A hero at home, a villain abroad

New revelations on the sort of weapons expertise that was on offer to all comers have deepened the world's worries about nuclear proliferation

EPA

COMPACT in design, efficient in operation and capable of inflicting immense destruction over long distances. There is something truly spine-chilling about the sophistication of the wares displayed in a build-it-yourself bomb catalogue that was apparently shared with members of an international nuclear smuggling ring by a Pakistani scientist, Abdul Qadeer Khan. The quality of the goods on sale, it now appears, was every bit as alarming as the geographical scope of his network.

New nuggets of information, suggesting that bomb-making know-how as well as enrichment was on offer, have emerged in a report by David Albright, a former weapons inspector who now runs the Institute for Science and International Security, an independent research outfit in Washington, DC. Mr Albright says modern designs for small, ingenious nuclear weapons have been discovered among the computer files of three Swiss citizens who were associated with Mr Khan.

“Why did [they]...have these designs, unless they had sold or intended to sell them for Mr Khan?”: that is one of Mr Albright's rhetorical questions. Without going into quite so much detail, America's national security adviser, Stephen Hadley, confirmed on June 15th that the administration was as concerned about possible dissemination of weapons know-how by the Khan network as it was over the spread of uranium enrichment technology.

It now seems that on computers belonging to the Swiss trio (and reportedly on others in Dubai, Malaysia and Thailand) was the design of a modern nuclear warhead, tested and deployed by Pakistan, its parts ready-coded for ease of manufacture. But who were the likely buyers? And will this discovery prod Pakistan to tell the world more about the illicit trade Mr Khan had developed into an art form?

The network's customers for other nuclear technologies and equipment were Libya, Iran and North Korea, though suspicion has at times attached to Algeria, Saudi Arabia and Syria too. But Libya has been out of the bomb business since 2003. Jaws dropped when among the haul of equipment and documents it handed to inspectors was an Islamabad dry-cleaner's bag containing most (not all) of the drawings for a clunky Chinese-designed nuclear weapon from the 1960s, given to Pakistan before China decided that spreading the bomb was a dumb idea.

Unlike the Maoist model, the modern, computerised bomb design would fit easily on Pakistan's Ghauri missiles. Pakistan denies it, but these are a knock-off of North Korea's 1,300km-range Nodong rockets. Pakistan appears to have paid for its Ghauris with some nuclear assistance. Pakistan's president, Pervez Musharraf, denies this too. But in his autobiography he admitted that the Khan network had supplied Kim Jong Il's regime with some 20 uranium-enriching centrifuges.

Whatever the truth behind their missile deal, Pakistani officials were genuinely shocked to be told recently that Mr Khan was selling their most closely guarded weapons secrets too, according to Mr Albright. North Korea did test a nuclear device, in 2006. But its bomb used home-produced plutonium from Mr Kim's Yongbyon nuclear reactor for its fissile core; the Pakistani design touted by Mr Khan and his partners uses uranium.

Despite other evidence to the contrary, North Korea insists it got no uranium help from Pakistan or anywhere else. Recently (or so America and Israel say) it was caught out helping Syria to build a nuclear reactor (which Israel later flattened) that could produce plutonium for weapons, just like Yongbyon did. America seems ready to let both these matters go for now, so long as Mr Kim furnishes an accurate and verifiable inventory of his plutonium production. The gamble is that this would be a big step towards a six-party deal, to include South Korea, Japan, China and Russia, that could lead eventually to the dismantling of all North Korea's nuclear programmes.

Unlike Libya and North Korea, Iran flatly denies any weapons intent. It bought uranium-spinning equipment from Mr Khan, but says its nuclear work is entirely peaceful. Yet it has defied a string of UN Security Council resolutions demanding that the work be halted until inspectors can be sure of that. The trouble is that uranium enriched a little can be used in nuclear-power reactors, but when enriched a lot can be abused for bomb-building.

