Foreign Policy - #210 January-February 2015

ARE YOU AFFILIATED WITH A RUSSIAN STUDIES PROGRAM AT A U.S. COLLEGE OR UNIVERSITY? OPEN CALL FOR NOMINATIONS TOP RUSSIAN STUDIES PROGRAMS IN THE U.S. 9\\ZZPH +PYLJ[»Z LKP[VYPHS [LHT PZ WHY[ULYPUN ^P[O H WHULS VM L_WLY[Z [V WYVÄSL HUK YHUR SLHKPUN Russian Studies programs in the United States. This special feature will also review the latest [YLUKZHUKVWWVY[\\UP[PLZMHJPUNZ[\\KLU[ZLTIHYRPUNVU[OLZLWYVNYHTZHUK^OH[JVSSLNLZHUK universities are doing to create the best quality experiences for their students. To nominate your college or university, learn more about the upcoming report or to advertise in the section, please email [email protected] To learn more about Russia Direct, please visit RUSSIA-DIRECT.ORG/ABOUT-US

editors’ letter The New Foreign Policy of climate change—the overarching theme of this issue’s long-form features— THE WORLD ENTERS 2015 much changed, in many ways, from one Pulitzer Prize winner Kenneth R. Weiss year ago: The Russian ruble is in crisis, and oil prices are at the profiles an emerging class of international bottom of their barrel, so to speak. The United States and Cuba litigant: the climate refugee. McKenzie are embarking on a historic rapprochement, while a Seth Rogen Funk takes readers into the shadows of bro comedy has somehow redefined the notion of “interna- carbon-trading fraud. And FP’s own Keith tional incident.” Johnson unpacks burning questions sur- rounding Big Coal, weighing its potential Here at FOREIGN POLICY, we are committed to covering such to lift nations out of poverty against the change in ever-innovative, sharp, and agile ways. To that end, environmental threat it poses to the planet. we have embarked on a major change ourselves—the product of which you hold in your hands. In the vein of presenting more diverse voices, we are introducing a new travel The January/February issue is newly, completely redesigned. feature: The Fixer, which turns for guid- Offering a vision of FP’s future, the issue is the outcome of months ance to the too-often anonymous local of intense collaboration among editors and designers. It also hands who expertly lead parachuting jour- comes out of careful study of what FP has become since Sam- nalists through terra incognita. Kicking uel Huntington and Warren Manshel launched their journal of off the series is Olayinka Oluwakuse III, ideas in the winter of 1970. The magazine’s physical contours who tells readers where to eat, shop, relax, have evolved over the decades; longtime readers will recall the and even absorb some history in Lagos, original narrow, rectangular design. So too has our range of Nigeria. Other voices include a pair of new, coverage transformed: What was once the East Coast policy- regular columnists: James Bamford and opinion echo chamber has become a big tent for readers across Debora Spar. An authority on U.S. intel- an enlightened, interconnected world. ligence, Bamford airs a proposal to turn the bloated surveillance apparatus into In the redesigned magazine, you will notice a greater empha- a humanitarian tool. Spar, an economist sis on storytelling and on voices that are too often underrepre- and the president of Barnard College, asks sented in the media—the lives behind or tangled in matters whether foreign investors are saviors or of international importance. For instance, under the banner perpetrators in the Ebola crisis. We’ve invited designers, photographers, and illustrators into our pages—and not just to embellish stories. Visual Statement, for example, provides space for an artist’s take on a world event or trend; graphic artist Muiz launches this feature with a poignant map of the Middle East. In Aperture, our new home for photo essays, Hungarian pho- tographer Balazs Gardi shares his breathtak- ing work on the geopolitics of water. The list of new features and contribu- tors goes on; start turning the pages to see them all. We’ve worked to build a maga- zine brimming with revelations about our wide world, how it is changing, and the people who share it. We hope you enjoy the redesigned FP—and that you find it offers not just captivating perspectives, but also a unique reading experience. FOREIGNPOLICY.COM 1

contents 01|02.2015 032 Cap and Fraud Have computer hacks, bomb threats, identity theft, and other crimes stymied the world’s best hope to stop climate change? by MCKENZIE FUNK 040 Dirty Pretty Rock Coal is trashing the environment, but also lifting people from poverty. Like it or not, the fuel isn’t budging from the world’s energy mix. by KEITH JOHNSON 048 Exile by Another Name Ioane Teitiota, a migrant farmer from the tiny island nation of Kiribati, is a test case for determining whether millions of people, pushed from their homes by climate change, will be acknowledged—or forgotten. by KENNETH R. WEISS 058 The View from the Tower What are the top institutions for undergraduate, master’s, and Ph.D. programs in international relations? Who are the top scholars? And what are the most important foreign-policy issues facing the United States today? by DANIEL MALINIAK, SUSAN PETERSON, RYAN POWERS, AND MICHAEL J. TIERNEY 2 JAN | FEB 2015 ON THE COVER ILLUSTRATION BY Mike McQuade for FP Photograph by CHRISTOPHER LEAMAN

Honoring 2014’s Leading Global Thinkers From top right: Global Thinkers United Nations Special Representative Zainab Bangura (with microphone), paleopathologist Kathryn Hunt (clockwise) Water-Gen President Arye Kohavi and Uruguay’s Foreign Minister Luis Almagro; the Gala; FP Group CEO and Editor David Rothkopf and the introduction of the Global Thinkers in attendance. On November 17, Foreign Policy unveiled its sixth annual special issue spotlighting FP’s 100 Leading Global Thinkers at a dinner honoring the exclusive members of the list. Attended by over 40 Global Thinkers from around the world, the event celebrated people who translated ideas into actions impacting millions worldwide. FP’s Global Thinkers Gala was generously underwritten by Chevron

contents 01|02.2015 Observation Deck APERTURE: BALAZS GARDI; DECODER: TODD DETWILER; BOOKS: MAAYAN PEARL Sightlines 066 012 MAPPA MUNDI APERTURE Rights 2.0 The Waters Beneath by DAVID ROTHKOPF photographs by BALAZS GARDI 068 018 ECONOMICS THE THINGS THEY CARRIED Heroic Villains The Solar Pilot by DEBORA L. SPAR interview by KELLY DINARDO 070 020 VISUAL STATEMENT NATIONAL SECURITY The Ummah Is Humanity The Black-and-White Security Question by MUIZ by JAMES BAMFORD 022 THE EXCHANGE 076 Walter Isaacson and BOOKS & CULTURE Megan Smith Talk Tech Prize and Prejudice 024 DECODER by DIANE MEHTA The Plague by JAKE SCOBEY THAL 078 026 THE FIXER INNOVATIONS Out and About in Lagos 3-D Holograms, Real-Life Wonkavators, and More by GLENNA GORDON by BARRON YOUNGSMITH 009 Contributors 080 The Futurist 4 JAN | FEB 2015

