agreements are executed by executive agreement rather than treaties at a rate of 10:1.

Despite the relative ease of executive agreements, the President still often chooses to pursue the formal treaty process over an executive agreement in order to gain congressional support on matters that require the Congress to pass implementing legislation or appropriate funds, and those agreements that impose long-term, complex legal obligations on the U.S.

So what are the chances that President Obama is going to use his power to make executive agreements to bind the US, even provisionally, to a binding treaty? Bupkiss. He needs political cover from the Congress. This is also the reason why he is not going to use the newly sanctioned power of the EPA to directly regulate greenhouse gasses as harmful pollutants. Doing so would bypass the Congress and expose him to merciless attacks from the GOP, threatening his prospects for re-election in 2012.

But in order to get Congressional cover (buy-in) he needs both the House and the Senate, and we already know what a cesspool of deceit and obstruction the Senate is these days. So, sadly, once again, the Fate of the Earth hangs on the existence of a stupid procedural rule of the Senate that prevents electoral majorities from passing legislation without the consent of 60 Senators before they can end debate.

To be fair, the failure of COP15 is not entirely due to US non-commitment. Our neighbor the the North, Oh Canada, with its current conservative government, has linked itself to the US position on reduction targets and binding agreements and is standing with the US in blocking a deal in Copenhagen. Canada is, in case you don't know, the #1 supplier of petroleum to the US market, far ahead of the Middle East. Canada also has the Athabasca oil sands (or tar sands) in Northern Alberta, which are really going to start paying off big time once we reach Peak Oil (perhaps we already have) and the price of petroleum starts to relentlessly rise as supply declines while demands increases.

Peak Oil is the real underlying driver of the "go slow" or "go not at all" approaches to an energy transition in this century. The oil producing states, and the major oil companies that hold long term leases, want to delay the transition to a carbon-neutral energy economy as long as they possibly can. It they don't they stand to lose something on the order of $100 trillion in revenues during the remainder of this century. Much of that money that would be left on the table if the world manages to accelerate the shift to carbon neutrality sooner rather than later by making green energy cheaper than dirty petroleum and other fossil fuels. The environmentalists, of course, are worried that if we prolong the end of the Oil Age we are risking cooking the planet and producing catastrophic changes in the climate that will take centuries to correct, if they can ever be corrected at all.

Hey, but what does catastrophic damage to the Earth, its people, and its living species, matter if the oil companies lose all those healthy profits in the process? The Bush administration made no bones about its non-energy policy being designed (in still secret meetings with oil company officials in Dick Cheney's office) to protect future oil company profits. At least Dubya was not a hypocrite.

But Obama campaigned on the slogans "Hope You Can Believe In" and "Yes We Can" Well those slogans are wearing pretty thin right now. If Obama is not willing to take any political risks to lead this country to a better place, then in three years people in his base will not be talking about "Hope" any more. They will be saying "Nope."

Tuesday, December 15, 2009

The Great Health Care Give-Away of 2009


In an earlier blog post I explained why health care insurance reform without a robust public option is a huge government give-away to the private health insurance industry. But that is just what is coming out of the US Senate this week. Harry Reid has reportedly dumped both the public option and the idea that people 55-64 years of age should be able to buy into Medicare, in order appease Joe Lieberman (the Senator from Aetna), Ben Nelson (another recipient of insurance industry largesse) and other conservadems.

This is truly outrageous! What we are getting from the Sausage Factory that is the Senate is a bill that will require millions of Americans to purchase expensive private health insurance, many of whom will be subsidized by taxpayers dollars in order to do so, with absolutely no mechanism to prevent these corporations from using the proceeds to pad their profit margins. This is disgraceful.

Progressives need to learn a lesson from this. The reason why this happened is nicely summed up in an article by John Neffinger "Why We Lost Health Care."
The US Senate is a dysfunctional and undemocratic institution.

Former Vermont Governor Howard Dean has now called upon democrats to "Kill the Senate Bill" and start over with the House of Representatives. Without a public option or a Medicare buy-in provision it is not real reform at all. It is just a huge corporate welfare bill for the private insurance industry.

The people need to rise up and demand better of their government.

Sunday, December 13, 2009

Pascal's Wager and Climate Change (Revised)

Current climate science suggests that the Earth's temperature has been steadily rising due to greenhouse gas (GHG) emissions produced by our use of fossil fuels such as coal, oil, and gas, and that the rate at which are pumping CO2 and other gases into the atmosphere exceeds the ability of the oceans and the plants to absorb them. If GHG emissions continue unabated then, scientists predict that the Earth's average temperature will continue to rise, and this may cause some potentially very serious climatic changes such as melting glaciers and icecaps, rise in sea levels, species displacement and extinction, spread of tropical diseases, refugee flows, droughts, floods, increasingly powerful cyclones, and so forth.

