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Climate Change Policymaking in Germany and the USA Guri Bang Softing, CICERO, University of Oslo (www.cicero.uio.no) March 2002 Paper presented at the 43rd Annual International Studies Association Convention, New Orleans, LA, 24-27 March 2002. Panel: TA 30 Environmental Policy Making, Tuesday 8:30-10:15 Abstract In a comparative analysis of climate change policymaking processes in Germany and the USA, the paper explores, first, how national cost-benefit calculations and international interdependency structures are decisive for the development of the counties’ negotiation positions in the international climate change negotiations. This gives a rather rough picture of the environmentaleconomic interests of the countries. Secondly, therefore, the paper explores how a focus on domestic politics can provide a supplemental, more detailed account of the climate change policymaking process. Institutional structures and the political system of the countries influence the scope of possibility for national climate change policy outcome, as the complicated decisionmaking process involves competing interests of political, economic and social stakeholder groups. The distribution of power and influence between domestic actors can limit the government’s ability to implement the climate change policy it prefers. Introduction Climate change scientists have found discernible evidence that the world is undergoing humaninduced global warming. This means that human behavior will have to be changed to abate the problem by reducing emissions of harmful greenhouse gases (GHGs). This in turn means politics: who are to take the decisions about how to change behavior, and in what way. In this paper the research question is why two large, high emitting countries like Germany and the United States have ended up with so different policies to address the problem? To analyze this, I am using two established explanatory models from political science: the unitary rational actor model (URA) and the domestic politics model (DP). From each of the models I extract two central theoretical predictions about what influences the policymaking process. Hence, four central elements – national cost and benefit calculations, interdependence, public demand and support for climate policy, and governmental supply of climate policy – are considered in this paper to analyze similarities and differences in the climate change policies in Germany and the United States. The paper concentrates on the Kyoto protocol negotiations (1995-July 2001). To be able to understand climate change policy choice in the two countries, it is essential to establish a set of causal mechanisms that is assumed to influence the policymaking process. I have chosen to use the unitary rational actor model and the domestic politics model to establish four sets of causal configurations commonly thought to be important in this respect within the international relations field of policy analysis.1[1] From each of the models, I extract two main assumptions. These constitute the configurations of causes that are thought to inform us as to the rationale behind policy choice. Degree of membership (mostly in or mostly out) in these four causal sets will be a signal of what causal factors were important in this policymaking process in each of the countries. The hypothesis is that the same set of causal conditions does play a role in the policymaking process in both countries, although to a different degree. The data consists of secondary literature (academic literature, journal articles, newspaper articles) about the climate change policy in Germany and the USA, personal interviews with central participants in the policymaking processes in the countries (approximately 12 interviews per country), as well as policy documents and analyses made by actors in the policy process (governmental documents, NGO documents). 1[1] See for instance Harris, P. (1998): Understanding America's Climate Change Policy: Realpolitik, Pluralism, and Ethical Norms. OCEES Research Paper, or Hasenclever, A., et al. (1997): Theories in International Regimes. Cambridge University Press, Cambridge. National costs and benefits The central issue for a rational decision-maker will be to try to balance marginal abatement costs against marginal damage costs. The problem for most countries in the climate change context is that it is difficult to know for certain what the damage costs or impacts of climate change will be in the future. Hence, a direct comparison of abatement costs and future benefits of reduced damage costs is challenging, if not impossible. A core objective - for both the USA and Germany - in the climate change negotiations has been to work for policy solutions that can be implemented at a reasonable cost. Economic assessments of the costs that climate policy action would incur have been produced. The overall conclusions have been different in the two countries. Furthermore, countries assess the difference in costs and benefits between prevention of serious climate change effects and adaptation to climate changes. It could for instance make more economical sense to wait and see what climate changes will entail for the country, and then adapt to it, rather than to invest large sums of money into prevention-policy initiatives with uncertain future benefits. The problem is, however, that uncertainty still pertains to the time-range, speed, and gravity of future climate changes. Under uncertainty, the first choice for policy design would be “no regrets” solutions. When the question of extra costs becomes relevant, i.e. implementing more than no-regrets measures, the policymaker will have to consider the elements of uncertainty involved when making cost-benefit calculus. It would be better to choose policy design that has many advantages beyond the climate change aspect. A policy proposal is therefore more likely to find support through serving several policy needs at the same time. Urgency and timing of the issue obviously also plays a role here. To assess the degree of explanatory power of these theoretical predictions on German and US climate policy, I will consider to what extent cost and benefit calculations have been used by the government to design domestic climate policy and negotiation positions at the international level. The presumption is that all governments employ such calculations, and that economists will recommend policies where the expected benefits outweigh the expected costs, as with no-regrets policies. I then move on to assess to what degree such recommendations have lead to policy decisions and positions that correspond with the advice. Thus, high degree of membership in this causal set is identified as use of cost and benefit calculations when establishing policy alternatives, combined with corresponding policy decisions. Low degree of membership in the causal set is identified as use of cost and benefit calculations when establishing policy alternatives, combined with non-corresponding policy decisions. Germany In the period 1987-1992, a very important process of issue framing took place in Germany: The Enquete Commission,2[2] consisting of parliamentary politicians representing all political parties as well as experts on global climate change issues, assessed both the science of climate change and policy options through several scenarios in 6 studies. The commission recommended a 25-30% reduction of CO2 emissions from 1987 levels by 2005. This target could be reached without any harmful effects on the German economy provided that energy efficiency efforts, investments in renewable energy sources, and continued use of nuclear energy became the focus of government energy policy. The broad base of participation in the commission, and the high level of agreement that was achieved, resulted in a very high level of acceptance and consent with the commission’s policy advice. In December 1990, the German parliament agreed on an emissions reduction target of 25% of CO2 from 1987 levels by 2005. The Enquete-process framed the issue, and created a base for agreement about global warming that lasted through the 1990s. The remarkable degree of agreement between the political parties in Germany on the high ambitiousness in climate policy has resulted in a stable policy direction. Even when a realization came about after the “wall fall” effect3[3] started to wear off, that reducing GHG emissions would be more expensive for Germany than first thought, the policy direction was upheld. As such, the precautionary principle has been at the center of climate policy strategy since the start – also this in consistency with the recommendations by the Enquete Commission. In addition, much weight was put on the possible positive effects that energy efficiency and new job markets could create in the national economy. The government based much of its information and decisions it made on studies 2[2] The German Bundestag from time to time appoints expert commissions to make assessments on complex policy issues. 