 Climate change is the greatest ecological crisis of all times. It's the greatest ecological crisis humanity has ever faced. And what the scientists are telling us with a remarkably united voice is that this problem is very, very serious that we have already put so much greenhouse gas, extra greenhouse gas up into the upper atmosphere that we have pretty much already guaranteed ourselves a degree of mild climate change. And what they are telling us with an increasingly loud and desperate voice is that as we continue to do this, we are running a truly unacceptable risk of cataclysmic types of climate change that really nobody even wants to think about what that might look like. Now ordinarily, what does a species do unless they plan to imitate the lemmings? Ordinarily, when you are essentially about to commit ecocide, then the sensible response is to sort of take the issue seriously and to come to grips with what are we going to have to do to do about this. So that's the second piece of reality I think that it's important for us to understand. The first piece of reality is climate change is real. Every single time the scientists look at the new data and evaluate the new data about how rapidly the change is proceeding, every single time the update is, remember what we told you last time? It's even worse. And the other thing to remember about what we take to be the consensus from the scientific community, we're taking this information from a very, very large network of scientists and they only tell us what they can get consensus on. So think about what that means. That means that the scientists that are giving us this information are saying this much we can be sure about. Most of them are thinking it's worse than they're telling us. And then every time they tell us and they update us, they tell us we underestimated just how rapidly this process is going. So that's the first thing. The second thing is absolutely nothing's being done about it. Amazing. Are carbon emissions and greenhouse gas emissions falling anyplace on the planet? No. You go back to 1992. All the countries of the world came together in Rio de Janeiro at the famous Earth Summit. Some important things were accomplished. Climate change is going to be a real problem. It's being caused by human economic activity, release of greenhouse gases. It's a problem that no country can solve all by itself. It's going to require some form of international cooperation because all countries are going to have to participate in solving this problem. The other really important thing that was decided at Rio de Janeiro was, well, it's important to recognize that when countries participate in solving this problem that you can't expect them all to participate completely equally because countries have different responsibilities or degrees of responsibility for having created the problem and countries have different capacities for just having the wherewithal and the wealth to actually go about solving the problem. And that was the language that actually goes all the way back to the Earth Summit in Rio de Janeiro in 1992. There was a recognition there and an acceptance on the part of all the attendees at that conference that a solution had to take seriously that countries had different responsibilities for having gone ahead and caused the problem and had different capacities for being able to contribute to a solution. You could roughly say, you know, you could roughly say there was a consensus there that we have to solve this problem fairly. So if you want to summarize a lot of complicated sort of resolutions and everything else that came down to this, the problem series is going to have to be solved by cooperation amongst countries that can't be solved individually and we really, we need to solve it in a fair way that's reasonably fair. The one thing that they did not decide in Rio in 1992, they could not come up with an agreement on mandatory emissions reductions for particular countries. That was a bullet that was too hard to bite in 1992. And so instead what delegations did was they each sort of said, we will volunteer to reduce our emissions by so much. Everybody sort of volunteered, how much am I going to contribute to solving the problem and various countries made announcements there either in Rio or soon after. Well, five years later the meetings were in Kyoto and when the world, when the countries regathered in Kyoto in 1997, there was an overwhelming fact that was staring them in the face. Not a single country had reduced greenhouse gas emissions. Much less had a single country come close to reducing emissions to the degree that they had said voluntarily we are going to try and do such and such. And in Kyoto, the world succeeded in biting the hard bullet, the hardest bullet of all, which is to recognize if we don't agree, if we don't have mutual agreement to mandatory reductions, we are not going to solve this problem. Now, economic theory basically suggests that there's every reason to expect this to be the case. You could simply say we don't need, sometimes we don't need economic theory. Somehow the facts and history sometimes teach you such an obvious lesson, you don't need to do a lot of theorizing, you just take the lesson from history. Well, you could say what we learned in the five years between Rio and Kyoto was that when we just voluntarily pledged to reduce emissions country by country, it doesn't happen, so we better try something else. Well, economic theory basically bolsters that conclusion. It says it's not an accident that it didn't happen. And perhaps at this juncture it's really important to sort of explain why it is that economic theory says it's no accident that if you try and solve the problem that way you won't get it solved because we are back in that situation again. Ever since Copenhagen there is no international