Iran's determination to enrich on regardless looks like dooming the latest offer of negotiations from America, Britain, France, Germany, Russia and China. The six have promised Iran assistance with other, less proliferation-prone nuclear technology, and direct talks on a whole range of economic, trade and security issues that Iran itself raised in a set of counter-proposals last month. A crucial difference between the two offers is that Iran wants to enrich on regardless, on its own territory, whereas the six insist the work be suspended before negotiations start.

Unless Iran shows willing, says Britain's prime minister, Gordon Brown, European governments are prepared to extend their sanctions on Iran, for example by freezing the overseas assets of Bank Melli, Iran's largest commercial bank. (That move is not quite a done deal, but Mr Brown is confident it soon will be.) Despite record world energy prices, the Europeans may consider blocking investment in Iran's oil and gas industries too. America already has tough sanctions in place, though Russia and China do not.

Iran's insistence on enriching, whatever the cost, deepens suspicion of its motives. Now there are more worries. Like Pakistan's Ghauri missiles, Iran's Shahab-3 rockets are clones of Mr Kim's Nodongs. So the Khan network's modern warhead design would fit them just as nicely.

There is no evidence of any such transaction, but American and other intelligence agencies recently showed nuclear inspectors from the International Atomic Energy Agency (IAEA), the UN's nuclear guardian, evidence pointing to Iranian weapons work which America thinks may have stopped in 2003—though others believe it continues. This includes both high-explosive testing for possible nuclear triggers and work on a Shahab-3 missile cone to accommodate a nuclear warhead. Iran has dismissed the material as fabricated. But it has yet to give a convincing explanation of why it had a document, supplied by Mr Khan and his associates, on shaping uranium into spheres—a technique useful only in weapons building.

That is as far as the evidence goes. Pardoned by Mr Musharraf after a public confession in 2004, Mr Khan was put under house arrest. Neither American officials nor IAEA inspectors have been allowed to question him. Now the revered “father” of Pakistan's bomb is campaigning for release, and he seems to have many admirers among his compatriots. But the revelation that he was preparing to sell his own country's nuclear crown jewels surely ought to be enough to goad the authorities into questioning him more thoroughly. Without further information on the scope of his network and the real nature of his nuclear dealings, it will be impossible to assess how many other people (both salesmen and customers) are still engaged in the same murky business.

The Economist

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Selling nuclear weapons is like selling drugs, except a lot more dangerous. Both are highly profitable, highly illegal, and sell to shady customers. Nuclear weapons are lethal and a huge risk to have. What are you going to do with an item capable of causing the destruction of our entire planet? It's playing with fire. Especially when multiple parties own and are willing to use such items. It remains secure only as long as the balance of power remains intact, but the more countries obtain nuclear weapons the more shaky the situation becomes. That there is a catalouge of instructions for how to make such weapons is, while hardly surprising, a petrifying thought.

Authoritarian governments can lock up bloggers. It is harder to outwit them

WHAT do Barbra Streisand and the Tunisian president, Zine el-Abidine Ben Ali, have in common? They both tried to block material they dislike from appearing on the internet. And they were both spectacularly unsuccessful. In 2003 Ms Streisand objected to aerial photographs of her home in Malibu appearing in a collection of publicly available coastline pictures. She sued (unsuccessfully) for $50m—and in doing so ensured that the pictures gained far wider publicity.

That self-defeating behaviour coined the phrase “Streisand effect”, illustrated by an axiom from John Gilmore, one of the pioneers of the internet, that: “The Net interprets censorship as damage and routes around it.” But the big test of the rule is not whether it frustrates publicity-shy celebrities. It is whether it can overcome governments’ desire for secrecy.

In November 2007 Tunisia blocked access to the popular video-sharing sites YouTube and DailyMotion, which both carried material about Tunisian political prisoners. It was not for the first time, and many other countries have blocked access to such sites, either to protect public morals, or to spare politicians’ blushes. What was unusual this time was the response. Tunisian activists and their allies organised a “digital sit-in”, linking dozens of videos about civil liberties to the image of the presidential palace in Google Earth. That turned a low-key human-rights story into a fashionable global campaign.

