Environment

Live Chat: Christina Larson on China and the Environment (Tuesday, Noon ET / 9 am PT)

admin — Mon, 16 Nov 2009 16:55:00 -0500

As Barack Obama embarks on his first trip to Beijing as president -- and with less than a month to go before the Copenhagen climate change summit -- it's worth asking: Is China's rapid economic growth ravaging the environment? Or are that nation's massive investments in green technology an environmental lifeline -- not to mention a huge headstart in a sector that could drive the economy of the 21st century?

New America Foundation Schwartz Fellow Christina Larson will be discussing these questions Tuesday, Nov. 17, in this week's New America Foundation / Politico live web chat.

Update: This chat has concluded, but a full transcript is archived below.

New America's Christina Larson on China's Environmental Paradox

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Past Chats

Previous New America/Politico chats have their full transcripts archived:

Schwartz Fellow Dayo Olopade on the Obama Administration's faith-based initiatives
Education Policy Program staffers Lisa Guernsey and Christina Satkowski on the future of Head Start
Health Policy Program Director Len Nichols on the current state of health reform
Energy Policy Initiative Director Lisa Margonelli on the prospects for real progress with climate policy legislation.
Schwartz Fellow Nicholas Thompson on Cold War lessons for Afghanistan
Global Assets Project Deputy Director Jamie Zimmerman on savings as a path out of poverty
Bernard L. Schwartz Fellows Program Director Andres Martinez on "President Obama: Pragmatist or Ideologue?"

Climate Change and Microfinance: It's Not Easy Being Green?

Leila Seradj — Mon, 17 Nov 2008 15:02:00 -0500

The unofficial color of the new millenium is beginning to evoke less images of Kermit the Frog, and more impressions of the lively discourse on environmental sustainability.

What with "green" on everyone's tongues, it was only a matter of time before the question of environmentally-friendly practices arose in the microfinance realm. Green Microfinance, an organization devoted to harnessing the power of renewable energy to microfinance, is facilitating this week's microLINKS Speaker's Corner on Microfinance and Climate Change, which poses three questions to its participants:

What is the impact of microenterprise and microfinance clients on the natural environment?
How can MFIs promote environmental sustainability while still meeting their "core mission" of reducing poverty?
What is the role of donors and investors in ensuring environmental sustainability of an MFI and their clients?

These issues are important, but one can't help but wonder if there's a fourth question that also needs to be asked: What can microfinance do to help protect livelihoods threatened by climate change?

In 2001, the U.N.'s Intergovernmental Panel on Climate Change surmised that "the impacts of climate change will fall disproportionately upon developing countries and the poor persons within all countries."

And last year, IPCC Chairman R.K. Pachauri re-emphasized this forecast in his Nobel Lecture:

"...the impacts of climate change on some of the poorest and the most vulnerable communities in the world could prove extremely unsettling. And, given the inadequacy of capacity, economic strength, and institutional capabilities characterizing some of these communities, they would remain extremely vulnerable to the impacts of climate change and may, therefore, actually see a decline in their economic condition, with a loss of livelihoods and opportunities to maintain even subsistence levels of existence."

Unfortunately, it seems that as the destructive effects of climate change begin to manifest themselves, spending shifts from long-term sustainable development programs to emergency relief. In Tanzania, where drought has had grave effects on the energy sector, health, and food prices, Richard Muyungi, the deputy-director for the environment in the office of the Tanzanian vice-president, attests that this is already evident.

It's clear, then, that the devastating impact of climate change on the livelihoods of many in the developing world is something that needs to be taken into consideration if we're to be vigilant about decreasing dependency on foreign assistance. Climate change has already had an impact upon land, the value of property in the developing world, and on low-income individuals' ability to cultivate resources and leverage their assets. When assistance is shifted from providing long-term access to sustainable financial services to communities, and toward emergency relief, this only intensifies the problem.

So while efforts to "green" microenterprises in developing countries are both crucial and commendable, the need to provide safeguards for livelihoods of those most vulnerable to the effects of climate change is likewise imperative.

In a speech made earlier this year, IMF Deputy Managing Director Takatoshi Kato insisted that countries' efforts to adapt to climate change must fit with their broader development agenda, maintaining that social and economic development "is one of the most powerful ways to increase the capacity to adapt to climate change":

"Rising income levels can create the fiscal space needed to meet additional demands on public spending, both on climate-related public goods... and to protect programs affected by climate change."

He continued:

"There may be opportunities for spending that is ‘pro-development' and that helps adapt to climate change at the same time.... Nonetheless, it is important to guard against the possibility that efforts to adapt to climate change would detract from wider developmental objectives."