treaty with mandatory reductions for anybody. That process was abandoned in Copenhagen and since Copenhagen the situation is that countries are back to maybe we will have conversations and discussions but basically we are back in the world of countries perhaps hopefully will be making voluntary attempts to reduce carbon emissions. Well, it didn't work before and it isn't going to work now. And what economic theory tells us is that there's every reason to expect that. I think I remember the numbers, I might have to look at a page here. It's basically the free rider problem. And this is a problem that we teach in economic theory courses. And the free rider problem says that if when I do something I'm not the only one that benefits a whole bunch of other people benefit too. Then I'm going to hesitate to do that if it's also the case that if you did the same thing you wouldn't be the only one to benefit, I would benefit likewise. So the name comes from this, there's a sort of perverse incentive for neither person or party to go ahead and do what is clearly sort of desirable because there's an incentive for each party to hesitate and wait and let the other person do it and then free ride on what they did because I'm going to benefit from that too. Now in this context I can sort of block out the sort of the rough figures here. China is the most populous country on the earth. When anybody reduces greenhouse, when greenhouse gas emissions are reduced any place on the earth roughly speaking every person on the earth benefits equally. That would be exactly true if the negative consequences of climate change were really going to be visited exactly equally on every country. And that's not true but that's a different issue. So for these purposes just assume for the moment that when greenhouse gas emissions are reduced no matter where they're reduced there'll be less climate change and then we all more or less benefit equally from having less climate change. Well China is the most populous country on earth. They have roughly 20% of the world's population. When China reduces greenhouse gas emissions, suppose they do it voluntarily China is going to do something, they're going to reduce greenhouse gas emissions well they pay 100% of the costs for those reductions. Whatever it costs to reduce their emissions they pay 100% of the costs but they only get 20% of the benefits. When the United States reduces, we don't have as many people as China when the United States reduces greenhouse gas emissions we pay for 100% of the cost of that and the United States gets less than 5% of the overall benefits that come from that. When the United Kingdom reduces emissions they get roughly 1% of the benefit but they have to pay for 100% Grenada, what percentage of the benefits does Grenada get if Grenada reduces carbon emissions? 0.0016%. There's no incentive for them to do that except if they are just going to do everybody a big favor. Well there's the problem. How does mutually mandatory reductions change the self-calculating logic that countries predictably engage in? Well the Kyoto treaty said that England would reduce emissions by 5.5% and basically they would bear 100% of the cost but look what they got in exchange they didn't just get the benefits of their own reduction of 5.5% in emissions they got the benefits of a 5.5% reduction in emissions from every other advanced economy in the world that's what you get if you have mutually agreed to reductions you get the benefit of all those other countries reductions along with the benefits of your own it's a total game changer it's the only way we're going to solve this problem so the first thing that has to happen is and oh so in Kyoto they basically said nobody's reducing without mutually agreed to mandatory reductions we're going to do it but they also took seriously and I believe we should take seriously and I think we can take seriously the idea that this should be done fairly and the way they took that into account in Kyoto was they said look the advanced economies are responsible for 80% of the excessive emissions that are up there the underdeveloped countries are really only responsible for at most 20% of what's put in there so the advanced economies really have 80% of the responsibility at this point for having created the problem and if you take a look at sort of comparative wealth and resources roughly the same thing is true that the advanced economies have 80% of the sort of resources that we could reasonably say they should be made available to solve a serious problem so in Kyoto they basically did a rough cut they said at least temporarily here in 1997 let's agree that all the advanced economies will commit to mandatory reductions not exactly the same for each country that had to be sort of argued and discussed but pretty much 5.5% and we will temporarily exclude the developing economies from committing to mandatory reductions we'll ask them to please try and reduce but we'll leave them in the voluntary status and that was the way in Kyoto that they decided to try and that was how they tried that was how they decided to implement the notion of fairness and equity but in Kyoto it was very very clear that this exclusion for this sort of this exclusion for mandatory reductions for the less developed countries that this was temporary and that in some post-Kyoto treaty then perhaps they would also have to participate in this stronger form that's what happened in Kyoto and very soon after Kyoto the US government said we're unwilling to participate soon as Bush was elected in 2000 he said we're withdrawing from the Kyoto process we don't believe in this I don't even believe in climate change that's my official position of my party this is all nonsense we're not going to be part of it and actually most people thought well with the wealthiest with the wealthiest