Russia has many interesting New Year traditions, but the most famous one, at least in the Western media, is its annual bickering over energy prices with neighboring states. It was Minsk’s turn to join Moscow in upholding the tradition this year.

No sooner had Belarus finished toasting the New Year than Russia halted oil supplies to Belarusian refineries through the Druzhba, or Friendship, pipeline. Although the Kremlin quickly restored the oil flow to pacify its European customers, the dispute over pricing is far from settled. Russia and Belarus are still arguing over terms of a new agreement on export tariffs to replace the deal that expired on Dec. 31.

Having subsidized Belarus for years on end, Russia is now asking it to pay full import duties for the oil resold abroad. While Russia agreed to Belarus’ continuing to buy crude for domestic market duty-free, the Belarusian government argues that the customs union between the two states obviates the need for duty on all oil imports from Russia, including the 14.4 million tons of oil that Belarus refines and re-exports.

The oil dispute has already driven oil prices to a 15-month high and elicited strong criticism from the Europe Union, which imports thirty percent of its oil from Russia, half of it traveling through Belarus. Were the oil supplies disrupted, Germany and Poland would be hit hardest because Russian oil comprises 15 and 75 percent of their total oil consumption, respectively. (more…)

By almost any standard, the outcome of the UN Climate Change Conference in Copenhagen last week fell well short of its increasingly humble expectations. Copenhagen was considered pivotal because the “Bali Roadmap” laid out in 2007 circled this meeting on the calendar as the conclusion of the negotiating period which was to create a legally-binding post-Kyoto agreement. But by the beginning of the conference, the goal had been reduced to just establishing a politically-binding framework that would set the world on a course toward reaching a comprehensive international agreement in 2010.

Modest yet politically significant emissions reduction pledges by the US, China, and others prior to the conference contributed to a mood of cautious optimism at the outset of the two-week summit. But on just the second day, the massive rift between developed and developing countries was exposed with the leak of the so-called “Danish text” – drawn up by delegates from Denmark, Australia, the UK, and the US – which would allegedly place most of the power in the hands of developed countries at the expense of developing countries. The text was dismissed by the executive secretary of the UNFCCC, Yvo de Boer, as just an “informal” draft. But China quickly fired back with its own draft text, flipping the blame and the burden onto wealthy countries. A day later, delegates from the US and China traded barbs as the US State Department Envoy Todd Stern told reporters that “there’s no way to solve this problem by giving the major developing countries a pass,” to which Chinese Vice Foreign Minister He Yafei responded that Stern either “lacks common sense” or is “extremely irresponsible”.

The controversy stirred up in the first few days served as a precursor for the deep division between rich and poor countries that would plague the remainder of the negotiations. The next week was remarkably unproductive. Countless controversial draft texts fluttered around the Bella Center amid a walkout by African countries and thousands of angry rioters – impatient with the lack of progress – taking to the streets. With the looming arrival of over a hundred heads of state, the symbolic dichotomy of rich vs. poor countries had grown ever clearer and was threatening to derail the negotiations. (more…)

Yesterday in Copenhagen, 15,000 delegates from 192 countries filled the cavernous meeting room of the Bella Center to commence the much-anticipated UN Climate Change conference. In the months leading up to the conference, hopes were slowly lost that a legally-binding global agreement would be reached in Copenhagen. By the time the conference began, world leaders had lowered expectations – due in no small part to the stall of U.S. legislation in Congress – to merely creating a politically-binding blueprint for concluding a comprehensive international agreement in 2010.

In September, PSA released a statement signed by 33 prominent Republicans and Democrats urging Congress and the Administration to “develop a clear, comprehensive, realistic and broadly bipartisan plan to address our role in the climate change crisis.” The signatories warned that “if we fail to take action now, we will have little hope of influencing other countries to reduce their own harmful contributions to climate change, or of forging a coordinated international response.” The Senate has already failed to deliver legislation prior to the conference, but it is not too late for the U.S. to take the lead in the negotiations, especially since it will be impossible for a global consensus to emerge from Copenhagen without strong U.S. support. (more…)

On Wednesday, Barbara Boxer and John Kerry introduced the Clean Energy Jobs and American Power Act, the long-awaited Senate version of the climate change bill that squeaked through the House in June. With the UN Climate Change Conference in Copenhagen just nine weeks away, U.S. legislative action will be a key to successful global negotiations. Particularly, investment in international adaptation – the multilateral assistance to developing countries in order to withstand the impacts of climate change – is widely expected to be one of the central elements of the looming debate in Copenhagen. Whereas climate change mitigation policies aim to reduce greenhouse gas emissions, adaptation seeks to lessen the vulnerability and enhance the resilience of the most at-risk countries through disaster management and infrastructure capacity-building. Kerry has called international adaptation “part of the glue” holding together hopes of reaching a new global treaty to succeed the Kyoto Protocol. Still, investment in adaptation – at both the domestic and international levels – has been continuously overlooked.