It was the same story in Armenia in March, where the president, Robert Kocharian, ended his term in office with a media blackout that, supposedly, extended to blogs (self-published websites which typically contain the author’s personal observations and opinions). Like all other outlets, the authorities said, blogs could publish government news only. The result was a soaring number of blogs hosted on servers outside Armenia—all sharply critical of the authorities.

Some countries still think that the benefits of censorship are worth the opprobrium. China unabashedly blocks foreign news sites, with state-financed digital censors playing an elaborate game of cat and mouse with those trying to elude them. Saudi Arabia makes a positive virtue of the practice, warning those trying to access prohibited websites of the dangers of pornography: sources cited include the Koran and Cass Sunstein, an American scholar who argues that porn does not automatically deserve First Amendment protection.

Such authoritarian countries are increasingly co-operating: Chinese software for finding keywords and spotting dangerous sites is among the best in the world. But international co-operation cuts both ways. If Egypt, for example, buys Chinese web-censorship technology, the Egyptian bloggers may learn ways to bypass it from their Chinese colleagues before the technology arrives.

That may keep information flowing fairly freely. But it does not keep bloggers out of prison. Security officials who once scoffed at blogs, or ignored them completely in favour of bigger and more conspicuous targets, are now bringing their legal and other arsenals to bear. A common move is to expand media, information and electoral laws to include blogs. Last year, for example, Uzbekistan changed its media law to count all websites as “mass media”—a category subject to Draconian restriction. Belarus now requires owners of internet cafés to keep a log of all websites that their customers visit: in a country where internet access at home is still rare and costly, that is a big hurdle for the active netizen. Earlier this year Indonesia passed a law that made it much riskier to publish controversial opinions online. A Brazilian court has ruled that bloggers, like other media, must abide by restrictions imposed by the law on elections.

The chilling effect of such moves is intensified when governments back them up with imprisonment. From Egypt to Malaysia to Saudi Arabia to Singapore, bloggers have in recent months found themselves behind bars for posting materials that those in power dislike. The most recent Worldwide Press Freedom Index, published by Reporters Without Borders, a lobby group, estimates their number at a minimum of 64.

International human-rights organisations have taken up their cause. But the best and quickest way of defending those in prison may be with the help of other internet activists. Sami ben Gharbia, a Tunisian digital activist who now lives in exile in the Netherlands, says that this beats traditional human-rights outfits when it comes to informing the world about the arrest of fellow bloggers. He co-ordinates the campaigning efforts of Global Voices Online, a web-based outfit that began as a collator of offbeat blog content and has now branched out into lobbying for free speech.

Such issues were expected to be in sharp focus at Global Voices’ annual summit in Budapest this week, where hundreds of bloggers, academics, do-gooders and journalists from places like China, Belarus, Venezuela and Kenya were due to swap tips on how to outwit officialdom. The aim, says Ethan Zuckerman, a Harvard academic who cofounded Global Voices, is to build networks of trust and co-operation between people who would not instinctively look to the other side of the world for solutions to their problems.

That is a worthy if ambitious goal. Doubtless, authoritarian governments are in close touch too, sharing the best ways of dealing with the pestilential gadflies and troublemakers of the internet. But they will not be posting their conclusions online, for all to see. Which way works better? History will decide.

The Economist

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The internet is an information-sharing interconnected network. Anything one person can see, anyone with an internet connection will also be able to see. I think it's rather futile to try and keep information about yourself or your government off the web. Any attempts will just cause far greater publicity, as demonstrated by Barbara Streisand. So why try? I suppose authoritarian governments are not well known for being logical. So they lock up renegade bloggers and twenty more will write about how unjust it is to be jailed for talking about things presidents are embarrassed about. 

