5 Advantages of Stepping away from the Paris Climate Treaty

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Today marks the one-year anniversary of President Trump’s announcement that the United States would be withdrawing from the Paris Climate Agreement, the United Nations global warming treaty originally signed by former President Obama in 2016. Already, the advantages of that move have been clear and will become more significant as time goes on. The following are five prominent examples.

1. U.S. taxpayers won’t be sending billions of dollars to the United Nations’ Green Climate Fund.

The UN’s Green Climate Fund, originally established during negotiations in Cancún, Mexico in 2010, has set a goal for itself of raising $100 billion a year by 2020, although former executive director Héla Cheikhrouhou has suggested that such climate investments should actually total as much as $450 billion a year. One of the most significant requirements of the Paris treaty for developed-nation signatories like the United States is to make large annual contributions to the fund. President Obama initially pledged $3 billion, although future annual contributions would have only increased with time. These billions of U.S. taxpayer dollars would have been spent by an organization that operates with insufficient transparency and accountability, problems raised as far back as 2015 and amplified even by supporters of the UN climate agenda. Worse yet, the GCF’s projects face the age-old problem of international development money being diverted by corrupt government officials in recipient nations. The Cato Institute’s Marian Tupy has called it a “slush fund for the world’s dictators,” writing that “Third World tyrants salivate at the prospect of largesse from the green climate fund.”

2. The U.S. won’t have to set domestic policies that will raise the costs of energy and all goods and services.

The Paris treaty was to go hand in hand with the Obama administration’s domestic energy agenda, with each propping up the other. Meeting the U.S. “nationally determined contribution” would have required the implementation of domestic policy changes, like the Clean Power Plan, which would have made coal, oil, and natural gas significantly more expensive, while subsidizing already expensive energy sources like solar and wind. American consumers would have seen those increased energy prices throughout the economy—not just in utility bills and at the gas pump, but in the prices of everyday goods of all kinds. Then-candidate Obama promised as early as January 2008 that under his plan “electricity rates would necessarily skyrocket.” The requirements of Paris are slightly different from his initial proposal of a domestic cap and trade system for carbon dioxide, but the skyrocketing prices would have been the same.

3. American companies can use their energy price advantage to unleash a manufacturing renaissance.

As my colleague Marlo Lewis has pointed out, “[U.S.] companies are best served by an international framework that allows them to capitalize on comparative advantages. One of U.S. industry’s key advantages…is an abundance of affordable energy.” Complying with the requirements of the Paris treaty would have imposed a significant and significantly disproportionate cost on U.S. industry, relative to other countries that are also large emitters of carbon dioxide, like China. Stephen Eule of the Institute for 21st Century Energy stated it clearly when he testified before the House Committee on Science, Space, & Technology in 2016: “It is well understood that America’s abundance of affordable, reliable energy provides businesses a critical operating advantage in today’s intensely competitive global economy. [International Energy Agency] data show a huge comparative energy advantage in natural gas, electricity, and coal prices for U.S. industry compared to its OECD competitors, with prices for these energy sources in the United States often two to four times less.”

4. The U.S. can pursue policies that will make America the world’s top energy producer.

Under the Obama administration, domestic energy production was restricted and the activist mantra against fossil fuel production, “keep it in the ground,” was ascendant. Under the current administration, that trend has reversed, driven by executive orders like “Promoting Energy Independence and Economic Growth” and “Implementing an America-First Offshore Energy Strategy.” As of this February, the International Energy Agency predicted that the U.S. will overtake Russia to become the world’s largest oil producer by 2019. In April, Citigroup analysts predicted that the U.S. will likely overtake Saudi Arabia to become the world’s biggest oil exporter next year as well. These achievements would have been impossible under an Obama-style energy policy keyed to compliance with the restrictions of the Paris agreement.

5. The constitutional process for ratifying treaties is getting a second chance.

As noted earlier this week, the Obama administration attempted to define the Paris Climate Agreement as something other than a treaty, despite the fact that by the State Department’s own criteria for evaluating treaties, it clearly qualifies. This means that the White House should have submitted it to the Senate for ratification, as required by the Constitution, in 2016. The previous administration’s policy of “it’s not a treaty if we say it isn’t” set a dangerous precedent that threatens to upend the balance of powers and give the green light to future presidents to bind the American people to huge financial obligations and loss of American sovereignty without  democratic accountability. President Trump can still submit the treaty for a Senate vote, by the way, which would help set our constitutional norms back on track and end our entanglement with the treaty’s lengthy withdrawal process.