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Reproduced from Energy Institute at HAAS; Chart: Axios Visuals

A new working paper finds that trade barriers worldwide are generally lower for carbon-intensive goods than cleaner products, creating a large "implicit subsidy to CO2 emissions."

Why it matters: UC Berkeley economist Joseph Shapiro pegs this "subsidy" at $550 billion to $800 billion annually, making it harder to fight climate change.

How it works: The paper explores tariffs (shown above) and other import penalties on a vast array of goods.

  • Penalties are generally lower on "dirtier" sectors — think metals and petrochemicals for instance — used as manufacturing inputs for consumer goods.
  • Shapiro concludes that ending the trade restriction imbalance between "dirty" and "clean" industries would help curb emissions.

The bottom line: "The resulting change in global CO2 emissions has similar magnitude to the estimated effects of some of the world’s largest actual or proposed climate change policies," Shapiro writes.

Why you'll hear about this again: The EU is planning "carbon border adjustments" to keep domestic industries from being undercut by competitors in nations without climate policies.

  • Plus, White House hopeful Joe Biden's platform vows "fees or quotas on carbon-intensive goods from countries that are failing to meet their climate and environmental obligations."

Go deeper

Ben Geman, author of Generate
Aug 6, 2020 - Energy & Environment

Filibuster and Obama fossil fuel ties could slow Biden's climate ambitions

Photo: Mark Makela/Getty Images

Two new stories, taken together, highlight the political push-pull around Joe Biden's climate and energy plans.

Driving the news: Bloomberg reported on Wednesday that some left activists "want Biden to distance himself from former Obama administration advisers they view as either too moderate or too cozy with the fossil fuel industry."

Updated 1 hour ago - Health

First North American Omicron cases identified in Canada

COVID-19 testing personnel at Toronto Pearson International Airport in September. Photo: Steve Russell/Toronto Star via Getty Images

The first two cases of the new Omicron variant have been detected in North America, the Canadian government announced Sunday evening.

Driving the news: The World Health Organization has named Omicron a "variant of concern," but cautioned earlier on Sunday that it is not yet clear whether it's more transmissible than other strains of COVID-19.

Former Defense Secretary Esper sues Pentagon over book

Former President Trump and former Defense Secretary Mark Esper at the White House in 2020. Photo: Mandel Ngan/AFP via Getty Images

Former Defense Secretary Mark Esper filed a lawsuit Sunday against the Defense Department, accusing the Pentagon of "censoring" his First Amendment rights by redacting parts of his upcoming book on the Trump administration.

The big picture: Esper, who served as defense secretary from July 2019 until he was fired by then-President Trump in November last year, alleges in the suit that "significant text" is "being improperly withheld from publication" of the manuscript "under the guise of classification."