Still Knocking, as the Doors Close

As forced migration increases, some host countries grow harder

Reuters

MORE and more luckless people are seeking safety and a better future in whatever country they can find; and in various ways, many of the rich countries which might be able to help them are hardening their hearts, often under electoral pressure. That seems to be the common theme of many recent news reports about forced migration.

After a welcome decline between 2001 and 2005, the number of refugees—in the classic sense of people forced to leave their countries because of war or persecution—rose in 2007 for the second straight year, mainly because of turmoil in Iraq and Afghanistan, the United Nations reported this week. As of last December there were 11.4m people under the care of the UN High Commissioner for Refugees, up from 9.9m a year earlier. Then there are people uprooted within their own countries: the December 2007 total was 26m, a year-on-year increase of 1.6m. Countries with high numbers of internally displaced include Colombia (3m), Iraq (2.4m), Uganda (1.2m) and Somalia (1m). And if you throw the net really wide, to include people forced to move by natural disasters, the number of uprooted people reached 67m last year, the UNHCR says. Its secretary-general, António Guterres, has predicted that the interlocking problems of climate change, food shortage and state failure could well make the problem worse before long.

Only a fraction of the people on the move actually invoke the UNHCR procedure under which somebody who faces persecution at home can demand asylum in another country. But that figure also ticked upwards (by 5% to 647,200) in 2007, the first rise for four years. In the European Union, the number of bids for asylum rose by 10.9% last year after several years of decline. Against this dire background, people who lobby for refugees' rights were dismayed by the European Parliament's passage on June 18th of a long-debated “returns directive” which sets the conditions under which illegal migrants can be detained, and eventually sent home.

Under the directive, people who enter the European Union illegally can be detained for at least six months, plus a further year if they “fail to co-operate” with the authorities. (Existing limits vary from 32 days in France to 20 months in Latvia; eight countries declare no limits.) They should be kept in purpose-built detention centres, except in cases of “unforeseen heavy burdens”, in which case ordinary jails will do. Anybody who is expelled from an EU country may not re-enter for five years. Defenders of the directive say it will raise standards in some places and allow detention only when necessary.

In theory, none of these measures has anything to do with bona fide fugitives from persecution; the new rules are aimed at illegal entrants with no claim to asylum, or at those who seek asylum and are rejected. But UNHCR officials, and migrants' lobbies, are still unhappy. They argue that asylum-seekers are often lumped together with illegal entrants, and that refugees get little chance to stake their claim.

It is true that the fate of asylum-seekers varies from one EU country to another. It seems that an Iraqi stands a better-than-even chance of being granted asylum in Germany, but virtually no chance in Greece. Two-thirds of the Chechens who sought asylum in Austria were successful, while no Chechen has found shelter in Slovakia. Those figures were cited by EU officials this week as they laid out a plan for a common asylum policy that would deal consistently with people at Europe's gate.

Does all this entitle other rich countries—sometimes exasperated by Europe's image as the home of compassionate capitalism—to give the EU a scolding for its treatment of the world's unfortunates?

Canada is often thought to have set a gold standard for the treatment of asylum-seekers. It gives them ample legal protection, and detains them only briefly and rarely. But refugee groups have criticised Canada recently over an agreement it has made with the United States to co-operate on asylum cases. This lays down that a refugee making his way from America to Canada be returned across the border for processing, on the principle that America is a safe asylum destination. That agreement was struck down by a Canadian court in November 2007, and is awaiting a review by Canada's Supreme Court.

Does the United States have any reason for self-reproach over asylum-seekers? It is certainly a very popular destination, attracting 50,700 applications last year, more than any other country. And in contrast with some parts of Europe, the word “asylum-seeker” (which in certain British contexts is a term of abuse) has no particular negative connotations in America. Plenty of Americans fret about labour migration, but the issue of asylum is lower on the public's radar screen than in Europe.

