Silly thinking from the New Zealand Institute:
New Zealand should be a "fast follower" and not a leader in the race to reduce greenhouse gases, says a report issued today.700 million dollars is approximately 0.45% of GDP, but hey, no price to small to not save the planet...
The New Zealand Institute report recommends the country delay meeting its emission reduction targets under the Kyoto Protocol to 2020, instead of 2012.
New Zealand ratified the Kyoto Protocol five years ago.
It requires the country to meet emissions targets between next year and 2012, or buy carbon credits on the international market to cover the difference.
The Government believes New Zealand will exceed its target by about 12 per cent.
The Treasury estimates that will cost $700 million, but that figure will rise if emissions are higher than expected, the cost of carbon credits is higher than predicted, or if the exchange rate falls.
Dr Skilling recommends deferring until 2020 New Zealand's commitment to meeting the Kyoto target of limiting greenhouse gas emissions to 1990 levels.
He acknowledged that reversing an international commitment would damage New Zealand's reputation as a good international citizen, but said other countries were likely to be in the same boat.
Canada had already announced it would not be bound by its Kyoto commitments because of the costs associated with failing to reach its target."
The real problem with the NZI's logic is the fact that if we hang back and wait, while we may gain some sort of infinitesimal competitive advantage, we also increase the chances that everyone will do the same. And if that happens, trust me, the cost is going to be considerably higher than 0.45% of GDP.
The reason why our hanging back will influence others is as follows:
There is no international enforcement mechanism to compel countries to follow Kyoto, or take make GHG emissions reductions. This is one of the paradoxes of globalisation - we only have the barest skeleton of a global political infrastructure so, when we desire collective action, we have to rely on soft power. In this case the soft power in question is the domestic environment lobby of other countries. And every time we don't act we weaken their hand, and strengthen their opponents - who can claim that seeing as New Zealand isn't doing it their country doesn't need to act either.
Indeed, that is exactly what Skilling does above:
He acknowledged that reversing an international commitment would damage New Zealand's reputation as a good international citizen, but said other countries were likely to be in the same boat.If Skilling gets his way then somewhere else in the world they'll be saying "well Canada and New Zealand have reneged, we should too."
Canada had already announced it would not be bound by its Kyoto commitments because of the costs associated with failing to reach its target.
When it comes to our planet's future, it's worth being a leader not a follower. Even if it costs us (less than half a cent in every dollar we earn).
[Update: And Norigthturn lands the death blow for the NZI's silliness pointing out that:
But quite apart from their strange definition of "slowing down" - I'd have thought that unilaterally abandoning Kyoto would count as "stopping dead in the water" - there's also the fact that their entire analysis is predicated on the idea that New Zealand will somehow be "leading the world" if we implement climate change policy. And this is simply false. To pick my favourite example, Norway - the real "world leader" on climate change - started pricing carbon fifteen years ago. The European Union has been trading carbon since 2005 (though overallocation means it has been less effective than it could have been - a mistake we hopefully won't be making here). By contrast, we won't have even the rudiments of an emissions trading scheme until 2010. To claim that this would somehow be "leading the world" displays either a complete ignorance of international policy, or a deliberate attempt to mislead the public.Perhaps the 'think' in thinktank is meant to be ironic?]
The inconvenient truth is that even if the government implements its entire programme of emissions trading and regulation, we will not be a "world leader". We will not even be a "fast follower". Instead, we will be playing catch-up after 15 years of sitting on our hands doing nothing, and implementing measures that other countries implemented long ago.