READY TO CHANGE THE WORLD? TREASURY WHITE COMMERCE OAS FEDERAL NATIONAL ACADEMY DEPARTMENT HOUSE DEPARTMENT RESERVE OF SCIENCES WORLD IMF THE GEORGE WASHINGTON UNIVERSITY STATE BANK DEPARTMENT START HERE. GW ELLIOTT SCHOOL OF INTERNATIONAL AFFAIRS GW’s Elliott School of International Affairs is located just steps from some of the most important policy- making institutions in the world. Our proximity to U.S. and international organizations puts our scholars in a powerful position to analyze policy problems as they unfold, and it draws world leaders to our campus to address some of the most important issues of our time. Every school of international affairs bridges the theory and practice of foreign policy. At GW’s Elliott School of International Affairs, we don’t need bridges; we have sidewalks. elliott.gwu.edu

David Rothkopf CEO AND EDITOR, THE FP GROUP Mindy Kay Bricker Benjamin Pauker EXECUTIVE EDITOR, PRINT EXECUTIVE EDITOR, ONLINE Seyward Darby Yochi Dreazen DEPUTY EDITOR, PRINT MANAGING EDITOR, NEWS SENIOR VICE PRESIDENT, Lindsay Ballant Rebecca Frankel Nicole Duran GLOBAL ADVERTISING SALES CREATIVE DIRECTOR SENIOR EDITOR, SPECIAL PROJECTS DEPUTY MANAGING EDITOR, NEWS Amer Yaqub Amy Finnerty SENIOR STAFF WRITERS William Inboden, Charles Kenny, ASSOCIATE PUBLISHER Christina Larson, Aaron David ARTICLES EDITOR Colum Lynch, Gopal Ratnam Miller, Thomas E. Ricks, J. Peter Ian Keller Scoblic, James Traub, Stephen M. SENIOR EDITORS, TEA LEAF NATION SENIOR REPORTERS Walt, Micah Zenko VICE PRESIDENT, INTERNATIONAL Rachel Lu, David Wertime Kate Brannen, John Hudson, Emily Simon Keith Johnson, Jamila Trindle MIDDLE EAST EDITOR DIRECTORS, INTERNATIONAL STAFF WRITER David Kenner Duc Luu, Aaron Schumacher David Francis ASIA EDITOR DIRECTOR, ADVERTISING COPY CHIEF Isaac Stone Fish Brian Ackerman Preeti Aroon ASSOCIATE EDITOR VICE PRESIDENT, COMMUNICATIONS COPY EDITOR Max Strasser Carol Ross Joynt Vanessa H. Larson ASSISTANT MANAGING EDITORS PRESS DIRECTOR HOMEPAGE EDITOR Jake Scobey-Thal, Maria Ory Alicia P.Q. Wittmeyer Emma Carew Grovum VICE PRESIDENT, EVENTS ART DIRECTOR WEB DEVELOPER Grace Rooney Ed Johnson Erik Reyna DEPUTY DIRECTOR, EVENTS ASSISTANT EDITORS FELLOW, TEA LEAF NATION Stephanie Cherkezian Elias Groll, Siddhartha Mahanta, Bethany Allen-Ebrahimian Thomas Stackpole, Prachi Vidwans EDITORIAL RESEARCHER, TEA LEAF NATION FELLOWS Shujie Leng Justine Drennan, Siobhán O’Grady CONTRIBUTING EDITORS EDITORIAL RESEARCHERS Daniel Altman, John Arquilla, Peter Bergen, David Bosco, Simon Engler, Reid Standish Ian Bremmer, Rosa Brooks, Christian Caryl, Mohamed A. SENIOR VICE PRESIDENT, CIRCULATION, El-Erian, Peter D. Feaver, DIGITAL STRATEGY AND OPERATIONS David E. Hoffman, Christopher Cotnoir CONTRIBUTING PHOTO EDITOR, PRINT VICE PRESIDENT, BUSINESS James Wellford DEVELOPMENT AND BRAND MANAGEMENT 2009 NATIONAL MAGAZINE AWARD Tara Vohra GENERAL EXCELLENCE WEB DIRECTOR Foreign Policy SUBSCRIPTIONS SUBSCRIBER SERVICES Foreign Policy, P.O. Box 283, Congers, NY 10920- Tim Showers 11 Dupont Circle NW, Suite 600 0283; ForeignPolicy.com/services; e-mail: Washington, D.C. 20036 [email protected]; (800) 535-6343 in U.S.; WEB DEVELOPERS PUBLISHING OFFICE (845) 267-3050 outside U.S.; Publications mail (202) 728-7300 agreement no. 40778561. Rates (in U.S. funds): Josh Mobley, Priya Nannapaneni, SUBSCRIPTIONS $59.99 for one year. For academic rates, go to Saxon Stiller (800) 535-6343 ForeignPolicy.com/education. NEWSSTAND AND BOOKSTORE DISTRIBUTION Curtis Circulation DIRECTOR, CONTENT SALES ADVERTISING Company, 730 River Road, New Milford, NJ 07646- (202) 728-7310 3048; (201) 634-7400. BACK ISSUES $10.95 Keith Arends per copy. International airmail add $3.00 per copy; © 2015 by The FP Group, a division of Graham online: ForeignPolicy.com/backissues; e-mail: ASSISTANT DIRECTOR, MARKETING Holdings Company, which bears no responsibility [email protected]. SYNDICATION REQUESTS RESEARCH AND AD TRAFFICKING for the editorial content; the views expressed in Contact Matthew Curry (202) 728-7351; the articles are those of the authors. No part of this [email protected]. OTHER Matthew J. Curry publication may be reproduced in any form without PERMISSION REQUESTS Copyright Clearance permission in writing from the publisher. Center, Inc. (978) 750-8400; www.copyright.com. CONTENT SALES ASSOCIATE Travis Gross SENIOR VICE PRESIDENT, CHIEF FINANCIAL OFFICER Allen Chin ASSISTANT TO THE CEO Hilary Kline JUNIOR ACCOUNTANT Luyi Shonekan 6 JAN | FEB 2015

I came to Korbel because it’s a place where new ideas and different ideas are brought about – it’s not just about a set curriculum.” - Kyleanne Hunter M.A. Candidate Sié Fellow Kyleanne Hunter is a former officer in the United States Marine Corps, serving as an AH-1W Super Cobra attack pilot. Now she’s a Sié Fellow at the Josef Korbel School’s Sié Chéou-Kang Center for International Security & Diplomacy. As such she’s working alongside world renowned faculty doing relevant research on today’s most pressing global issues. To learn more about our master of arts programs and our two-year full tuition scholarship, the Sié Fellowship, call 303.871.2544 or email [email protected]. www.du.edu/korbel/info