3[3] Between 1990 and 1996 energy-related CO2 emissions in Germany fell by 10.3%. In relation to GDP CO2 emissions have fallen by 19% within the same period. The fall between 1990 and 1996 was 13.3% per person. The reasons for these trends are extremely varied. On the one hand, the economic reconstruction and reduced use of CO2 intensive lignite coal in the new Länder has played a significant role in the improvement in the whole of Germany’s emissions balance. However, including the eastern Länder into the system since October 1990 has implied a subsidy of approximately 150 billion DM per year to reconstruct that part of the country. The economic burden of this subsidy has been on the old Länder. (Federal statistical office Germany: http://www.statistik-bund.de/, and BMU (1997a). from renowned economic research institutes like RWI, Ifo, FhG/ISI, and the Öko-institut.4[4] The scenarios these institutes developed for important elements like energy consumption, employment effects, and CO2 emissions were used as background for cabinet decisions on the German climate protection program.5[5] Rhetorically, the costs of abatement policy have been evaluated as minor to the importance of taking precautionary action to prevent adverse climate changes. However, an obvious discrepancy has occurred in German climate policy over the period after COP1 in Berlin in 1995. Germany has been working to through the Kyoto protocol negotiations to have internationally binding reduction targets. Germany is a party to the common greenhouse gas emission reduction target of the EU,6[6] which is to reduce the emissions of CO2 equivalents by 8% in the first budget period (2008-2012) of the protocol. Germany has had a leadership role in the EU on climate policy initiatives, and on the common negotiation position of the EU in the international climate change negotiations. Germany alone is responsible for approximately 80% of the total EU reductions, decided by internal distributive negotiations within the EU. This underscores the pivotal role Germany has taken on in EU climate policy.7[7] At the same time, in the domestic arena the ambitious emission reduction target has proven to be hard to implement, despite the massive reductions achieved in the first years after reunification. Economic recession and increased unemployment have made that difficult. The national costs Germany would incur by implementing the Kyoto Protocol have been calculated to be relatively small, especially because of the potential for energy efficiency that is still unexploited. In a 2000 study by the Fraunhofer Institute (ISI), the main conclusions are that climate policy will have a fairly small impact on employment and economic growth, and furthermore that energy efficiency policies will lead to more jobs and accelerated innovation processes.8[8] Under the protocol, Germany can use a comprehensive approach towards reducing emissions, meaning that reduction can be achieved through policy reducing emissions of six major greenhouse gases. If reductions must be achieved through reduction of CO2 alone, the costs would probably be higher, mainly because Germany is a large importer of fossil fuels for primary energy use. Energy 4[4] Two central studies that have been used by the government in cost benefit calculations are the 1996 RIW/Ifo study “Overall economic assessment of CO2 reduction strategies,” BMWi Publication series: number 414, and the 1997 FZJ, DIW, FhG/ISI, Öko-Institut study “Policy scenarios for climate protection.” 5[5] BMU (1997b), pp. 46-47. 6[6] Commonly referred to as the ‘EU-bubble’. Within the bubble, the EU was allowed to distribute emission reductions between the member countries, thus achieving a flexible and cost-effective way of reaching the target of 8% emissions reductions. 7[7] Ringius,L (1999), p.22. 8[8] BMU (2000), p. 40. efficiency policy thus makes sense in Germany, and has been an important part of the 130 policy measures described in the Climate Protection Program.9[9] The United States In 1993 President Bill Clinton declared that the United States would commit to stabilizing its GHG emissions at the 1990 level by 2000. However, in a 1996 position paper explaining the U.S. government position on climate change the expected failure to achieve the stabilization target was spelled out directly.10[10] In the same year’s annual report of the Clinton administration’s Council of Economic Advisors (CEA), the main policy advice was to rely on cost-effective GHG control policies based on economic incentives to motivate the responses of the responsible GHG emitters, as well as flexibility in the timing of emissions reductions, and to coordinate national responses in order to avoid excessively costly outcomes.11[11] The Clinton administration followed the CEA advice closely in its negotiation strategy during the Kyoto protocol negotiations. In advance of the Kyoto meeting in December 1997, increased efforts were made to attain information about costs of climate change impacts and mitigation policies. The Council of Economic Advisors made economic assessments of the costs that climate policy action to fulfill the Kyoto Protocol would incur for the United States.12[12] The Council’s leader gave several Congressional hearing statements where she asserted that the United States could work to avert the dangers of climate change, while at the same time maintain the strength of the economy.13[13] In a 1998 CEA report, the economic costs for the United States was assessed to be critically linked to the degree of cost-effectiveness in the pursuance of emissions reductions. Also, the report made clear how difficult it is to calculate costs and benefits of climate. The use of economic models from OECD, IPCC, and Stanford University were central, along with other tools such as meta-analysis, basic economic reasoning, economic indicators from the World Bank, statistics, etc. in making these assessments.14[14] The overall conclusion was that the economic impact of the Kyoto Protocol will be modest for the United States. This conclusion was made, however, with the assumption that international agreement could be achieved on some of the most disputed issues in the protocol: full emissions trading, joint implementation, and participation by key developing countries. Other 9[9] BMU (1997a), pp. 17-24. EPA (1996), p. 2. 11[11] United States Government Printing Office (1995), p. 156. 12[12] U.S. Department of State (1998). 13[13] Janet Yellen’s testimony before the Senate Committee on Agriculture, Nutrition, and Forestry, March 1998. 14[14] U.S. Department of State (1998), p. 39. 10[10] economic studies, by renowned researchers like Nordhaus and Boyer,15[15] have predicted that U.S. costs could incur up to 2-4% of GDP if emissions reductions should be achieved in the short term, as with Kyoto. Concerning the costs of potential damages from climate change, a new study shows that long-term observations confirm a rapid change in the climate.16[16] The science indicates that the warming in the 21st century will be significantly larger than in the 20th century. Temperatures in the US will rise by about 3-5°C (5-9°F) on average in the next 100 years, which is more than the predicted global increase. For the nation as a whole, direct economic impacts are likely to be modest. But in some places, economic losses or gains are likely to be large. For example, crop yields are likely to increase over the next few decades and forest productivity is likely to increase over the short term. But sea-level rise might threaten coastal wetlands and human coastal development, and increased precipitation and storm surges can have economic consequences in several regions.17[17] The policy incentives in the second Clinton administration generally followed the CEA analysis and advice. President Clinton’s climate change policy programs were of a no-regrets character, emphasizing the potential for both environmental benefits and economic growth through win-win-partnerships with the private sector, states, localities, and non-governmental organizations. This means that Clinton was able to choose policy design that had many advantages beyond the climate change aspect. The Climate Change Technology Initiative (CCTI) is an example of Clinton’s “no regrets” strategy towards climate change. CCTI included tax credits to serve as incentives for deploying energy efficiency improvements and renewable technologies for buildings, light-duty vehicles, industry, and electricity generation. Other funding covered research, development, and deployment for energy-efficient and renewable technologies and appliance efficiency standards. One focus of these programs is climate change; but they often have additional benefits for improved air quality due to reductions in criteria pollutants, energy security, and maintaining U.S. leadership in science and technology.18[18] The new turn in US climate policy under George W. Bush – a rejection of the Kyoto protocol – seem to underline that climate policy has to “compete” with other issues for a place on the policy agenda. One of the reasons that Bush gave for turning away from the Kyoto Protocol was 15[15] See Nordhaus and Boyer (1999): “Requiem for Kyoto: An Economic Analysis” in The Energy Journal, Special issue. 16[16] US Global Change Research Program (2000). 17[17] US Global Change Research Program (2000), p. 7-10. 