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Market fundamentals show economic gains now, but the economy is still fragile –
precarious balance of key sectors – Schwartz and Rasmus – Brexit is the brink
Patrick Gillespie, 6-28-2016, Patrick Gillespie is a reporter at CNNMoney. He covers the U.S. economy,
stocks and emerging markets. Before CNNMoney, Patrick reported for McClatchy Newspapers and
Mashable. He graduated from the University of Delaware and received a Masters from the CUNY
Graduate School of Journalism. "Brexit hangover dims U.S. economy's future ," CNNMoney,
http://money.cnn.com/2016/06/28/news/economy/brexit-us-economy-downgrade/
Not everyone is dimming their outlook. UBS economist Samuel Coffin is sticking with his forecast of the
U.S. economy, though he adds "the U.K. decision does add some downside risk to our growth forecasts."
So don't hit the panic button on America's economy -- Brexit doesn't appear to be triggering a recession
in the States this year. But the historic vote means major uncertainties loom large on both sides of the
Atlantic.
A2: Gillespie
Concludes neg – the bottom of the article was in the overview
Econ Growth strong – Brexit isn’t a big deal
Lucia Mutikani, 6-28-2016, Economic reporter for Reuters, "U.S. first-quarter GDP revised up, Brexit
risk to outlook," Reuters, http://www.reuters.com/article/us-usa-economy-gdp-idUSKCN0ZE1F7
U.S. economic growth slowed in the first quarter but not as sharply as previously estimated, and while
there are signs of a pickup in the second quarter, analysts worry Britain's vote to leave the European
Union could hurt activity later this year. Gross domestic product increased at a 1.1 percent annual rate,
rather than the 0.8 percent pace reported last month, the Commerce Department said on Tuesday in its
third GDP estimate. The economy grew at a rate of 1.4 percent in the fourth quarter. There are
indications the economy has regained momentum in the second quarter, with retail sales and home
sales rising in April and May, although business spending remains weak and job growth has slowed. But
uncertainty following last Thursday's so-called "Brexit" referendum poses a risk to the growth outlook.
"The test comes in the next few months as the turbulence in financial markets may affect consumers'
behavior and also weigh on business investment," said Ryan Sweet, senior economist at Moody's
Analytics in West Chester, Pennsylvania. "If financial markets settle down, the effect of the British
referendum on the U.S. economy will be very small." Brexit wiped off $3.01 trillion from global stock
markets over two days. On Tuesday, global equities recouped some losses, with financial shares leading
the rebound. U.S. stock indexes rallied, while prices for government debt fell. The dollar fell against a
basket of currencies. Economists estimate that Brexit could subtract an average of two-tenths of a
percentage point from U.S. growth over the next six quarters, with most of the drag coming through
weak business spending as uncertainty causes companies to either delay or scale back capital projects.
"Following the Brexit vote, we expect a stronger U.S. dollar and heightened financial market strains will
weigh on domestic activity, but lower interest rates should provide some offset so that the net impact is
a marginal negative," said Gregory Daco, head of U.S. macroeconomics at Oxford Economics in New
York. Despite signs growth is gaining steam, economists say the Federal Reserve is unlikely to raise
interest rates in the near-term, given the uncertainty over the implications of Brexit. Fed Chair Janet
Yellen told lawmakers last week that data pointed to "a noticeable step-up" in GDP growth in the second
quarter. The Atlanta Federal Reserve is currently estimating second-quarter GDP rising at a 2.6 percent
rate. When measured from the income side, the economy grew at a 2.9 percent rate in the first quarter,
the quickest pace since the third quarter of 2014. That was up from the 2.2 percent pace reported last
month and reflected upward revisions to corporate profits. After-tax profits increased at a 2.2 percent
rate in the first quarter, rather than the previously reported 0.6 percent pace.