foreignpolicy.com COMING IN JANUARY JACK MA When Did Obama The FP CORRECTION Give Up? Twitterati 100 THE PACIFIC POWER INDEX The photo for Don’t be fooled by Ugh, @taylorswift13 Afghan graffiti artist Pivot. Rebalance. Containment. the recent flurry of is so last year. It’s Shamsia Hassani Provocation. Call it what you executive action on 2015, and time that appeared in the will, but the complicated immigration and to trim whom November/December relationship between the Cuba or the hasty you’re following. 2014 Global United States and China is half-war against the Every pundit and Thinkers issue was far more important than the Islamic State. Look D.C. junkie tweets mistakenly a photo Washington-Moscow closely at the U.S. breaking news like of Lima Ahmad. two-step ever was. Check president’s speeches they invented it, FOREIGN POLICY regrets out FP’s list of the 50 most of late, and you’ll but FP’s annual that the error was important people in Sino- see an unmistakable list of the most not caught during American relations. They put air of resignation. important—and the fact-checking the power in superpowers. Read FP contributing interesting—people process, which editor James Traub’s on Twitter has both should have flagged masterful feature the newsmakers the misidentification on the diminution and the intellectual by AFP and Getty of what was once a heavyweights to Images. grand vision in the keep you in the White House. conversation from Jakarta to Jerusalem. “GMAP is a unique program that has made me think JACK MA: ILLUSTRATION BY JOEL KIMMEL FOR FP; BARACK OBAMA: DOUG MILLS POOL/GETTY IMAGES deeply and differently about how the world works” – Per-Olof Schroeder, (GMAP 2014) Senior Director, Microsoft Office Division Western Europe GLOBAL MASTER OF ARTS One-year Master of Arts Degree. PROGRAM $WWKHQH[XVRILQWHUQDWLRQDODͿDLUVEXVLQHVVODZDQGGHYHORSPHQW 7KUHHZHHNUHVLGHQF\\VHVVLRQVZHHNVRILQWHUQHWPHGLDWHGOHDUQLQJ Courses Include: International Organization $OLIHORQJQHWZRUNRIGLVWLQJXLVKHGLQWHUQDWLRQDOOHDGHUVDQGH[HFXWLYHV International Politics -RLQXVWRGD\\ Corporate Finance and International Trade Global Financial Markets Leadership and Management 9LVLWXVDWÁHWFKHUWXIWVHGX*0$3RUFDOO Security Studies International Business Transnational Social Issues and Economic Law International Negotiation CLASSES BEGIN IN MARCH AND JULY. 8 JAN | FEB 2015

contributors KENNETH R. WEISS Keith Johnson Diane Mehta “While in Kiribati, I wanted to see the house is a senior reporter has covered books, where Ioane Teitiota had spent his last four covering energy geo- the media, and other politics for FOREIGN topics for the New years on the crowded capital island of POLICY. Previously, York Times, Fast Tarawa. I knew it was in the village of Abarao, Johnson worked for Company, the Paris more than a decade Review Daily, the and I had the name of a sister-in-law. I at the Wall Street New Republic, the arrived just before sunset and started ask- Journal and was Believer, the Los ing for her with the help of a translator. Vil- based in both Wash- Angeles Review of lagers pointed to a small woman holding a ington, D.C., and Books, and other young child in her arms. It was hot. Mosqui- Europe. From 2007 national magazines. toes were beginning to swarm. She was wary to 2010, he contrib- She has worked in of the strangers, but led me through a warren uted to Environmen- book publishing in of thatch-roofed huts. The family home stood tal Capital, a blog New York and is writ- on the water’s edge, its back to the ocean; for the Journal that ing a historical novel, focused on energy set in 1946, about a it was elevated by mounds of sand piled developments and mixed-race couple in up against a shoulder-high sea wall. Waves sustainability. Bombay. lapped below. Living on a narrow strip of land sandwiched between surrounding seas, peo- McKenzie Funk Glenna Gordon GORDON: ANDREW ESIEBO; FUNK: JAMES MOES; KIRIBATI: KENNETH R. WEISS ple here have run out of room. A recent high tide had torn chunks out of the wall, requir- is a founding mem- spent years working ing emergency repairs with coral scavenged ber of the global jour- as a reporter and off the beach. I felt a pang of compassion for nalism cooperative photographer Teitiota’s family, their endless task of rebuild- Deca and a maga- in Uganda, Liberia, zine writer covering and elsewhere in ing on the front lines even before feeling everything from Chi- Africa. Her photog- the full brunt of sea-level rise. What kind of nese Internet addic- raphy has appeared tion to how a detainee in the New York future do they have?” P. 48 adjusted to life after Times, the Wall being released from Street Journal, Guantánamo Bay. His Time, and Le Monde. stories have appeared Today, Gordon in Harper’s Magazine, is based in New Outside, and the New York, though she York Times. Funk is continues to travel the author of Windfall, abroad on assign- which profiles individ- ment. She is a lec- uals who are profiting turer at the New off global warming. School. 9 JAN | FEB 2015

Carolyn Kissane Academic Director and Clinical Associate Professor Center for Global Affairs Carolyn Kissane built her professional expertise in Kazakhstan, Russia, Mongolia, Japan, and Sweden as a researcher and consultant for educational institutions and NGOs. She brings her knowledge and experience in the politics of energy, geopolitics of oil, comparative energy politics, and resource security to graduate courses at the NYU School of Professional Studies Center for Global Affairs (CGA). Students in the M.S. in Global Affairs broaden their learning and professional experience with Professor Kissane through field intensives in which they visit the Athabasca oil sands in Fort McMurray, Alberta; by meeting industry leaders in Calgary; and by discussing polar politics in Quebec. It is this level of exposure and opportunity that CGA faculty members offer to students, resulting in an unparalleled global education. Learn More M.S. in Global Affairs with concentrations in Environment/Energy Policy, Attend an Information Session Human Rights and International Law, International February 21, 2015 Development and Humanitarian Assistance, sps.nyu.edu/graduate-events12a International Relations, Peacebuilding, Private Sector, and Transnational Security visit: sps.nyu.edu/cga/programs1a Graduate Certificates in call: 212-998-7100 Global Energy, Peacebuilding, and Transnational Security request info./apply: sps.nyu.edu/gradinfo12a Knowledge Through Practice

sightlines APERTURE THE THINGS VISUAL STATEMENT THE EXCHANGE DECODER INNOVATIONS From fights over The scars of the The Aspen Insti- There are up to Holograms ice chunks to a “gar- THEY CARRIED 1916 Sykes-Picot tute’s Walter Isaac- 2,000 cases of the you can touch, bage island” of plas- How to survive a Agreement son and U.S. CTO plague annually xenon’s power to tic bottles, images five-month, round- mar the landscape Megan Smith talk worldwide. Could cure PTSD, and of the geopolitics of the-world trip in of the Middle The Imitation Game the Islamic State poop-powered water. | P. 12 a solar-powered East. | P. 20 and Bitcoin. | P. 22 create more? | P. 24 spaceflights. | P. 26 plane. | P. 18 ICON BY ELIAS STEIN FOR FP “Who produces it? Who owns it? And who profits from it?” | P. 12 Lettering by DIMA LAMONOV