More's the pity, say some Americans who work with refugees. There are some genuine fugitives who find themselves in jail, often for long stretches—or else returned to their home countries with little consideration of their claims. One reason for this, say refugee advocates, is that people who flee from war zones—where local warlords extort “taxes” from the whole population—can find themselves branded as sympathisers with terrorism.

Maybe all rich democracies should look at the recent history of Australia, where attitudes (public and private) to refugees have lately swung from harshness to a softer approach. For the previous government headed by John Howard, a tough stance towards migrants was a political trademark. In 2001, after boatloads of mainly Middle Eastern fugitives started landing in western Australia, the government sent troops to board the Tampa, a cargo vessel that had rescued about 400 desperate people from their own sinking boat. Mr Howard's insistence that none of them would get to Australia was popular at home, but it marred the country's international reputation.

Over time, though, media reports about the conditions in which would-be immigrants were being kept in offshore detention centres, or in the Australian outback, had an effect on public opinion. Since Kevin Rudd, a centre-leftist, succeeded Mr Howard as prime minister last November, policy has changed. Two nasty detention centres on islands have been shut, and it has been made easier for asylum-seekers to graduate to residency and citizenship. The public seems, on balance, to approve—though full employment and a thriving economy, thanks to the world commodity boom, probably help.

The Economist

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It was interesting to learn that refugees can invoke a UNHCR procedure under which somebody who faces persecution at home can demand asylum in another country. I did not know such a procedure existed, but I think it's a wonderful idea. Fear of immigrants or immigration always seems tinged with discrimination and xenophobia, even though problems posed by immigration do exist. Refugees with no option but to flee their country should receive safe asylum automatically.

Investors are caught between the desire for growth and the fear of inflation

Illustration by Satoshi Kambayashi

POOR Goldilocks is suddenly out of sorts. After five years when economic conditions have been, like baby bear's porridge, “just right”—strong growth and low inflation—they are now spoiling fast. And as central banks begin to react vigorously, investors are taking fright.

When 2008 started, most investors assumed that the lingering effects of the credit crunch would allow interest rates to fall, or at worst be kept on hold. But over the past week markets have priced in a number of rate rises later in the year from the Federal Reserve, the European Central Bank (ECB) and the Bank of England. That has caused turmoil in short-term government-bond markets (see chart), as yields have been forced sharply higher.

The problem is inflation. Central bankers may hope that soaring oil and food prices will prove to be just a blip, and will not result in secondary effects such as higher wages. But they know that higher inflation expectations, once entrenched, are difficult to eliminate. So they are sounding as tough as they can.

Tricky Trichet

This has not been well co-ordinated. On June 3rd Ben Bernanke, the chairman of the Fed, tried to talk up the dollar (a falling currency adds to inflationary pressures). But on June 5th Jean-Claude Trichet, the ECB president, gave a strong hint that euro-zone rates were soon to rise. That sent the euro sharply higher. As Albert Edwards, a strategist at Société Générale, put it: “Only [two days] after Bernanke made his dollar-supportive comments and retreated to the sidelines, he received the studmarks from Trichet's boot in his chest.”

If that central-banking snafu was not bad enough, June 6th saw both an unexpected rise in American unemployment and an $11 gain in the price of oil—a combination that points to higher inflation and slower growth. Small wonder that the Dow Jones Industrial Average tumbled nearly 400 points on the day.

Investors fear that central banks, in their zeal to prove their anti-inflationary credentials, may inflict some severe damage on economic growth. The problems of the financial sector are far from over, as the $2.8 billion second-quarter loss at Lehman Brothers illustrated. Its share price continued to take a hammering this week as investors worried about its balance sheet and business model.

There have been few bond defaults as yet, but Stephen Dulake, a credit strategist at JPMorgan, reckons investors may be looking in the wrong place for trouble; there have already been 26 defaults in the American corporate-loan market this year. Credit spreads (the excess rates paid by risky borrowers), having fallen sharply between mid-March and mid-May, have been edging higher again.

