Romney, Climate Change, and Growth


The debate about the existence of global warming is over. Mitt Romney, the former Massachusetts governor who will probably announce next week that he's officially a candidate for president in 2008, single-handedly erased any lingering doubts I may have had during his interview yesterday with Lawrence Kudlow on CNBC's Kudlow & Company. (Host Kudlow also writes an insightful blog on economics and policy.) Romney gave some vague answers regarding his views on dealing with climate change, other than to emphasize that he wanted market-oriented solutions. But Romney, a guy who is trying to portray himself as a follower of Reaganomics, never really contested the underlying science. And probably no major 2008 candidate will either, for fear of being labeled a scientifically illiterate know-nothing.

The debate now moves to how to best deal with climate change without seriously damaging economic growth. This is something environmentalists will take seriously if they're smart. The better economic conditions are, the more likely people are to care about climate change. As a recent Goldman Sachs study found:

Public concern over the environment tends to rise and fall with economic growth. For instance, a series of Gallup surveys assessing public environmental concern correlate solidly ... with five-year cumulative returns in the S&P 500. Public concern over global warming peaked in 2000 along with U.S. equities and has only recently started to rebound from the subsequent decline.

Not only will any climate change plan that seems like an economy killer probably be a nonstarter, but poor economic growth would seemingly make it less likely that any major action is taken on the issue.