18[18] “Analysis of the CCTI”, April 1999, Energy Information Agency. that the United States is experiencing an energy crisis. Reduced use of fossil fuel generated energy would, in this situation, presumably hit the economy hard.19[19] The other main reason Bush gave was that the protocol would have an adverse effect on the national economy. Recent policy advice on for instance the energy policy of the United States20[20] does not go specifically in depth into the economics of climate change abatement policy. Membership degree The Clinton administration followed the recommendations made by the CEA. On the basis of the above analysis, I conclude that cost and benefit estimates was important for formulating climate policy in the United States. The CEA and the Treasury Department became closely involved in making cost estimates for the implementation of the Kyoto protocol. Policy advice was followed, both through no-regrets initiatives at the domestic arena, and through positions pursued in the international negotiations. The membership degree in this set is therefore mostly in for the United States. In the case of Germany, we saw that the issue framing phase was immensely important for both policy direction and level of ambitiousness. Policy advice have come from several influential research institutes, and have shown moderate to positive effects for German economy provided that energy efficiency and renewable energy sources have been in focus of policy choice. This policy advice has been followed in the national climate protection program. The program has proven too little to achieve the reduction target, and hence one could say that policy advice wasn’t followed to the required extent. The degree of membership is therefore mostly but not fully in, as in the case of the United States. Interdependence A central assumption in the Unitary Rational Actor model is that a country selects the policy alternative that has the highest-ranking consequence in terms of the country’s goals and objectives. In determining goals and objectives, one must look at the context in which countries operate, rather than internal policy processes or structures. The state is the agent, and the international community provides the structure in which the state must defend its interests21[21]. Hence, negotiation positions 19[19] See for instance the arguments made by Vice president Cheney in “Cheney Promotes Increasing Supply as Energy Policy” by Joseph Kahn, New York Times, May 1, 2001. 20[20] Report of the National Energy Policy Development Group (2001): National Energy Policy. 21[21] Allison (1971), pp 32-33. are chosen in response to the strategic problem the nation faces and are based on the best possible information available to the actor – about the preferences of other actors, the issue area, as well as the range of options available. These are considerations that will be part of the negotiation strategy of a country. To explore the degree of membership in this causal set I will assess whether the need for a regulative international structure is reflected in the positions the country take in the negotiations and decisions in the national policymaking process. The willingness of the countries to sign and ratify international treaties that regulate greenhouse gas emissions is the indicator of to what degree the country finds these international structures important to establish and participate in to maximize national welfare, and to regulate their opportunity space. Here, I am looking at the main arguments used during the negotiations and the national policymaking process to assess willingness. Willingness, as defined above, is going to vary between the countries since they are dependant on fluctuations in international markets to a varying degree. For instance, stable international structures in form of an international climate change agreement that regulate the important energy/environment interface would presumably mean more in terms of investment security for industries in a small country like Norway than in the USA, since Norway is a small open economy while the USA is a large open economy and thus less vulnerable to changes in the markets. High degree of membership in the causal set is characterized by high willingness to sign and ratify treaties, indicating how important a stable international regulatory climate change structure is for the national economy. Low degree of membership is characterized by high unwillingness to sign and ratify treaties. Germany A quick glance at Germany’s ambitious national emission reduction target convince us that the country is willing to take on a stronger climate policy than most other countries, and a disproportional large share of the joint EU-target. Governmental documents and civil servants22[22] point out that Germany has been occupied with the long-term in climate policy strategies. Even though the country would potentially lose welfare in the short term by being bound by an international treaty, it would reap benefits in the long term. This as a result of for instance benefits that a head start in new technology markets would produce, and also benefits from building confidence in potentially important markets in the developing world for the future. At COP5 in Bonn in November 1999, chancellor Schröder said in his opening speech to the conference that ‘if 22[22] BMU (1997b). we do not embark upon climate protection now, we will loose the markets of the next century.’23[23] He also reaffirmed Germany’s CO2 reduction target, and his ambition to keep it. It has been a specific objective for Germany to be a leader in international climate affairs. The country has showed strong willingness to sign and ratify treaties, and to take on tough commitments. Environmental minister Jürgen Trittin reaffirmed this in an interview in the run-up to COP5: “Germany will maintain its role as a front-runner in international climate protection into the future. During the Ministerial Segment of this Conference I will firmly support the idea of other States adopting a similarly broad catalogue of measures for climate protection as us. Measures for energy conservation, the ecological tax reform, the promotion of renewable energies and many further measures do not only benefit our climate, but also offer opportunities to modernize the economy.”24[24] These statements indicate that the possibility of gains in the future is important for the decision making in German climate policy, probably combined with the anticipation of modest costs with implementing abatement measures, as pointed out previously. Strategies of developing towards a sustainable development, while meeting the challenge of globalization, incorporate the importance put on having a potent industrial sector in Germany. Weight is put on the government’s willingness to prepare conditions that will make a strong and vital industry sector possible today, combined with a strong climate policy.25[25] There has been focus on the role of industry in German economy, and a debate about how one can keep the country an attractive site for large industrial companies and future investments has been important in the 1990s. Equal market conditions have been used as argumentation for Germany’s ambitiousness and willingness to sign and ratify the Kyoto protocol, as a means to provide stable international conditions. Germany is now on the verge of a new era, economically speaking, where globalization and changing industrial relations forces the economic actors to think new thoughts. Part of this change has been the increased environmental consciousness that has made policy-makers aware that investments in clean technology and energy efficiency can create new markets and new jobs. The recession that hit the German economy during the 1990s and the growing concern about the unemployment issue have been central in this change. Industrial managers expect the government to take action adjusted to the difficult economic situation of Germany. At the same time they call for a more comprehensive strategy in climate policy, where all affected policy areas must be kept in 23[23] http://www.bundeskanzler.de/03/27/ Federal Environment Minister Jürgen Trittin in Umwelt 10/99 25[25] BMU (1997c) 24[24] mind.26[26] For instance, the government introduced a complete liberalization of the electricity supply market in Germany in 1999 that will force electricity suppliers to be competitive on prices. At the same time the companies must be ready to face competition with foreign companies. This development will probably be easier to adjust to for large energy-supply companies. In Germany this means for the most part energy from coal-fired plants or nuclear power plants, supplied to the grid by energy giants like RWE. Over the last few years the economic difficulties and increasing unemployment have been important and restrictive for climate policy choices, not least because of the chances for decreasing competitiveness compared to major trade-partners in the world markets. This can be one explanation to why there is a discrepancy between ambitions to be a leader internationally, and the lack of political will for domestic implementation of CO2 reductions. The United States The United States has been less ambitious than Germany in setting targets and timetables for emissions reductions. Bill Clinton stated that emissions should be stabilized at 1990 levels by 2000, but later denounced the target. Likewise, the country took on a 7% reduction commitment by signing the Kyoto protocol, but has later walked away from that agreement. The willingness of the United States to sign and ratify the Kyoto protocol has of course been closely related to its contents. Elements like a comprehensive approach to including all GHGs in the reduction efforts, the participation of developing countries, and flexibility mechanisms to secure cost efficiency in policy have been important. However, what we are looking for here is the degree to which the United States has argued for the international treaty as a necessary international framework to secure own interests. The United States was actively involved in early critical issues such as deciding that the intergovernmental negotiations should perform step by step thru a “framework agreement model,” and that decision making should happen by consensus rather than majority, which gave individual countries substantial leverage over the final outcome.27[27] In the Kyoto protocol negotiations, the United States has been very concerned about issues such as compliance and options for flexibility in the approach to reduce emissions. 