July 18, 2009  For 12 years the plan has been to get China and India to agree to caps. They've said no to capping their citizens far below ours. We emit 18 tons per person and India emits 1.1. Finally the U.S. is catching on -- no caps.

So then what? This leaves half the world's emissions uncapped and growing 7 times faster than the rich half that Kyoto might cap -- except last time Congress voted 95 to 0 not to cap unless China did. Kyoto is at a dead end.

Be flexible. There's an alternative: A carbon tax. Our carbon cap will cost us about $20 per ton carbon, so why not let China and India sign on to a carbon tax of $20 per ton? That way they have no cap. Their economy can double and no cap will stop it. That's what they want. For them the tax is far less risky and far less insulting. They will be our equal and not be capped back to where we were in the 1800s.

There's a Plan. You can read about it here (wonkish): Reinventing Kyoto. Or you can read a much simpler version in Carbonomics, Part 4.

Why Copenhagen Will Fail. Unfortunately, the environmentalists who pushed for cap and trade, don't understand why it works. They think the "cap" forces change directly, but as every economist knows (and cap-trade was designed by economists) the cap just puts a price on carbon. It's the price that works. A carbon tax is an easier way to put the same price on carbon.

But since almost all environmentalists are old fashioned regulators that only want "command and control," when they don't get their cap, they will shift to other, very messy, forms of command and control. These cannot work as a massive global program like caps or taxes can. So we will just get a weak patchwork of subsidies, goals, targets, and mandates. As has happened with energy policy for 35 years, there will be a lot of money spend for few results. Pretty soon people will get disgusted and scrap it all.

July 9, 2009  At the Major Economies Forum (MEF) in Italy, the top 17 polluting nations decided they cannot even set an "aspirational goal" for the world for 2050. This reflects the more serious problem that China and India will not accept any cap on their own emissions until at least 2020.

The G8 summit, one day before the MEF, declared "We recognise the scientific view that the increase in global average temperature ought not to exceed 2°C." It's hard to imagine how they could have said anything weaker. (AFP)

A day later the MEF Leaders vowed "to identify a global goal for substantially reducing global emissions" by 2050. Well there you go; it is possible to say even less.

But, as I explain in Carbonomics, effective caps ask developing countries to cap their per-capita emissions at 5 or 10 times less than our own. That's insulting. So it's time to re-think caps. The world should have a target for 2020 and for 2050, but developing countries should be asked to commit to a carbon tax not a cap. This asks them for equal effort relative to their emissions level. Since they emit 10 times less, the same tax would charge them 10 times less.

On Feb. 12-13, the Seventh Informal Meeting on Further Actions against Climate Change was held in Tokyo, Japan. The United States, China, India, Australia and major European Union countries, participated -- 22 all together. Developing nations called for developed nations to cut their emissions 25-40% by 2020. Developed nations pushed for developing countries, which have no emission reduction obligations under the Kyoto Protocol, to cut their emissions 15--30% below BAU by 2020. Both sides we refused.

Japan Submits New Proposal for Post-Kyoto Treaty. Japan delivered to the United Nations Framework Convention on Climate Change a new proposal for addressing climate change after the expiration of the Kyoto Protocol in 2012. The Japanese proposal reiterated the nation's support for a sectoral approach to capping GHG emissions, urged the creation of a "knowledge network" intended to facilitate information sharing between nations, and supported an increased focus on mitigation and adaptation measures.