Tuesday, May 30, 2017

The ‘Business Case’ For Paris Is Bunk

The climate accord is a boon—yet pulling out would be unfair?


By Cliff Forrest
The Wall Street Journal
May 30, 2017

As President Trump weighs whether to withdraw from the Paris Agreement on climate change, some have tried to present a “business case” for why the U.S. should stay in. An economic windfall would come with the early and aggressive investment in alternative energy that the accord mandates, or so the argument goes. The Paris Agreement’s backers have told a very incomplete story and reached the wrong conclusion.

The economic merits of the Paris Agreement take on a different air when more fully considered. Climate-change advocates’ bizarre premise is that economic gains will come from restricting access to the most abundant, reliable and affordable fuel sources. Never mind that this defies the experience of many European nations that have invested heavily in renewable energy. After “Germany’s aggressive and reckless expansion of wind and solar,” for example, the magazine Der Spiegel declared in 2013 that electricity had become “a luxury good.” Apparently this time will be different.

There are a few interesting hypocrisies to consider as well. The commercial interests that strongly support the Paris Agreement typically have created programs to exploit, game or merely pass through the costs of the climate-change agenda. Many also maintain a green pose for marketing purposes. The classic example of this rent-seeking behavior was Enron, which in 1996 purchased Zond Energy Systems (now GE Wind) to complement its gas pipeline. Enron then set about lobbying its way to green-energy riches. It seems that Paris backers hope for a sudden public amnesia about the many businesses that use government to push out smaller competitors.

Green companies also argue that, beyond economic benefits, their ability to slow climate change helps contribute to the public good. To my knowledge, none declare a measurable impact on climate from their businesses or their desired policies.

Mr. Trump should keep in mind that the people calling for him to stick with the Paris Agreement largely did not support him during the campaign. Few would like to see him succeed now. As for his strongest supporters, they’re the ones who will take the hit if he breaks his promise to withdraw.

Some countries have threatened to punish the U.S. if it pulls out of the accord. Rodolfo Lacy Tamayo, Mexico’s undersecretary for environmental policy and planning, said in an interview with the New York Times: “A carbon tariff against the United States is an option for us.” Countries imposing costs on their own industries through the Paris Agreement complain that they are at a disadvantage if the U.S. doesn’t do the same. Apparently they didn’t receive the talking points describing green energy as an economic boon for everyone involved.

So which is it? Does the Paris Agreement spur a U.S. economy otherwise unprepared to succeed in the 21st century? Or is the U.S. maintaining economic advantage by not subjecting itself to the accord’s arduous requirements?

Mr. Trump’s obligation is to do what is in America’s best interest. Rejecting a confused and costly international agreement, with questionable benefits to climate, should be a slam dunk. Don’t take my word for it: Just study the other side’s arguments.


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