Hot air and high ground at Gleneagles

Doing good takes more than good intentions. You need to be tough-minded. That’s the idea embodied in the economists’ synthesis: “Hard heads; soft hearts”.

It’s such a powerful idea that if it’s forgotten we’re often forced to relearn it - often through the agency of the painful and uncertain political contest between Left and Right.

At Gleneagles this synthesis worked on foreign aid.

Because program failures undermine its support, a left-of-centre “cartel of good intentions” has covered up the many failures of foreign aid. So we’ve been slow to discover and learn from what works and what doesn’t. We’ve even seen aid disappear into the Swiss bank accounts of third-world kleptocrats.

It’s taken the political Right to impose some hard-headedness. George Bush has sharply increased foreign aid while imposing much stronger conditions - for instance, on cleaning up corruption - and Gleneagles extended this approach. That’s hard-headed soft-heartedness in action.

But on the environment, Gleneagles gushed greenhouse gobbledygook.

Leaders committed to “act with resolve and urgency” - about as firmly as St Augustine prayed for virtue. “Lord make me chaste - but not yet”. Lord make me reduce my emissions - but not yet.

We’re at a pretty pass. No one is sure that the world will continue to warm or that our emissions of greenhouse gases are causing it. But scientists who deny it are now a rump consisting increasingly, though not entirely, of cranks.

There’s plenty of uncertainty about the costs of global warming too - and that’s not counting the subjective value of unique eco-systems we could lose. But the costs of global warming could vastly outweigh the modest cost of even quite vigorous action.

The Kyoto Protocol caps global emissions, but with two huge exceptions. First, the US has refused to ratify. (And thus emboldened, we’ve joined the US in our own exclusive duo - the coalition of the unwilling).

Second, Kyoto exempts the developing countries - which produce nearly 40 per cent of global emissions now and will overtake the West within two decades. What are we doing about it? Next to nothing.

International greenhouse politics remains mired in a swamp of soft-hearted soft-headedness. Being poorer, the developing countries are supposed to be the good guys. They’re also a majority of the UN and its progeny, the Kyoto Protocol. Thus the bizarre spectacle of a small group of rich countries taking on difficult commitments within an agreement formally controlled by those doing next to nothing. The majority remain serenely intransigent about taking on serious commitments while berating the minority for the paltriness of their sacrifice. They even call for compensation.

Pointing to their own much lower carbon emissions per capita and the West’s relative wealth, they cry: “You created the problem, you fix it”.

But if we were rationing water in a drought we’d want everyone to save water, though we might choose to compensate the poor. We should do the same with greenhouse.

Actually, we already have. When Kyoto was negotiated, Russia was in the midst of a depression produced by its botched transition to capitalism. So the richer countries gave it a very generous entitlement to emit. Indeed Russia was permitted to emit more carbon than it was then emitting - so called “hot air”.

Why? To reward it for signing up. Whether you call this “compensation” or an “incentive”, (I call it a bribe) Russia now sells its excess emission entitlements to the highest bidder. Get it? In addition to compensating Russia, trading emissions permits make Russia keen to cut its emissions further - so it can sell more permits. So it joins the global effort to reduce emissions.

The West should offer developing countries a similarly generous deal. But breaking through their intransigence would also require a credible threat to impose trade sanctions if they kept stalling. But so far a hard-headed, soft-hearted offer like this isn’t even on the table.

Why? Because the Europeans’ soft-heartedness is also soft-headed. They seem incapable of walking away from the table in the face of the developing country intransigence. American hard-headedness could be the antidote.

But so far developing country intransigence has just been a fig leaf for the Americans’ refusal to ratify Kyoto. The real motive is hard-heartedness. George Bush wants to protect the American “way of life” from the costs of its existing emissions target. So he’s not about to accept an even smaller target, which he’d be forced to, if the developing countries were brought into Kyoto - like Russia, with a generous emissions entitlement.

While I wait for progress out of this mess I’ll think of that Puritan saying that the road to hell is paved with good intentions. I'll be hoping that America’s walking away from Kyoto might just end up doing some good - that here on earth the road to heaven might be paved with a few bad intentions.

Economists have been unable to sell their “hard heads, soft hearts” recipe ready-made. But the contest between Left and Right might eventually deliver it.