President Clintons Kyoto Legacy for the U.S. Economy - Example

President Clinton’s Kyoto Legacy for the U.S. Economy Introduction Concerns with climate change cast long shadows on the economy of this decade and beyond. Industry, which was celebrated throughout most of the 20th century as a harbinger of human progress, is now looked at askance. The emergences of countries such as Brazil, Russia, India, and China, challenge the world domination which the United States has enjoyed since the demise of the Soviet Union. Policies have long gestation periods. Immediate and imagined public perceptions of what an administration does, must ultimately give way to reality as it unfolds. Hindsight has an additional advantage: we can criticize leaders of the past for all that they have not done in time. We should leave it to future generations to have the last word on the United States sabotage of the Kyoto Protocol during the reign of President Clinton. However, this landmark posture in Rio de Janeiro, by a person who once stood in public protest against his country, has surely had lasting effects on the evolution of the economy of the United States. This document attempts to review the effects of the refusal by the world’s leading economy to accept specific standards with respect to global pollution control. The Michael Porter Way 1995 was an opportune time for any business to secure a durable lead over the competition. The world was more secure then that it is today, though none of the present battle-fields were any freer from strife than they are today. The countries that are now poised to take on the United States in various fields were in the infancies of resurgence in those days. Worries about the ozone layer had only just begun to surface, and activists spoke in simplistic and minority terms about ceasing industrial activities altogether, in order to save planer earth. The Harvard Business School has never lost its vanguard position in the world of business management. Michael Porter, an integral part of this cloistered intellectual leadership, had chosen competition as his domain well before 1995. However, it was in this year that he took environmental conservation head on. Michael Porter is the first business management authority to assert that competitiveness and conservation have synergy (Porter, M, 1995). This strategic line continues to be nearly revolutionary to this day. The moves towards standard quality, mass production, and affordable costs, which started in the late 19th century, served us well for over 100 years. Porter laid the foundations for the next step in industrialization: he suggested that only those enterprises with the resources to meet green business standards would survive the new Millennium. Porter’s clairvoyance was especially significant for his own home country. That was because Porter did not limit his concepts of competition to corporations alone. He wrote about the competitiveness of nations, albeit in a detached and selfless format. The opportunity for the United States to extend its domination of the world in to the 21st century was clear. Neither California nor British Columbia may be willing to credit Michael Porter for their almost unassailable leads in matters of superior environment protection standards, but the Hydrogen Highway connecting these two regions of North America is a striking demonstration of where the entire continent could have been today, using the Porter Mantra. The U.S. Stand on the Kyoto Protocol The Kyoto Protocol brought common issues of Planet Earth to center-stage. It demonstrated that world issues are beyond the limits of individual nations. Any one country may strive for environmental conservation, but its efforts may come to naught because its peers do not follow suit. It is a convention of contemporary world life that nations are represented by their politicians. That is why representatives of the people jockey to assuage the emotions and perceived needs of their constituencies, rather than take leadership roles, or try to set examples for others to follow. The Kyoto Protocol also brought disparities in development between countries in to sharp focus. Damage to the ozone layer is heavily skewed in debits of mature economies. We are all agreed on this fact. That is why the Kyoto Protocol asked for rich countries to make the greatest sacrifices in terms of and towards amelioration. There has been a view that poorer and populous nations be given elbow room in terms of past levels of emissions. Porter’s work, referred to in the preceding section of this document, suggests that the United States could have taken a stand on the Kyoto Protocol distinct from that of Europe. It was an opportunity to leverage technology for future competitiveness. Better emission norms would have elevated all of North America to the plane of California. Business considerations apart, there was a moral case for the United Sates to lead the world in matters of conservation (Brown, 2002). After all, the World Bank does not lend to all countries equally. Why should the United States have taken a stand on the Kyoto Protocol that it would not take steps to protect the environment unless lesser countries did the same? Hybrid Automobile Engines The Japanese lead over Detroit with respect to hydrogen fuel-cell technology is acknowledged by the administration (Clean-Fuel Vehicle Deduction Available for Certain Models, not dated). Citizens are offered financial incentives to buy cars and trucks designed and owned in other countries, even as the fortress of U.S. industrial enterprise crumbles. What use are tax incentives for people out of jobs? It is not as though the United States lacks hydrogen fuel cell technology. No other country has any Hydrogen Highway as of 2008. Universities and the administration pour virtually unlimited resources to innovate power systems free of crude oil and its polluting effects. Yet, an industry fed on the sops of the Kyoto Protocol sabotage, wallows in decline, refusing to partake of new technologies that are theirs for the asking. Window-dressing for the profits of the next quarter is as far as we have been able to see. It is not a matter of automobiles alone. Another country has pioneered railway locomotives that run on hydrogen fuel cells. An entrepreneur from a third has funded research in to flying civilian aircraft on bio-fuels. The United States has been truly left behind through its intransigence on the Kyoto Protocol. Fortunately, it is not too late. The next year is opportune for a new administration to chart a fresh course. It is time for industry to adapt. Corporations must generate cash inflows because they are more effective in conserving the environment. Simultaneously, the real cost of pollution must be paid in full. We need new standards of costing and accounting. How can this be done? Carbon Exchange The leadership opportunity in trading emission rights may remain, but the benefits of being a pioneer have been lost by the United States (About the MBRE, 2004). Brazil has shown that a carbon exchange