A2: warming savings
Econ gains from warming offset dont solve – even elimination of all emissions cant
compensate
David W. Kreutzer, David W. Kreutzer, Ph.D. Research Fellow in Energy Economics and Climate Change
The Heritage Foundation , Ph.D., 11-17-2014, "Impacts of Carbon Taxes on the US Economy," Heritage
Foundation, http://www.heritage.org/research/testimony/2014/11/the-impacts-of-carbon-taxes-onthe-us-economy
Impact on Climate Some would argue that the CO2 reductions create benefits from reduced global
warming and the value of these benefits more than offsets the cost of a million lost jobs and trillions of
dollars of lost income. There are several ways of looking at these suggested benefits. Estimates of a
carbon tax’s impact on world temperature do not lend much support for a carbon tax. Climatologists Pat
Michaels and Chip Knappenberger provides an online calculator to estimate the impact of various cuts in
CO2 emissions.[5] The calculations are based on the MAGICC model developed at the National Center
for Atmospheric Research. The AEO2014 side case for the $25 per ton carbon tax would cut energyrelated CO2 emissions by about 50 percent by 2050 (overall emissions would probably drop by a slightly
smaller percentage). These cuts translate to a temperature moderation of about 0.05 degrees
centigrade (about 0.09 degrees Fahrenheit) by the end of this century. Few would argue that this
virtually unmeasurable impact is worth the million lost jobs and trillions of dollars of lost income. Even
eliminating carbon dioxide emissions entirely and assuming the highest sensitivity of world temperature
to carbon dioxide levels (which happens to be the sensitivity that is furthest from that in recent
research) would project a temperature moderation of less than 0.2 degree centigrade.[6] Of course,
eliminating CO2 emissions entirely, if possible, would have much higher costs than even those of the
$25 carbon tax modeled by the EIA or the Boxer-Sanders tax modeled by Heritage.
Link
The plan crushes key economic sectors - energy prices, production costs, income and
job loss – costs a trillion in GDP – No efficiency gains from offsets/ industry
compensation – Kreutzer
A2: no short term
1. This measures welfare, not spending – doesn’t answer our i/l
2. Admits that there is still a drop over long trends – rasmus says fragility = short
term impacts are especially large
Economic calculators are useless- Carbon tax would do more harm than good to the
economy even with a revenue neutral tax
Robert P. Murphy, Patrick J. Michaels, and Paul C. "Chip" Knappenberger, 9-4-2015, "The Case
against a Carbon Tax," Cato Institute, http://www.cato.org/publications/working-paper/case-againstcarbon-tax<Robert P. Murphy is an economist with the Institute for Energy Research specializing in
climate change, Patrick J Michaels is a senior fellow in environmental studies at the Cato Institute, Chip
Knappenberger is the assistant director of the Center for the Study of Science at the Cato Institute>
In the policy debate over carbon taxes, a key concept is the “social cost of carbon,” which is defined as
the (present value of) future damages caused by emitting an additional ton of carbon dioxide. Estimates
of the SCC are already being used to evaluate federal regulations, and will serve as the basis for any U.S.
carbon tax. Yet the computer simulations used to generate SCC estimates are largely arbitrary, with
plausible adjustments in parameters — such as the discount rate — causing the estimate to shift by at
least an order of magnitude. Indeed, MIT economist Robert Pindyck considers the whole process so
fraught with unwarranted precision that he has called such computer simulations “close to useless” for
guiding policy. Future economic damages from carbon dioxide emissions can only be estimated in
conjunction with forecasts of climate change. But recent history shows those forecasts are in flux, with
an increasing number of forecasts of less warming appearing in the scientific literature in the last four
years. Additionally, we show some rather stark evidence that the family of models used by the U.N.’s
Intergovernmental Panel on Climate Change (IPCC) are experiencing a profound failure that greatly
reduces their forecast utility. Ironically, the latest U.N. Intergovernmental Panel on Climate Change
(IPCC) report indicated that a popular climate target cannot be justified in cost/benefit terms.
Specifically, in the middle-of-the-road scenarios, the economic compliance costs of limiting global
warming to 2 degrees Celsius would likely be higher than the climate change damages that such a cap
would avoid. In other words, the U.N.’s own report shows that aggressive emission cutbacks — even if
achieved through an “efficient” carbon tax — would probably cause more harm than good. If the case
for emission cutbacks is weaker than the public has been led to believe, the claim of a “double dividend”
is on even shakier ground. There really is a “consensus” in this literature, and it is that carbon taxes
cause more economic damage than generic taxes on labor or capital, so that in general even a
revenueneutral carbon tax swap will probably reduce conventional GDP growth. (The driver of this result
is that carbon taxes fall on narrower segments of the economy, and thus to raise a given amount of
revenue require a higher tax rate.) Furthermore, in the real world at least some of the new carbon tax
receipts would probably be devoted to higher spending (on “green investments”) and lump-sum
transfers to poorer citizens to help offset the impact of higher energy prices. Thus in practice the
economic drag of a new carbon tax could be far worse than the idealized revenueneutral simulations
depict.
