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Is Arnold an Environmental Girlie Man?

By Thomas Bray

At the 2004 Republican National Convention, Arnold Schwarzenegger brought a roar from the faithful with his admonition to the economic pessimists on the left: "Don't be economic girlie men!" But when it comes to the environment, it turns out that the Terminator has a distinctly softer, gentler side himself.

Last week the California governor signed into law a measure that would require a 25 percent cut in carbon dioxide emissions by the year 2020. Even assuming that global warming is the threat it's cracked up to be, and that human activity is an important contributor to the problem, such a cut wouldn't mean much. California, despite its reputation as the sixth largest economy in the world, accounts for only about one percent of global emissions.

But Schwarzenegger is up for reelection and he clearly suffers from anxiety about California's potent environmental lobby. And while the CO2 measure may be mostly symbolic, symbols count in politics. California's action, however short-lived, will encourage the environmental left in the seven Northeastern states that have been tinkering with similar ideas. It also may serve to co-opt a number of major corporations in a position to reap an immediate profit from the emissions trading system that would accompany the emission caps.

Ultimately the environmental left hopes to build enough support in enough states to force the federal government to adopt Al Gore's beloved Kyoto Protocol, which would require industrial nations to roll back CO2 emissions below 1990 levels.

Europe has signed on to the protocol and is testing a cap-and-trade system almost identical to California's. European politicians, realizing that they are about to make themselves even less competitive if other nations don't follow them over the environmental cliff, miss no opportunity to portray America as some sort of international renegade. Never mind that the major European industrial countries already have fallen well behind their commitments under Kyoto.

It's a virtual certainty that California will fail to meet its goal as well. That's why the measure signed into law last week contains an escape hatch in the measure which allows a governor to suspend the program if it imposes "significant economic harm." In an election year, significant economic harm likely will mean the loss of a single job. About the only thing the CO2 cap is likely to achieve is to empower the politicians to meddle ever more deeply in the state's economy - which itself would cost lots of jobs as businesses move elsewhere or fail to be formed in the first place.

California has been here before. In the 1990s it tried to mandate the sale of electric cars as a means of reducing pollution and cutting oil imports. But when it turned out that not many Californians were eager to drive golf carts to work, the state backed away from the mandate.

The Wall Street Journal last week carried a front-page article touting the supposed success of a German emissions trading system under which companies that don't meet CO2 goals can buy "credits" from companies that fall under the limits. The non-compliant companies can also earn credits by financing energy-saving schemes elsewhere in the world. But as the Journal had to admit, even this very modest program, targeted at utilities and other big energy users, has helped boost electricity rates 25 percent to 60 percent in the last two years.

And that's in pursuit of a measly 0.4 percent cut in emissions. Germany has committed itself to cutting emissions 21 percent under the Kyoto protocol negotiated by Al Gore in 1997. Imagine what full implementation would mean for the cost of electricity - and the overall German economy, which in any event has created almost no new jobs in the last 20 years. No wonder the U.S. Senate voted 97-0 not to even consider ratifying Kyoto, or that succeeding Congresses have declined to impose emissions controls on the American economy.

President Bush is right to emphasize that the best strategy is to provide an economic context in which the natural tendency of industry to invent efficient new technology should be encouraged, not punished with mindless controls on energy. (Germany has cut more than 50 special deals with industry to cushion the blow, but such bureaucracy-enhancing complexity is likely to be counterproductive - as well as discourage entrepreneurs from offering real alternatives to existing production methods.)

None of this has stopped the international chattering classes, or Al Gore, from scolding us about global warming, of course. This very week, the supposedly authoritative voice of the British establishment, The Economist magazine, editorially declared that "America should lead the way" in cutting CO2 emissions. But in a more sober article in the same issue, the magazine had to confess that "nobody knows for sure what is happening to the climate."

If California wants to turn itself into a Third World country, that's its prerogative. But it's not a very good reason for the rest of us to act like environmental girlie men.

Tom Bray writes columns for The Detroit News and RealClearPolitics.com. Email: tbray@detnews.com

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