can work. It is ironic that this center is based in the very city where President Clinton killed the Kyoto Protocol. The NYSE, AMEX, and NASDAQ spring to mind when one mentions a stock exchange. However, the United States has taken no lead in international trading of pollution standards. A carbon exchange is the tip of an iceberg. All future enterprises should include environmental and social accounting. Only such firms should survive which conduct their operations responsibly and in sustainable ways. Time limits for better environmental standards must be set by levying direct and glaring charges for continuing the old ways of pollution. This will drive management teams to innovate and to meet better standards. Conservation of the environment should become the new driver of competition. A carbon exchange will also pave the way for more equitable distribution of the world burden for environmental protection. The World Bank and the International Monetary Fund may dole out carbon credits to the poor along with the financial resources they have provided for so many years. Technology is another form of aid, which will help poor countries improve their emission standards. After all, no nation wishes to pollute the earth without a pressing reason. A new attitude could drive the United States to its deserved place in the comity of nations. People with foresight should replace those with selfish commercial aims in the formulation of key economic policies. Citizens from all walks of life should also have more influence on the process. The academic resources of the country must be brought to bear on its fortunes. Energy Transformation It is nearly incredible that a country with such large coal reserves, and with sequestering know-how as well, should be so abjectly dependant on crude oil (Environmental Benefits of Clean Coal Technologies, 2001). It is also a powerful demonstration of how the United States has squandered its entrenched strengths to continue its technological leadership of the world. Technology and innovation are mutually enabling partners: each fosters the other, though they are discrete intellectual processes. However, they should be united in purpose. Coal has the potential to improve America’s energy self-sufficiency. Thoughts that coal is necessarily polluting are outdated. Other countries such as China, which challenge U.S. supremacy today, also have large coal reserves. They too can benefit by following the U.S. lead in clean coal technologies. Since the United States has vast arable land resources, it can also use photosynthesis to capture carbon dioxide. The latter is made out to be some kind of villain by folklore and in the popular media, but the gas is an essential component of essential carbohydrate manufacture in nature. This is another example of innovation to put technology to best use. Another dimension of this issue is to decentralize the generation of power. The involvement of local communities, and even of individual consumption units, helps to ensure economic feasibility, and reduces expectations for subsidies. This form of meeting power needs also suits technologies associated with alternative forms of energy. New ways of looking at costing can also help in energy transformation. Crude oil fixation has been under the cartel of OPEC for a long time. It does not account for the reparation costs of pollution in any case. Simultaneously, clean fuels are sold in competitive market conditions, without any credits for environment conservation. These structural defects are spin-off implications of U.S. opposition to the Kyoto Protocol. What Could Have Been The United States could have taken the place of OPEC (First Solar modules are optimized for large scale, grid-connected commercial power plants, 2008). Most of the alternative fuel spaces are dominated by American technologies. Domestic corporations could have used clean sources of energy to revitalize their domains. Instead, they have chosen to remain short-term oriented, lobbying with Washington to stay with fossil fuels from abroad. The super-power has also lost much of its stature in the eyes of the rest of the world, since opposition to the Kyoto Protocol was in such blatant disregard of global needs. It has to be said that emerging countries have been equally inflexible on the issue of controlling their emissions, citing specious arguments about development, and per capita pollution. Concern for the environment has also been diluted to the point of negation by extraneous considerations, such as negotiations over mutual trade barriers for various classes of goods. Conclusions Holds of big business on the Office of the Presidency must be broken. The United States needs checks to prevent the Washington administration acting solely in the immediate interests of the corporate sector. A gap created by the elimination of lobbies in favor of industries, should be replaced by aware and concerned citizens. Ordinary folk must be able to work out the future effects of present policy alternatives, especially on matters that concern the future place of the United States in world trade. We need processes that promote substance and reduce forms of public engagements between people and their representatives. The questioning and debate that occurs during an election campaign must continue throughout terms. The time horizon in which a nation functions makes a difference. The best days of a country are when people plan for the next generation, rather than for their own nest-eggs alone. Modeling the inter-relationships within an economy, and using academic excellence in real lives, are other routes to more effective planning in the greater public interest. Finally, there is no substitute for basic patriotism. A Presidential entourage must know that molly-coddling domestic business interests can hurt national interests. The U.S. action in Rio de Janeiro on climate change has been unconscionable. We need safeguards to avoid this genre of office abuse as well. Works Cited Brown, D, 2002, American Heat: Ethical Problems with the United States Response to Global Warming, Rowman & Littlefield Porter, M, 1995, Green and Competitive: Ending the Stalemate, Harvard Business Review, September-October 1995 About the MBRE, 2004, web site of the Bolsa de Valores do Rio de Janeiro, retrieved July 2008 from: http://translate.google.co.in/translate?hl=en&sl=pt&u=http://www.bvrj.com.br/&sa=X&oi=translate&resnum=1&ct=result&prev=/search%3Fq%3Dbrazilian%2Bstock%2Bexchange%2Brio%26hl%3Den%26client%3Dfirefox-a%26rls%3Dcom.google:en-US:official%26hs%3DEck%26pwst%3D1 Clean-Fuel Vehicle Deduction Available for Certain Models, not dated, web site of the Internal Revenue Service, retrieved July 2008 from: http://www.irs.gov/newsroom/article/0,,id=104549,00.html Environmental Benefits of Clean Coal Technologies, 2001, DIANE Publishing First Solar modules are optimized for large scale, grid-connected commercial power plants, 2008, web site of First Solar, retrieved July 2008 from: http://www.firstsolar.com/projects_applications.php Read More