country that's the largest polluter out of the process the whole process is going to really fall apart and largely thanks to the European countries and largely thanks to the Scandinavian delegations that participated in the in the European Union sort of thinking and thinking and strategizing about this Kyoto didn't fall apart because the Kyoto treaty said look this whole thing will go into effect when enough of the advanced economy signed it and a lot of thinking was well they're not going to get enough signatures there's never going to be a Kyoto treaty but they did get enough signatures which was rather surprising here the world is going to engage in mandatory reductions they're really biting the bullet they're doing the serious thing and the country that's wealthiest and most responsible is saying we're just going to free ride but it happened and then countries came together in Copenhagen and some of the countries that came together said look we have discovered there's some problems in the Kyoto treaty between 97 and 209 and these are some serious problems and we really need to we need to fix them some of the countries the European delegations for the most part the UK the UK was awful but the European delegations said we've identified problems in Kyoto we are here and ready to fix them in a post Kyoto treaty that retains the incredibly good things that were in that treaty in the first place the essential good things were we got to have mutually agreed to mandatory reductions and we got to figure out a way to do this fairly so we want to retain that and fix the problems and I'm going to spend some time here in a minute talking about the problems and how they can very easily have been fixed there were other countries that came to Copenhagen and here a rather strange thing surprised us all my wife is an environmental economist this is actually her chief issue if any of you have ever heard of the 350 campaign which is a campaign that's very very active trying to promote awareness about climate change and sort of urging governments and people to get their governments to do something effective about it Bill McKibben is the usual spokesperson my wife is an environmental economist this is her specialty she was his chief economic advisor at Copenhagen and they went and of course they came back completely depressed and discouraged over what had happened and this is something that I think is very important for Europeans to think about in terms of thinking about how you're going to go forward when the US wasn't even participating you surprisingly successfully kept on the right track now of course you want the biggest polluter in the wealthiest country to join the world's process for solving the problem and that's what everybody thought maybe hopefully was happening when the Obama administration is newly elected and they say we're not climate denialist and verbally Obama said and we believe the United States should be playing a very active even leading role in solving this problem and I'm sending Hillary off there to Copenhagen and I'm going to fly in two days later and everybody got all excited about that but it turned out that what the US delegation Hillary and Obama said was we don't like this whole Kyoto thing we really are unwilling to accept mandatory reductions and we want to work with people who don't want to do mandatory reductions so what came out of Copenhagen was no start instead of Copenhagen launching a process that would have that would have fixed problems in Kyoto and continued to send us farther in the direction of actually seriously doing something about the greatest problem we probably face in this entry we basically went 20 years backwards in time to an international situation that is exactly where the world was prior to 1992 prior to the Earth summit we literally lost 20 years of international diplomatic progress in what happened in Copenhagen now problems with the treaty and ways to fix it and I'm going to I'll be quick and some of this is a little hard to catch but there's plenty, there'll be time to talk about it there's five things that should have been done and could easily have been done to make a post-Kyoto treaty a serious what are we trying, what do you want in your treaty you want it to be effective and effective means is global reduction in emissions has to be big enough and quick enough so that we actually no longer run an unacceptable risk of triggering cataclysmic climate change that's what effective means and effective really is it's one thing and one thing only have you got a big enough reduction in global emissions it's nice, it's nice when your goals are very very clear cut and you can think about it that way and you don't have to get all complicated about it that's what effective means we want a treaty that would distribute the burdens of accomplishing this effective prevention of cataclysmic climate fairly you want a treaty that's effective you want a treaty that's fair and here's where we economists come in you want a treaty that's efficient it turns out that there's tremendous differences in what it costs society to reduce emissions in some ways rather than other ways and there's actually very very significant differences in what it would cost society to reduce emissions in different countries so you don't want to reduce emissions where in ways that it costs the most you want to reduce emissions where and in ways that cost the least that's what efficiency is now there's an immediate conflict that arises between what would be a fair if we want to distribute the emissions reductions fairly then we would distribute most of those emission reductions predominantly in the more advanced economies and less of the emission reductions in the less developed economies but unfortunately it is usually far cheaper to reduce emissions in the poorer economies than in the