President Obama declared climate change to be the defining threat of the century in Alaska this week, before he literally hiked a melting glacier. But, once again proving that virtually nothing will be enough for some activists, environmentalists have attacked Obama, the president who has done more on climate change than any other ever — and perhaps a lot more than the next one will. His sin: allowing oil drilling to proceed in the Arctic Circle.
Behind their claims is a study that seems to prove governments must restrict further development of fossil fuels, particularly in high-cost zones such as the Arctic. Except it doesn’t actually show that.
The paper figures that, if the world were to meet its goal to keep global temperature rise to 2 degrees Celsius or lower, lots of fossil fuel will have to remain unburned, and it finds that “development of resources in the Arctic and any increase in unconventional oil production are incommensurate with efforts to limit average global warming to 2 [degrees] C.”
But in May the Council on Foreign Relations’s Michael Levi punctured the conclusions environmentalists drew from the study. “[M]ore oil production in one place generally means less oil production elsewhere — that’s how markets and prices work — which substantially blunts the effect” that Arctic drilling would have on global greenhouse emissions. In fact, “the study never asked what would happen to emissions if the Arctic oil were put off limits. Had it done so, it would have found more oil production elsewhere, and minimal net emissions impact.”
The key to meaningful climate action is not to haphazardly reject oil projects in the vain hope that people elsewhere will decline to produce oil, too. It is to reduce demand for fossil fuels, either by mandating reductions in their use, which Obama has done, or by slapping a fee on carbon dioxide emissions, which is the economically rational way to tackle climate change, and a version of which Europe and China have done. Every major emitter has a lot more to do to drive down fossil fuel demand, particularly for super-dirty coal. That must be the focus of environmentalists’ efforts. That should be the issue attracting activist passion.
With significant demand-side policy in place, markets would sort out which oil is economical to develop and which is not. It just won’t feel as emotionally satisfying as blocking a pipeline or angrily attacking the president over insignificant policy differences.