26[26] Interviews with a director in the coal-mining company ‘Rheinbraun AG’, Cologne, 03.11.99 and a representative of BDI (Bundesverband der Deutschen Industrie), Cologne, 16.09.97. 27[27] Bodansky (2001), pp. 32-33. The United States is the world’s largest emitter of GHGs. This gives the country real power of control over the degree to which an international agreement to reduce emissions can become effective. If the United States participates, the effect is so much larger than if the country chooses not to participate. On the other hand, domestic politics can seem just as important precisely because of that. And in addition, it would mean more flexibility and maximum control. One can say that the United States in this sense have much less degree of interdependency than small countries like Norway, where contribution to the climate change problem is so small that the country depends on other actors to participate in a global effort to address the problem. Also, the vulnerability for adverse climate change impacts is comparatively small in the United States. Climate change poses no direct threat to society. This makes the country less dependant on others and less in need for having a global treaty. The United States’ immediate interest for structural regulations at the international level thus seems small. It is more important what happens at the domestic arena than what happens at the international level. This is also reflected in the positions the United States has taken in the negotiations. Focus on flexibility mechanisms and cost efficiency in policy solutions mirrors the interests that the country will have included the treaty. The United States has shown little leeway or willingness to move on these key elements. In fact, at COP6 in The Hague in 2000 the United States was willing to strand the whole negotiation process as a result of not winning through on important elements like no restrictions on emissions trading and the right to uptake of CO2 in forest and land-use as part of the GHG account. This is a signal of the low degree of dependency the country has of an international treaty that regulate the framework for emissions reductions. In spite of seemingly low interdependency, what happens in Europe, Japan, and China is important for U.S. business. Trade with rapidly growing developing countries, like China, has become more important, and the development of the trade and export sector in the United States has made the country more vulnerable than earlier. Hence, in particular the United States Senate has considered participation by the developing countries, which within a few years will contribute more to the world total of GHG emissions than the OECD countries, a requirement for the country to participate in an international climate change treaty. As a dominant country in the world and in the negotiations, the United States has been able to influence the positions of other Annex 1 countries substantially, as discussed above. The United States has also used its influence to shape the design of the treaty itself, to secure accurate reporting procedures to allow monitoring of the actions of all parties. Here, the United States has been a proactive participant in the negotiations. In light of this effort and the degree to which the United States has been able to dominate the design of the Kyoto treaty, it is a strong policy choice signaling independence and need for national control that the United States now has rejected the treaty. Membership degree The United States introduced a stabilization target in 1993, but showed little willingness in implementing policies to achieve the target. The rather high willingness to sign the UNFCCC was qualified by the low willingness to take on binding targets and timetables. The analysis shows that the United States showed reluctance to sign and ratify the Kyoto protocol. On grounds that the U.S. negotiation positions were not taken sufficiently into account, the negotiations about specific important elements in the Kyoto protocol proceeded for more than 3 years after the protocol was signed. The United States is further away from ratifying than ever after George W. Bush rejected the treaty in March 2001. Hence, the membership in this causal set is mostly out. Germany has shown high willingness to sign and ratify the Kyoto protocol. Throughout the protocol negotiations Germany has been taking a leading role, also within the EU. The EU is about to take the final decision to ratify the protocol in March 2002. The analysis shows that changing industrial relations and beliefs in new market conditions have been part of doing an international framework for GHG reductions important for Germany. The membership in this causal set is mostly in. Public demand and support In democratic, pluralist societies, we expect politicians and government agencies to be concerned with the public opinion concerning the climate change policy issue. This analysis will concentrate on two elements of societal demand and support of climate change policy. First, the DP model predicts the distribution of damage and abatement costs in society to be important. The general public concern about the degradation of the environmental condition of the country or any irreversible damages must be considered and balanced against the concern of actors who will suffer from heavy abatement costs incurred by climate change policy measures. For instance, local business and energy interests strongly affect the way constituency-attentive politicians handle the climate change issue. The second relationship that the DP model predicts is that public demand and support of climate change policy is likely to be decided by the values, interests, and knowledge of the public. The degree to which a clean environment is valued can vary from one society to another. The level of knowledge and interest about climate change in different groups of the society also plays a role. Actors like the mass media, environmental organizations, political parties, and stake-holder organizations shape and influence people’s knowledge and attention to political issues like global warming, and must be expected to play a role in domestic policy making. Three factors are used here to assess degree of membership in this causal set: First, I look at the degree of public concern about global warming. Second, the degree of special interest lobbying is assessed, and third, the degree of ENGO activism on climate change is considered. High degree of membership in the set is equal to public pressure to employ proactive climate policy, and is characterized by high levels of public concern combined with low degree of special interest lobbying and strong ENGO activism, with actual positive influence on government policy positions. Low degree of membership is equal to public pressure not to employ abatement policies, and is characterized by low public concern about global warming, combined with high degree of special interest lobbying and low ENGO activism resulting in actual influence on government policy positions. Germany The environmental awareness in Germany was growing in the 1980s and early 1990s, much as a result of concern about dying forests (Waldsterben), growing air-pollution in the cities and other urgent environmental issues. From 1986 the German public concerns about climate change continued the trend of growing environmental awareness. The environment was, as in many other Northern European countries, at the top of the agenda in the public debate of the late 1980s. Most people were concerned about the environmental condition of our earth, and signalized to politicians through polls that this topic should be high on the agenda. At the time, the domestic distribution of costs and benefits was relatively roughly estimated and hard to determine exactly. Coupled together, these two elements probably