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Chrysler chief economist on climate change
The chief economist of DaimlerChrysler, Van Jolissaint, has attacked European attitudes on climate change.

This transcript has been provided by the Society of Automotive Analysts (SAA), who organised the meeting in Detroit at which Mr Jolissaint made his remarks. The meeting was the SAA's 19th Annual Automotive Outlook conference which took place at the Detroit Marriott Rennaissance Center on Tuesday 9 January, 2007. It replaces a partial transcript and recording made by Daimler Chrysler and provided to the BBC. Mr Jolissaint's remarks on climate change were made during a question and answer session following his prepared remarks. The grammar, spelling and sentence structure have been left as provided by the SAA.

Question: Van, this one is directed to you obviously from someone who knows you very well to direct this question to you. The mild winter in the Northeast and the Midwest appears to have raised the awareness of global warming in the United States. With automakers so dependent upon light-duty trucks, what impact do you anticipate from this increased awarness? Maybe in general just talk about the political environment as you see it with the new Congress here, how's that?

JOLISSAINT: I have the honor to work for a company that's co-located in Europe and the United States, and the experience of meeting and working with German colleagues and other professionals in Europe has certainly made me aware that the rest of the world views the threat of global warming with much more alarm than we do.

It's difficult for me to say he's right, because I personally think when you face a certain -- I kind of defer to William Norhouse at Yale, when you face a problem that's way, way distant in the future with a high agree of uncertainty, what you do is buy insurance, and insurance tends to be things like small incremental increases in energy prices or in carbon, and you allow the free market to work, and you reinvest some of the proceeds of that revenue in research and development, and you devote resources to big problems that are big problems today rather than uncertain problems in the future.

But that you should do something, you should do something today. You should do more tomorrow.

Europe seems to take a political position that some people might describe, not me, of course, some people might describe as quasi-hysterical that the sky is falling and we have to dramatically change the way that we organize society today and forever.

And that view I think is probably best evidenced by the contents of the Stern report that was released this fall by the former -- I guess he's an advisor to the government in Britain, and he is a former government official. I think he was former Chief Economist of the World Bank. But it's a pretty -- it's a very thorough but very political document in that they don't use any discount rating.

In other words, saving, saving -- let's see. Preventing an uncertain but small but continuing forever problem is worth huge, huge changes today.

I kind of don't agree with that. But it's about politics.

And if people believe that global climate changes is a big problem, there is more evidence that suggests that it is occurring and that it's something that governments and societies need to deal with.

We think they should deal with it in a step-by-step rational manner, and not behave like Chicken Little, but it is very real.

Now, everything that we've ever seen in the way of research suggests, for instance, that small general taxes or price increases is the best way to deal with an uncertain event like climate changes.

In other words, a carbon tax, a gas tax, small today, rising tomorrow.

And that things like CAFE or fuel economy or fuel efficiency standards or electrical efficiency standards for appliances have welfare losses to the general public.

Essentially in order of magnitude higher than step-by-step general policies, so we're not in favor of them.

But I think it's probably fair to say that climate change is going to be on the agenda, globally and on the agenda in the United States for a long, long, long time

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SEE ALSO
Chrysler questions climate change
10 Jan 07 |  Business



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