While there is a strong consensus among climate scientists that the theory of anthropocentric (human-induced) global warming is true with a high degree of certainty, a great many people still refuse to believe it. Some of these skeptics are suspicious of the explanation that humans burning fossil fuels is the cause of the warming trend and point out the existence of some studies that cast doubt on the consensus view (Alexander Cockburn claims the theory is a farce) . The recent release of "climate gate" emails from scientists at the University of East Anglia's Climatic Research Unit suggesting that they had tailored some data to fit this theory fueled climate change skeptics and deniers. Recent Polls show that the percentage of Americans who believe in anthropogenic global warming has declined. Some climate skeptics believe that the whole story is a hoax concocted by a vast left-wing conspiracy. Many of these climate skeptics are also vehemently opposed to the world's nations taking any serious steps to reduce GHG emissions in order to mitigate the threats predicted to arise due to global warming by reducing the use of fossil fuels and moving rapidly to a carbon-neutral energy economy.

But the question about whether or not we should now take serious steps to reduce GHG emissions is a classic case of decision-making under uncertainty. The question whether we should believe or disbelieve in current climate science is analogous to Pascal's Wager, named for the mathematician and philosopher Blaise Pascal (1623-1662) whose Pensées contained the following intriguing paragraph:

“God is, or He is not.” But to which side shall we incline? Reason can decide nothing here. There is an infinite chaos which separated us. A game is being played at the extremity of this infinite distance where heads or tails will turn up... Which will you choose then? Let us see. Since you must choose, let us see which interests you least. You have two things to lose, the true and the good; and two things to stake, your reason and your will, your knowledge and your happiness; and your nature has two things to shun, error and misery. Your reason is no more shocked in choosing one rather than the other, since you must of necessity choose... But your happiness? Let us weigh the gain and the loss in wagering that God is... If you gain, you gain all; if you lose, you lose nothing. Wager, then, without hesitation that He is.

In this argument Pascal portrays the decision about whether to believe in God or not as a wager made under conditions of uncertainty. In modern decision theory the logic of his argument is represented by a decision matrix such as the following:


God exists (G)God does not exist (~G)
Believe God exists (B) eternal heavenly bliss
-N (none)
Not Believe God exists (~B) eternal damnation or (perhaps) purgatory

+N (none)

His argument suggests that if God exists, the reward for believing that God exists is very high, whereas the cost of not believing in God (if indeed He does exist) is very great --- eternal damnation. Therefore, it is a good bet to believe in God. If, on the other hand, it turns out that God does not exist, then the benefits as well as the costs are negligible (perhaps some Sunday mornings wasted going to Church), and perhaps, if God does not exist, we will never really know anyway whether our bet paid off.


Philosophers have found various reasons to object to this argument as providing a good basis for theism. But I leave these philosophical niceties aside, interested readers might want to consult the article on Pascal's Wager in the Stanford Encyclopedia of Philosophy. My intention here is to suggest that there is a similar (and much better) argument to be made about the uncertainty of catastrophic climate change due to anthropogenic (human-induced) changes in the concentration of CO2 and other greenhouse gases in the Earth' atmosphere.


There will be a big payoff if we believe in current climate science and take steps to reduce carbon emissions, and it turns out the theory was correct. And there will also be a big loss if we do not believe in current climate science, when it turns out that the theory was correct -- oops, we cooked the planet. Assuming that there is a greater than zero chance that current climate science is correct, then the rational wager would be to accept it and act so as to gain the best outcome and avoid the worst one, even if there remain some doubts about whether the current science is indeed correct. As a decision matrix this set of choices would be represented like this:



Current Climate Science is correct (C)
Climate Science is not correct (~C)
We believe in climate science and act (B)
F1
F2
We do not believe in climate science and do not act (~B)
F3
F4


What are the relative values of F1...F4 in this payoff matrix? In order to make the answers more concrete suppose that you will be able to experience the planet Earth as it will exist 100 years from now. Perhaps you will still be alive because of miraculous new lifespan enhancing medical technologies. Or if you prefer a more supernatural possibility, suppose that you do die but will be reincarnated as one of your own great great grandchildren, or as another member of their generation.

Let's first examine the value of F3. If we do not believe in current climate science and act (~B) to mitigate its predicted catastrophic effects by rapidly transforming our energy economy so as to radically reduce GHG emissions, and it turns out that the current science is correct (C) in predicting catastrophic climate changes 100 years from now if we do not act, then you or your great great grandchildren will be very unhappy campers on Planet Earth. The payoff value of F3 (~B & C) is strongly negative. How would you feel about F3? Well probably a lot like an atheist who dies and meets St. Peter at the Pearly Gates --"Oops, I guess I was wrong, Gulp!"

What then is the value of F1? In this case, we decided to believe in current climate science and acted in order to mitigate its worst predicted effects, and it turned out that our current theories were indeed correct (B & C). The payoff for F1 is then very high indeed. F1 is analogous to the situation of the faithful religious believers who discover that the God they accepted does indeed exist, except that their reward is an earthly one, a planet whose climate is not greatly altered and disrupted by human activities.

