The Lessons of Kyoto

Before September 11, the Bush administration was often criticized for going it alone in foreign relations, notably in its decisions to abrogate the Anti-Ballistic Missile (ABM) Treaty and to reject the 1997 Kyoto Protocol on global warming. Since September 11, while the United States has built a broad coalition against terrorism and is talking seriously to Russia about the ABM treaty, it is still quite alone in its stance on climate.

Indeed, U.S. business also seems to be isolated on this issue. Before Kyoto, the U.S. Senate, in response to lobbying by both business and labor, had voted 95 to 0 to oppose any climate change treaty that lacked meaningful participation by developing nations. Nevertheless, the Clinton administration then signed on to a Kyoto deal that committed industrialized nations to cut greenhouse gas emissions and involved essentially no participation by developing countries.Kyoto required the United States to reduce emissions of carbon dioxide (CO₂) by about 30% relative to business as usual by 2010, implying deeper cuts in the consumption of fossil fuels, the main relevant source of CO₂ emissions, than most other industrialized countries were required to make.

Not surprisingly, the protocol draft was opposed by many U.S. interests concerned about economic costs and unfair international competition, and it had no chance of Senate ratification. When the new Bush administration rejected the Kyoto Protocol, I — and many other observers — felt it was simply burying a long-dead corpse.

But we were wrong. Negotiations continued after the U.S. rejection, and a final deal was struck that is likely to be implemented by many industrialized nations. Although there is some opposition from business and labor in the European Union and Japan to the higher fuel costs and/or tighter regulation required to reduce CO₂ emissions, there are few public displays of that opposition. That is, in part, because business participation in the political process is generally less visible abroad than it is in the United States. But it is also because foreign business leaders seem generally more reconciled than their U.S. counterparts to the inevitability of ever stricter environmental controls, and more confident that their governments will not impose economically damaging climate change policies.

But the Kyoto Protocol really got its second life when the remaining negotiators adopted some creative accounting that weakened the protocol substantially.