NCPA - National Center for Policy Analysis

EUROPEAN HOT AIR

July 10, 2009

Western European leaders are the latest to discover that climate-change talk is cheap, but carbon-emissions regulation is expensive.  That might be bad news for green activists, but it's very good news for Europeans worried about their jobs and their economy, says the Wall Street Journal.

Governments in industry-heavy countries are now less willing to sacrifice jobs for cooler temperatures:

  • Germany's generally environmentalist Chancellor Angela Merkel insisted on exemptions for her country's industry from December's European Union (EU) climate package, which pledged to reduce carbon emissions by 20 percent below 1990 levels by 2020.
  • Germany also plans to build several dozen coal-fired power plants in the next few years.

Additionally:

  • Italy insisted on a clause in the December climate deal that requires the EU to renegotiate its climate policy after the United Nations summit in Copenhagen later this year.
  • Any renegotiated EU deal is likely to contain even more loopholes and exemptions to keep from denting European competitiveness.

Credit a deteriorating economy for this about-face.  Businesses and unions finally are starting to speak out against intrusive and expensive emissions regulations, says the Journal: 

  • In December, Phillipe Varin, chief executive of Corus, Europe's second-largest steel producer, told the London Independent that the cost of carbon credits and new technologies needed to reduce emissions would destroy European steel production, forcing manufacturing overseas.
  • Jaroslaw Grzesik, deputy head of energy at Poland's Solidarity trade union said last month that the union estimated the EU's climate policy would cost 800,000 European jobs.

Before the December negotiations, the London-based think tank Open Europe estimated the EU climate package would cost governments, businesses and householders in the EU-25 more than €73 billion (about US$102 billion) a year until 2020.  No wonder leaders decided to water it down, says the Journal.

A recent paper by Gabriel Calzada Álvarez, an economics professor at Universidad Rey Juan Carlos, said that since Spain started investing in "green jobs" policies in 2000, the country has lost 110,500 jobs in other parts of the economy.  That amounts to 2.2 jobs lost for every new "green job" created.

This has politicians worried.  They might have been willing to sacrifice a few jobs when they signed Kyoto in 1997.  But economic times were flush then.  Now a global slowdown is forcing a rethink on whether emissions control is worth the cost, says the Journal. 

Source: Editorial, "European Hot Air," Wall Street Journal, July 7, 2009.

For text:

http://online.wsj.com/article/SB124691243941002053.html

 

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