Hair-Raising New World
Israeli officials this week made two painfully honest nuclear pronouncements. The first -- Prime Minister Ehud Olmert's indirect admission on Monday that Israel had nuclear weapons -- got the lion's share of attention. Another statement, however, was easily as interesting: On Wednesday Israeli officials publicly applauded Saudi Arabia's announcement that it and its Gulf Cooperation Council (GCC) neighbors intended to develop "peaceful nuclear energy." Why Jerusalem's endorsement? Because, as Israeli officials explained, these Arab nations' announcement was "directed against Iran." That is, it threatened to check Iran's bomb activities with a Sunni nuclear-weapons option.
Welcome to the new nuclear age where peace is the sturdy child of terror and "peaceful nuclear energy" is the not-so-secret weapon of choice. Unlike Washington, which last month applauded Egypt and earlier Turkey (two other Iran-fearing nations) for the utility and peacefulness of their own just-announced nuclear programs, Israel deserves credit for candidly outing such projects for what they truly are -- nuclear-weapons options.
Still, even with Israel's atomic honesty and America's embrace of a new world full of nuclear-energy programs and a growing number of mutually-not-so-deterred states, no one has yet thought through just how hair-raising this new world is likely to be. Without any luck, in 15 to 20 years, we could see a Middle East (Turkey, Algeria, Egypt, Iran, Saudi Arabia, Morocco, Syria and Israel), an Asia (Vietnam, Indonesia, Burma, Malaysia, Australia, Japan, Taiwan, Korea, China, India and Pakistan), and even a Latin America (Mexico, Venezuela, Cuba, Argentina and Brazil) full of nuclear weapons-ready states.
This may seem far-fetched but consider: The U.S. is now encouraging nuclear power to sustain economic growth and save the world from global warming. The Bush administration has condoned or backed nuclear expansion in India, China, Brazil, Argentina, South Africa, Ukraine, France, Britain, Japan and Australia. Because of this and previous U.S. winking at the nuclear fuel-making activities of key U.S. allies, our own State Department's lawyers now eagerly insist that all nations have a right under the Nuclear Nonproliferation Treaty (NPT) to make nuclear power and fuel. All that's required, they say, is that states claim their activities have some conceivable civilian application and open them to occasional international visits.
The risk of pursuing such egregious policies is obvious: A world full of nuclear fuel-making states, claiming they are on the right side of the NPT, only days or weeks from having bombs.
The latest idea that is supposed to prevent this is to assure countries affordable (i.e., subsidized) nuclear fuel and reactors in order to bribe them to forgo nuclear fuel-making. If this is not enough, the International Atomic Energy Agency recently suggested that perhaps it would also be useful to share "proliferation resistant" -- but not necessarily proliferation proof -- reprocessing technologies (a key way to make nuclear-weapons fuel). All of this, of course, would be voluntary. Countries that signed up could change their minds.
Much of this is worse than doing nothing. Such subsidized nuclear aid, at a minimum, will undermine whatever moral or economic authority we might otherwise have to scold or isolate would-be bomb makers about their unnecessary, uneconomical and dangerous activities.
What then should we do instead? The short answer is to rely more on market mechanisms and less on government guessing to guide us through the myriad of choices that must be made to fuel and generate clean, economical electricity. Fortunately, the most dangerous nuclear activities, like nuclear fuel-making, are uneconomical as is producing large amounts of nuclear power in oil- and gas-rich countries with small electrical grids (e.g., much of the Middle East). There are also a number of non-nuclear ways to reduce greenhouse gas emissions. We need to exploit this.
First, we should encourage open international bidding on the construction of large electrical power generators and their related fuel-making plants. Winning bids in any national competition should go not to the priciest or the most subsidized project but rather to the option that is the best value in producing a desired amount of clean electricity. Here, one might begin by pushing the Global Energy Charter for Sustainable Development, a popular treaty which calls for "open and competitive" energy markets.
Second, we must recognize that to meet tough greenhouse-gas emission goals, a consumption tax on carbon-generating fuels will be necessary. Besides making its introduction revenue neutral and progressive through tax reform (income and other tax reductions, plus rebates for citizens who are poor), these new taxes should be accompanied with an early sunset on all the fuel-specific subsidies now in place for nuclear and natural gas, oil, clean coal and renewables. Anything less would only stack the deck higher in favor of nuclear against safer, less subsidized alternatives.
Firms building and operating fuel-making and electricity-generating plants would have to assume the full costs of financing, insuring and decommissioning them. In the case of nuclear facilities, they also would have to assume the expense of safeguarding and physically securing them against diversions and terrorist and military attacks. Ideally, keeping governments from subsidizing these activities should be a priority not only for national governments, but for trade organizations like the EU and WTO.
Under such a market regime, nations that choose to subsidize any particular form of energy production would be called to account for undermining economic fairness. If they subsidized nuclear activities, they also could also be collared for threatening international security. Certainly, subsidizing nuclear fuel-making (where the world capacity is projected to exceed demand for the next decade or more) makes no economic sense.
Would this stop nuclear proliferation? No. But, unlike today's interpretation of the NPT, which ignores suspicious "civilian" nuclear undertakings even when it's obvious that they lack any economic rationale, it would help flag worrisome nuclear activities far sooner -- well before a nation came anywhere near making bombs. Would it stifle nuclear power? No. A carbon tax should favor nuclear power but no more than cheaper, clean alternatives.
Would it take care of a nuclear-ready Iran? Hardly. Only military, economic and diplomatic efforts to squeeze Iran (as we did the Soviet Union during the Cold War) can handle that problem. But it would prevent Iran from becoming an international nuclear model. It certainly would be far more effective in promoting nonproliferation than any American-led effort to subsidize atomic power, and clearly less risky than backing Israeli and GCC efforts to surround Iran with peaceful nuclear-weapons options.