12 JAN | FEB 2015

aperture SIGHTLINES photographs by BALAZS GARDI The Waters Beneath In May 2009, a truck rolled through the Sheikh Yasin camp in Mardan, Pakistan’s “city of hospitality,” where thousands of people had fled follow- ing one of the country’s military offensives against the Taliban. If water was a scarce commodity to this refugee community, ice was a luxury. And it was worth fighting for: A single block could refrigerate whatever perishables the dis- placed had secured for their families. Over the past 10 years, Hungarian photojour- nalist Balazs Gardi has explored how some- thing as basic as water has become a source of global conflict. But his work focuses on more than just environmen- tal catastrophes and humanitarian chal- lenges; exposing corporate interests— the massive bottled- water industry and the plastic waste it cre- ates—is another layer of his project. When it comes to water, he asks, “Who produces it? Who owns it? And who profits from it?” FOREIGNPOLICY.COM 13

aperture A boy washes vegetables at a Displaced flood victims wait for makeshift sink in front of his aid in a village in Bihar, India, on house in the Santa Marta favela Oct. 1, 2008. in Rio de Janeiro, Brazil, on Sept. 25, 2009. Esekon Eipan carries a gun to protect his herd while the goats Smoke from burning plastic water drink from a watering hole in the bottles in Thilafushi—known Todonyang plains of Kenya in as the “garbage island” of the 2014. Maldives—darkens the sky on June 17, 2010. 14 JAN | FEB 2015

SIGHTLINES People play at the Wild Wadi Water Park in Dubai, United Arab Emirates, on April 16, 2008. FOREIGNPOLICY.COM 15

aperture A cliff diver performs at Ik Kil cenote, a sinkhole, near Chichen Itza, Yucatán, Mexico, on April 9, 2011. 16 JAN | FEB 2015

SIGHTLINES Villagers travel on an over- crowded boat to visit their flooded homes in Bihar, India in 2008. FOREIGNPOLICY.COM 17

1 2 The Solar Pilot 4 Bertrand Piccard 5 3 6 1 2 3 4 Icaro-brand Inflatable Flight suit Oxygen alarm helmet life jacket system It’s good to wear We tried a lot of We keep that on for layers to help reg- At 28,000 feet, if different helmets. the entire flight. If ulate our body you have a problem Eventually I saw an we have to bail out, temperature. The with your oxygen, advertisement for we are ready. bottom of the flight you are dead in two one in a hang- suit has zippers on minutes. This sys- gliding maga- the legs to let air in tem monitors the zine and thought when it gets hot. oxygen levels. If it might work. We It also allows us to you have a prob- called the manu- use the bathroom. lem, there’s a light facturer and they on the dashboard adapted the helmet and a horn. If you for our use. don’t react, it really starts going. 18 JAN | FEB 2015 Photographs by NIELS ACKERMANN

the things they carried SIGHTLINES interview by KELLY DINARDO 11 IN BERTRAND PICCARD’S family, there’s a tradition of being first. His grandfather, Auguste, was the first person to ride a balloon into the stratosphere. His father, Jacques, was the first to reach the Earth’s deepest point, the Pacific’s Mariana Trench. And in 1999, Bertrand completed the first nonstop, around-the-world balloon flight. That feat, plus an environmentally con- scious approach to innovation, spurred 12 the renowned Swiss adventurer to dream 7 13 of circumnavigating the globe in a plane that uses no fuel. The result? Solar Impulse 2, an aircraft equipped with more than 17,000 solar cells. Thanks to lithium batteries that effi- ciently store energy reserves, it’s the first solar-powered plane that can fly through the night. “If we want to solve our pollution 8 and energy problems,” says Piccard, a psy- chiatrist by training, “we need to increase our energy efficiency and focus on clean technologies. Solar Impulse is really a way to show that these technologies are mature.” In March, Piccard and André Borsch- berg, a former fighter pilot in the Swiss Air Force, will take off from Abu Dhabi for a 15 five-month journey. They will land every few days to trade shifts in the plane’s cock- 9 14 pit. (While one man is in the plane, the 10 other will be on the ground traveling to meet Solar Impulse II at its next destina- tion.) The pilots will sleep in 20-minute spurts, practice yoga and self-hypnosis techniques to remain alert, and use a toi- let built into the cockpit’s seat. FOREIGN POLICY spoke with Piccard to learn what, if not tons of fuel, are essential resources when circling the world. 5-10 11, 12 13 14 15 Survival kit Heated gloves Parachute Swiss Army Omega-brand and boots knife cuffs If we have to jump We trained in with the para- We don’t have northern Germany During the balloon These were made chute, we have an enough energy for three days. We flight, I used it all for us. They are inflatable safety to heat the entire were dropped into the time. I used it to connected to boat and an emer- cockpit. At night, it the water with a scratch the ice off instruments gency survival kit. can go down to -4 crane and taught to the propane, to pre- that measure It includes fish- Fahrenheit. But if ditch the parachute pare my bread and the plane’s tilt. ing gear, desalt- you heat the hands and inflate the raft. cheese. It’s the tool If the plane dips ing pellets, flares, a and feet, it’s like a I love. 5 degrees, it will radio to reach other radiator: You have vibrate your arm. boats, and a first- warm blood circu- The dip can be a aid kit. lating through the sign of turbulent entire body. air or a problem with the plane. FOREIGNPOLICY.COM 19

visual statement by MUIZ “The Prophet Mohammed described the ummah, or the community, as a body where, if one part is hurt, the pain is felt throughout. For us today, the ummah is humanity. The part of humanity now known as the Middle East is here represented by two hands whose arteries and veins run deep across the landscape: from the Nile to the Jordan River to the Tigris and the Euphrates. The Middle East continues to suffer the effects of the crude pencil lines of the 1916 Sykes-Picot Agree- ment, in which the landscape and its various people were divided into ‘A’ and ‘B.’ Whether the region’s people resist or submit to the dominance inherent in Sykes-Picot, it is an agreement whose scars stand even now, between them and self-fulfillment, between them and peace. And as the Middle East hurts, the whole world feels the pain.” THE ARTIST 20 JAN | FEB 2015