advanced economies the basic reason for that is we already have cleaned up industries to some extent we already drive around in a few sort of hydro cars smaller cars where the less advanced economies are basically still using that old gas guzzling technology so it's less costly at least for a while it's going to be far less costly for them to reduce emissions then to reduce the same number of tons of emissions in advanced economies oh wow well this is just a problem that isn't possible to overcome you've got a conflict of interest and it's just too bad it worked out that way well it turns out that there's actually a way of solving that problem of reconciling how can we make sure that this problem is solved fairly and at the same time it's solved efficiently we don't spend more money globally solving this problem than is necessary now when I talk to environmental or when I talk to environmental audiences they quite reasonably have the following attitude you're an economist so that's why you care about efficiency I'm an environmentalist I don't give a damn about efficiency I care about whether this problem's fault is going to be solved effectively and if the person is not only an environmentalist if they have a bone equity in their body they say well and I also would like to see it done I would also like to see it done fairly but here's why I tell environmentalists and people who believe in fairness and I am both of those that you should care about efficiency if the reductions are done inefficiently they're going to cost a lot more and therefore the political resistance to reducing the emissions enough to solve the problem is going to be that much greater anything that reduces the costs of achieving a certain level of global emissions is essentially going to make it easier for us to accomplish the incredibly difficult political task of getting people to agree that they are willing to go ahead and do this so that's why I think even if you're not an economist and you have no particular devotion to the god of efficiency that from a very practical point of view that's an important goal okay how could we affix Kyoto to make it more effective, more fair and more efficient first thing is by the time the delegations arrived in Copenhagen it was very clear that the overall reduction in emissions 5.5% for only the advanced countries wasn't going to get the job done that wasn't nearly effective and quite frankly the European delegations showed up for the most part with the attitude we know that the overall cut has to be bigger and steeper we know it has to be we know we have to do this faster because the science keeps coming in and telling us that the problem is even more serious unfortunately so there were delegations that arrived and they were prepared to read to deeper cuts deeper overall cuts they were willing to listen to the scientists that needed to happen unfortunately the entire process blew up and that never even got discussed I call that let the scientist advise us about how much we have to lower the caps the overall global cap what's the second thing that has to be done you have to cap emissions in all countries you can't exclude the mutually agreed to mandatory part is absolutely necessary now that can appear to be problematic oh there's two reasons you want to do that one is the one that immediately becomes apparent well if we have some countries that are forced to reduce and then other countries that aren't well those countries might increase emissions and it just cancels out the ones that we said had to be reduced so the usual thinking about well why should we cap the emissions in all countries is that one that otherwise the treaty won't be effective we'll make progress here and we'll just lose it over here there's another reason that you want to cap the emissions in all countries the way you reconcile fairness and efficiency in a context where it's more costly to reduce emissions in advanced countries than it is in poor countries the way you reconcile that is you create and allow you create a carbon market and you allow carbon trading if you do that and some countries do not have their emissions capped they're going to have serious difficulties policing the carbon market but if you cap emissions in all countries it turns out that you really don't have to worry about something that will inevitably happen if you allow carbon trading there will be cheating there will be what I call bogus carbon trading and I'll spell out sort of exactly what it would be so we can talk about it a bogus carbon trade would be a factory in Canada that says we're reducing our emissions but really isn't but somehow somebody says you did and they get more credit for reducing emissions than they really did then they sell that credit to some factory in Japan and factory in Japan doesn't have to reduce its emissions because they bought these credits from Canada oh but if it's a bogus trade there really wasn't any reduction in Canada and now we don't get the reduction we were supposed to get in Japan this is a serious problem now it would look like it's a serious problem no matter whenever it happens and it's actually very difficult it turns out that it's very difficult process to figure out just how much credit should be given to anybody that says I'm reducing my emissions so that they could sell those credits in the market and it's a difficult problem because you have to compare something that actually happened to something that never did happen you have to compare a hypothetical outcome to an actual outcome these people say okay we reduced our emissions but what would have happened if that project hadn't happened so there's something that the economists in the field they call it the baseline problem and it makes this a difficult process figuring out exactly how much credits should we give this company for