Global Warming: India, China and the US
January 10th, 2007
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Over at Marginal Revolution, Tyler Cowen outlines various options/scenarios vis-a-vis India and China’s fossil-fuel consumption (and consequent contribution to global warming) and possible responses from the US.
1. China and India are less locked into fossil fuels than is the United States, and as Brazil has done they will take the lead in moving toward energy alternatives. America does not need to get them “on board,” and given their cooperativeness American energy policy will matter at the margin.
2. We can cut a deal with China and India at a suitably presented international convention. China and India will enforce this deal and abide by it, overcoming previous problems they have had ruling their provinces and avoiding excess decentralization.
3. Forget about the international conference, we can pressure China and India by twisting their arms. Like we’ve done with the Chinese currency. We also can threaten them with trade taxes, as has been discussed in Europe.
4. We are best saying nothing to China and India and calling no conference. There is some chance they will act unilaterally, out of pride and the desire to upstage the United States. External pressure will be counterproductive, remember British imperialism and the Opium Wars?
5. China and India will continue to be major polluters. If we tax American-generated carbon we pay a big price in terms of economic growth but make no real progress on global warming.
6. We do not know what China and India will do, but the United States is a world leader and ought to move first, set a good example, and do the right thing.
As noted later in the post, the cost for either India or China to be reduce global warming contribution might not be very high in real terms, but the important problems are institutional.
There are potential incentives (#2) and disincentives (#3), both political and economic, that might compel the two countries to overcome such barriers. But I doubt that either country will act unilaterally (#4) out of pride or to upstage the United States, even if under the remote possibility that USA is able to set a ‘good example’. Conventional wisdom says that while protecting the environment and reducing fossil fuel consumption are noble goals, China and India’s interest at this stage is obviously better served through economic growth and that is where all policy will be directed.
What interests me though is the flip side question: will investment in cleaner energies now actually make the Chinese and Indian economies grow at at a more rapid pace ? I am not an expert by any stretch and would welcome comments from those who are. However, a couple of intuitive points come to mind.
First, cleaner burning systems means more efficient systems, which should be beneficial in economic terms, right ? Second, independence from natural gas might serve the political interests of the country, since it would not have to pander to the interests of oil rich countries to ensure smooth economic growth.
As noted in the original post, Brazil has taken a lead in innovation towards energy independence - would be interested to know if how that has helped the growth of their economy.
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7 Responses to “Global Warming: India, China and the US”
Confused January 10th, 2007 at 9:57 am #
Bongo,
The key issue is development of technologies which can help move towards energy independence. They would require huge investments at least in the beginning, shouldn’t US be taking a lead in developing them? I think by not investing in green technology, Americans are not only helping the cause of Anti-Americans regimes but more crucially breaking the chain of innovation which has served them well.
About India, I think there are two things. A. ones which are relatively easy to do -for example measures to control power consumption by making smart meters compulsory. B. Newer technologies, we might have to wait some time for that.
Global Warming: India, China and the US « Recurring Decimals….. January 10th, 2007 at 11:26 am #
[...] January 10th, 2007 in Environment, Economics Cross-posted from here. My not so subtle manner of letting people know that I am co-blogging at yet another blog. Details [...]
inel January 11th, 2007 at 6:15 pm #
Sorry, I don’t know enough to answer your flip side question, though there must be someone who could address that.
Well, I would vote for option number 6, and I agree with confused (is that you?), who says “For real innovation, United States needs to step up.”
(And now I am confused myself as to whether I am writing to Bongo or confused!)
Imho, the US should not have been reduced to a level of merely responding to India’s and China’s environmental issues: the US needed to get out front with Europe and Japan and show the way to the developing countries.
Unfortunately, America missed the boat and is now dragging behind and, worse still, either pulling the rest of the world down with it, or not allowing the rest of the world to succeed. In the U.S. there exists a popular and strongly skeptical view of climate science — which means Americans spend more time arguing about details (as on the blog you linked to) and less time doing anything effective to address the effects of climate change.
By the way, I found your post after reading this BBC report titled “China fails environment targets”. This kind of report is dreadful to read, but necessary reading
I agree that the world is not being helped by the stance that America (at a national level) takes on the climate challenge, though there is a lot that individual Americans, U.S. cities, and states are doing to address it. Yes, I wish the U.S. would take more of a lead in developing new climate-helpful technologies, for a win-win-win-win situation that will benefit people from all nations, rich and poor.
Confused January 11th, 2007 at 8:37 pm #
Hi inel
Thanks for your comments. Sorry for the ‘confusion’ but there are two contributors to this blog-’bong’o'pondit and yours truly-confused.
I will let Bongo respond to your comments, But I would just like to make one point-that unlike what many Americans think, environment is not a zero-sum game and they can actually benefit by investing more in environmental protection.
inel January 12th, 2007 at 3:55 am #
You are right about the mistake people make when they think in zero-sum terms: that approach does not apply to environmental issues or educational issues. However, it appears to be the dominant mode approved, propagated, and taught these days, especially in the U.S.. It is divisive. Winners versus losers, and all that. People who think there is a right or wrong approach to anything often cannot handle uncertainty, so they jump for one solution (obviously “the right answer” in their own minds) and twist all their arguments to fit. Uncertainty is exciting, because there is always the chance for new possibilities to crop up and new ideas to take flight. So, I hope more people will cotton on to the fact that we can tackle climate change immediately, with what is known so far, without waiting for all the details to be known and all the suffering to have been proven.
BongoP'o'ndit January 12th, 2007 at 2:52 pm #
Inel:
thanks for the comments and I agree by and large. I think you make a good point that the US has been spending a lot of energy on arguing the existence of global warming and the relative blame rather than actually taking action.
IMO, being environmentally cleaner and economically productive can and should go hand in hand (irrespective of whether global warming is true or not).
There are possibilities of myriad innovative technological by-products while addressing environmental issues.
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