contribute to explain why there was such a broad consensus – also in the general public – in Germany about taking on a very ambitious CO2 reduction target. Over the last five-six years, as the economic growth has slowed, the public seems less willing to accept regulations that affect their own welfare directly. For example there has been considerable opposition to the ecological tax reform introduced by the government in April 1999. After 1995 climate change has lost as an issue on the political agenda, when during the 1990s the more urgent issues of unemployment and social welfare have gained importance with politicians. Combined with the fact that the climate change issue contains a high degree of scientific uncertainty over the consequences, time frame and costs of global warming, policy-making on this issue has become increasingly difficult for the government. At the same time, the Kyoto protocol negotiations have made it increasingly clear that a broad range of actors and sectors will be affected in the future if adverse climate changes are to be curbed. As the attention shifted towards more specific policy measures, more domestic actors understood that their interests were at stake, and that policy measures could be potentially costly. This triggered a phase of the policy process where we have seen a greater involvement and opposition to climate policy measures from a varied range of interests like industry groups, trade unions and the automobile organizations that had earlier been surprisingly in agreement with the government. The industry sector has been very important for the German economy after the Second World War, and industrial organizations like BDI (Bundesverband der Deutschen Industrie) and DIHT (Deutsche Industrie und Handelstag) have been active participants in the national debate about climate policy initiatives. Industry is the source of about 14% of CO2 emissions in Germany, and consumes about 17% of final energy.28[28] The potential costs that would be inflicted on the industry sector by the Kyoto protocol commitments induced them to be active in lobbying the government. The distribution of power and influence also matter here, and the large companies in industries like automobile, chemicals, and coal have good connection into the two major political parties (SPD and CDU). Industrial managers admit that their influence on climate policy is substantial.29[29] To support this, consider the voluntary agreement announced by the industry in 1995/96, where industrial associations representing 4/5ths of final industrial energy consumption committed themselves to reduce CO2 emission by 20% within 2005 from 1990 levels. The agreement came after intensified planning of a CO2 tax in the Federal Ministry of Economics and Technology (BMWi) prior to 1995, and was hastened because of the upcoming COP1 hosted by Germany in Berlin.30[30] The voluntary agreement thus had the effect of reducing the potential conflict level between the government and the industry, as both parts needed a new policy solution that they could agree upon. In achieving this, the long standing tradition of good industrial relations and policy consensus in Germany seem to have been important, together with the importance of the organizational-corporate channel in German politics. 28[28] BMU (1997a). Interviews with a director in the coal-mining company ‘Rheinbraun AG’, Cologne, 03.11.99 and a representative from the Association of German Electricity Supply Companies (VDEW), Bonn, 01.06.99 30[30] Interview with representative from the Association of German Electricity Supply Companies (VDEW), Bonn, 01.06.99 29[29] When the climate policy issue was introduced on the agenda in Germany, the actors who were most dominant were scientists, environmental agencies, the Green Party and the media. The environmental non-governmental organizations (ENGOs) were not so active in this initial phase, because they have traditionally been working primarily with local or national issues.31[31] This has changed during the 90’s, as there has been a development towards more professionalisation of the environmental movement in Germany, with increased use of scientific expertise in the organizations.32[32] This has lead to a turn away from confrontations and more effort towards cooperation strategies with the government The Green Party had a strong position in the public debate, supported by an active press functioning as a transmitter for new knowledge to the public. Counter-forces have traditionally been the pollution intensive industry and the trade unions. After the Kyoto protocol negotiations got under way in 1995, German ENGOs became more involved in the debate, as they became aware that climate change is one of the most serious environmental problems.33[33] ENGOs have been mostly satisfied with Germany taking on a leading role in the international negotiations, but have been more critical to the speed of implementation of domestic policies. The argument has been that the reduction target can be met only if the government shows higher willingness to take domestic action. In a situation of larger degree of involvement from several domestic actors, a process of redefinition of the policy problem occurred, so that climate policy became just as much a matter of energy policy, transportation policy, etc. The redefinition of the issue and the take-over by sector agencies tend to reinforce each other.34[34] Hence, the calculus of behavior by domestic sub-actors can lead to a lack of ability by the government to implement a preferred climate policy. The United States The United States is slowly moving in the same direction that Europe has done when it comes to heightened environmental concern, but has still not come as far along in that development. Americans tend to think of the climate change issue as a vaguer, long-term issue than air-pollution or water/sewer issues that affect people right here and now. Hence, they are skeptical towards accepting climate change regulatory policies or environmental taxes on for instance gasoline. If you ask if people are willing to pay 15 cents, or 18 or 25 cents more per gallon of gasoline to help 31[31] Beuermann and Jäger (1995), p. 212. Brandt, K.W: (1999): ‘Dialectics of Institutionalization: The Transformation of the Environmental Movement in Germany’, in Environmental Politics, Vol. 8, No. 1. 33[33] Interview with representative from the ENGO “Forum Umwelt und Entwicklung”, Bonn, 03.11.99. 34[34] Underdal (1998), p. 17. 32[32] combat climate change a majority would be negative. In general, it seems support for the environment among Americans is very broad, but it is not very deep, i.e. people are unwilling to sacrifice a lot to protect the environment. If asked, people would probably agree that global warming is a problem. But the public opinion does not demand actions, and politicians consequently avoid sticking their necks out, and are doing as little as possible for the time being. In a 2000 Gallup poll 71% of respondents say that they are either active participants in the environmental movement or sympathetic to the movement. 40% also express a great deal of worry about the greenhouse effect, while 32% worry a fair amount.35[35] In a 1999 Gallup poll, however, Americans are evenly divided between those who consider themselves environmentalists, and those who do not. 50% say yes, 49% say no. After the second IPCC report in 1996, the “war of public perception” has changed. Although “skeptics”36[36] are still present in the media, the majority of newspaper articles and media coverage portrays global warming as a serious problem that must be dealt with. For instance, PBS television had a two-hour special during spring 2000 where the problem was thoroughly analyzed, and where both mainstream and skeptic scientists had their say. Also, in Congressional hearings the witness list is not filled with “skeptics” like it used to be. Now, Senators and Congressmen are more willing and interested to hear both sides. In the United States, lobbying is part of the pluralist nature of the political system. Local business and energy interests strongly influence the way politicians handle the climate change issue. The differences in potential costs of climate policy in the various states are large. Local electoral processes and interest group pressures, as well as the need to raise large sums of money for reelection campaigns, make politicians respond to interests and concerns different from those affecting the nation as a whole. After the 2000 election, newspaper commentators have pointed out that, according to the Center for Responsive Politics, $10 million out of $14 million in political contributions from oil and gas companies to the election in 2000 went to Republican candidates.37[37] The enormous economic importance of the energy industries – oil and coal – has traditionally given these industries power to influence policymaking, both in fossil fuel rich regions 35[35] The Gallup Organization, 2000: “Earth Day Poll” conducted April 3-9. Scientists skeptical to the theory about human imprint on climate changes had the opportunity to attract a lot of attention in the public debate in the agenda setting phase, both in congressional hearings before a range of committees, and in the news media. “Skeptics” actively informed about the uncertainties still facing climate change research, especially focusing on the pertinence of the computer models used by atmospheric scientists to predict the effect of GHG increases in the atmosphere, and whether temperature increases can be related to human activities or are the result of natural variations in the atmosphere. 