In
December 1997, more than 150 nations met in Kyoto, Japan, to
negotiate the terms of the Kyoto Protocol, a global climate
agreement under the U.N. Framework Convention on Climate Change.
The Protocol reflects a comprehensive plan to reduce six greenhouse
gas emissions, including carbon dioxide (CO2), between 2008 and
2012. During the negotiations, President Bill Clinton pledged that,
in those five years, the United States would reduce emissions by 7
percent below 1990 levels. However, developing countries will not
be held to the same standards as industrialized countries like the
United States. In addition, it is not certain that meeting the
targets will reduce greenhouse gas emissions, and various
econometric analyses predict that the treaty's restrictions will
seriously affect the U.S. economy. Data provided by a recent
economic report indicate that the restrictions would reduce
America's gross domestic product (GDP) by as much as $2 trillion
between 2008 and 2012. This impact will
come at great cost to the American taxpayer: According to the
President's own estimates, the Administration's many climate change
programs, if fully funded, will account for almost $11 billion in
spending from FY 1998 through FY 2000.
Concerns about the impact of the treaty
are not new. Before the President went to Kyoto, the Senate
expressed its opposition to the Protocol in a vote of no
confidence. On July 25, 1997, the Senate overwhelmingly (95-0)
passed Senate Resolution 98 (S. Res. 98), known as the "Byrd-Hagel
resolution," that conditions ratification of the Kyoto Protocol on
1) the inclusion of "new specific scheduled commitments to limit or
reduce greenhouse gas emissions for Developing Country Parties
within the same compliance period," and 2) evidence that the treaty
was not "result[ing] in serious harm to the U.S. economy." The Administration,
however, ignored the concerns of the Senate and agreed to the Kyoto
Protocol in December 1997, and signed it on November 12, 1998, even
though it still does not meet the criteria of S. Res. 98. Furthermore, the
President has not submitted the treaty to the Senate for
ratification. To ensure that the Administration would not begin
implementing a flawed agreement without Senate advice and consent,
Congress began a series of hearings in 1997 to answer four specific
questions:
-
What conclusive scientific evidence exists
that global warming is occurring and is indeed harming the
environment?
-
Will implementation of climate
change-related programs in the developed world decrease the
planet's aggregate emissions?
-
What economic effects will implementation
of the agreement have on the United States?
-
Is the Administration implementing the
Protocol through back-door funding to circumvent the Senate's role
in the ratification process?
Much
of the testimony of scientists, economists, policymakers, and
analysts during the congressional hearings (see Appendix A) served
not only to intensify calls for the Administration to provide
evidence that the treaty was based on sound science but also to
highlight the unfair, draconian measures the treaty would impose on
the United States and how it would severely affect the U.S.
economy. For example, Dr. Sallie Baliunas, an astrophysicist at the
Harvard-Smithsonian Center for Astrophysics, testified that:
An
important feature of the surface temperature record of the last 100
years is that the temperature rose about 0.4C between 1910 and
1940. But most of the increases in greenhouse gases occurred after
1940. That means that the recent increase of greenhouse gases
cannot be the cause of the 0.4C warming that occurred earlier in
the 20th century. Most of the warming early in this century must
have been due to natural causes of climate change. These natural
causes must be understood in order to make an accurate assessment
of the effect of any human climate influences added to the natural
changes.
Ronald G. Prinn, professor of atmospheric
chemistry at the Massachusetts Institute of Technology, testified
that:
Current climate models cannot simulate
realistically the remarkable natural climate changes exemplified by
the succession of ice ages and warm periods over the last 250,000
years. There may even be fundamental limitations to our ability to
predict climate due to chaotic processes such as we already see in
weather predictions. As a result, forecasts of future climate
changes due to future emissions of greenhouse gases are very
uncertain.
And
Mary H. Novak, senior vice president of WEFA, Inc., an
internationally acclaimed econometrics forecasting firm, testified
that:
Implementing the Kyoto Protocol would mean
sharply higher prices for energy and electricity. Gasoline prices
would rise 65 cents, industrial gas and electricity prices would
double. Higher energy costs would not only reduce U.S. living
standards, but would give developing countries a competitive
advantage over the U.S. and other developed economies....Family
incomes would be reduced. The average loss in income, $2,700 per
family, would take a devastating toll on middle- and lower-income
families. The U.S. would lose more than 2.4 million jobs.
A
September 1999 report issued by the American Council on Capital
Formation (ACCF), a group that promotes cost-effective
environmental regulation, reinforced the assessment that efforts to
reduce CO2 emissions to meet Kyoto Protocol targets, let alone 1990
levels, would reduce economic growth significantly as well as impose a
heavy burden on every U.S. household and industry, including
agriculture. The ACCF report
points out that, "the projected federal budget surpluses, which
many hope will fund a more secure retirement for the baby boom
generation, are imperiled by the slow growth in GDP stemming from
CO2 emission reductions." (See Chart 1.)