The international security crises associated with climate change are dramatic and self-perpetuating. Drought, rising sea levels, and resource scarcity will lead to disease, mass migration, and political instability, ultimately causing fragile states to collapse into failed states. These cascading effects are intensified with the Earth’s population projected to reach nine billion by 2050. And in a cruel twist of irony, the most devastating effects will be felt in parts of the world that are least responsible for global climate change, specifically Africa, the Middle East, and South Asia.

In North Africa, subsistence farming will suffer a 20-40% reduction in crop yield due to prolonged drought and desertification. Drought will hit the Middle East hard as well, a region that is already home to 6% of the world’s population but just 2% of the Earth’s water supply. And with 60% of the Middle East’s bodies of water lying trans-boundary, the stage is set for conflict. As John Kerry said, “a demographic boom and a shrinking water supply will only tighten the squeeze on a region that doesn’t need another reason to disagree violently.” (more…)

Every February and March, a black haze descends onto mainland Southeast Asia, lowering visibility and driving thousands of people with respiratory complaints into hospital emergency rooms. The cause of this haze has been known for years- the widespread use of slash-and-burn agriculture that results in large swathes of farmland going up in flames annually. What hasn’t been known until recently, however, is the global impact that hazes like this, made up of airborne soot, has had not only on air quality but on the earth’s rising temperature. Scientists now believe that soot, more formally known as black carbon, is responsible for almost twenty percent of the increase in the earth’s temperature over the past century, making it the largest contributing factor to climate change after carbon dioxide. Through legislation aimed at further reducing domestic black carbon emissions and promoting international projects and agreements aimed at emissions cuts, Congress can take immediate, definitive steps towards reducing black carbon’s effect on the rate of climate change.

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The nation can’t seem to get enough of Sarah Palin.  Many social conservatives adore her just as many liberals seem to be giddy over her repeated missteps.  Whether one loves her or hates her, there’s no question that she draws much attention whenever she speaks.  So, like many others, I was quite interested to read her recent op-ed in the Washington Post criticizing the proposed cap and trade plan to deal with energy and global warming.

Perhaps as one of the defacto figureheads of the Republican party, this would provide an opportunity for her to present some new ideas on these vexing problems.  The reality is that there’s no free lunch when it comes to energy and the environment.  All solutions have costs and will involve some pain.  Unfortunately, rather than addressing these tradeoffs constructively, Palin chose instead to just ignore the problem.  This is not to say that she was all wrong.  She raised some important points.  It’s just that her proposed solutions are the exact opposite of what needs to be done.

Probably the most concerning aspect of Palin’s piece is its glaring omission of any serious thinking about how to deal with the environmental impact of our energy usage.  The cap and trade program addresses two interrelated issues:  energy and environment.  While Palin seems eager to speak about utilizing domestic sources of energy, she says virtually nothing about how to deal with emissions.  I was struck by Palin’s dismissal of the cap and trade program.  She wrote, “It would undermine our recovery over the short term and would inflict permanent damage.”

Yes, there will likely be some short term financial costs to this effort.  However, I’m not sure how ignoring global warming can be considered good long term planning.  It seems to me that dramatically altering our environment such that coastal regions are flooded and the nation’s agricultural output is significantly altered could be considered “permanent damage.” (more…)

The likely probability, as I noted in my last post, of Sen. Obama becoming president is now reality.

And though I normally shy away from using words like “historic” because it is such a cliché I think this may be a time when it can validly be used. If, for no other reason than, as a recent Defense Science Board report noted, “It has been more than two generations since the presidency transitioned with American troops engaged in significant combat operations—a deployment begun in the aftermath of the September 11, 2001 attacks.”

So now Americans get to indulge in one of their favorite perennial activities; telling him what he should do. Deal with the financial meltdown, close Guantanamo Bay prison, make Africa a greater priority, declare a moratorium on new “free-trade” deals, reaffirm U.S. commitment to international laws, treaties, the United Nations, and multilateral responses to violations of international peace, work for a comprehensive nonproliferation policy, institute a cap and trade policy for carbon emissions, et cetera.

Looking at all the things people want him to work on you would think we elected Superman as president instead of a mere mortal.

Yet let’s not be naive. Even though he has yet to assume office his victory is already starting to create change. For example, as the Washington Post reported , Iraqi officials, who see President-elect Obama’s views on the timing of a U.S. withdrawal as consonant with their own, appear to be leveraging his election to pressure the Bush administration to make last-minute concessions.

Indeed, the Wall Street Journal reported last Friday that the U.S. notified Iraqi Prime Minister Nouri al-Maliki it has accepted many of the changes proposed last week by the Iraqi cabinet in a draft security agreement between the two countries.