37[37] See for instance “The President who bought power and sold the world” by Ed Vulliamy, The Observer, April 1, 2001. 36[36] and nationally. Hence, energy companies like Exxon and Western Fuels have made up the backbone of one of the most influential interest advocacy groups: The Global Climate Coalition (GCC). It has 230 000 companies as members. The organization has a lot of weight on Capitol Hill. One of the most remarkable efforts to influence the public opinion on climate change was organized in the fall of 1997, in the run-up to the Kyoto conference. Hundreds of advertisements focusing on the uncertainty of the science and the potential costs of a Kyoto agreement were printed in the United States news media, in addition to paid television advertisements. Approximately $150 million was spent by organized business interests on this campaign informing about their views on global warming. The Global Climate Coalition organized the campaign with the aim to portray the Kyoto Protocol as flawed, and economically harmful to the American society. At the Kyoto Conference, stakeholder organizations were well represented and made contacts and efforts to influence the U.S. position at the talks. Together with senators and congressmen that have expressed strong negativity to the Kyoto protocol, the GCC, the American Petroleum Institute, and other influential stakeholder organizations represented a strong reminder to the Clinton administration officials in the negotiation delegation about the sentiment at the U.S. domestic level. It had been an advantage especially for the GCC that they portrayed to be talking on behalf of the entire American industry up to early in 1998. After the Kyoto meeting, however, this changed. More and more industry associations broke off with the GCC. The sentiment changed as more and more businesses realized that some kind of regulation will eventually come, and that they would be better off trying to actively be part of shaping future policy and regulations rather than just protest against it. Hence, the GCC lost power, while the Pew Center, the International Climate Change Partnership and other organizations organizing more proactive firms and industries gained members and influence. The signing of the Kyoto Protocol has had the effect that major stakeholder groups are convinced that some kinds of policy action or regulations are going to be introduced. They must be prepared and try to shape the policy choices that are going to be made. Therefore constructive participation has become important. For multinational corporations this has become important regardless of whether the United States is going to ratify the Kyoto protocol, since they have to take actions into consideration because of what happens in other countries too. The United States has a flourishing number of ENGOs, in all kinds of political shades. The more radical organizations, such as Greenpeace and Earth First, have used direct action and civil disobedience to attract attention, while the more moderate organizations, such as the Sierra Club and Environmental Defense, have used lobbying, science and lawsuits as means of information. Monitoring legislative proposals and campaigning for implementation have been important national efforts. Environmental Defense and WWF have been particularly active in using science as a means of influencing both the U.S. negotiation position and the international negotiations agenda. For example, Environmental Defense has developed expertise in understanding and promoting emissions trading as a solution to achieve cost-effectiveness in reducing GHG emissions. Together with the WWF and the EDF, the Sierra Club is perceived to be among the most influential ENGOs in the United States on the climate change issue. The WWF is one of the largest ENGOs in membership numbers, and has established itself as an expert in the international negotiations, interpreting the positions and proposals of delegations at important meetings. Membership degree We have seen that public concern for climate change issues in the United States was lower than for immediate issues such as water and air pollution, and that public concern has been quite low compared to other OECD countries. The ENGOs have gained a higher level of influence over the years that the climate change issue has developed in the United States, especially as they developed expertise in essential areas like emission trading and joint implementation. However, heavy lobbying efforts by economically important business and industry actors had more influence on policy direction. Business stakeholder lobbying lost some of their lever as they could no longer stand together as a united interest block. However, oil and coal industries seem to have regained powerful influence channels into the new Bush administration. The membership in this causal set is therefore mostly out. In Germany, public awareness about environmental issues and climate change has been much higher than in the United States, although the willingness to pay for abatement policies has fallen as unemployment has increased and the economy has become strained. Stakeholder groups have had substantial influence in finding policy solutions, for instance the voluntary emissions reductions agreement from 1995/96. ENGOs have been mostly satisfied with Germany taking on a leading role in the international negotiations, but have been more critical to the speed of implementation of domestic policies. The membership in this set is mostly in. Governmental supply Although governments are influenced by the public in the decision making process, it is even more important to learn about own preferences and political agendas. Governmental supply of policy alternatives is here assumed to be a function of at least three determinants:38[38] First, the design of the political system of the country is important, in that the distribution of power between the legislative and executive branches of the governing system is designed in a particular way that restrict the options and access for influencing policy choice. Second, the distribution of power and influence among the different agencies of government can affect the governmental supply of policy. Issue specialization often makes some ministries or agencies dominate the participation and influence in the policy process. How influential a ministry or agency is depends on factors like staff size on the issue within the agency, as well as budget size and the political clout of the agency’s staff. Third, the government’s control over state policy is assumed to be important. Factors like the degree of internal unity in the administration, the cooperative relationship with the political opposition, and the political authority of the head of government can be decisive for ability to reach good policy alternatives and agreement among the many domestic political actors. Assessment of the degree of membership in this causal set will be based on three factors: First, the degree to which political system design result in ability for one governmental branch (executive or legislative) to dominate the policymaking process. Second, the degree of cooperation or conflict about climate change issues between government agencies, and third the degree of cooperation or conflict between political parties. High membership is equal to a high degree of consistent governmental supply of policy choice, and is indicated by executive domination, interministerial cooperation, and stable cooperation/coalitions between political parties. Low membership is equal to non-coherent governmental supply of climate policy, and is characterized by high degree of legislative domination over the executive, interministerial conflict, and lack of stable coalitions between political parties. Germany The formal decision-making system is rooted in the federal, parliamentary democratic state system that West Germany has had since World War 2. The political parties have had a strong role in this parliamentary system. The establishment of a stable democratic order based on the model of the “social market economy” underpinned by legal regulation, free collective bargaining and codetermination has been a success for Germany. There has been executive dominance, since majority coalitions have been in power in the cabinets of the Federal republic. In other words, the majority of the parliament has the same political platform as the cabinet, and hence works cooperatively together. The personal authority of 38[38] Parts of this discussion are built on Underdal and Hanf (2000): International Environmental Agreements and Domestic Politics: The case of acid rain, pp. 66-70. the head of government is likely to be an element in understanding the executive’s control over the policymaking