A2 rev neut investment
1. This isn’t the aff – the whole econ advantage is premised on the revenue
generated by a tax – that’s their morris card!
2. Even if you think their “tax swap” means its revenue neutral, the plan doesn’t
specify what the revenue does, while the obeiter ev says it would go to R/D –
be skeptical of solvency for the turn and the advs
3.-A revenue-neutral carbon tax would be net worse for the economy anyway
Robert P. Murphy, Patrick J. Michaels, and Paul C. "Chip" Knappenberger, 9-4-2015, "The Case
against a Carbon Tax," Cato Institute, http://www.cato.org/publications/working-paper/case-againstcarbon-tax<Robert P. Murphy is an economist with the Institute for Energy Research specializing in
climate change, Patrick J Michaels is a senior fellow in environmental studies at the Cato Institute, Chip
Knappenberger is the assistant director of the Center for the Study of Science at the Cato Institute>
With progressives enumerating the various “green” investments that could be funded by a carbon tax,
and with even one of the leaders in the conservative pro‐ carbon tax camp laying the intellectual
foundation for a net tax hike, it should be clear that a revenue‐neutral deal at the federal level is very
unlikely. However, in order to drive home just how baseless are the claims that a carbon tax could
somehow deliver a “win‐win,” we should review the results from the academic economists publishing in
the field. For example, a 2013 Resources for the Future (RFF) study considered the different impacts on
GDP from various methods of implementing a revenue‐neutral carbon tax of varying levels. Figure 3
below reproduces their findings for the case of a $30/ton tax on CO2 (in 2012 dollars) which is
completely revenue neutral, with the funds being returned to citizens through one of four ways: (1)
reductions in the corporate income tax rate and personal income tax rate on dividends, interest, and
capital gains (blue line), (2) reductions in the payroll tax rate and personal income tax rate on labor
income (red line), (3) reductions in state sales tax rates (green line), or (4) a lump‐sum payment made to
each adult citizen (purple line). The carbon tax is imposed in 2015 and revenue neutrality is maintained
throughout the scenario. The results from the RFF modeling may surprise readers who are familiar with
the “pro‐growth” claims about a carbon tax swap deal. As Figure 3 reveals, all of the tax swaps reduced
GDP relative to the baseline in the beginning. The only way to eventually see a “double dividend”—
where the economy was stimulated in addition to any environmental benefits from the new carbon
tax—was to refund all of the revenues exclusively through offsetting tax cuts on capital. Supposing
instead that a completely revenue neutral deal used the carbon tax receipts to fund payroll tax
reductions, Figure 3 shows (red line) that the economy would actually suffer a permanent reduction of
about half a percentage point of GDP. To reiterate, this result may be very surprising to those familiar
with the mantra, “tax bads, not goods.” To the extent that a U.S. carbon tax were not fully revenue
neutral, the reality would be much worse than is depicted in the theoretical ideal of Figure 3. It should
be stressed that RFF is a respected organization in this arena and it’s fair to say that most of its scholars
would endorse a (suitably designed) U.S. carbon tax; their team’s modeling results are quite consistent
with the academic literature. 21 Indeed, in a 2013 review article in Energy Economics, Stanford
economist Lawrence Goulder—one of the pioneers in the analysis of environmental tax analysis—
surveyed the literature and concluded: If, prior to introducing the environmental tax, capital is highly
overtaxed (in efficiency terms) relative to labor, and if the revenue‐neutral green tax reform shifts the
burden of the overall tax system from capital to labor (a phenomenon that can be enhanced by using
the green tax revenues exclusively to reduce capital income taxes), then the reform can improve (in
efficiency terms) the relative taxation of these factors. If this beneficial impact is strong enough, it can
overcome the inherent efficiency handicap that (narrow) environmental taxes have relative to income
taxes as a source of revenue. … The presence or absence of the double dividend thus depends on the
nature of the prior tax system and on how environmental tax revenues are recycled. Empirical
conditions are important. This does not mean that the double dividend is as likely to occur as not,
however. The narrow base of green taxes constitutes an inherent efficiency handicap…Although results
vary, the bulk of existing research tends to indicate that even when revenues are recycled in ways
conducive to a double dividend, the beneficial efficiency impact is not large enough to overcome the
inherent handicap, and the double dividend does not arise. [Goulder 2013, bold added.]33 In short,
Goulder is saying that the bulk of research finds that even a theoretically ideal revenue‐neutral carbon
tax would probably not promote conventional economic growth (in addition to curbing emissions). The
only way such a result is even theoretically possible is if the original tax code is particularly distorted in a