Doubtlessly U.S. military officials will advise President-elect Obama to adjust his campaign pledge to withdraw all U.S. combat troops from Iraq by mid-2010. Remember that while promising a 16-month timetable for getting all U.S. fighting forces out, Obama repeatedly insisted on what he calls a “responsible” withdrawal.

And, in truth, if the United States wants to take back the majority of its equipment from all the bases, major and minor it has in Iraq, it will take more than 16 months.

Like all administrations, Obama needs to take stock of the world. Eight years of Bush foreign and national security policies, plus ongoing globalization, emergence of new powers makes the world a very different place. (more…)

The Wall Street Journal reports that oil prices are up again today, apparently because of the fear of a disruption in the Strait of Hormuz. The price bump follows a series of events in what is becoming a familiar pattern. First, an Israeli politician said today that Iran is making “unacceptable” progress with its nuclear program and that an Iranian nuclear weapon would be an “existential” threat to Israel. Presumably investors fear that this statement indicates an increase in the probability that Israel will unilaterally attack Iran. In the past, Iran has promised to respond to an attack by disrupting oil flows, which would increase the price of oil. Traders, wanting to buy low and sell high, rush into the market to buy oil at its current “cheap” price, so the price goes up today.

Today’s Wall Street Journal report was better than most, because it suggested that an Israel-Iran conflict would threaten oil supplies in two ways:

The comments brought to surface long-held market fear over a potential attack on Iran, OPEC’s second-largest oil producer. Apart from a potential loss of Iran’s output of near 4 million barrels a day, conflict in the region could endanger the vast amounts of oil that move through the Middle East. Iran sits at the mouth of the Strait of Hormuz, through which about 20% of the world’s oil flows — a volume that couldn’t be made up fully through the release of emergency stockpiles in consumer countries.

Most articles just point to Iran’s threat to “close” the Strait of Hormuz. Regardless, these regular references — and their effects on oil prices, which affect consumers around the world — deserve deeper consideration. At the bottom of this post, I’ll point you to a tool that I hope will help you to think through the problems in the Strait.

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Bipartisanship has its advantages. A bipartisan process is more likely to get policy based on values that Americans broadly agree on, and a bipartisan process is less likely to accept mistaken evidence because many eyes will have examined the evidence from different perspectives.

But we need to remember, especially at Across the Aisle, that bipartisanship should rarely, if ever, be a goal for its own sake. The United States in recent years has made all sorts of “bipartisan” foreign policy errors.

And we’re on our way to another one, if the House-led effort to crack down on oil market speculators makes it into law.

In recent years as a New York Times columnist, Paul Krugman has often opined based on his values, and his columns can sometimes seem partisan and shrill. But when he writes as an economist, he is almost always sharp and clear and insightful (who am I to offer broad criticism of one of the leading international economists of our time? I once tried to get him to join my committee of advisors on my Ph.D. dissertation, but since I studied graduate international economics at MIT when he was on leave, meaning that I took the class with another great contemporary international economist, Avinash Dixit, Krugman demurred.  Bottom line: I have my personal views about Krugman’s economics writings, but a dispassionate observer would be perfectly justified in taking his views much more seriously than mine.).

Krugman’s column in today’s Times about speculation in the oil market seems solidly on point, based on well-argued economics. And he offers much more detailed analysis on his blog (here is the most recent post in a series, which started here). Blaming “speculators” for the run-up in oil prices and passing bipartisan legislation to crack down on speculators in hopes of driving down the price of gas in the U.S. is misguided.

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According to Secretary of State Condoleezza Rice in an article in the July/August issue of Foreign Affairs, China’s reluctant and belated concession to allow a skeleton UN-AU peacekeeping force in Sudan represents a newly “cooperative approach on a range of problems.” But the reality is that some newfound sense of Chinese responsibility on the world stage had nothing to do with Beijing’s decision to “cooperate.” The concession on Darfur (if you want to call it that) was entirely about the Beijing Olympics. Given that it took a threatened boycott by Western leaders for China to stop arms sales to Sudan and drop its veto of the peacekeeping resolution, I am dubious that we’ll see any further “responsible” behavior after the Olympic Games have come and gone. At this point, the Games are going ahead—with or without protesting Western leaders—and the leverage a coordinated boycott might have provided will be a mere memory.

But I’m not writing this to bemoan a missed opportunity or cast aspersions on Rice’s diplomatic optimism. I’m writing this to call some attention to the next opportunity down the road: Sochi 2014.

China and Russia are both rising powers, economically, militarily and diplomatically. Secretary Rice referred to both as carrying “special responsibility and weight as fellow permanent members of the UN Security Council.” Translation: they both have lots of nuclear weapons, so our military power doesn’t really scare them. China is also not the only rising power we’d love to see adopt a more cooperative stance as it claims (or reclaims) “full membership in the international community.”

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