process. Chancellor Kohl had a personal interest in the climate change issue, and he took initiatives that pushed the policy process forward. For instance, his speech at the COP1 in Berlin is regarded as decisive as an incentive to the elaboration on domestic strategies. And he said several times that it was Germany’s goal to reach a real obligation for the industrialized countries in the negotiations about a Kyoto Protocol.39[39] Although the Länder are generally relatively autonomous, in environmental policy there is a hierarchical relation between the Länder and the federal government, which makes the government largely responsible through the division of jurisdiction. The federal Basic Law, as well as the rule of ‘competing’ legislation and the right to issue framework legislation, makes federal jurisdiction rule over Länder jurisdiction in most parts of environmental policy. The implementation of both federal and Land legislation is almost entirely a matter for the Länder with their two or three-tiered administrative structure.40[40] High degree of centralization of formal authority at the federal level is expected to facilitate the implementation of a climate policy. In Germany, the Länder has a certain degree of independence, but most of the German climate policy measures are federal ordinances that apply in all Länder. However, some effects can be seen of vertical fragmentation, for instance in Nordrhein Westfalen where the Land-government continue to subsidize the coal industry while the federal government are reducing its coal subsidies. After the UNCED conference in Rio de Janeiro in 1992, Germany took on a leading role in the negotiations, and more domestic governmental agencies became involved. An inter-ministerial group (Interministerielle Arbeitsgruppe “CO2 Reduktion”) was given the responsibility of working together to develop a climate policy strategy, and to report to the government every second year on progress and suggestions for new policy measures. The involvement of several ministries inflicted on the policy process in relation to the relative strength of the different branches of government. Elements like the institutional capacity and degree of involvement became important for the degree of influence over policy formulation and implementation. In Germany, the environmental ministry (BMU) has had a coordinating role in the development of both the country’s negotiation position and in the national implementation work. But the BMU has had a weak role in comparison to the ministries of economy (BMWi), transport (BMVBW), and building (BMBF). The BMU has a small budget, only 0.7% of the total, and a small staff. More people work on climate related issues in the BMWi than in the BMU. In addition, there has been a conflict of sector interests within the interministerial group. Particularly the first two reports to the government were difficult to reach an 39[39] 40[40] Interview with a civil servant at the Chancellors Office, Bonn, 02.06.99 BMU (1997b), p.13. agreement on, as they introduced many new measures and proposals affecting sector interests within the ministries.41[41] The coalition between CDU and FDP between 1982 and 1998 seem to have been a relatively harmonious collaboration. The new red-green coalition government, however, have had internal differences of opinion. Regarding climate policy, there have been internal disagreements about which policy measures are most adequate: energy savings or clean energy investments. This is a disagreement that goes between the Green Party allied with the left wing of SPD against the right wing of SPD. There is also a friction between the Greens and parts of the SPD that are criticized for being too closely connected with the coal and automobile lobbies.42[42] One of the most remarkable features of the climate policy in Germany has been the high level of agreement across traditional political dividends. There has mostly been a high degree of bipartisan support for climate policy decisions. The opposition parties through most of the 1990s (SPD and the Green Party) did to a large degree support the Kohl government decisions. They criticized that the implementation was too weak, but agreed to the general policy direction. This bipartisan support continues today: apart from criticism against the ecological tax reform, the opposition parties (now the CDU and FDP) support the government’s climate policy direction. The United States Climate policymaking has been affected by the constitutional separation of powers. The right to negotiate a climate change treaty is in the hands of the administration. However, the rights of the Congress are to give advice and consent to the administration during treaty negotiations, and ultimately approve any agreement. Under Clinton’s 2nd administration, the Democratic Party was in minority position. Congress was very active but not very cooperative towards the administration in climate change issues. For instance, Congress issued several resolutions, even one about how the negotiations themselves should proceed. In a vote 95-0, the senate in 1997 stated their indications that they will not ratify a climate change treaty that doesn’t have a minimum representation of developing countries (the Byrd-Hagel resolution). The senate also passed several resolutions and bills that severely limit the ability of agencies involved in climate policy to proceed with policy implementation. For instance, funding has been cut that have resulted in agencies like EPA and DOE to be unable to do analysis of options that have been considered under the Kyoto protocol. The United States is lacking a domestic implementation strategy on key issues such as emissions trading, in some areas neither the administration nor the Congress have a clear view of 41[41] 42[42] Interview with two civil servants at BMWi, Bonn, 23.09.97. Interview with a scientific advisor for the parliamentary group of the Green Party, Bonn, 02.06.99 what policies should be implemented domestically. For instance, it was hard to develop a position on emissions trading in the international negotiations. The United States was very active in pushing for emissions trading, and did an active job in informing the international community. But at a certain level of details it became difficult to proceed, because the country didn’t want to restrict its ability to have maximum flexibility about how a trading system should be implemented domestically. That prevented the United States from wanting to make decisions at the international level that would avert it from making domestic implementation decisions one way or the other. The personal authority of the head of government is likely to be an element in understanding the executive’s control over the policymaking process. The president’s power rests to a certain extent on his ability to persuade the public that he is on the right course. With a split in the American public on whether climate change is a real problem, President Clinton had difficulties with this persuasion. Also, his authority was strongly reduced after the impeachment process, which affected all policy areas. George W. Bush may also run into problems on this account, because of the massive critique he has met both at home and abroad – a critique he perhaps underestimated prior to his decision to withdraw the support of the United States of the Kyoto protocol. For instance, a poll from ABC News showed that 61% of Americans think the United States should join the treaty, while 26% think it shouldn’t. In the Republican Party, 52% supports joining the treaty while 37% oppose it.43[43] However, Bush has presented an alternative approach to the Kyoto protocol in February 2002, and can thus gain support for taking action on the problem – although many have been critical to the new climate policy approach. The liability clause affects the relationship to other countries that may not be equally strongly bound by their court systems to achieve whatever obligations they agree to internationally. This may be one of the reasons why the United States has been reluctant to ratify the Kyoto Protocol, and also why Bush has rejected the treaty. The way the domestic legal system would operate within each country may thus influence a country’s willingness to make commitments to other countries. Countries that can credibly promise to be more bound by the treaty by their own domestic legal systems might be seen as more attractive partners by other countries. Within the government three core agencies have been heavily involved in climate change policymaking since climate change became an issue - the Department of State, which has the lead on all foreign policy issues, the EPA, which has been a driving force on the emissions trading issue as a result of their domestic experience with the SO2-program, and the Department of Energy. Those three agencies were the most involved, with biggest interest and a history on the issue. 