SIGHTLINES FOREIGNPOLICY.COM 21

the exchange SIGHTLINES Is innovation the being a pioneer woman programmer, was product of inevitable also somebody who understood the con- progress—or nection of the humanities to technology. MS: unique genius? Right, or Grace Hopper and the beginnings of programming languages. WI: When Hop- per taught students mathematics, she made them write essays. Then she would correct their writing, and they would say, “We’re supposed to be taking a math course.” She said, “Yes, but if you can’t explain it in writ- ing, then you don’t fully understand it.” MS: She’s an elite-level American like Thomas Edison, and people don’t know her. WALTER ISAACSON, president and CEO of the Aspen WI: One of the next big things that’ll affect Instituteandauthorof2014’sTheInnovators, ahistory what you’re doing now as CTO is the rise of of the digital revolution, and MEGAN SMITH, U.S. chief cybercurrency. MS: Very much so. There’s technology officer (CTO) and a former Google a great little company called PayNearMe, executive, discuss imagination, invention, and the which is allowing people to go into different need for a stronger Silicon Valley-Washington nexus. places [like 7-Elevens] near their homes and use cash and a bar code to pay utility bills. MEGAN SMITH It’s not only things like Bitcoin, but also ways to make life easier for people who might not MEGAN SMITH: One of my favorite expressions is: “People have a credit card. WI: One theme you’ve dis- do things. Things don’t just magically happen.” Inno- cussed is making the whole digital revolu- vation comes out of great human ingenuity and very tion more inclusive, making sure that people personal passions. WALTER ISAACSON: It’s not a passion who are unbanked, people of color, women, for making profits. When Bill Gates wrote BASIC for the people who don’t have the full advantages of Altair and Steve Jobs created the Apple, they had no having grown up in a wired household are idea that the personal-computer revolution was about connected. MS:Many people say, “The future to start. They wanted to create something really cool. is here; it’s just not evenly distributed.” We [at MS: It’s really founding teams—these small, agile teams the CTO’s office] are interconnecting talent that come together. WI: When I asked Steve Jobs near and people. If they can bring their passion the end of his life what product was he most proud of, to make a difference, I think we’ll see a lot he said, “Making a product is hard, but what I’m most of great solutions. proud of is putting together Apple the company, because that was a great team and it is the team that can con- WI:What’s it like to be working in the govern- ISSACSON: PATRICE GILBERT/ASPEN INSTITUTE; SMITH: JD LASICA/CREATIVE COMMONS tinue to make future products.” MS: I was thinking also about Bletchley Park [the site of ment now, having worked at Google? MS: I British code-breaking efforts during World War II]— there’s the new movie out that has [mathematician] love it. My colleagues are incredibly entre- Alan Turing depicted. WI: One of the things The Imita- tion Game got exactly right was that Turing was a real preneurial. We coined an expression called loner. Suddenly, at a certain point in Bletchley Park, he realizes he needs to be a team player. MS: But the “TQ” [technical quotient]. We’re bringing film also has a little bit of historical inaccuracy: I think Bletchley Park was more than half women. I once met the TQ into government. In the end, our a woman who told me she and her siblings used to live next door to Dilly Knox’s team [a group of Bletchley Park government will be whoever shows up and mathematicians]. Their mom constantly was saying, “Shhhh, the girls are working.” I think: Wow, the girls whoever makes this happen. Q are working, saving 11 million lives and shortening WALTER ISAACSON World War II by two years. WI: Ada Lovelace, besides This conversation has been condensed for publication. Go to ForeignPolicy.com for an extended version. 22 JAN | FEB 2015



The Plague decoder The first victim of the Ebola epi- by JAKE SCOBEY-THAL demic in West Africa was almost 2 certainly a 2-year-old boy in the small village of Meliandou in south- 1 eastern Guinea. Since his death in December 2013, the disease—whose 1 The plague is caused by a bacterium called Yersinia pestis previous outbreaks killed at most that typically lives in fleas and some 200 rodent species. It hundreds of people, and generally usually enters humans through bites. 2 There are three in rural areas—has infected thou- main types of the plague, each affecting a different part of sands of people across West Africa, the body. Bubonic plague, which attacks the lymph nodes, as well as a handful of people around is the most common form of the disease. Septicemic plague the world, due to porous borders, occurs when Y. pestis multiplies directly in the bloodstream. ill-equipped health systems, and a Pneumonic plague infects the lungs. faulty international response. The virus has drawn comparisons to one Illustration by TODD DETWILER of history’s greatest biological kill- ers: the plague, which killed tens of millions of people from China to Europe in the “Black Death” of the 14th century. As it happens, toward the end of 2014, a country on the other side of Africa was coping with the real thing. In Madagascar, as of late November, at least 119 people had been infected and 40 had died in an outbreak of the plague. Cases were reported in the capital and 16 districts across the island nation. This is not an isolated incident. As many as 2,000 plague cases are reported each year to the World Health Organization (WHO). In 2013, there were 783 cases and 126 deaths from the illness. The plague occurs in countries such as Mada- gascar with poor living standards and weak health services, but else- where too: In 2014, at least four peo- ple contracted it in Colorado. Centuries after the Black Death, humans have come a long way in combating this deadly, if minus- cule, foe. (The plague is caused by a microscopic bacillus, or rod-shaped bacterium.) But with regular out- breaks and even fears that it could be used as a biological weapon, the plague is anything but an artifact of the past. 24 JAN | FEB 2015

3 SIGHTLINES 4 EARLY EVIDENCE The first account of the plague may be 3 Within three to 10 days of contracting the plague, found in the Old Testament. According people usually develop flu-like symptoms, including to the text, after stealing the Ark of the fever, chills, headaches, body aches, weakness, vomiting, Covenant from the Israelites around 1000 and nausea. The expression “Black Death” comes from B.C., the Philistines were afflicted by a a later symptom of the disease: Skin and flesh die and devastating outbreak of tumors. (The bubonic turn black. 4 Pneumonic plague is the least common but plague causes swollen lymph nodes that can most deadly form of the disease. It is also the only type look like such growths.) The first confirmed transmittable by air. pandemic occurred around A.D. 540, when the Justinian plague, named for the Byzan- tine emperor at the time, began in North Africa and spread to the Middle East and then to Europe. The most recent pandemic, which killed around 12 million people, began in China in the 1850s and lasted well into the 20th century. HOW TO END A PLAGUE In 1896, Russian microbiologist Waldemar Haffkine began developing an effective plague vaccine using inactive Y. pestis and, among other ingredients, goat flesh. He tested it on himself and prisoners in a jail in Bombay, India. Since then, vaccinations, antibiotics, insecti- cide development, and improvements in living conditions have helped drastically cut cases of the plague. In 2003, researchers in Madagascar developed a rapid diagnostic test that identifies Y. pestis in just minutes. Today, if the plague is promptly diagnosed and treated with antibi- otics, its mortality rate drops from 60 percent to less than 15 percent, according to the WHO. MODERN GEOGRAPHY Between 1989 and 2003—the most recent comprehensive WHO data set—nearly 40,000 cases of the plague were recorded in 25 coun- tries, with transmission usually occurring within, not across, national borders. The three most endemic countries, as per the WHO, are Madagascar, Peru, and the Democratic Repub- lic of the Congo. According to the Centers for Disease Control and Prevention, an average of seven U.S. cases are reported each year, usually in the rural Southwest, where the plague is entrenched in various rodent spe- cies. In July 2014, China quarantined 30,000 people in the city of Yumen after a man died of bubonic plague. BIOLOGICAL WARFARE In 1346, according to Italian notary Gabriele de’ Mussi, the Mongol army hurled plague- infected cadavers into the city of Kaffa, in present-day Crimea, to break a years-long siege. The Mongols weren’t the last to con- sider how the plague might be used in war. During the Cold War, the Soviets’ Biopreparat project allegedly stockpiled the plague for use in intercontinental ballistic missiles. In 2014, FOREIGN POLICY reported on the contents of a laptop recovered from the Islamic State that included, among other things, a 19-page doc- ument detailing how to use infected animals to weaponize bubonic plague. FOREIGNPOLICY.COM 25

