Every week some seriously stupid policy proposals get floated by our great leaders. But this past week somehow had a few that were even stupider than usual.
First up, there's the one that you would think cannot be topped. I'm referring of course to President Obama's climate change agreement with President Xi Jinping of China. Really, when Obama left town Xi must have laughed so hard that he split a gut. Under the agreement, the U.S. pledges to reduce its CO2 emissions by 26-28% below 2005 base by 2025, while China pledges only to achieve "peaking" of CO2 emissions by 2030. Here is the key text of the joint announcement:
Today, the Presidents of the United States and China announced their respective post-2020 actions on climate change, recognizing that these actions are part of the longer range effort to transition to low-carbon economies, mindful of the global temperature goal of 2℃. The United States intends to achieve an economy-wide target of reducing its emissions by 26%-28% below its 2005 level in 2025 and to make best efforts to reduce its emissions by 28%. China intends to achieve the peaking of CO2 emissions around 2030 and to make best efforts to peak early and intends to increase the share of non-fossil fuels in primary energy consumption to around 20% by 2030. Both sides intend to continue to work to increase ambition over time.
You might say for starters that this is entirely a charade, only applying to a period when these leaders will be long gone, and their successors will likely pay no attention whatsoever. Maybe true. But assume it is real. In terms of actual emissions, what are the two sides saying they will do?
On the U.S. side, this agreement would mean undergoing a giant transformation over the next ten years of our means of generating electricity. According to Wikipedia from EIA data for 2012, we have 557 coal power plants generating 1,514,043 GWH of electricity per year, which is 37.4% of our total electricity output. Barring a sudden revival of nuclear power, the feasible way to achieve Obama's goal by 2025 is to shut most of that coal capacity down and replace it with natural gas. The EPA already has regulations in the works to force most of U.S. coal electricity-generating capacity out of business. The cost of changing several hundred power plants from coal to natural gas? Perhaps a few hundred billion, to be buried in your skyrocketing electric bill. Meanwhile, better hope that the natural gas "fracking" boom continues to keep natural gas prices low.
And for China? They don't even suggest starting any capacity-restricting efforts before 2030. So during the years that we are shutting down hundreds of coal power plants at enormous cost, they are building hundreds more of them. How many? The total capacity they will build in that period is going to be a multiple of what we ever had. Here is a chart from Climate Central showing to-date and projected coal electricity-generating capacity in China and the U.S.:
We have about 500 coal power plants now. They have about 1000, and while we're shutting down our 500, they'll just build another 1000 and get to 2000! Oh, are they supposed to achieve "peaking" by 2030? OK then, they'll just build the last couple of hundred plants a few years earlier than otherwise planned! Or, perhaps more likely, they'll just get to 2030, look over at a U.S. that has hobbled its economy for no reason by closing down its entire coal power capacity, and say, "Sorry, we changed our minds."
Needless to say, this agreement came to great cheer-leading from the usual suspects, like the New York Times ("landmark agreement . . . signature achievement"), Krugman ("really important . . . a big deal") and NPR ("inject[s] fresh momentum into the global fight against climate change . . . unexpected breakthrough"). The Wall Street Journal even gave an op-ed to Fred Krupp of EDF (who calls the agreement "a game changer"). Can any of these people count? The amazing thing to me is their level of arrogance and smug superiority even as they show off their total stupidity.
Well, is it really possible even to compete with that one for the title of Stupid Policy of the Week? Believe it or not, I have a candidate. New York City's Public Advocate, Letitia James, has proposed expanding the City's defined benefit pension plans to include all workers in the private sector. According to the Wall Street Journal on Thursday November 13:
Public Advocate Letitia James wants to create a centrally pooled retirement fund in the next 15 years that would be open to any private-sector New York City worker who doesn’t have access to a pension. . . . “Quite simply, too many New Yorkers are not prepared for retirement,” Ms. James said at a breakfast meeting of the Association for a Better New York.
It seems that Ms. James has not noticed that defined benefit pension plans are gradually destroying the public sector employers that sponsor them. So it must be time to multiply our commitments by, say, a factor of ten! Ms. James, after all, is the close ally of Mayor Bill de Blasio -- the guy who managed to give his first budget speech earlier this year without ever mentioning the pension issue.
Yes, these are the people who think they should be running our lives.