43[43] ABC news.com: “Global Warming Trend,” by Dalia Sussman, April 17, 2001. Immediately prior to Kyoto and thereafter, there was more involvement from other agencies. Two in particular have been very important: the Treasury Department and the Council of Economic Advisors. Both have been very influential because of the credibility they bring when it comes to economic analysis and hence serving the need the Clinton administration had to be able to go to Capitol Hill and present credible cost estimates for the Kyoto protocol. Under the Clinton administration an inter-agency working group met every week in Washington. This was a general policy group, led by the State Department and with the participation of all agencies involved in climate change policymaking: EPA, DOE, USDA, Treasury, USDOT, NOAA, etc. The meetings in this group was a mix between a kind of stocktaking exercise, just to keep people aware of what was going on in the international process, and a lot of reporting, where agencies report on what meetings they had and what was going on. Because the policy-issues have become so complicated there usually were separate meetings on for instance a particular emissions trading issue, and a separate meeting on CDM baselines. The inter-agency climate change process has been fairly balanced in that it seems to have been a consensual process. There has been a fairly equal balance of power and no one agency has completely been able to push or run a process. On the other hand, occasionally one agency can be more influential because it has more resources to bring to bear; it can do more analysis, it can have more people involved, it can talk to more people outside the agency, and positions frequently could go one way or the other because of that. One agency can have one person working on the issue, while another agency can have lots of people working on it; they can usually back their position up with data and statistics. For instance, air pollution, clean air, and air quality information is provided by the EPA's Office of Air and Radiation (OAR). OAR develops national programs, technical policies, and regulations for controlling air pollution and radiation exposure. OAR is concerned with pollution prevention, indoor and outdoor air quality, industrial air pollution, pollution from vehicles and engines, radon, acid rain, stratospheric ozone depletion and radiation protection. Finally, the agencies work under different roles. For instance, the EPA is an environmental agency, and it is supposed to be more concerned about the environment. On the other hand, the State Department is more worried about the politics. The State Department is responsible for the negotiations, and hence the agency that is going to be called to the Hill if the United States does agree on an international treaty that the Senate has advised against. The State Department also has to be more neutral because it is supposed to represent the combined, common view of all the agencies. It cannot go against the wishes of the other agencies. Members of Congress are likely to be more concerned with local, regional and economic impacts of environmental and resource policies than with their ultimate benefits to the nation as a whole. In Congress, the Republicans don’t benefit from pushing the issue since they can get attacked for their environmental record in general. Also, corporate interests are some of the most potent in the policy process, and they traditionally support the Republican Party. Republican interviewees in Congress claimed that there is a fairly strong bipartisan consensus on the climate change issue, and the Byrd Hagel resolution was used as an example of this. However, it was claimed that there is a more intense skeptic feeling on the part of conservative Republicans, who have less faith in international fora and protocols of the sort that Kyoto represents. Democrat interviewees on the other hand claim that global warming has become a very partisan issue. These sources refer to the close contact between the GCC and other stakeholder groups with the Republicans in Congress as a reason for the increased partisanship. The example they use is that the key issue for the Senate concerning the Kyoto protocol was really developing country participation. In other words that it is a global problem and that the solution should be global. Some of the Republicans have very deliberately, and with a lot of support from some of the industry that is opposed to any action on climate change, interpreted the clause about participation of developing countries in the Byrd-Hagel resolution in much greater detail than the majority of people from both parties who voted for it would have interpreted it. Whether or not climate change has come down to a partisan issue seem to be dependant on who you talk to. More important than party affiliation can, in many cases, be the interests and circumstances in the politicians’ constituency. Membership degree The legislative branch dominated over the executive branch in U.S. climate change policy. Congress actively limited the Clinton administration in implementing policies that could be taken as a backdoor implementation of the Kyoto protocol. There was a high level of interagency cooperation, and the partisanship in Congress was enforced after the impeachment case of Clinton, but also as a result of Senators feeling deprived of their right to advice and consent to the administration in the Kyoto negotiations. Membership in this set is mostly but not fully out for the United States. In Germany, there has been executive domination over the legislative. The interministerial cooperation has mainly been harmonious with relatively low degree of disagreement between central ministries, although the BMU has been pushing to take on more measures than the BMWi. There was a high degree of correspondence and agreement between the major political parties during the 1990s about the general direction of the climate change policy. Membership in this set is therefore mostly in. Conclusions The perception that emissions reductions would be costly has prevailed in the United States, and that costs would outweigh the benefits. The combination with the observations done when it comes to public demand and support for proactive climate policies, where we saw that the pressure have gone the other way, i.e. that low degree of public awareness and pressure combined with high degree of potent, resourceful stakeholder lobbying and limited influence for the ENGO movement, have reinforced the impression that also domestic distributions of costs indicate a restrictive attitude to a climate treaty focusing on emissions reductions in the short term for the United States. Even the balance of power in the political system of the country supports the restrictiveness. The focus in this analysis was put on the locally oriented and constituency attentive politicians in Congress, and the way they are influenced by local and regional interests have been important in the decision-making process. In that way the design of the political system – where legislative dominance over the executive has been the case – has been an important factor. To further conclude from the analysis, we saw that the United States is less interdependent than Germany. Based on less willingness to sign and ratify climate treaties, we saw that the country had less perceived need for an international framework to address the climate change problem. The balance of costs and benefits was an important factor also in German climate policymaking. However, since the conclusions from renowned researchers were that costs would be fairly modest, Germany had the opportunity to seek a more challenging policy than the United States. The modest cost frame was one important factor to influence the process, but must be considered in combination with strong public pressure to address global warming, and relatively high degree of agreement even between stakeholder lobbyers and the government about the need to address the problem. All in all the analysis show that both the cost-factor and high degree of public demand and support pointed in the direction of a proactive climate policy in Germany. The distribution of costs and power between domestic actors has made that kind of role possible for the German government. To support the direction of policy, the executive branch could dominate the legislative branch since it has emanated from majority coalitions in the parliament, and have the same political platform. There was also a broad bipartisan agreement in Germany. Both of these elements have been pointed to in the analysis as contributors to the high ambition-level in German climate policy. Interdependency was also an element that influenced the policy in the same direction. Germany showed high willingness to sign and ratify the Kyoto protocol, which has been interpreted here as a signal of the perceived need the country had for an international framework to regulate and harmonize climate policy. The analysis pointed out that the four elements under consideration here had a different degree of influence on the policy process in Germany and the United States. In both countries, there was substantial use of cost and benefit calculations when decisions were made. However, to get a more detailed view of other important element in the process, it was an advantage to also take into account predictions made by the domestic politics model. 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