Recent Times ArticlesAs I listened to Denmark’s minister of economic and business affairs describe how her country used higher energy taxes to stimulate innovation in green power and then recycled the tax revenues back to Danish industry and consumers to make it easier for them to make and buy the new clean technologies, it all sounded so, well, intelligent. It sounded as if the Danes looked at themselves after the 1973 Arab oil embargo, found that they were totally dependent on Middle East oil and put in place a long-term strategy to make Denmark energy-secure and start a new industry at the same time.
The more I listened to the Danish minister, Lene Espersen, the more I thought of my own country, where I’ve been told time and again by U.S. politicians that proposing even a 10-cent-a-gallon increase in gasoline taxes to make America more energy independent and to stimulate fuel efficiency is “off the table,” an act of sure political suicide.
I’ve long believed there are two basic strategies for dealing with climate change — the “Earth Day” strategy and the “Earth Race” strategy. This Copenhagen climate summit was based on the Earth Day strategy. It was not very impressive. This conference produced a series of limited, conditional, messy compromises, which it is not at all clear will get us any closer to mitigating climate change at the speed and scale we need.
Indeed, anyone who watched the chaotic way this conference was “organized,” and the bickering by delegates with which it finished, has to ask whether this 17-year U.N. process to build a global framework to roll back global warming is broken: too many countries — 193 — and too many moving parts. I leave here feeling more strongly than ever that America needs to focus on its own Earth Race strategy instead. Let me explain.
Let’s not fool ourselves. Whatever threat the real Afghanistan poses to U.S. national security, the “Virtual Afghanistan” now poses just as big a threat. The Virtual Afghanistan is the network of hundreds of jihadist Web sites that inspire, train, educate and recruit young Muslims to engage in jihad against America and the West. Whatever surge we do in the real Afghanistan has no chance of being a self-sustaining success, unless there is a parallel surge — by Arab and Muslim political and religious leaders — against those who promote violent jihadism on the ground in Muslim lands and online in the Virtual Afghanistan.
In case you haven’t noticed, the U.S. economy today is actually being hit by two tsunamis at once: The Great Recession and the Great Inflection.
The Great Inflection is the mass diffusion of low-cost, high-powered innovation technologies — from hand-held computers to Web sites that offer any imaginable service — plus cheap connectivity. They are transforming how business is done. The Great Recession you know.
If you follow the debate around the energy/climate bills working through Congress you will notice that the drill-baby-drill opponents of this legislation are now making two claims. One is that the globe has been cooling lately, not warming, and the other is that America simply can’t afford any kind of cap-and-trade/carbon tax.
I don’t expect much from the G-20 meeting this week, but if I had my wish, the leaders of the world’s 20 top economies would commit themselves to a new standard of accounting — call it “Market to Mother Nature” accounting. Why? Because it’s now obvious that the reason we’re experiencing a simultaneous meltdown in the financial system and the climate system is because we have been mispricing risk in both arenas — producing a huge excess of both toxic assets and toxic air that now threatens the stability of the whole planet.
Just as A.I.G. sold insurance derivatives at prices that did not reflect the real costs and the real risks of massive defaults (for which we the taxpayers ended up paying the difference), oil companies, coal companies and electric utilities today are selling energy products at prices that do not reflect the real costs to the environment and real risks of disruptive climate change (so future taxpayers will end up paying the difference).
Thomas Friedman is the "Foreign Affairs" columnist for The New York Times. Below are links to articles and other content on their site (registration required).
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