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A Conservative Answer to Climate Change

With a market-driven agenda to reduce greenhouse gases, the U.S. can lead without suffering from free riders.

The Paris climate change negotiations won’t end until later this week, but we already know what will happen. The parties will reach a toothless agreement pledging to reduce emissions and provide aid to the developing world. Everyone will talk about how much they accomplished. Then they will go home, where most countries will ignore the whole thing and start getting ready for the next conference.

The international community has given up on the idea of top-down, enforceable emissions limits. Instead, they rely on each country to develop Intended Nationally Determined Contributions. If the countries agree that each nation is doing its fair share, they’ll come to an agreement.

Sure, countries can renege on their INDCs without triggering any penalties, but that very fact makes it more likely that negotiators will come to some sort of agreement in Paris. The remaining controversies will be over how many degrees of warming are acceptable and the emissions trajectory necessary to satisfy that target, which countries should bear what degree of emissions reduction burden, whether and at what level developing countries should receive what types of aid, and how reporting and verification requirements will be structured.

The final product won’t add up to much, but at least the final communiqué will read nicely.

Some environmentalists have noticed this. Ex-NASA climatologist-turned-activist James Hansen called the conference’s proposals “half-assed and half-baked.” For the politicians involved, making commitments to do something in the future is far better than actually doing something.

President Barack Obama’s promises aren’t serious, either. The White House-developed INDC would reduce emissions 26 to 28 percent below 2005 levels by 2025, a goal that isn’t achievable under current policies. The Clean Power Plan, tighter CAFE standards, a constant flow of efficiency standards, regulations on the oil and gas sector, billions in subsidies for renewable sources of energy and many other small-bore policies all fall far short of satisfying the targets that the United States is bandying about in Paris.

Estimates suggest the country is about 30 percent shy of meeting this stated target. Which shouldn’t be surprising, since the president’s executive orders and the administration’s rulemaking both rely on outdated legislative authority. The tools at Obama’s disposal are artifacts of an environmental movement dedicated to stamping out acute harms like acid rain and ground-level ozone, not the pernicious problem of global climate change.

Of course, our partners in Paris know this, too. They have access to the same figures we do and know existing policy isn’t up to the task. They have seen the Senate resist ratification of a climate treaty before. They know that 24 states have filed suit against the president’s marquee climate policy, the Clean Power Plan, and that their case to overturn the regulation in the courts is strong.

Still, even paltry U.S. carbon policies have pulled ever-intractable China and India into commitments to reduce their emissions intensity radically over the coming decades.

The challenge now is to overcome these persistent obstacles and actually realize global emissions reductions. Game theory calls this the free rider problem. When one country reduces its emissions, it restrains its own economic growth and bears costs without receiving climate benefits. Limiting global anthropogenic climate change is only achievable if each country acts in concert to address emissions, even though the smart strategy is to free ride on other nations’ actions.

That means some big changes. The United States should resist any binding international commitments to reduce greenhouse-gas emissions. Surrendering any economic sovereignty for the sake of climate action is a foolish choice. Similarly, the president’s actions so far on the climate are poorly designed, economically destructive, and beyond his constitutional limits. International emissions-reductions efforts should not be predicated on either course.

The United States needs an alternative climate policy to the one put forward by the Obama administration. If designed properly, that policy can also encourage international partners to reduce emissions with us, protect our economy from leaking jobs and emissions overseas, and give U.S. companies access to emerging markets for climate adaptation and mitigation technologies and services in the developing world.

The old playbook upon which the president relies doesn’t have the flexibility or authority to create such a policy. It must come down to congressional action.

That’s a big ask with a tricky political calculus. The Republican Party has not had a great track record of identifying solutions to climate change. Many are suspicious of the big-government intentions of the environmental left and repeated government overreach from the Obama administration. But Republicans have overseen every major environmental legislative achievement. Air and water are cleaner and the economy more productive because the GOP has uniquely appreciated the delicate trade-offs associated with creating strong and sensible environmental policy.

With the right leadership, the political right has the answers. Directly pricing carbon, adjusting that price at the border, creating a technology-agnostic research and development agenda, and using our massive development engine to bring U.S. technological achievements to a broader market form the heart of a policy that conservatives can and should get behind. Couple any price on carbon with corresponding reductions to or the outright elimination of existing taxes, as well as the rollback of redundant regulations, and a conservative carbon policy can shrink the government and emissions alongside positive economic growth.

If we commit to reducing greenhouse-gas emissions while affording new and growing economic opportunities to American businesses, international negotiations like those in Paris will be unnecessary. We can reduce emissions without fearing free riders, and might just encourage other countries to follow suit.

Catrina Rorke is a senior fellow and director of energy policy at R Street Institute.