Second Floor to Smart Is the New Black the Left, Please What you wear can say a lot about you— A REVOLUTION IN ELEVATORS has been a long especially now that researchers at Canada’s time coming. Other Victorian-era tech- Université Laval have created a stylish smart nologies have transformed beyond fabric that can monitor and communicate a recognition—typewriters, for instance, wearer’s heartbeat, brain waves, glucose lev- have given way to computers and tab- els, and other health indicators. The fabric lets—but modern elevators remain is made of layers of copper, polymers, glass, close cousins of their earliest incarna- and silver, which act as sensors and anten- tions: boxes connected to a set of cables nas; information gathered can be transmit- and a counterweight, traveling in a ver- ted via wireless or cellular networks. The tical shaft. fabric is durable and malleable—and also machine washable. With smart clothing, With a new design, unveiled in late doctors could monitor aging or chronically November, ThyssenKrupp, a German ill patients, constantly updating medical steel company, may finally be bringing records and reducing health-care costs by the humble lift into the future. Thyssen- cutting down on office visits. Moreover, the Krupp has built a machine powered not fabric could be used to remotely track the by cables, but by magnets, and capable health of firefighters, first responders, and of moving not just up and down, but also soldiers deployed overseas, alerting super- left and right. It’s the closest the world visors when individuals are in need of med- has ever come to the Wonkavator from ical assistance. Willy Wonka’s chocolate factory. Magnet-based elevators would be a boon for innovative architects with heads full of creative designs. What’s more, as the world urbanizes and the buildings of some megacities grow taller, elevators that function efficiently and take up less precious space are increasingly important. Because sev- eral magnet-powered elevators could operate simultaneously in one shared shaft, ThyssenKrupp says its design could increase a building’s usable area by as much as 25 percent, while dramat- ically boosting passenger capacity. The elevator helped create mod- ern city life. Now next-generation lifts could give rise to urban landscapes as we’ve never seen them before. ALICIA P.Q. WITTMEYER 26 JAN | FEB 2015

innovations SIGHTLINES by BARRON YOUNGSMITH Reality Check BRISTOL INTERACTION AND GRAPHICS, UNIVERSITY OF BRISTOL Ultrasound waves HOLOGRAMS THAT humans can tol. Coroners could exam- Breathe In, are focused to create touch: The very idea conjures ine parts of a body without Breathe Out, up visions of a sci-fi future removing them, or children and Forget the shape of a in which police investigators could feel an ancient artifact virtual sphere. handle 3-D images of crucial in a museum—a mummy, Fresh air does a body good, the evidence and surgeons probe perhaps, or a scroll—without thinking goes. For some people, That’s the amount of meth- a model of a patient’s brain damaging it. however, air permeated with an ane (in liters) Pratap Pulla- to find the precise location of odorless, colorless, and dense mmanappallil, an advisor a tumor. Now, researchers at As it happens, research- noble gas could be even better. for NASA, has found that one Britain’s University of Bristol ers in Tokyo announced in In late summer, researchers at astronaut can produce per are turning those visions into October that they had devel- Harvard-affiliated McLean Hos- day. The old saying “waste not, reality. oped a similar technology pital, a psychiatric facility that want not” is supremely true in called HaptoMime, which treated Sylvia Plath, John Nash Jr., space, where resources can be In December, a team from uses both ultrasound waves and David Foster Wallace, found very limited. So Pullammanap- the university’s computer sci- and infrared sensors. Among that xenon gas can reduce pallil has figured out how to ence department announced other things, the inventors memories of traumatic events. break down human waste— that it had invented a way to are interested in creating Every time the brain recalls a that’s right, astronauts’ poop— create holographic shapes 3-D images of touch screens, memory—along with the pain or and generate enough biogas to using “haptic feedback”— which would allow peo- fear attached to it—that memory fuel a spaceship’s return flight tiny air vibrations that react ple to play a virtual piano or is refreshed and stored, much like from the moon. to touch and mimic the sen- avoid contacting—and thus a new one. Called “reconsolida- sation of handling a physi- spreading—germs found on tion,” this process leaves open a cal object. The researchers ATM keypads and computer window in which the memory can focused ultrasound waves, keyboards. be modified. With this in mind, which further amplify the McLean researchers conditioned tactile response, into complex Indeed, haptic holograms rats to be afraid of environ- patterns above a holographic could revolutionize 3-D com- mental cues and electroshocks. projector; they found that puter interfaces. Other inno- When fearful, the animals natu- the feedback created shapes vators have experimented rally froze. Some of the rodents that could be seen and felt. In with “data gloves,” which were then exposed to xenon, a fact, when the visual element contain sensor technologies gas that occurs in trace amounts of the method was disabled, that allow wearers to activate in the Earth’s atmosphere. All test subjects could still iden- virtual operating systems. of the rats’ fear responses were tify the “objects” they were But as Long and his Bris- tested again—and those in the touching. tol colleagues write in their xenon-exposed group froze for findings, “[T]his requires the just a fraction of the time they Once developed further, process of fitting [gloves] on had before. “It was as though the the innovation, known as before use. This can be cum- animals no longer remembered UltraHaptics, could have a bersome and prevents instan- to be afraid of those cues,” study host of high-tech applica- taneous user interaction.” It is author Edward Meloni said in a tions. “Touchable holograms, far better and more “elegant,” news release issued by McLean. immersive virtual reality that the researchers suggest, to Xenon is safe for use in humans, you can feel, and complex spontaneously generate float- meaning a similar technique touchable controls in free ing control panels, for exam- could help treat sufferers of space are all possible ways of ple, that could be activated post-traumatic stress disorder, using this system,” Benjamin and tossed aside at will. which in a given year afflicts mil- Long, one of the researchers, lions worldwide. said in a news release issued It’s a good bet that com- by the University of Bris- puter users and designers around the world will agree. Illustration by SAM ISLAND FOREIGNPOLICY.COM 27