Yet
Congress has been funding many of the Administration's initiatives
to begin implementing the Protocol's controversial climate change
agenda. Now, the Administration is requesting a $1 billion increase
in FY 2000 funding for its climate change initiatives--30 percent
more than in FY 1999. In its April 20,
1999, Report to Congress on Federal Climate Change Expenditures,
the Administration organized these activities into 32 programs, or
groups of programs (see Appendix B), spanning nine Cabinet-level
departments and five independent agencies. Taken together, these
programs account for almost $11 billion of funding during FY 1998
to FY 2000. Since FY 1998, 13
climate change programs have also received additional funding from
new sources, primarily the Climate Change Technology Initiative. If
the Administration's FY 2000 request for funds is granted, total
funding for all climate change programs and related tax policies
will increase by more than 40 percent over FY 1998 levels.
In
May, the U.S. General Accounting Office (GAO) acknowledged that the
Administration's April report to Congress: 1) was delivered nearly
three months late, 2) did not always link activities and
performance goals to line items in the President's budget, and 3)
did not always specify the outcomes the Administration expected
from use of the federal funds. The GAO's
conclusions demonstrate that there are few mechanisms in place in
Washington to hold federal agencies accountable for how they spend
taxpayer dollars or for what that spending should accomplish.
In
FY 1999, Congress took the extremely modest step of including in
the Foreign Operations, Treasury, Veterans-Housing and Urban
Development, and Interior appropriations bills some restrictive
language sponsored by Representative Joseph Knollenberg (R-MI) and
others. The "Knollenberg" language restricts the use of federal
funds for implementing the Kyoto Protocol prior to Senate
ratification. Given the
significant scientific uncertainties about climate change and the
potential adverse impact of the Protocol on the economy and the
surplus, some Members of Congress have indicated their willingness
in FY 2000 to stop any effort to fund and implement the agreement
until more research has been conducted and scientific information
is available on the nature and causes of global warming.
It
is unlikely that frugal appropriations committees will approve the
$4.5 billion requested by the President for his climate change
projects. The House already has incorporated the "Knollenberg"
language into the six appropriation bills it passed (Agriculture,
Commerce/Justice/State, Energy and Water, Foreign Operations,
Interior, and VA-HUD) to restrict the Administration's efforts to
implement the unratified Protocol. Thus, several of the FY 2000
appropriations bills are likely to see a presidential veto.
Looking beyond the FY 2000 appropriations
debate, Representative David McIntosh (R-IN) introduced H.R. 2221,
the Small Business, Family Farms, and Constitutional Protection Act
to 1) extend and strengthen funding restrictions already in place
in the FY 1999 VA-HUD appropriation bill, 2) prevent federal
regulation of CO2 emissions without a law that specifically grants
such authority, and 3) prevent the use of federal funds for
"voluntary" CO2 emission credits prior to Senate ratification of
the Protocol.
CONCLUSION
As
Congress considers funding federal agencies in FY 2000 within the
spending caps set in the 1997 Balanced Budget Agreement, it must
carefully scrutinize any climate change funding requests from the
Administration. Billion-dollar backdoor implementation of an
unratified Kyoto Protocol, which is based on unproven science and
will have a long-term impact on the nation's economic growth, will
make it more difficult for Congress to pay for tax cuts, reform
Social Security, and fund genuine national priorities.
If
the Administration insists on using surplus funds for its climate
change initiatives rather than on shoring up Social Security and
Medicare and giving middle-class Americans a hard-earned tax cut,
it should make this priority clear to all Americans. As numerous
experts explained in previous congressional hearings, implementing
the Kyoto Protocol will go against sound science and threaten
America's economic and environmental well-being. Congress should
stand firm on its efforts to halt further implementation of the
unratified Kyoto Protocol and stand by its earlier commitment to
the Balanced Budget Agreement.
Gregg VanHelmond is a
former Research Assistant in the Thomas A. Roe Institute for
Economic Policy Studies at The Heritage Foundation.
APPENDIX A
EXCERPTS OF CONGRESSIONAL TESTIMONY ON GLOBAL WARMING AND THE
EFFECTS OF THE KYOTO PROTOCOL
On the Uncertain Science of Global
Warming
"The Kyoto Protocol requires that the
United States reduce its overall greenhouse gas emissions by a
remarkable 43% for the 2008-2012 average....Wigley recently
calculated the "saved" warming, under the assumptions noted above,
that would accrue if every nation met its obligations under the
Kyoto Protocol. According to him, the earth's temperature in 2050
will be 0.07ºC lower as a result. My own calculations produced
a similar answer. Wigley is a Senior Scientist at the U.S. National
Center for Atmospheric Research. [A temperature change of]
0.07°C is so small that it cannot be reliably measured by
ground-based thermometers. If one assumes the more likely scenario
that warming to the year 2100 will be approximately half of the
IPCC [the United Nations' Intergovernmental Panel on Climate
Change] estimate, the saved warming drops to 0.04°C over the
next fifty years. This is no benefit at an enormous cost."