certain dimension (such as taxing capital much more than labor), and if the carbon tax revenues are
then devoted to reducing that distortion. It is important for libertarian and conservative readers—
concerned about the economic impacts of a new carbon tax—to understand what Goulder means when
he explains that the “narrow base of green taxes constitutes an inherent efficiency handicap.” If we put
aside for the moment concern about climate change, then generally speaking it would be foolish (on
standard tax efficiency grounds) to raise revenue by taxing carbon dioxide emissions rather than taxing
labor or capital more broadly. The tax on CO2 would have a much narrower base, meaning that it would
take a higher rate of taxation to yield a given dollar amount of revenue. Since standard analyses suggest
that the economic harms of taxes (the “deadweight losses”) are proportional to the square of the tax
rate, these considerations mean that even a dollar‐for‐dollar tax swap, in which a new carbon tax raised
$x which was then used to fund rate reductions in labor or capital taxes, would nonetheless increase the
economic drag of the overall tax code.34
A2: pos o/w
Their “solves economy” args assume a 3 century timeframe! The short term collapse is
sufficient trigger the impact well before then!
David W. Kreutzer, David W. Kreutzer, Ph.D. Research Fellow in Energy Economics and Climate Change
The Heritage Foundation , Ph.D., 11-17-2014, "Impacts of Carbon Taxes on the US Economy," Heritage
Foundation, http://www.heritage.org/research/testimony/2014/11/the-impacts-of-carbon-taxes-onthe-us-economy
Extreme Assumptions Needed for Declining Discount Rates The Science paper refers to several other
papers that also derive these declining discount rates. A necessity for all of them is that the lower
discount rate must be in force for an extended period. For a 300-year time horizon, the simplest split of
equally likely one-percent and seven-percent discount rates would be 150 years at 1 percent and 150
years at 7 percent. Discounting $1,000 for 150 years at one percent gives a present value of $224.79.
Discounting this value for the remaining 150 years (for a total of 300 years) at 7 percent gives an
ultimate present value of $0.0088. Note that using the average discount rate of 4 percent for the whole
300 years gives a present value of $0.0078. In fact, for the present value to even reach as high as $1.00,
the one percent discount rate has to apply to at least 232 of the 300 years. If one and seven are equally
likely for each of those years, the probability of this occurring is 2.05 x 10-22. Correlated Discount Rates
and Economic Growth Rates To extricate themselves from the dismal probabilities of the previous
paragraph, proponents of declining discount rates appeal to the possibility of correlated discount rates.
In essence, the coin flips stop early in the game and we are stuck with the rate chosen on that last flip,
which at the time of analysis is unknown. Weitzman illustrates the uncertainty this way: “When I try to
imagine how the future world might look a century from now, I start by trying to conceptualize how
people a century ago might have attempted to envision our world today. We have available now some
important technologies, like computers or airplanes, that were essentially unimaginable 100 years ago.
Maybe a now unimaginable ‘photon-based technology’ will replace today’s electronic technology and
deliver such prodigious rates of technological progress with a clean environment that historians then
will look back on the previous 100 years and smile at the modest projections of even the growth
optimists at the close of the twentieth century. Or, who knows, maybe a century from now people will
feel crowded and polluted and very disappointed in a pace of technological change that failed to
maintain the productivity growth of the ‘golden age’ of the industrial revolution during the earlier two
centuries from 1800 to 2000.” The people in the future envisioned by the IWG (and embedded in their
IAMs) need not worry. They will not be disappointed because the IWG assumes future growth in per
capita GDP that actually exceeds that of the U.S. for the past two centuries. The per capita GDP growth
rates for the reference scenarios listed by the IWG ranged from 1.58 percent to 2.03 percent per year
with an average of 1.8 percent per year. On the other hand the Maddison Project estimates per capita
GDP levels for the U.S. that grew only 1.56 percent per year from 1800 to 2000.[14] Over those same
two centuries the real compounded annual rate of return in U.S. stock markets has been a “remarkably
stable” 6.8 percent per year.[15] It would be reasonable to assign an even higher projected rate of
return on capital in an environment where growth is projected to be in excess of 1.56 percent. In short,
the growth rates built into the IAMs exceed that of the past two centuries in the U.S. (and the world)
and therefore rule out the possibility that Weitzman offers as justification for the very low discount
rates. The IWG cannot simultaneously entertain arguments for low discount rates and project high GDP
growth rates. At least until economic growth in the IAMs is re-worked to match the lower rates implied
by DDRs there can be no argument for DDRs in the IAMs.