this project saying that they've reduced emissions by this amount because they're going to take that credit and they're going to go ahead and sell it to somebody and as soon as that person that buys has it they don't have to reduce emissions by the amount of the credits that the piece of paper says it turns out that if you cap national emissions in all countries even if bogus even if bogus credits get sold in the carbon market it does not reduce the overall reduction in global emissions this is a complicated issue it is almost universally misunderstood by many of my political allies in the so called climate justice movement who have been screaming and yelling about how terrible the carbon market is and the whole Kyoto process and the clean development mechanism is but there's an easy way to fix the problem if sources selling emissions operating countries that have a national cap and if the treaty forces countries with national caps to actually reach that national reduction then any time a company in Canada sells a bogus emission to somebody outside the treaty is going to force somebody else in Canada to actually plug the hole by reducing their emissions and this has to do this ultimately goes back to what it's easy to measure and what it's not easy to measure and there's some surprises in there what's easy to measure is national emissions you would think that God has to be hard that's a huge big thing you're measuring what were the carbon emissions from a particular country in a particular year it turns out that is relatively easy it's so easy that it's almost non-controversial so there really wouldn't end up being a lot of arguments if the treaty ended up saying to a country you were supposed to reduce by such and such but you actually didn't do it because we can measure what you've done the country would have a very very difficult time making a credible case that oh we really did do it because it's actually rather easy to measure national emissions from data that's already readily available and what the Chinese delegation of Copenhagen didn't understand we're not talking about on-site inspections to see whether you're doing some sort of nuclear reactor they got all in a huff in Copenhagen saying we're not going to agree to anything where somebody might have to come in and inspect we don't even have to do it so it's relatively easy to see when a country has met its mandatory reductions and the way that the treaty organization is going to decide if the country has met its treaty obligations is they're going to say what are your actual emissions how much were you how much were you allowed to emit did you did anybody in your country sell credits to somebody outside because if you sold credits to outside then you've got to actually have come down as a country by that much more than you actually did what about if people inside your country bought credits from another country what that means is we measure your national emissions we compare it to what was required but if you bought credits then you didn't have to come quite down that much so that's how it would actually work that's how it sort of did work in the Kyoto process to the extent that any of this was going on during a time period so the second thing we have to do to sort of fix really a kind of a technical problem in Kyoto is we have to cap the national emissions in every country and we have to basically understand what the treaty organization needs to do is just get about the business of measuring national emissions and checking to see whether or not countries made their target and then actually get about the really serious business of deciding and what are the penalties going to be if the country doesn't something that was very under debated and under discussed and under it was like that was the real sort of elephant in the room that nobody wanted to talk about between 97 and 2009 and that's a serious problem and that doesn't go away now what's the problem with capping national emissions in every country it's completely unfair to the Republic of the Congo I take the Republic of the Congo as one of the more desperately underdeveloped countries in the world they bear practically no responsibility for carbon emissions as a matter of fact they're for a sequester a ton of carbon, tons of carbon and they are dirt poor trying not to diabetes you're really going to burden them with a cap that says you've got to reduce your carbon emissions that would reduce your already slim possibility of achieving economic development for your citizens from slim to minus minus number well there's the problem it's grossly unfair ha capping national emissions for every country doesn't mean the same cap and this is where the single most important document that you can read if you're trying to sort of think through climate change and climate change policy comes up and neither my wife or I are responsible for it we are truly we believe somebody else has done the best work out there on this subject it's called the green house development rights framework the people that put together the green house development rights framework said this is not rocket science differential responsibility differential capability the problem with Kyoto was we just did a dichotomous split we said here a whole bunch one whole group of countries have responsibility and capability the other whole group of countries is treated as if they had none it's really sort of a continuous variable and we can calculate it all we need to know is GDP per capita all we need to know is cumulative emissions per capita that's data that's sitting there in their wonderful pamphlet it's data it's available it gets updated all the time you can get their pamphlet version of the green house development rights framework I'm trying to remember the title of it anyway it's referenced in something I think you're