Chump Change to Halt Climate Change
WASHINGTON - Pennies a day. That's all it would cost the United States to significantly reduce the emission of gases that contribute to global warming. What's more, the cost to businesses, families, and overall economic growth would be minimal, according to a new study released this week.
"We can afford an ambitious climate policy for just pennies on the dollar. It's a small investment that will pay off in cleaner air, new jobs, and a safer world," said Dr. Nathaniel Keohane, director of economic policy and analysis at Environmental Defense Fund (EDF), and a former associate professor of economics at the Yale School of Management.
"Not acting now just means paying a heavier price later as we try to manage the consequences of unchecked climate change," Keohane added.
The report, "What Will It Cost to Protect Ourselves from Global Warming?" counters the argument that addressing environmental concerns is "too expensive," a perspective put forward by the Bush administration that has led the United States to drag its heels at global environment meetings aimed at halting climate change.
The EDF report argues that adoption of a national cap-and-trade system, along with the removal of barriers and subsidies that stifle technological innovations, could drive U.S. emissions down by as much as 60 percent below current levels by 2050.
A policy based on Keohane's study would call for national caps, or limits, on the amount of greenhouse gases that could be produced in a given economic sector. Firms that produced less could "trade" them to others, and receive payment. Those that exceed the limit would be fined.
The idea is to put a dollar value on pollution. According to the EDF report, the argument that tackling climate change would be too expensive to the U.S. economy fails to factor in the society-wide cost of pollution. A cap-and-trade system, by placing firm limits on emissions, imposing penalties for noncompliance, and rewarding success, creates incentives for pollution reduction.
Among the specific findings of the report -- based on economic models and projections by several respected institutions -- was that implementing change would have little impact on overall economic growth. For example, with no change, U.S. GDP is projected to reach $26 trillion in January 2030; with a cap-and-trade system, the target would be reached in April of the same year. While some energy sector jobs would be lost, others would open up as a result of technological change.
For individual households, the study forecasts "modest" increases largely in line with those already being experienced -- a few dollars a month. It also points out that families already pay for health and home insurance, two areas likely to be affected negatively by ongoing pollution and global warming.
"It's important to keep in mind that these forecasting models compare climate policy to a business-as-usual case that doesn't take the costs of climate change into account," said Keohane. "If we fail to take action on global warming, the future will be anything but 'business as usual.' The most expensive policy by far is to do nothing at all."
The U.S. Youth Network for Sustainable Development also stressed the perils of inaction in a statement issued last Friday critiquing the "unambitious goals" of the latest Bush administration climate proposal. SustainUS agreed that: "environmental sustainability and economic growth need not be mutually exclusive," and that a green economy will create, rather than destroy, jobs.
© 2008 One World