A2: slow phase in
1. Patterson assumes a slow phase in – fiat isn’t that – its immediate or you
violate resolved and should and lose on T – I’d read a def but the file isn’t out! –
makes CP competition impossible and skews links to core neg DA’s like
elections and econ!– voter for f/e
2. Assumes a measured response by investors and consumers – every market
crash ever disproves this b/c there are panics and rushes – rasmus
3. Requires tax swaps to work – all the rev neutral work answers this
Case
Econ
A2: econ weak (general)
Doesn’t assume specific fundamentals stability – it is strong now but fragile – this ev is
descriptive of the brink – Schwartz and rasmus
U.S. Economy strong now – several factors
Focus economics, 6-28-2016, "United States Economy," FocusEconomics | Economic Forecasts from
the World's Leading Economists, http://www.focus-economics.com/countries/united-states
The U.S. economy has been in good shape overall in the second quarter following the slowdown in Q1.
Consumer spending—the main engine of the economy—likely remained strong in Q2 as retail sales
expanded for a second consecutive month in May. In addition, an increase in the ISM manufacturing
index was positive news in May, although the indicator still suggests soft growth in the sector.
Meanwhile, the May jobs report took center stage as non-farm payrolls grew at the weakest pace since
September 2010. On 8 June, Hillary Clinton, former first lady, secretary of state and senator for New York, became the Democratic Party's
presumptive nominee for the 2016 presidential election. Clinton will run against the Republicans' choice of real estate mogul and television
personality, Donald Trump, in an unusual battle to lead the country. American voters are divided and many are faced with a tough decision as
they must choose between one candidate who, for many, is associated with supporting the dysfunctional Washington status quo, while many
others believe a vote for Trump is equivalent to taking a dive into the unknown.
United States Economy Data 2011 2012 2013 2014 2015 Population (million) 312 314 317 319 321 GDP per capita (USD) 49,725 51,384 52,608 54,375 55,868 GDP (USD bn) 15,518 16,155 16,663 17,348 1 7,947 Economic Growth (GDP, annual variation in %) 1.6 2.2 1.5 2.4 2.4 Domestic
Demand (annual variation in %) 1.6 2.1 1.3 2.5 3.0 Consumption (annual variation in %) 2.3 1.5 1.7 2.7 3.1 Investment (annual variation in %) 6.4 9.8 4.2 5.3 4.0 Exports (G&S, annual variation in %) 6.9 3.4 2.8 3.4 1.1 Imports (G&S, annual variation in %) 5.5 2.2 1.1 3.8 4.9 Industrial
Production (annual variation in %) 2.9 2.8 1.9 2.9 0.3 Retail Sales (annual variation in %) 7.3 5.0 3.7 3.9 2.2 Unemployment Rate 8.9 8.1 7.4 6.2 5.3 Fiscal Balance (% of GDP) -8.4 -6.7 -4.1 -2.8 -2.4 Public Debt (% of GDP) 98.3 102 104 105 106 Money (annual variation in %) 7.4 8.6 6.8 6.2 5.9
Inflation Rate (CPI, annual variation in %, eop) 3.1 1.8 1.5 0.7 0.7 Inflation Rate (CPI, annual variation in %) 3.1 2.1 1.5 1.6 0.1 Inflation (PPI, annual variation in %) 3.9 1.8 1.4 1.6 -0.9 Policy Interest Rate (%) 0.25 0.25 0.25 0.25 0.50 Stock Market (annual variation in %) 5.5 7.3 26.5 7.5 -2.2
Current Account (% of GDP) -3.0 -2.8 -2.3 -2.2 -2.7 Current Account Balance (USD bn) -460.4 -449.7 -376.8 -389.5 -484.1 Trade Balance (USD billion) -740.7 -741.2 -702.6 -741.5 -759.3
SAMPLE REPORT 5 years of United States economic forecasts for more than 30 economic indicators. DOWNLOAD United States Economy
Overview Economic Overview of the United States Despite
facing challenges at the domestic level along with a rapidly
transforming global landscape, the U.S. economy is still the largest and most important in the world. The
U.S. economy represents about 20% of total global output, and is still larger than that of China.
