Advocacy and credibility

"The wasteful habits of many energy users are so deeply ingrained that a massive re-education effort will have to be undertaken to change them."

"Governments must set a policy framework which will orient domestic energy choices towards low-greenhouse gas technologies and behaviors."

"...It may be necessary to encourage more forcefully the adoption of electricity systems based on renewables."

"Taxes and tradable emission permits may be appropriate tools to address environmental externalities."

When officials from many governments gather to discuss the Kyoto Protocol on climate change, observations like these zing headily through the proceedings. Usually, however, they have deep, easily traceable political roots.

The source

But the comments didn't come from a socialist group. They didn't come from Greenpeace. They didn't come from some country with easy Kyoto targets hoping to foist as much economic distress as possible on competitors.

The comments came from the International Energy Agency, best known for its monthly Oil Market Report and various other analyses of energy supply and demand. They appear among published "messages" IEA planned to deliver at the fourth conference of the Kyoto parties last week in Buenos Aires.

Clear political overtones of the messages clash with IEA's background, function, and credibility as a market analyst. The Organisation for Economic Cooperation and Development created the agency in response to the Arab oil embargo to monitor oil markets and administer an emergency oil-sharing program. The sharing program doesn't work and-thanks to an ill-defined trigger-never will. But it can claim credit for making hoarded crude oil a factor of global politics.

The greater triumph is the market-reporting facility IEA has developed over the past quarter-century. As a noncommercial alliance of governments, IEA enjoys broad access to data and does a thorough job of collecting and reporting them. Even economists who dispute the agency's numbers respect them for having come from a body hawking no political or commercial agenda.

In its crusade on climate change, IEA steps far out of its realm. Predicting emissions likely to result from anticipated fossil energy consumption is one thing; telling governments how to govern and energy users how to conduct their lives is something quite different.

In line with popular alarmism, IEA hinges aggressive policy recommendations to the atmosphere's rapidly rising concentration of carbon dioxide. Yet science remains far from definite about the need for costly response. The proper controversy focuses on how much insurance the world can afford against the chance that a CO2 build-up does pose a threat. To fix upon CO2 as a cause for immediate sacrifice, as IEA has done, is to prejudge science.

Furthermore, IEA has no policy-making authority and should quit acting otherwise. Assertions about "wasteful habits" and the need for "massive re-education"-followed, of course, by increased taxes-betray an unbecoming urge to let governments dabble in markets and psychology.

Fuzzy economics

And why slosh into "environmental externalities"? The concept serves only as a handy sanction for official mischief, such as the taxes and emission permits that IEA sees as possibly "appropriate tools." The fuzzy economics of externalities never accounts for the cost of statist blunders and thus deserves no mention in serious discussion about policy.

With its evident prejudice about climate science and taste for state-centered remedies, IEA takes a staunchly political stance in an important global controversy. It thus sacrifices neutrality to no constructive purpose and jeopardizes its credibility as a market observer, which the world needs more than misplaced advocacy.