GLOBAL WARMING: COOL HEADS REQUIRED
Acultural divide makes clearheaded discussion about global warming difficult. Most executives and economists are optimistic about the future and believe in the concept of progress, while most environmentalists are pessimistic about the future and want to restore the past. The first group views growth as the solution to problems afflicting society, while the second sees growth as a problem in itself. The split in the Clinton Administration over global-warming policy is symptomatic of this long-running debate.
But there is a middle ground. The temperature of the Earth has risen one-half to one degree F in the past century (much of it before 1960), and computer climate models predict the warming will continue. What we don't know is how much rising greenhouse gas emissions, especially carbon dioxide from the burning of fossil fuels, contribute to the trend. And we have little idea how much it will cost in terms of economic growth to cut the emission of carbon dioxide into the atmosphere. Here, cost-benefit computer modeling is still in the garbage-in, garbage-out stage.
To suggest that the U.S. now take radical steps to curb greenhouse gases, such as imposing heavy taxes on carbon dioxide emission, would be to make policy in a void of information. Germany and Britain are demanding sharp 15% cuts in emissions by 2010 from 1990 levels for industrial countries at the upcoming Kyoto Conference on global warming. They can meet those goals simply by shutting obsolete coal mines and switching to more efficient gas and oil. The U.S., less dependent on dirty coal, has no such easy out. It would have to go much further to meet the target and hurt economic growth just at a time when the benefits of the current expansion are starting to felt by the poor and much of the middle class.
Improving energy efficiency, a smart alternative to cutting energy use, would not hurt growth. The efficiency of electric power generators is in the range of 30%. With co-generation technology, it jumps to 50%. Most appliances, from TVs to microwaves, drain power when they're not on. A deep-sleep mode could cut this usage in half. Then there are auto engines. A large percentage of all U.S. greenhouse emissions stem from burning gasoline in cars and trucks. Detroit has only reluctantly improved engine efficiency to boost mileage. In the past, it has taken the whip of government to get the Big Three to act on both fuel efficiency and safety. Detroit is setting itself up once again for government action. It should take the lead in doubling fuel efficiency over the next decade, which would go a long way toward curbing U.S. carbon dioxide emissions. This is especially true for big sport-utility vehicles, which get the worst mileage on the road. Owners of Ford Expeditions and Chevy Suburbans would be only too happy to gas up once instead of twice a week.
It would be a mistake to confuse concern with calamity. But the environmentalists do have a point. The U.S. has not fully played to its strengths--technology and markets--in protecting the environment. Devising more efficient engines, appliances, and power generators would be major steps toward curbing global warming. Corporate America should take the lead. Extending the successful U.S. experiment in reducing acid rain--creating a market for trading permits for sulfur dioxide pollution--to carbon dioxide pollution is also worth a try. Here, Washington should provide incentives.
As the U.S. moves rapidly toward an information economy, it should become easier for the economy to tread more lightly on the land. There is growing common ground between those who think growth is the greater good and those who prefer the pristine beauty of nature.