--Patrick J. Michaels, Climatologist
and
Professor of Environmental Sciences,
University of Virginia
"[A]ccording to Accu-weather, the world's
leading weather forecasting company, there has been only a .45
degrees C change in this century, and satellite data shows that a
slight cooling has occurred in the last 18 years.... a Gallup
survey of the American Meteorological Society and the American
Geophysical Society found that only 17% of their members believe
that any warming is the result of human activity. Additionally,
over 15,000 scientists recently signed a petition that urged the
rejection of the Kyoto protocols. These scientists find no
convincing evidence that human activity is causing heating of the
atmosphere, or disruption of the climate."
--The Honorable Bill Walaska,
Rhode Island State Senator
"In
brief, a decade of focus on global warming and billions of dollars
of research funds have still failed to establish that global
warming is a significant problem....One of the common claims in
support of the reality and seriousness of global warming is that we
have had a large portion of record breaking warm years during the
last decade or so. This is not a claim used by the IPCC, and its
presence in any discussion is a rather clear piece of evidence of
the intent to deceive."
--Richard S. Lindzen,
Professor of Meteorology, Massachusetts
Institute of Technology
"The detection of human effects on the
Earth's climate has not been convincingly proven because (1) the
variations we have observed to date are not outside of the natural
variations of the system and (2) the Earth system is very complex
and probably has ways to expel heat energy which are not properly
accounted for in climate models."
-- John R. Christy, Professor of
Atmospheric Science,
University of Alabama
On the Protocol's Serious Economic
Consequences
[I]t is important to look at the impacts
of the prices energy users actually pay. The price of a gallon of
gasoline, for instance would increase an estimated 14 to 66 cents
in 2010. The price of electricity would be more heavily impacted,
rising an estimated 20 to 86 percent over the baseline price in
2010....In 2010, EIA estimates that the Gross Domestic Product will
be $13 to $397 billion ($1992) smaller than in the reference
case....This represents a projected reduction of between 0.1
percent and 4.2 percent [of GDP] from the level expected
otherwise."
--Jay E. Hakes, Administrator,
Energy Information Administration
"New studies predict that meeting the
emissions targets in the [Kyoto] Protocol would lead to significant
reductions in output and employment among energy intensive
producers. U.S. output of energy intensive products such as autos,
steel, paper, and chemicals could be 15 percent less under the
reference case by 2020....The Administration's estimates of
economic damage from the CO2 emission reductions are far below
those of other models due to their unrealistic assumptions...."
--Margo Thorning, Senior Vice
President
and Chief Economist,
American Council for Capital Formation
"The loss of real GDP would be significant
under the proposed Kyoto Protocol....the decline in GDP would be
about 1.2% on average in the 2008-2012 compliance period. This
represents economic losses in excess of $100 billion per year, and
cumulative losses from 2001 to the end of the initial compliance
period in 2012 would be about $1.1 trillion....Our analysis
indicates that GDP losses would exceed $400 per person in 2010 and
GDP losses per household would be nearly $1,200 in the same year.
Cumulative GDP losses from 2001 to [2012] of over $4,000 per person
and nearly $12,000 per household."
--Cecil E. Roberts,
President, United Mine Workers of America
"We
estimate that holding carbon emissions to 1990 levels from 2010
onward would cause GDP losses on the order of 1% of GDP in 2010,
rising to 2.7% by 2030....Job impacts on energy producing and
energy intensive industries will range from a loss of two-thirds of
the jobs in the coal industry by 2030 to losses of about 7% in
motor vehicles and 4% in metals."
--W. David Montgomery,
Vice President, Charles River Associates
On the Effects of the Protocol's
Implementation Without Ratification
"On
March 3, 1999, the EPA announced a Final Rule for `Protection of
Stratospheric Ozone' `Refrigerant Recycling,' [and] `Substitute
Refrigerants.' These new rules establish sales restrictions on HFC
and PFC refrigerants and would ban the `manufacture in or import
into' the U.S. of certain devices, including `self-chilling cans.'
Not, however, because the chemicals used in the devices would
deplete the ozone layer, but because of their supposed contribution
to global warming. It is questionable whether the EPA has the legal
authority to consider the greenhouse warming potential of a
refrigerant as a basis for proscribing its use under Section 612 of
the Clean Air Act."
