ECONOMIC HARDSHIP Nearly every study projects economic harm to the strong US. economy if the Kyoto Protocol enters into force: I Argonne National Lab Study concluded that policy restrictions on six energy-intensive industries - chemicals, petroleum refining, paper, iron and steel, aluminum and cement in developed countries, but not their less developed trading partners, would result in significant adverse impact. The main effect of the policy would be to redistribute output, employment and emissions from developed countries to develop? ing countries that are not required to participate. I WEFA, Inc. estimates that the Kyoto Protocol will result in: CI Total annual output reduction of $300 billion or $2,700 per family [3 Loss of more than 2.4 million jobs A competitive advantage for advanced developing countries that are not required to participate Sharply higher prices for gasoline (65 cents per gallon) and gas and electricity (double) I Charles River Associates estimates the Protocol will cause price increases for natural gas electricity and heating oil Energy consumption will need to be reduced by about 30%. I CONSAD Research estimates that by the year 2010, more than 3.5 million jobs will be lost, mostly in the aluminum, chemicals, mining, paper, petroleum and steel industries. CONSAD estimates a loss of $359 billion in Gross Domestic Product (GDP). Energy prices will rise by 59% causing an $87 billion reduction in disposable income, or $875 per household. A THREAT TO OUR NATIONAL SOVEREIGNTY The Kyoto Protocol on global climate threatens U.S. sovereignty and security. As the largest user of energy in the United States, our Armed Forces could be devastated by forced reductions in energy output. An energy reduction of only 10% smaller than the Kyoto Protocol demands would: I Downgrade U.S. Army readiness and require six additional weeks to prepare and deploy. I Result in the loss of more than 210,000 flying hours per year by Air Force pilots. I Cut 2,000 steaming days per year for deployed U.S. Navy ships, canceling bilateral and multilateral exercises. The treaty will open the door for hostile nations to hamper U.S. military operations because unilateral action is not exempt from greenhouse gas limits agreed to in Kyoto. Every action could generate international controversy over whether or not the U.S. military is violating the Kyoto Protocol. I In response to this shortcoming in the treaty, the U.S. House of Representatives voted 413-0 to exempt military actions from the treaty. But the treaty language cannot be changed until it takes effect. "on? A. n. .. - INDUSTRY TECHNOLOGY VOLUNTARY ACTIONS Five years ago, President Clinton challenged industry to reduce greenhouse gas emissions. ?This must be a clarion call, not for more bureaucracy or regulation or unnecessary costs, but for American ingenuity and creativity.? President Clinton, April 22. 1993 American ingenuity and creativity has responded to this challenge in full force, even though scientific uncertainty exists about the effects of global climate change. In just five years, here?s how industry has contributed: I Oil producers have cut emissions of carbon by more than one million tons through process improvements. I Television and VCR manufacturers are producing more efficient products that reduce energy use and save consumers millions of dollars per year. I Electric utilities will have reduced greenhouse gas emissions by 47 million tons through efficiency and process improvements by 2000. I The aluminum industry has forged agreements to reduce greenhouse gases by 40-60% by 2000. I The steel industry expects to reduce emissions through more effective utilization of materials, SEVERE WEATHER Severe weather and global warming have almost nothing to do with each other. Even this year?s El Nino - a natural phenomenon that occurs roughly every seven years has nothing to do with global warming. Historical evidence from earlier centuries calls into doubt claims of a relationship between El Nino and global warming. I ?It cannot be determined from current evidence whether El Nifios are becoming more frequent or more severe because of global warming.? National Oceanic and Atmospheric Administration (NOAA) report (May ?98) I UN scientists say there is ?no causal link? between severe weather, El Nino and global warming. (IPCC Second Assessment Report, ?95) I IPCC Chairman Robert Watson acknowledged ?signi?cant scienti?c uncertainties? regarding whether global warming is occurring. (House Small Business Committee testimony, july ?98) I IPCC contributor John Christy, an atmospheric scientist who works with NASA, said the recent ?xation on extreme weather is misleading. (House Small Business Committee testimony, July ?98) I 35 states recorded their all-time high temperatures before 1940, prior to the alleged period of human-induced warming. (Christy, july ?98) I While ground data show a slight warming, satellite and weather balloon data - generally considered more accurate - show a slight cooling. (Christy, july ?98) DEVELOPING COUNTRY PARTICIPATION Developing countries continue to actively oppose their own inclusion in the Kyoto Protocol, claiming binding emissions reductions would harm their economies. The Administration has demanded ?meaningful participation? from developing countries before submitting the treaty to the US. Senate, although it has never fully defined the term. I 134 so-called developing countries are exempt from the Kyoto Protocol, including industrial competitors like China, India, Mexico, South Korea, Brazil, Argentina, and Chile. World finance centers like Singapore and Hong Kong are also exempt. I Developing countries will account for 75% of the increase in greenhouse gas emissions between 1990 and 2020. I By 2010, developing countries will surpass the United States and other developed countries in greenhouse gas emissions. I The United States Energy Information Administration concluded in March 1998 that the Kyoto Protocol would slow the growth of greenhouse gas emissions only modestly. Carbon dioxide emissions would grow 32% above 1990 levels by 2010 - less than the 44% growth that would occur without the treaty - because of the growth of emissions in developing countries like China, Mexico and India. MANDATES VS. VOLUNTARY ACTIONS I Voluntary action is already lowering greenhouse gas emissions while scientists still debate the potential human impacts on climate. I Implementing rules to cut our energy use up to 40% as the Kyoto Protocol requires - will cost more than $1 trillion, according to a 1998 study by WEFA, Inc. I Voluntary programs let the marketplace dictate the best way to meet environmental goals. That ensures: Cl Access to leading-edge information CI Greater return on economic investments CI Increased public awareness and recognition I Government, society and the environment bene?t from voluntary programs. A UN Environment Directorate report on industry voluntary programs said voluntary agreements: Cl Are ?exible policy instruments to achieve environmental objectives in a manner which best suits the economic circumstances of companies Cl Encourage industry-led initiatives to address environmental objectives [3 Encourage cooperation between industry and government Cl Achieve energy and environmental objectives faster than regulations