Meanwhile, house prices are falling in America and Britain. Consumers are struggling to cope with the impact of that on their wealth and with the effect of higher fuel and food prices on their wallets; a rise in interest rates may push them over the edge. In the global economy, more bad news came on June 11th: Australian consumer confidence and New Zealand home sales fell to 16-year lows.

Nor is the task of balancing inflation and growth confined to the developed world. In China the central bank raised the amount of reserves banks must hold against their loans, in an effort to restrain inflation, and shares fell for seven days in a row up to June 12th. Inflationary fears led India's central bank to raise interest rates for the first time in more than a year.

In essence, the global economy has received two shocks in the past 12 months—the credit crunch and higher commodity prices. Those shocks have made the outlook more uncertain, not just for the economy but for monetary policy. And uncertainty makes investors nervous, not least because it comes after a long period when markets seem to have underpriced risk. “Recent years have seen the world get all the benefits of globalisation without the costs,” says Peter Oppenheimer, a strategist at Goldman Sachs. “Emerging markets got growth, developed countries kept the lid on inflation.”

But higher commodity prices are a zero-sum game; for every winner, there is a loser. Many of those losers are likely to be companies. Profit margins have been at historic highs in some big countries, in large part because businesses have been successful in controlling labour costs. But higher raw-material prices present firms with a problem. Pass those costs on, and not only will consumer demand falter, but central banks may raise rates. So they may have to accept lower margins instead.

At the start of the year analysts were forecasting 15% profits growth for European companies in 2008. Revisions have brought that number down to 4%, largely because of problems in the finance industry. But Goldman Sachs thinks analysts are still too optimistic; it is predicting an earnings decline of 12% this year. A combination of higher interest rates and lower profits makes it difficult to see how stockmarkets could advance much during the rest of the year.

Currency markets are also likely to be volatile. The Fed would like to engineer a rise in the dollar against the euro and the yen and a fall against the developing Asian currencies. But that will be hard to pull off as central banks around the world grapple with the inflation/growth trade-off. The dollar's yield will continue to look unattractive, since American interest rates are likely to remain lower than most (bar Japan's). The Bank of Canada, which was widely expected to cut rates this week, decided to keep them steady.

And government-bond markets may also be set for turmoil. Analysts have been scratching their heads at some of the recent moves. “If we told you that the Dow fell by 400 points one Friday after the largest rise in the unemployment rate in nearly three decades, would you buy or sell two-year Treasury notes?” asks William O'Donnell, a strategist at UBS. The usual response would be to buy, but investors sold. Expectations of higher short-term interest rates trumped the safe-haven appeal of the bonds.

At the ten-year level, it may seem odd that investors are willing to receive a Treasury-bond yield of just 4.1% when headline inflation is 3.9%. But if the American economy slips into recession, ten-year yields could fall a lot lower than that; they were 3.1% in June 2003.

So, a world without Goldilocks would be a harsh one for investors. It is not a place where bears eat porridge and go for strolls in the wood. It is one where bears eat ingénues for breakfast.

The Economist

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Economics and the stock market are a complicated game which I don't pretend to understand. 

a convienient truth, sadly ignored

A deal to be done between rich and poor countries on global warming is going begging

Imagine China

IF ALL goes well, in 2011, a year before the Kyoto protocol expires, a new opera will open at La Scala in Milan. It will be based on “An Inconvenient Truth”, the book and film about global warming by Al Gore, the former vice-president. It is easy to see the drama in the story of the failed American presidential candidate turned green crusader (although not in the thickets of statistics into which he sometimes strays). But whether the opera in Milan will end happily or tragically, the composer has not yet revealed.

Does Mr Gore, armed with a PowerPoint presentation and mounted on a rickety mechanical ladder, put the sceptics and recalcitrants of climate change to rout? Or do the world's politicians ignore his song and allow timidity, suspicion and recrimination to vanquish the greater good?

