The Biggest Loser of 2001
The international treaty dies.

oining Taliban John Walker, Enron, and baseball contraction on the list of the "biggest losers" of 2001 is a less obvious suspect: the international treaty.

First, President George W. Bush treated the ABM Treaty like a 30-year-old son still living in the basement of his folks' house: After repeatedly branding him good-for-nothing, he finally kicked him out of the house. Bush wisely ignored the protestations of arms-control enthusiasts and withdrew the U.S. from the treaty.

And lost in the holiday news lull was a significant development in Japan. CNN reported that the Land of the Rising Sun wants to toss the Kyoto Protocol — the treaty designed to regulate global climate change by restricting energy use — into the ash heap of history, right alongside the ABM treaty.

Japan's decision was typical of all developments that frustrate or anger the environmental lobby. In the Manichean universe of "objective" news reports on green issues, business was the villain. "Japanese industry groups have forced" a reluctant government to throw aside the treaty; the Environment Ministry caved "under pressure from corporate lobbies."

There's more to the story, naturally enough, than business special interests protecting their turf. CNN reported that the decision was based in part on concerns over Japan's "economic slump." That's misleading in the extreme. The Japanese economy isn't in a slump. It hasn't had a pitch to hit since Roger Clemens won his first Cy Young.

The New York Times reported last weekthat Japanese industrial production had fallen to a fourteen-year low. Their most recent decline in output was "twice the decline anticipated by private economists."

"In comparison to this year, next year will be worse," said Yasuo Goto, an economist with the Mitsubishi Research Institute.

So it's not surprising that after the latest round of global climate negotiations in Bonn and Marrakech, government ministers in Japan have had a chance to take stock of the potential economic costs of Kyoto, and they don't like what they are seeing.

Despite the doublespeak of enthusiasts of greenhouse-gas reductions like Kofi Annan who say that the Kyoto regulatory scheme could help the economy, Kyoto is a massive tax, one deliberately designed to slow and check economic activity.

It's worth noting that it's not just the Japanese (or the Americans) who now have serious reservations about Kyoto. As my colleagues Sallie Baliunas and Willie Soon recently pointed out, Kyoto skepticism is sweeping the globe like Pokemon. Politicians and business leaders in Canada, Germany, and New Zealand have taken measure of the costs involved and are now much less enthusiastic about the treaty. Why? To give just one example, New Zealand's Institute of Economic Research recently estimated that by 2016, the Kiwi GDP would be 18% lower than it would have been without the Kyoto emission cuts.

Of course, all of the growing — and prudent — international concern over the economic consequences of Kyoto would be irrelevant if sound science demonstrated that human-induced climate change was a threat requiring the submission of scores of nations to an intricate energy-regulation scheme. But it doesn't.

If human-induced CO2 emissions caused global warming, the world should have witnessed an increase in troposphere temperatures commensurate with the significant increases in CO2 during the 20th century. But no such demonstration exists. What Japan and other countries are realizing is that the science, at this point, is insufficient to justify the energy shackles called for by Kyoto — especially when they are trying to get their economies going again.

If 2001 was good for anything it was for reminding the United States that what the world needs is critical thinking about the genuine threats posed to humanity and that the world will follow if the U.S. has the courage to lead. It usually takes some time for a flawed conventional wisdom to be unmasked. After all, the Japanese are still considering voluntary cuts in greenhouse-gas emissions — not because they fear for the environment, but because they fear retribution from Kyoto proponents in Europe who might punish them with economic boycotts. Nonetheless, Japan's decision to follow the U.S. and put sound economics over shoddy environmental science will help make for a happy new year.