TCS Daily

The Never Ending Story

By Christopher C. Horner - October 1, 2004 12:00 AM

Late this week -- for the fourth time in recent memory -- major press outlets trumpeted that, as Bloomberg News put it, "Russia Approves Kyoto Protocol". The stories claimed Russia would be ratifying the global treaty designed to reduce greenhouse gas emissions, thus ensuring enough participant countries for the treaty to enter into effect. None of the major outlets explicitly noted the irony of having reported this purported breakthrough on several prior occasions -- although one curious Reuters headline hinted at the media's earlier errors: "Kyoto Saved Again".

What's behind the latest outburst of "news"? Russian officials cleverly continue to engineer a campaign to obtain from the European Union certain concessions and understandings. Russia appears driven to tell the EU what it wants to hear on Kyoto, in order to avert problems with Brussels over other matters, including Russia's response to Beslan and other terrorist attacks. Until recently, trade-off negotiations with the EU centered on Russia's desire for membership in the World Trade Organization (WTO).

The greatest insight into what Russia might ultimately decide can be found in the comments of Andrei Illarionov, President Putin's chief economic adviser. A vocal Kyoto critic, he has likened Kyoto's restrictions on energy use to economic warfare against Russia, and the failed Soviet central planning scheme Gosplan. His money quote: "It's a gesture toward the European Union, nothing more." Illarionov reaffirmed the skepticism of Russian leadership toward its future in Kyoto this week saying:

"Nobody among Russian officials believes the protocol is good for Russia. Nobody sees any sense in the economic nature of this document. Nobody sees any scientific relevance in this document. Nobody sees any advantages for Russia in this document. It is just purely politics."

Whatever may have occurred this week, Duma officials confirmed that any real action on Kyoto would still only occur at or toward the end of the year -- if at all. Indeed, that is precisely what has been expected since Russia put off its decision on final acceptance until after the next Kyoto negotiation which will take place in December, in Buenos Aires.

Meanwhile, Russia will continue to play the EU for concessions. Once it has obtained what it sees as the maximum in concessions from Europe -- including non-interference in its handling of terrorism -- Russia might actually ratify. But even this is by no means certain (as even pressure group Greenpeace seemed to acknowledge in its press release this week).

But what happens if Russia does ratify? First it will sell Europe all of the "credits" it has toward tons of carbon dioxide. Russia holds these credits after it maneuvered under the Kyoto talks to include consideration of its massive forestland as carbon "sinks" (what's more, Russia's post-Cold War economic collapse -- and subsequent precipitous decline in energy use -- timed nicely with Kyoto's emissions baseline, giving it further credits under the scheme).

Once those credits are sold, and Russia must begin worrying about its own greenhouse gas emissions, Russian officials could then provide notice that it will withdraw from the treaty. After all, many prominent Russian scientists have expressed significant skepticism over the alarmist science undergirding Kyoto's mandated greenhouse gas restrictions. Under Kyoto, withdrawal requires a three year window, which is ample time for Russia to again bring the EU to the trough for further subsidies and trade concessions.

This week's news revealed no change in any country's Kyoto status, but further recognition that the press loves a good story. So mush so that they will run it every few months.


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