Moreover, according to the IMF, the U.S. has the sixth highest per capita GDP (PPP), surpassed only by
small countries such as Norway and Singapore. The U.S. economy features a highly-developed and
technologically-advanced services sector, which accounts for about 80% of its output. The U.S. economy is
dominated by services-oriented companies in areas such as technology, financial services, healthcare and retail. Large U.S. corporations also
play a major role on the global stage, with more than a fifth of companies on the Fortune Global 500 coming from the United States. Even
though the services sector is the main engine of the economy, the U.S. also has an important manufacturing base, which represents roughly
15% of output. The
U.S. is the second largest manufacturer in the world and a leader in higher-value
industries such as automobiles, aerospace, machinery, telecommunications and chemicals. Meanwhile,
agriculture represents less than 2% of output. However, large amounts of arable land, advanced farming
technology and generous government subsidies make the U.S. a net exporter of food and the largest
agricultural exporting country in the world. The U.S. economy maintains its powerhouse status through
a combination of characteristics. The country has access to abundant natural resources and a
sophisticated physical infrastructure. It also has a large, well-educated and productive workforce.
Moreover, the physical and human capital is fully leveraged in a free-market and business-oriented
environment. The government and the people of the United States both contribute to this unique
economic environment. The government provides political stability, a functional legal system, and a regulatory structure that allow the
economy to flourish. The general population, including a diversity of immigrants, brings a solid work ethic, as well as a sense of
entrepreneurship and risk taking to the mix. Economic
growth in the United States is constantly being driven
forward by ongoing innovation, research and development as well as capital investment.
Obvi the da turns – im going for the utsourcing arg and if I win then it makes solvency
impossible for all advs
Welfare – insuff – that’s the DA link
Rev recycle is link arg
On case Leakage Link mag XT
The aff leads to outsourcing carbon emissions to coutries without regs – NCPA on the
case page – that magnifies the link argument
1. It destroys exchange rates and results in higher inflation levels – it erodes all
resiliency to feedback loops and makes economic risks net worse in the world
of the aff – Roberts
2. In generates international models that incentivizes low cost high emission
production in developing nations – yoshida
That increases costs by 250% - the global econ doesn’t stand a chance post plan!
Robert P. Murphy, Patrick J. Michaels, and Paul C. "Chip" Knappenberger, 9-4-2015, "The Case
against a Carbon Tax," Cato Institute, http://www.cato.org/publications/working-paper/case-againstcarbon-tax<Robert P. Murphy is an economist with the Institute for Energy Research specializing in
climate change, Patrick J Michaels is a senior fellow in environmental studies at the Cato Institute, Chip
Knappenberger is the assistant director of the Center for the Study of Science at the Cato Institute>
Besides the arbitrariness and/or dubious choices for the major input parameters, another problem with
use of the SCC as a guide to setting carbon taxes is the problem of leakage. Strictly speaking, it would
make sense (even in textbook theory) to calibrate only a worldwide and uniformly enforced carbon tax
to the SCC. If a carbon tax is applied only to certain jurisdictions, then emission cutbacks in the affected
region are partially offset by increased emissions (relative to the baseline) in the non‐regulated regions.
