Responding to the Stern Review, Jerry Taylor and Peter Van Doren of the Cato Institute argue that adopting measures to stabilize greenhouse gas emissions is not (yet) a good deal for us or future generations.

Not to be flip about it, but why should the relatively poor (us) sacrifice for the relatively rich (our children and grandchildren)? The Stern Report argues that the emissions cuts necessary to stave off disaster will likely cost about 1 percent of global GDP every single year, or about $1,154 in current dollars per household in the United States. A small price to pay, we're told, when GDP losses will likely total 5-10 percent of global GDP every year if we do absolutely nothing.

But even with a 10% reduction in GDP relative to what it would have been, 100 years from now, people will still be extraordinarily well off by current standards. For example, since 1950 real U.S. GDP per capita has increased by about 2% a year. Given that growth rate, real GDP per capita one hundred years hence would be $321,684, or more than 7 times higher than it is at present ($44,403). If global warming cuts GDP by 10% a year beginning about 50 years from now, then GDP per capita will be $289,515 in 2106 rather than $321,684.

Would anyone, let alone liberals, ever propose a 1% tax on those who make $44,000 to create benefits for those who make $289,000? In short, paying now to head off warming is a regressive intergenerational tax that takes from the poor and gives to the rich.

Nobel laureate economist Thomas Schelling has often made a similar point, arguing that intergenerational equity need to account for the likelihood that future generations (particularly in the developing world) are likely to be significantly wealthier than current generations.

Meanwhile, the European Union's industry commissioner, Günter Verheugen, is warning his colleagues that the EU's "environmental leadership could significantly undermine the international competitiveness of part of Europe’s energy-intensive industries and worsen global environmental performance by redirecting production to parts of the world with lower environmental standards."