So, just looking at these two values F1 and F3, we can say that F1 dominates F3, that is, that the expected utility of believing in climate change is far greater than the expected utility of not believing in it. Therefore, even with uncertainty about C, it is rational to bet that current climate science is correct and take steps now to significantly reduce our GHG emissions.

But we must also consider the costs and benefits of F2 and F4, the cases where current climate science is not correct. Suppose that in 100 years we learn that the climate science of the early 21st century was wrong in predicting catastrophic climatic changes due to anthropogenic GHG emissions (~C), but because people in the early 21st century believed in it (B) they spent a lot of money and effort on energy efficiency, electric cars, windmills, solar panels, and hydrogen fuels cells, and all that green stuff. How would you feel about that? I guess you would probably feel pretty okay about it; it would be kind of like learning that you had already been saved through God's grace, and it really didn't matter whether you went to church or not, even though you did. But your ancestors did make a big effort to "Go Green" for nothing, so let's say that F2 is marginally negative.

Now, finally, for F4 suppose that at the present we do nothing to prevent further increases in global temperature by altering our current fossil fuel energy economy (the so-called "business as usual" scenario), but that it turns out that current climate science is wrong, and nothing very bad happens. This is like finding one has a "Get into Heaven Free" card even though one lived a life of sin. One can imagine this would make one pretty happy. So let's say F4 is marginally positive.

Since F1 and F2 together still yield a strongly positive payoff, while F3 and F4 still yield a strongly negative one, it is still rational to bet that current climate science is correct and act on that belief.

Critics of this argument may want to quibble with my estimate of the cost of F2. Climate skeptics are likely to argue that the cost of mitigating global warming is going to be greater than marginally negative. We will have to make some real sacrifices in order to reduce our GHG emissions to safe levels by mid-century. Let's assume this is correct. Even so, it is worth it because the expected loss if we do nothing is too great. As the authors of a recent report on the economics of climate change argue, it is also possible to think of the choice we face as analogous to the decision to buy fire insurance:
The reason people buy fire insurance is not because they are certain that their house will burn down; rather it is because they cannot be sufficiently certain that it will not burn down. Likewise, the projections of dangerous climate risk if the world exceeds 350 ppm CO2 in the long run are not certainties; they are, on the contrary, necessarily uncertain. If the worst happens our grandchildren will inherit a degraded Earth that will not support anything like the life that we have enjoyed. On the other hand, if we prepare for the worst, but it does not happen, we will have invested more than, in perfect hindsight, was necessary in clean energy, conservation, and carbon-free technologies. How would we feel about discovering we had done too much about climate change, compared to discovering that we had done too little? (DeCario, S.J., Norgaard, R .B, Norman, C. S., and Sheeran, K.A. "The Economics of 350: The Benefits and Costs of Climate Stabilization." Economics for Equity and Environment. www.e3network.org. October 2009, p. 6.)

So how much is catastrophic climate change insurance going to cost? According to this study, which is based on a comparable analysis of several economic projections done both by business-sponsored groups, and nongovernmental and academic groups, it is estimated that climate insurance would cost between 1% and 3% of global GDP in order to reach the lowest carbon target currently being discussed, 350 ppm. As the authors of this report reckon:
Suppose the cost of climate protection turns out to be 2.5% of global GDP, toward the high end of the global scenarios just discussed. In an economy that is growing at 2.5% per year, a rate that is common for developed countries, spending 2.5% of GDP on climate protection each year would be equivalent to skipping one year's growth, and then resuming. Average incomes would take 29 years to double from today's level, compared to 28 in the absence of climate costs. In an economy experiencing 10 percent annual growth, as China has in many recent years, imposing a cost of 2.5% per year is equivalent to skipping 3 months of growth; if 10% growth is sustained, average incomes would reach twice the current level in 86 months, compared to 83 months in the absence of climate costs.
In fact, these authors argue that at the early stages of a climate mitigation program we might actually save money because we are reaping the benefits of greater energy efficiencies. But the bottom line conclusion derived from this study is that, "There are no reasonable studies that say that a 350 ppm stabilization target will destroy the economy; there are no studies that claim that it is desirable to wait before taking action on climate protection" If this is correct, then buying climate insurance is a good investment because we can easily afford it and with a relatively modest cost we can avert a disaster in the making.

On the other hand, if we disbelieve in current climate science and do nothing now to reduce our carbon emissions, then either we discover that we spent 1%-3% of global GDP converting to a carbon-neutral energy earlier than we had to, or we find that we overheated the Earth and our house burned down.

So you climate change skeptics and deniers out there, which risk would you rather take? Would you rather that we now take steps to prevent catastrophic climate change when we can easily afford climate insurance, or do you want to go on business as usual without spending anything on insurance and risk the catastrophic climate changes that current science is predicting? You must choose now. Choose wisely.