Monday, December 11, 2006

Paulson's View on China's Energy Policy

I think Henry Paulson, the current Treasury Secretary, was a strong addition to George W. Bush's cabinet. I wish he had come along sooner.

He authored this op-ed and it is a good (but boring) summary of the economic priorities the U.S. needs to consider as it works with China in the coming years. Still, it's dry reading and therefore, I'm writing more about the tone of the article than the content.

The Bush Administration has a tendency to talk to other soveriegn nations in a condescending manner (e.g. "Old Europe"). This is clearly counterproductive. There is also some clear hypocrisy in some of Paulson's comments on China's energy policies that I found troubling - not only because hypocrisy is intrinsically bad, but also (and more importantly) because it has clear negative consequences on our ability to pursue our own interests.

Particularly troubling:

"...much of [the energy China produces is] from sources that generate high levels of
pollution. This harms the air and water we all share, and creates health problems for Chinese citizens.

Through the Strategic Economic Dialogue, we can work with China's leaders to help it achieve more environmentally and economically sound growth and constructive engagement with the global energy market."

I think his comments are true and the SED is a desirable initiative. Furthermore, it is obvious that engaging China to develop an environmentally sustainable energy policy is a tremendously important issue for the U.S. and the world.

I am an advocate of tact, not silence.

But I wonder how effective we can be towards this end when our own committment to responsible energy policy is questionable (at best). In particular, our recent unwillingness to engage in international actions on energy consumption could make influencing China in the future more difficult. As the years pass and China reaches economic parity with the United States, strong international institutions will be essential to influence their economic activities with respect to the environment (and potentially human rights as well). Anyone who doubts this assertion should consider how much trouble we are having managing this today, at a time when we have substantially superior economic and political strength. Although it is arguable that international institutions may not be sufficient to address issues such as this, it is hard to see how they harm the cause.

In any case, given that we are currently responsible for approximately 24% of global carbon emission compared to China's 13%, it makes sense to start at home if we are serious about the global impact of inefficient and/or excessive energy consumption.

Incidentally, this is not a rant intended to hint at reconsidering the Kyoto treaty. I am not certain if that is the best course of action for the U.S. or the world. However, I do feel strongly that disengaging from Kyoto without a meaningful alternative is unacceptable. (I'm confident this will change with the next Administration though - regardless of who leads it).

I just hope that in private Paulson is willing and able to say to President Bush what he cannot, for undertandable reasons, say in public. Specifically, that a sustainable global energy strategy has to at least have the participation, if not the full leadership, of the United States.

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