NCPA - National Center for Policy Analysis


September 30, 2009

To combat increasing concentrations of greenhouse gases in the atmosphere, the Obama Administration supports a cap-and-trade system similar to the one implemented by the Kyoto agreement which commits developed countries to limit and eventually reduce greenhouse gas emissions.  In contrast to the economic costs of limits on greenhouse gas emissions there are responses to climate change that would have substantial economic benefits, says H. Sterling Burnett, a senior fellow with the National Center for Policy Analysis.

Climate change is mainly projected to add to existing problems, rather than create new ones.  Focused adaptation addresses these problems -- including malaria, hunger and coastal flooding -- directly now, rather than indirectly in the future via emissions reductions, says Burnett: 

  • For example, according to the World Health Organization, malaria's current yearly death toll of one million could be halved with annual expenditures of $1.5 billion or less (in 2003 dollars).
  • By contrast, limiting emissions to 1990 levels, as called for under the Kyoto Protocol, would reduce the total number of people at risk from malaria in 2085 by 0.2 percent, while costing about $165 billion in 2010 alone.

No-regrets policies are actions that are desirable even if there is no threat of global warming, says Burnett.  They would reduce greenhouse gas emissions, increase energy efficiency, reduce harms associated with global warming and/or increase the world's ability to deal with climate-change-associated problems. 

No-regrets policies include:

  • Eliminating fuel subsidies.
  • Reducing regulatory barriers to building new nuclear power plants.
  • Encouraging breakthroughs in new technology by fostering competition.

Such policies would reduce world emissions, reduce America's dependence on foreign oil and reduce energy prices for consumers, says Burnett.

As a stopgap measure, geoengineering deliberately modifies the Earth's climate, yet does not address the underlying causes.  One type of geoengineering, solar radiation management, seeks to increase the Earth's reflectivity in order to mimic the natural cooling effects of clouds and volcanic eruptions.  While the cost of reducing greenhouse gases enough to stave off serious harm has been estimated at 2 percent to 5 percent of gross domestic product (GDP), Johns Hopkins University professor Scott Barrett says that geoengineering solutions would cost only 0.2  percent to 0.02 percent as much as mandatory stringent emissions reductions, while preventing more damage. 

These policies, taken together, could do a great deal to minimize the risks of global warming while at the same time promoting economic growth and global development, says Burnett.

Source: H. Sterling Burnett, "Reasonable Responses to Climate Change," National Center for Policy Analysis, Study No. 324, September 30, 2009.

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