If development and climate change are, as Britain's international development secretary stated in February, "inextricably linked," how can development programs and assistance be focused so as to help sustain livelihoods? What role can microfinance play in order to protect the assets of low-income individuals who are particularly vulnerable to the effects of climate change? Some food for thought as we enter tomorrow's Speaker's Corner on Microfinance and Climate Change.

Live from the CGI: President Clinton Exclusive II – Energy, the Environment and T. Boone Pickens

Jamie Zimmerman — Tue, 23 Sep 2008 23:24:00 -0400

Last night, in the few minutes we weren’t talking about the financial crisis and the impending bailout, President Clinton waxed political on the potential for energy investment in the United States. According to the President, the near-certain reality of approving legislation liberalizing off-shore drilling should be seen as a political opportunity for progressives interested in sustainable environment and combating climate change. But if we’re going to “give” drilling to the right, the left should negotiate hard for the environment, including:

Extending solar and wind energy tax credits from three years to ten;
The creation of a fee collection system to modernize the electricity grid;
$10,000 tax credits for purchasing plug-in electric hybrid cars, and;
Compressed natural gas for trucks

On the subject of T. Boone Pickens, whose advertising campaigns have sparked intrigue across the USA, Clinton commented, “Boone Pickens is a god-send to this effort.” More specifically, Pickens’ plan is to modernize the electricity grid and harness the wind to power the whole of the United States. This is something reportedly is something wind can actually do, with the right grid. And despite few fiscal incentives to invest in this new technology (something President Clinton suggests need immediate remedy), there is currently two-year waiting list for wind-powered mills.

But why is off-shore drilling inevitable? In Clinton’s mind, even though he knows for a fact that there is no more than 6 months of oil in the arctic refuge that the legislation would open to drilling, the fact of the matter is that the government has got to “get real.” Everyday Americans are hurting in a big way, and they see gas prices as the cause of so much of their pain. This short-term solution is a political necessity. But, if “there is going to be drilling, let’s get something for it.”

Beijing's New Polluter Pays Car Tax - Good Idea?

Annette Nellen — Wed, 13 Aug 2008 19:32:00 -0400

Tax systems get used for a lot more than raising revenue for the government. They are also often used to help change behavior and to make prices reflect costs of "negative externalities." If you want to discourage something, raise the tax on it. If you want to encourage something, lower the tax or offer a special deduction or tax credit.

One activity we want to discourage today is greenhouse gas emissions, such as CO2 from burning fossil fuels - like the gas in your car. So, despite some elected officials calling for ways to lower the cost of gasoline, we should really be looking to increase the cost because:

The higher cost will encourage people to drive less or find other ways to use less gasoline.
What we pay for gas at the pump is not the true cost. When we drive and burn gasoline, we cause air pollution, create GHG emissions that contribute to global warming, wear out roads, and cause congestion. These activities have costs - such as cleaning the air or refurbishing roads. When that cost is not included in the price we pay, the government doesn't get the money needed to deal with the problems - the negative externalities of driving.

Beijing seems to have the idea right. It was reported in several news outlets that on August 13, Beijing announced that there would be a much higher sales tax on large cars and a lower tax on smaller cars (see abcnews.go.com)

The US has something similar with the gas guzzler tax enacted in 1978. However, that only applies to new cars so trucks and some heavy SUVs are not covered. You can find a list of covered vehicles from the EPA (here).

A flaw with both approaches is that the tax is only assessed at time of purchase. This doesn't do a good job of tying the tax to the cost of the negative externalities or help modify behavior. Once you've paid the gas guzzler tax, on the purchase of a $350,000 Lamborghini Murcielago, are you going to care how much you drive it every year? On the purchase of an expensive gas guzzling car, is someone even going to notice the up to $7,700 gas guzzler tax tacked onto the price tag? Will it cause someone to not buy the car? Of course, the gas guzzler tax also applies to some less expensive cars and it does seem to have caused carmakers to avoid mass producing cars that are subject to the tax.

Even if you buy the gas guzzler and keep it in your garage without driving it, you owe the tax.

A solution to better encourage less driving of gas guzzlers and discouraging their purchase (and manufacture) would be to have an annual tax on their ownership in addition to a higher gasoline excise tax.

The funds generated from a gas tax increase could be used for environmental research and clean-up, education on how to help the environment, and to provide relief to low-income taxpayers, as well as to some hard hit industries which they retool to use less gasoline. The use of a polluter pays tax to reduce another tax is called a "tax shift."

Another stick to help discourage production of gas guzzlers would be to deny companies the manfucturing deduction for them (IRC Sectoin 199) or impose an excise tax on some part used in these cars.

As federal and some state governments start serious work on reforming their tax systems to make them work better in supporting economic, societal and environmental goals, polluter pays taxes and tax shifts need to be part of that discussion.