going to get sent anyway but these the better thing to do is to go to their website online because they keep updating exactly what the differential response so they calculate an index they call it a responsibility a responsibility capability index and it essentially says we can sort of calculate in a way what is the what would be fair to require each country to do in terms of how much they have to bring their emissions down well you can allow the Republic of the Congo to increase its emissions for 20 years as long as it's capped so you don't even have to require some countries to cut back on their emissions which would probably make it almost impossible for them to develop at this point you can allow them to increase emissions as long as the increase is capped you can say you have permission to emit more carbon this year in the Republic of the Congo 10% more than you did last year you can actually use the you can allow that now doesn't that mean that some developed country is going to have to reduce even more yes of course it does so that's the third thing let the scientists tell us how much that global cap is going to come down cap emissions in every country so that there's no leakage and you can allow carbon trading that maybe somebody sold a bogus carbon credit to somebody else and my climate justice friends they're right about one thing the carbon market is not like other markets in the apple market if somebody sold an rotten apple to you and you bought it you'd object you'd refuse delivery you'd say this is no good it's rotten but somebody if I buy a certified emissions reduction credit from somebody else suppose it's totally bogus they didn't reduce anything is there any incentive for me to say well this is a rotten certificate no all I care about is the certificate is a piece of paper that allows me to reduce my emissions I just turn it in my government was going to tell me I had to bring my emissions down by some amount I can use this piece of paper instead so I had no incentive as the buyer to care whether or not this apple was rotten when I handed it to my government in my example it was going to be the Japanese company that bought it from the cheating Canadian company when I handed it to my government are they going to question me about whether or not there was really a reduction in China in Canada they had no incentive to because they're just going to take that and hand it over to the treaty organization and say see somebody inside Japan bought one of these things that means Japan doesn't have to reduce as much as a country and the treaty organization is going to take it and just say yep it's certified so it is true that you have to be you can't assume that the buyer is going to enforce the integrity of the market exchange in carbon markets so it's very very important to do two things make sure that even when the cheating goes on that it doesn't reduce it doesn't puncture holes in our essential goal here which is to bring down global emissions by a certain amount and that will we will protect ourselves against this if the country from which the bogus credit was sold if it has a cap because somebody else in that country then is going to have to make up for that difference and that's where the unfairness comes in and it's where the climate justice movement will still play a very important role there's going to be a lot of cheating and the cheating is unfair this is not a victimless crime but the crime when you cap the national emissions in every country when you have cheating in the carbon market is not the environment and our goal of protecting the environment and preventing climate change that's not who's cheated it's somebody else in the country inside the country where the bogus credit was sold out of so is there plenty of work for the climate justice movement to do to police the carbon market to prevent some people inside countries from being cheated by others in their countries selling these credits yes there is okay I'll be quick on this one actually early in the game way back in in Rio people realized it's not emissions that matter it's net emissions whoops what's that mean the real problem is adding to the accumulation of greenhouse gases in the atmosphere that's what the problem is all about but every year two things happen we emit greenhouse gases and we mostly nature sequesters greenhouse gases so think of it as we send more gas up but we also take more greenhouse gases out of the atmosphere through sequestration does it really matter to us whether we reduce emissions by one ton or we increase sequestration by one ton really not and as a matter of fact we want to do is both we want to reduce our emissions and we want to increase our sequestration and presumably we want to do which is ever cheapest wherever we can so what we ought to actually do is perhaps on countries net emissions not their emissions if we don't do that we run into a serious problem and it became very apparent between 97 and 2009 it has to do with deforestation forest sequester carbon you got a lot of forests here now unfortunately they are pine needles and unfortunately the weather is cold a lot and unfortunately it doesn't rain a lot so you don't sequester as much as they do in the Amazon but Finland ought to get credit and paid for this so you ought to start demanding it because it's an incredible benefit provided to the rest of the world in terms of you know preventing climate change so the problem is it turns out that there is more net emissions from deforestation globally than from the entire world's transportation system I remember when I first saw that I didn't believe it when I checked it I still didn't believe it it's a real eye-opener so anybody that thinks well we don't want deforestation but it's a problem that's not immense think about the entire world's transportation system that