SPONSORED CONTENT The Greening of South Africa Close to half the new energy capacity South Africa plans to commission between now and 2030 will be from renewable sources, writes Simon Barber Business leaders surveyed last year by • Two 75 MW PV farms, also built and run by SolarReserve at management consultants AT Kearney said Letsatsi in Free State province and Lesedi in the Northern Cape. $586 million was raised for the project. Investors include Hong they had more confidence in South Africa as an Kong-based GCL New Energy Holdings, UK-based Old Mutual’s IDEAS Fund, and the Kensani Group out of Cape Town. The investment destination than they did in many company is also bidding on two CSP projects. western European countries and emerging • The 22MW Herbert and 11MW Greefspan PV farms in North- ern Cape, built by SunPower of San Jose, and owned by AE- powerhouses like Chile and Malaysia. AMD Renewable Energy, a joint venture between Spain’s AMDA and South African Alt-E Technologies. Old Mutual’s IDEAS Fund is One reason was Pretoria’s much lauded renewable energy program an investor. which in the view of London-based risk analysts IHS has made South Africa “the world’s most attractive country for solar energy” • Scatec Solar’s 75MW Kalkbulk PV facility near Petrusville in investment. As a destination for investment in all forms of clean the Northern Cape. Completing the plant ahead of schedule, energy, Bloomberg New Energy Finance currently ranks South the Norwegian company was the first REIPPPP preferred bidder Africa third behind China and Brazil on its Climatescope index of to deliver solar power to the South African grid. Investors include 55 countries. Norfund, Norway’s official development finance arm, South Africa’s Standard Bank, Old Mutual and local partner Simacel. Since late 2013, a growing fleet of solar and wind power projects has begun feeding hundreds of badly needed megawatts into South Afri- • Two 50MW PV plants at Da Aar and Droogfontein in the ca’s national grid. This is the start of a carbon-free energy revolution Northern Cape, built and operated by Mainstream Renewable that will, under current plans, see 42 per cent of all new generating Power and Globeleq, a multinational power generation company capacity commissioned between now and 2030 – 17 800MW of 42 wholly owned by private equity firm Actis. Also part of the consor- 539MW – fueled by the country’s abundant sun and wind. tium are Absa Capital, Thebe Investment Company and Siemens Energy South Africa. Driving the revolution is South Africa’s Department of Energy (DoE) and its groundbreaking Renewable Energy Independent Power • A 60-turbine, 128MW onshore windfarm at Jeffreys Bay, built Producer Procurement Program (REIPPPP). The department is by the same Mainstream-led consortium. In a subsequent round, inviting consortia to bid on the supply of 6 925 MW (equivalent Mainstream and partners won the right to install a further 360MW to about 15 per cent of current national capacity) using a range of of wind capacity at other sites. The company says its project pipeline renewable technologies — primarily solar photovoltaic (PV), which in South Africa now totals 5 GW of renewable energy. converts sunlight directly into electricity, concentrating solar (CSP), which uses the sun’s rays as a heat source, and wind turbines. Small Nearing completion are two CSP facilities the Spanish sustain- hydro, landfill gas and biomass are also in the mix, but on a much able energy company Abengoa is developing with South Africa’s smaller scale. Industrial Development Corporation and a local community trust. Kaxu Solar One is a 100MW parabolic solar trough facility near the Bids are initially being solicited in a series of five reverse auctions, Northern Cape village of Pofadder. Khi Solar One is a 50MW super- the last scheduled for next year. So far there have been three heated steam solar tower near Upington in the same province. CSP rounds, resulting in 54 deals with an investment value of $10 technology has the advantage over PV of being able to store heat billion. The foreign portion of the funding assembled by successful to generate power during peak periods when the sun is not shining. consortia in round three was just under $1.5 billion, mostly in the form of equity, according to DoE. With each bidding round, the average price winning consortia have asked for their electricity has fallen significantly – from $0.28 per Many of the projects selected in the first round at the end of 2011 kWh for PV in round one, to $0.09 in round three at today’s ex- are already supplying power to the grid. Among them: change rate, and from $0.12 per kWh to $0.07 for wind. This is only fractionally higher than Eskom’s current average cost for generating • A 96MW, $260 million PV facility at Jasper near Kimberly, built power from coal and that is before coal’s externalities – in the form and operated by Santa Monica-headquartered SolarReserve. of carbon emissions and water consumption – are accounted for. Commissioned last October, this is the country’s largest PV project to date. Google has a $12 million equity stake.

Droogfontein Solar PV Park, developed and built by Mainstream Renewable Power Renewable gold South Africa’s green rush Since late 2013, a growing fleet of solar and wind power projects has begun feeding hundreds of megawatts into South Africa’s national grid. This is the start of a carbon-free energy revolution that will, under current plans, see 42 per cent of all new generating capacity commissioned between now and 2030 — 17 800MW of 42 539MW — fueled by the country’s abundant sun and wind. Our widely lauded renewable energy program has made South Africa one of the world’s most attractive countries for clean energy investment. Come and join our green rush. www.southafrica.info Photo credit: Mainstream RP

Expand Your Global Reach Earn Your Master of Arts in Diplomacy – Online Norwich’s Master of Arts in Diplomacy online program can help you develop the specialized skills you’ll need to build cooperation and solve problems on an international scale. Whether your background is business, military, government VYPU[OLUVUWYVÄ[ZLJ[VY`V\\»SSNHPUHUL^WLYZWLJ[P]LVU[OLJVTWSL_P[PLZVM communicating and negotiating global affairs. It’s time to think globally. Visit diplomacy.norwich.edu/fpp VYJHSS L_[[VSLHYUTVYL

the climate issue features LAST OCTOBER, scholars David Victor and Michael Kennel cast doubt on the linchpin of climate diplomacy: the 2-degree Celsius rise in temperatures that international agreements have cited as the threshold for severe, irreversible effects of global warming. A number is a fundamentally useless measure, the duo wrote in Nature—political theater. The FP climate change issue shows that the actual drama of global warming can’t be adequately expressed in figures. Kenneth R. Weiss profiles a man who, inadvertently, became the face of a new brand of refugee; McKenzie Funk explores how computer hackers have undermined cap and trade; and FP’s Keith Johnson illustrates why big, bad coal may still be the fuel of the future. At this year’s U.N. climate conference in Paris, progress could be made on an international framework for slashing emissions. But if that happens, will it be enough? —The Editors Illustration by JAMES VICTORE FOREIGNPOLICY.COM 31



BY MCKENZIE FUNK ILLUSTRATIONS BY OWEN FREEMAN HAVE COMPUTER HACKS, BOMB THREATS, IDENTITY THEFT, AND OTHER CRIMES STYMIED THE WORLD’S BEST HOPE TO STOP CLIMATE CHANGE? CAP AND

The client wanted carbon credits: The two men communicated via secure tradable serial numbers that confer the right to online chats, using their pseudonyms. In pollute the Earth with invisible, odorless gas. real life, the Dragon was 31-year-old Mat- Jugga, as the client called himself, planned thew Beddoes, a coal miner’s son, high- to steal the credits, quickly resell them, and school dropout, and self-taught computer become rich overnight—but he needed the whiz who collected thousands of strang- Black Dragon to hack into a computer system ers’ credit card numbers and floated from to help him do it. The Dragon, who in online couch to couch in central England’s Mid- forums advertised his services as a corporate lands region. Jugga was 36-year-old Jas- spy, was sure he could hack anything. But deep Singh Randhawa, who was previously when Jugga contacted him in June 2011, the part of a cigarette-smuggling network in hacker had no idea what carbon credits even Leicestershire. were. “I didn’t think anyone would be stupid enough to come up with that,” the Dragon Randhawa outlined a complicated plan says of the concept. for a backdoor hack into a carbon registry, a kind of stock market for carbon credits. Bed- 34 JAN | FEB 2015 does agreed to do the job, but, he asked, why not go through the front door? Although stockbrokers have to be licensed, just about anybody can become a carbon trader. (In 2007, the New York Times had called car- bon traders the “rising stars” of London’s financial district.) Beddoes recommended a classic confidence trick: Pose as a trader, build email rapport with people at the reg- istry, and then get them to open an infected attachment. Randhawa agreed and sent Beddoes the first half of a fee worth 6,000 British pounds (almost $10,000)—for a job that could have secured Jugga tens of mil- lions of dollars. Beddoes got into computers at a young age. “I started out on a Commodore 64,” he says via Skype, his lilting speech pep- pered with “yeah?” and “aight?” “I wasn’t always black hat,” he explains; he was just a smart kid who hated school but loved a challenge. That’s what hacking offered— endless challenges—and it was a “highly addictive hobby,” his lawyer would later explain in court. Beddoes told me that when he first started hacking computer networks at age 16, it was in part because his attempts to play nice were rebuffed. If while cruising the cor- ners of the Internet he found a business—a local bank, a clothing chain, a school— whose website had a vulnerability, he sent it a courtesy email. “And I’d get a message back,” he recalls. “‘You shouldn’t be testing our website. If anything’s wrong, we’re call- ing the police.’” This was a bad approach with a teenager, especially one who could easily grab lists of passwords and account