--William H. Lash,
Professor of Law, George Mason University
"The President's FY2000 budget for DOE
programs related to climate change proposes $1,674 million, an
increase of $252 million over FY1999 appropriated levels...Taken as
a whole, these programs will help reduce U.S. greenhouse gas
emissions...."
--T.J. Glauthier, Deputy
Secretary,
U.S. Department of Energy
"Last month this subcommittee heard from
the State Department's nominee to head climate activities regarding
his role in developing `pilot emissions trading' programs with
Russia. The Committee had received documentation of meetings by EPA
to create a pilot program for trading in carbon emissions--a
mechanism called for in the Kyoto Protocol on Climate Change.
Previously, the Administration had assured this Committee that
there would be no implementation of any aspect of the Kyoto
Protocol unless the Senate gave its advice and consent....
According to EPA lawyers: `because the possible pilot program would
not impose any legal obligations on the United States (or on the
U.S. private sector), the issue of relying on authorities provided
under the Framework Convention on Climate Change does not arise.'
The contorted argument put forward by these lawyers is that the
United States can engage in all activities called for in the Kyoto
Protocol so long as the Administration justifies its activities as
the legitimate exercise of the President's foreign affairs
powers."
--Senator Chuck Hagel (R-NE),
Chairman of the International Economic
Policy, Export, and Trade Promotion
Subcommittee, Senate Foreign
Relations Committee
"President Clinton authorized the U.S. to
sign the [Kyoto] treaty, but he has refused to submit it to the
Senate for ratification. Nevertheless, the administration works
tirelessly to implement Kyoto de facto....The President himself has
cited global warming as a reason for (1) his executive order
mandating a 30% emissions reduction in federal facilities (an order
Senator [Thad] Cochran [R-MS] is fighting to block in the Senate),
(2) various provisions of his electricity restructuring plan geared
to reducing emissions and promoting the so-called renewables, and
(3) EPA's attempt to regulate particulate matter and ozone."
--Jack Kemp, Distinguished
Fellow,
The Competitive Enterprise Institute
"[A] Senate report directed the
administration to provide the Congress with a detailed plan for
implementing key elements of the President's proposal on climate
change.... In setting out this directive, the report said that the
administration must do a better job of explaining the components of
the programs, their anticipated goals and objectives, the
justification for any funding increases, a discussion of how
success would be measured, and a clear definition of how these
programs were justified by goals and objectives that were not
linked to implementing the Kyoto protocol."
--Peter F. Guerrero, Director of
Environmental Protection Issues,
General Accounting Office
On the Kyoto Protocol's Double
Standard
"No
matter what policy is chosen, energy and energy-related costs will
become much higher in the U.S. than in countries that do not adhere
to the same emission limits.... Increases in emissions from
developing countries that do not participate in emission limits
(`leakage') will offset U.S. efforts to reduce emissions. For every
three tons of emission reduction accomplished by the U.S.,
developing country emissions could increase by 1 ton."
--W. David Montgomery,
Vice President, Charles River Associates
"[I]t is well recognized that emissions
from developing countries are increasing rapidly due to increases
in population and economic growth, and are likely to surpass those
from developed countries within a few decades...."
-- Robert T. Watson, Chairman,
Intergovernmental Panel on Climate Change
"[N]o single country has an incentive to
reduce emissions sufficiently to protect the global environment
against climate change. Each has an economic incentive to `free
ride' on the efforts of others. Even if the United States sharply
reduced its emissions unilaterally without an international
agreement limiting emissions abroad, greenhouse gas emissions from
all other countries would continue to grow, and the risks posed by
climate change would not be significantly reduced."
--Dr. Janet Yellen, Chairwoman,
Council of Economic Advisers
"[R]egardless of the CDM [Clean
Development Mechanism], developing countries, especially China and
India, have steadfastly refused to make any commitments to limit or
reduce their emissions--and even have refused to agree to any talks
about future participation in any voluntary or mandatory
initiatives....Bert Bolin, former chairman of the [IPPC]...first
raised this point in February 1995 when he stated that the impact
of proposals under consideration then for reductions only by
developed nations `would not be detectable on projected temperature
increases.'"
--Terry F. Steinbecker, President and
CEO,
St. Joseph Light & Power Company
"Although the United States remains the
world's leading emitter of greenhouse gases, developing countries
make up an increasingly large share of the global emissions
problem. Their emissions are expected to surpass those of the
industrialized nations in the next twenty years. As countries like
India and China bring dozens of new coal-fired power plants on line
each year, their emissions of carbon dioxide will grow greater and
greater."
--Harriet Babbitt, Acting
Administrator,
U.S. Agency for International Development
APPENDIX B
PROGRAMS AND TAX POLICIES RELATED TO CLIMATE CHANGE (IN
MILLIONS OF DOLLARS OF BUDGET AUTHORITY)
