Goodbye Donald

A post to commemorate the belated passing of Donald Rumsfeld. Bush showed himself to be a man with immense balls by keeping him for such a long time when it was plain for all to see that his post-conflict strategy in Iraq was, for want of a better word, rubbish. It's not surprising that Bush was so stubborn about Rumsfeld though - supposedly one of the reasons that he has been so popular (at times) is his confidence in his own decisions. However this was a time when that confidence clearly betrayed him.

I guess now's the time when we find out what plans, if any, the Democrats have had up their sleeves these past twelve years. Maybe we'll see something getting done about climate change?

With regard to a post of a couple months ago - "Rampant Cross-dressing" - note this observation: "The Times believes the Democrats won votes by moving into the centre ground. Among these so-called "Blue Dog" Democrats is Jon Tester, the Montana Senate candidate, who is "is an anti-abortion, pro-gun, three-generation farmer with a buzz cut, three missing fingers on his left hand and no big fan of Hillary Clinton"." It could be a sign of the political discourse having been hegemonised by the right, to the extent that the only way to get elected is to talk like you're one of them (in much the same way as David Cameron is trying to change the image of the Conservative party over here). But I guess this was a local phenomenon in Montana, rather than a national one.

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Stern review joy?

The last post’s comments touched on economics and the environment. Here we are told how the Stern review begins to seriously question economic short-termism by showing how we can invest now to save later.
Is this basic economic principle (its quite similar to R&D expenses) cause for optimism?
I remind you I am fresh out of An Inconvenient Truth and suggest you all see the film.

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Stern review offers counsel of hope
Published: October 31 2006 02:00 | Last updated: October 31 2006 02:00

The science on global warming is now incontrovertible: the climate is changing, man is helping to make that happen, and the damage could be irreversible. But the contest over the economics of what to do about this is open, or at least was until the UK government published its big study chaired by Sir Nicholas Stern. This report rebuts any fatalistic notion that the world would do better to spend its economic resources just adapting to inevitable climate change, a counsel of despair. Instead, the Stern review suggests that the economic benefits of early action to curb greenhouse gases would far outweigh the costs - by eventually as much as $2.5 trillion a year.
So for the first time we have, spelt out in copious detail over some 600 pages, an economic rationale for action on climate change. It bills itself somewhat optimistically as "a pro-growth strategy", when in fact it is more a strategy to protect growth from the catastrophic fall it could eventually suffer from higher temperatures around the world. But the report will serve a valuable purpose if it can convince the US, China and India - the three big economies that lie outside the Kyoto protocol on climate change - that growth is compatible with international action to cut carbon emissions. It is by its effect on these three countries particularly that the Stern review must finally be judged.
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Key to the Stern review is a relatively pessimistic assumption of eventual climate change damage on unchanged policies, and a relatively optimistic view of what early investment to mitigate climate chance can achieve. On the former, it is gloomier than most previous studies because it differs from them in assuming the possibility of a higher temperature rise (based on more recent data); in incorporating harder-to-measure impacts such as declining human health; and in adding in negative feedback such as melting ice caps releasing methane. As a result, it suggests that the eventual reduction in world gross domestic product could be anywhere from five to 20 per cent a year. However, this is just an estimate of the present value of possible climate damage far into the future, and is an average that could conceal a far greater impact on certain countries, particularly poorer, developing ones.
On the issue of mitigation costs, the review comes up with a relatively modest figure of one per cent of world GDP that would, it believes, stabilise carbon dioxide emissions at 550 parts per million. The relative caution in this estimate lies, in part, in assumptions that much can be done with relatively little economic pain: for instance, improving energy efficiency, halting deforestation and "decarbonising" the power sector.
One per cent of GDP is not a heavy price for the world to pay, just the equivalent of a one per cent rise in its price level. But stabilising emissions at 550ppm - twice the level of the pre-industrial world - might not be enough to ward off serious damage. So the Stern review admits that mitigation costs could rise as 3.5 per cent of GDP.
Crucially, keeping mitigation costs as low as one per cent of GDP depends on the world agreeing to cut emissions far quicker and faster than at present. And here is the rub. For amid all the uncertainty about climate change one thing we know is it will take a very uneven toll on the nations of the world, and that the poorer developing countries will suffer most. One reason why the US, or at least the Bush administration, remains infuriatingly relaxed about climate change is that the US mainland is likely to remain relatively untouched by rising sea levels.
For their part, the big developing countries may concede the problem, but they have immediate priorities of poverty to deal with. Moreover, they can argue that it is the industrialised countries that got the world into this mess, and must get it out of that mess. Indeed. But while the industrialised world must set a lead, in the end developing counties must accept the need to follow. For as Tony Blair, the prime minister, points out, if Britain were to cease all its emissions overnight, the beneficial effect for the planet would be wiped out just by the growth in China's emissions in two years.
How can more countries be persuaded to join in fighting climate change?
First, they must accept a responsibility to act, but be allowed to choose their actions from a mix of taxes or the trading of permits. The latter has been pioneered by the European Union, but its current emissions trading scheme is in disarray. It needs to be fixed, and extended to other countries. Second, urgent negotiations are needed to prolong the Kyoto protocol beyond 2012; investors require the certainty of a longer term framework if they are to sink their money in low-carbon capital equipment that may last decades. Third, the Kyoto signatories need to secure firm commitments from big polluters outside that protocol.
Kyoto took five years to negotiate. But the world, and its atmosphere, cannot afford to wait that long again. The Stern review is not only a counsel of hope, it is a necessary call for action.
Copyright The Financial Times Limited 2006

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