includes all of the automobile emissions deforestation is causing more of the increase in net emissions every year than the entire world's transportation industry and here's the problem you do not want to encourage the following process forest gets burned down for planting agriculture we deforest and then we come in and we go ahead and we plant trees and get carbon credits for it failing to conserve existing forests and replacing them with new forests is actually going to take us backwards it's going to be counterproductive in terms of the effect on emissions well you don't want to set up incentives you basically have created programs and incentives for people's behavior so that that's something that turns out to be a really good idea the simplest way to take care of it is simply to make sure that what you cap and insist on reducing is net emissions from countries and here again there's an incredible measurement surprise when I started first working in this field 15-20 years ago I went to people that were already doing this in the U.S. over at the EPA actually and I said you know I understand I know the science logic that sequestration is important just like emissions are but I suppose it would be really really impossible to figure out how much sequestration is going on in different countries I know it's not that easy to figure out how much emissions are going on but I bet it's impossible to figure out just how much carbon is being sequestered in different countries and they said au contraire you wouldn't believe it but you know those satellites we've got up there that are floating around the ones that allow you to go to Google Earth and look in the window of somebody's apartment in Karachi we know what's going on on every little square foot of the planet all the time and the botanists have mapped the flora and the meteorologists tell us what was the temperature and humidity on every day every place it's actually the easiest thing to calculate the easiest and least controversial thing that you would have to calculate to set up a good treaty enforce a good treaty actually solve climate change is we can easily figure out how much carbon sequestration is going on in every country every year so we could cap net emissions and we could measure that and we could then enforce those sort of mutually agreed to mandatory reductions equitable caps yes if you do that if you cap emissions in all countries if you cap them fairly using some sort of formula like the greenhouse development rights framework if you do that you can allow full carbon trading which probably in this world today in the emergency situation we face in despite all the ugly things I told you about markets in that article that some of you read is probably a necessary component to solving the most drastic problem that humanity faces in a situation where we're not going to be rid of a global market system within the next two years at least the carbon markets and allowing full carbon trading allows the full efficiency benefits of the trades you don't have to police the market to worry that bogus trading is going to destroy the effectiveness of the treaty you can leave the policing basically to national governments and you can rid the climate treaty of that very very difficult job of deciding how many credits to award to people who want to come in and say I'm going to do this and I should get credit for this so I can sell it in the carbon market that's a tough process mistakes will be made Kyoto created a situation where the Kyoto Protocol had to establish a whole international bureaucracy to administer the clean development mechanism the clean development mechanism was companies were coming with projects in countries that had no caps saying we're actually reducing emissions and we want to sell this to some company that's going to have to reduce emissions in a country that has a cap and we needed to basically put together a team of people at the United Nations clean development mechanism that was deciding is this a legitimate reduction and how many credits do you need it's tough mistakes are made tremendous amount of arguing and quibbling over this and the environmental organizations were all over the clean development mechanism you're making mistakes you're granting more credits than they really deserve and of course the businesses are saying well you're being really slow in the process that the line is so long that I have to wait three years before I'm evaluated and then governments would come in and complain all our companies are sort of waiting in line this is hurry up you got to do this faster so it's a very messy process that makes absolutely everybody furious and angry with one another and it really and it became a major obstacle to the climate treaty essentially functioning effectively in a way that was making people confident and happy that this is really going forward well look if you do these other four things I said none of which are rocket science all of which people who went to Copenhagen and environmental organizations and people like my wife understood that these things would be improvements and these things are something that we should be able to agree to if we did all those things you could leave the task of awarding credits to national governments because it's basically the national governments that have something at stake if they award a credit that's bogus so they give some company more credit to sell in the carbon market than is legitimate somebody else inside their country is going to basically pay the price so essentially the you want to make the policemen the one that has the incentive to do the best job in a situation where doing the best job is going to be very difficult and you want to relieve the international organization from the most difficult and troublesome job so basically you don't have to have the