Depending on the specifics, leakage can greatly increase the economic costs of achieving a desired
climate goal, and thus the “optimal” carbon tax is lower if applied unilaterally in limited jurisdictions. To
get a sense of the magnitude of the problems of leakage, consider the results from William Nordhaus, a
pioneer in the economics of climate change, and creator of the DICE model (one of the three used by
the Obama Administration).13 After studying his 2007 model runs, Nordhaus reported that relative to
the case of the entire globe enforcing the carbon tax, to achieve a given environmental objective (such
as a temperature ceiling or atmospheric concentration) with only 50 percent of planetary emissions
covered would involve an economic abatement cost penalty of 250 percent. Even if the top 15 countries
(by emissions) participated in the carbon tax program, covering three‐quarters of the globe’s emissions,
Nordhaus still estimated that compliance costs for a given objective would be 70 percent higher than for
the full‐coverage baseline case.14 To see the tremendous problem of limited participation from a
different perspective, one can use the same model that EPA uses to calculate the effect of various policy
proposals. The Model for the Assessment of Greenhouse‐Gas Induced Climate Change (MAGICC) is
available and easy‐to‐use on the Cato Institute website. MAGICC shows that even if the U.S. linearly
reduced its emissions to zero by the year 2050, the average global temperature in the year 2100 would
be 0.1°C—that’s one‐ tenth of a degree—lower than would otherwise be the case.15 Note that this
calculation does not even take into account “leakage,” the fact that complete cessation of U.S. emissions
would induce other nations to increase their economic activities and hence emissions. Our point in using
these results from the MAGICC modeling is not to christen them as confident projections, but rather to
show that even on their own terms, using an EPA‐endorsed model, American policymakers have much
less control over global climate change than they often imply.
Warming
Turns warming
Economic crisis turns warming and investment – increases fossil fuel use and
outweighs short-term gains
Reuters, 3/20/’9
(http://www.reuters.com/article/GCA-GreenBusiness/idUSTRE52J1BV20090320)
ROME (Reuters) - The
economic crisis may lower carbon emissions in the short term but will raise them over
the long term by crimping investment in cleaner energy sources, the International Energy Agency's chief economist said
on Thursday.¶ The impact of the financial crisis and the ensuing economic slump on energy investments had
been "stronger than anyone expected" and significant enough to have an impact on climate change and
the whole energy supply chain, warned Fatih Birol.¶ "To think that lower economic growth is good for the environment is
completely wrong," Birol told Reuters.¶ "Because there are many investments that are good for the environment, like
efficiency, renewables and nuclear, that are being postponed or canceled. One or two years of lower
carbon emissions won't count for much at the end of the day."¶ A $100 a barrel price drop from a record high
last year has hurt oil producers, but is a bigger threat to generators of more environmentally-friendly fuels,
which are considered commercially viable only as alternatives to expensive oil.
Yes outsource – assume that no nations are willing – our v says china
and india will cheat! – doesn’t assume BRICS nations
Tech
The wealthy countries will just outsource their carbon pollution to developing nations
Suzanne Goldenberg, 1-19-2014, "CO2 emissions are being 'outsourced' by rich countries to rising
economies," Guardian, https://www.theguardian.com/environment/2014/jan/19/co2-emissionsoutsourced-rich-nations-rising-economies
The world's richest countries are increasingly outsourcing their carbon pollution to China and other
rising economies, according to a draft UN report. Outsourcing of emissions comes in the form of
electronic devices such as smartphones, cheap clothes and other goods manufactured in China and
other rising economies but consumed in the US and Europe. A draft of the latest report from the
Intergovernmental Panel on Climate Change, obtained by the Guardian, says emissions of carbon
dioxide and the other greenhouse gases warming the planet grew twice as fast in the first decade of the
21st century as they did during the previous three decades. Much of that rise was due to the burning of
coal, the report says. And much of that coal was used to power factories in China and other rising
economies that produce goods for US and European consumers, the draft adds. Factories in China and
other rising economies now produce more carbon pollution than industries in America and Europe. "A
growing share of global emissions is released in the manufacture of products that are traded across
international borders," the draft says. The newly wealthy elites of China, India and Brazil are flying more,
buying more cars and otherwise fuelling the consumption that is driving climate change. There is now
growing debate about how to assign responsibility for emissions generated producing goods that were
made in one country but ultimately destined for another. "The consumers that are importing those
goods have some responsibility for those goods that are happening outside of our boundaries," Cummis
said. The 29-page draft, a summary for policy makers, was dated 17 December. An edited version is due
to be published in Germany in April. The report is the third in a series by the IPCC, summing up the state
of the climate crisis since 2007 and prospects for solutions. The first part was released in September. It is
stark about the chances of avoiding dangerous climate change – especially if deep cuts in greenhouse
gas emissions are pushed back beyond 2030.