In real life, the answer to those questions is being debated, amid negotiations over a replacement for the Kyoto treaty. Discussions are under way in Bonn and America's Congress right now (see article). The talks are due to culminate in a summit in Denmark next year. But already, the protagonists are blocking out their positions.

Most developing countries are as one: almost all the greenhouse gases that have accumulated over the past two centuries, and are now heating up the planet, came from the chimneys and exhaust pipes of the rich world. What is more, each person in a rich country adds far more to the build-up than someone from a poorer country does. So, the likes of China and India conclude, the rich world must shoulder its responsibility for fixing the climate.

Meanwhile, in America in particular, a chorus of leery politicians points out that China is now churning out greenhouse gases faster than any other country, even if its cumulative tally remains relatively low. Indonesia, India and Brazil are also prolific polluters. Emissions from developing countries are growing so fast that they are likely to swamp any reductions made by the rich world. So there is no point in America and other rich nations cleaning up their act unless rapidly industrialising countries do too.

The fat lady is visible through the Beijing smog

Inconveniently enough, both these arguments are valid. But so is another important and more encouraging observation. It is easier to affect emissions in poor countries, since such places tend to be less energy efficient, to have adopted fewer measures for cutting pollution and to be installing more new capacity. That suggests there is a deal to be done. If the rich world agrees to pay for most of any reduction in the world's emissions, developing countries will allow the cuts to be made wherever they are cheapest.

That, more or less, is the premise of the Kyoto protocol. Rich countries agreed to cut their emissions, or to pay for equivalent reductions elsewhere under a scheme known as the Clean Development Mechanism (CDM). In some ways, it has been a great success. Eager Western bankers have spent billions of dollars capturing noxious gases, improving energy efficiency and building wind farms in developing countries.

Nonetheless, the scale of the investment remains grossly inadequate. What is more, the scheme gives poor countries a reason to avoid any sort of climate-friendly regulation, including measures they could readily afford. Why spend money, when someone else will pay you to do it? Chinese refrigerant factories, for example, produce a lot of trifluoromethane, which is a potent greenhouse gas, but one that can be easily isolated and destroyed. Yet the government does not regulate the stuff, so that its makers can exploit the CDM to sign lucrative contracts, which the government then taxes heavily.

Again, the outlines of a deal are clear. The rich world should agree to increase the flow of clean investment dramatically, in exchange for a promise from fast-growing developing countries to take some steps of their own to curb emissions. That should not be such a hard sell in China and India. After all, their governments are all too aware of the devastating consequences if global warming were to cause the Himalayan glaciers to melt, or crop yields to fall (see article). Moreover, Chinese and Indian firms, in particular, have become accustomed to the flow of funds from the CDM, and would be unhappy to see it evaporate.

Western countries would benefit too, thanks to the lower cost of cutting emissions abroad. That is why the European Union allows international offsets to be used in its “cap-and-trade” scheme. In this, governments issue a set number of permits to produce greenhouse gases, obliging firms to cut their own emissions or buy spare permits from others. The cap-and-trade scheme that America's Senate began debating this week would also allow firms to fulfil some of their obligations through green investments in other countries.

But the bill in Congress would allow only a small number of offsets, and only from factories that do not compete with American firms—a big hurdle in a globalised world. Worse, to make the bill more palatable to China-bashing politicians, its authors have strengthened provisions that would impose tariffs on energy-intensive imports from countries that are not taking “comparable action” against climate change, meaning all developing countries. That is a recipe for a trade war, which would only compound the economic pain of global warming. Just when a deal is possible, the stage is being set for a tragedy of Wagnerian dimensions.

The Economist

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Tariffs don't seem like a very efficient solution to anything. They just make international trade more difficult and that seems to be universally damaging to all involved. Why not have everyone, all the countries that signed the kyoto protocol and any others that want to get involved, work independently towards lowering emissions and greenhouse gasses in their own countries? Sure, money has to come from the rich countries for the poor countries to be able to do anything, but that doesn't mean the poor countries should be the only ones making an effort.