international treaty organization standing in judgment about these credits what if you have a country government that says well we just don't want to give any credits to be sold because any credits that are sold out of our country we're going to have to we know national that means we're going to have to come down even farther than we would have had to as a country fine if a country government doesn't want to award credits let them not award credits if a country government does a terrible job of monitoring and they award many more credits than they should it will be their own citizens some other citizens inside their country that are going to pay the price of that are not going to suffer you know a lowering of the emissions in any case I'm going to stop there actually I should say I should say something very provocative about growth in the environment let me say that and that will open up a whole new area for discussion yes in a finite world infinite growth is impossible the actual quote is from Kenneth Bolding and there was a second sentence the second sentence is even more delicious only a madman or an economist would think otherwise it is beautiful but it's just fundamentally wrong growth of what and I'll make the argument very succinct ecological economists and in some ways I consider myself an ecological economist have a concept called throughput it's sort of material matter of various kinds from nature that we use as resources bring into our production processes and it's material matter that exits our production processes as waste products that's what they call throughput here is what is true in a finite planet infinite growth of throughput is impossible and only a madman or economist would think otherwise but throughput is not GDP when most economists and most people talk about growth they're talking about growth of the value of what we produce and the value of what we produced is not measured in tons it's measured in dollars or euros so the real question is this it is true that if you want to stop treading too heavily on the environment we need to cut back on throughput steady state throughput I could be behind that reducing throughput well obviously we have to reduce throughput of carbon emissions if we don't reduce throughput of carbon emissions by 80% by the year 2050 we are going to broil to death so in some areas we have to dramatically reduce throughput because we simply have to not increase throughput but the real question is is there any reason to believe that it's impossible to reduce throughput or hold throughput steady and yet have the value to us of what we produce in an hour of our time get larger and larger more or less forever I don't think it's impossible at all we're really asking is there are there any limits on how much more creative and inventive we might be about how much value we get out of our work time because that's really that's what GDP is supposed to represent now there's a whole bunch of issues about mis-measurement and everything else and the other thing I'm going to say on this subject is whenever there's massive unemployment which there is right now and is going to say we need more jobs more jobs means we need to get more production going it's totally understandable whenever there's more production the environmental movement says but more production just trades more heavily on the environment and that's only natural it depends on what you're producing if we put people back to work producing the same kind of throughput intensive goods we have been in the habit of producing if we put people back to work building more I call them McMansions the big housing boom in the United States a lot of that was these ridiculously huge energy and efficient you know mansions being built spread out over over productive agricultural fields well that is terribly environmentally destructive production if we produce more by producing more cars and putting a second car in everybody's garage or equipping every Chinese with a car that is terribly environmentally destructive throughput production but what if we put people to work producing billions of solar panels and we put people to work installing billions of solar panels on on roofs what if we put people to work building the windmills in the Columbia river valley where I live so that we don't have to burn coal for electricity we're getting more of it from wind power what if we put people to work retrofitting all our buildings so that their energy efficiency is 80% greater than it is now we could put hundreds of millions of people to work doing all those things over the next two decades and as a matter of fact if we don't we will broil to death if we actually set about doing what we need to do there is no more conflict between growth in the environment if we produce the kind of things we need to produce to save the environment there is no conflict between we're going to lose jobs that whole thing I mean and my particular region in the United States it was the major issue that led to tremendous clashes and disagreements and antagonisms between environmentalists and labor organizers it was called owls versus loggers so the environmental protection agency said because of the spotted owl a species we're going to stop forestry operations from going on in these particular forests in the coastal range of Oregon and as a result there were whole communities where job unemployment rate went up to 30-40-50% they were furious they didn't have jobs the environmentalists were happy nobody really cared about these spotted owls they're ugly little creatures yes I know there are some people but the real point was you saved the ecosystems in these incredibly wonderful forests on the coastal range that was a conflict of interest but that old debate that old debate really should not we should not get entangled in those disagreements anymore