numbers. The Dragon doesn’t “like being shit on, so to speak,” Beddoes clarifies. ers, and others—who have tried a hand at “‘OK, then I’m putting your website up for sale, mate.’ Y’know wha’ I mean?” what Interpol has identified as the future of international fraud: carbon crime. Accord- Yet what really drove him was not revenge but curiosity: He wanted to ing to the international police agency in see what he could pull off. “You could describe him as a master online lock- a damning 2013 report, emissions trad- smith,” his lawyer said in court. In one advertisement to potential custom- ing is the fastest-growing commodities ers, which Beddoes sent out on Twitter in 2010, he described himself as market in the world, and criminals have “[v]irtually unstoppable.” eagerly exploited weaknesses and gaps in that market’s regulations and security— For the job with Jugga, Beddoes had Randhawa ask officials in Bonn, reaping tens of millions of dollars in ille- Germany, at the headquarters of the United Nations’ global carbon registry, gal profits and threatening to destroy the what was needed to open a carbon account. When they responded—driv- much-lauded environmental concept of er’s license, passport, value-added-tax (VAT) form, and the like—Randhawa “cap and trade” as they go. inquired whether he could send the documents in encrypted form. “It’s company security policy,” he apologized. Beddoes created a zip file that “If I’d done the carbon thing myself,” contained dummy documents, a piece of Trojan horse malware called Zeus, claims Beddoes, who is now out of prison, and a crypter that made Zeus “100 percent undetectable by any anti-virus back in the Midlands, and—he says—on program, including Norton.” He gave the package to Randhawa, who sent the straight and narrow, “I coulda been the email to Bonn, and someone clicked on the file almost immediately after on a bloody desert island.” The hacking the message arrived. The recipient would have been reassured by a pop-up was that lucrative, and that easy. “Every- that read “‘Santrex Business Encryption’ or something like that,” Beddoes one says, ‘I bet you had some high-tech says. “I made the name up.” software and a badass modified laptop,’” Beddoes brags, speaking of the U.N. hack. It took an hour for Zeus to fully infect the trading system. Randhawa began “No. I had a shitty little netbook I used to transferring 426,108 certified emissions-reduction credits—each worth about carry around with me. I just put the pack- 10 euros and equivalent to a ton of carbon dioxide—to a trading account he age together and passed it off.” had set up for the scam. But then, suddenly, he was frozen out. He’d typed in the wrong account number for the transfer, and administrators in Bonn As for carbon trading as a strategy to had noticed an irregularity. Frantic, he called the Dragon. (They had burner save the world, Beddoes remains skepti- phones with anonymous prepaid numbers in case things got hot.) “Sort it!” cal. “Biggest scam on the planet!” Beddoes says Randhawa yelled. “Go in and sort it!” The carbon credit is essentially a It was a stormy day; Beddoes remembers rain and thunder and lightning. permission slip with a cash value that He grabbed his computer and tried to fix Randhawa’s mistake, but it was too allows a country or company to emit a late. Left without the coveted carbon credits, there was little to do but dis- certain amount of greenhouse gases. In a connect Zeus and move on. standard cap-and-trade system, a govern- ing body sets a limit on the total allowed But the duo didn’t give up. That same month, Beddoes used another hack- emissions and doles out or auctions off ing method—called SQL injection—to allow Randhawa to siphon off 350,000 credits that add up to that limit. carbon credits, each worth about 15 euros, from a Spanish registry within the European Union’s carbon-trading system. (Two years later, a portion of If a company is flush with carbon cred- those stolen credits would be resold for almost 89,000 euros to an unsus- its, it can keep its dirty coal plant. Slash pecting company: oil giant BP.) Beddoes says he also helped Randhawa break the plant’s emissions, and the company into registries in Africa and Asia, though nothing seems to have been stolen. will have excess carbon credits it can trade to, say, an oil company looking to As 2011 came to a close, friends told Beddoes that the Serious Organised pollute more. Societies have determined Crime Agency, then Britain’s equivalent of the FBI, was asking where he was. that global temperatures should not rise That stormy day the U.N. had blocked him and Randhawa, the Dragon had more than two degrees Celsius to avoid the been using a 3G modem, a USB stick with an Internet connection that helped worst impacts of climate change. If they mask his identity and his computer’s location. But the lightning must have use credits to prevent going over that level, shorted out his connection just long enough for his computer to join a home the thinking goes, carbon trading will help Wi-Fi network—just long enough, in other words, for his IP address to disclose keep the world from burning. his whereabouts. He eluded authorities for weeks until, early one November morning, he was sleeping upstairs at his parents’ house when his father opened The basic mechanisms for carbon the door to go to work and found the police waiting outside. In March 2013, trading were outlined in the 1997 Kyoto the Dragon, Randhawa (whom Beddoes met for the first time in court), and Protocol, a climate agreement adopted by an associate named Jandeep Singh Sangha were sentenced to a combined five and a half years in prison for the carbon hacks. FOREIGNPOLICY.COM 35 The trio is among the thousands of people—gang members, terrorists, hack-

191 countries that set emissions-reduction emission cuts elsewhere. (Offset projects have included tree planting in targets for 37 industrialized countries and Uganda and South Sudan and biogas projects, in place of coal plants, in the European Community. This gave rise India.) Critics of offsets say they only allow rich countries to feel better about to the U.N. registry based in Bonn, which bad behavior, rather than encouraging governments to correct that behavior. oversees credit trading among countries Environmental writer George Monbiot has compared offsets to indulgences bound by Kyoto and has provided mod- sold centuries ago by the Catholic Church—cash for forgiveness. But the real els for other systems. Today, there are problem with offsets has been fraud. For instance, back in 2007, fittingly, a more than 60 existing or planned carbon- Vatican cardinal stood before cameras and received a certificate declaring pricing schemes worldwide, ranging from the Holy See the world’s first carbon-neutral sovereign state, thanks to offsets one covering the entire European Union promised by an American businessman who ran a reforestation project in to programs launched in the state of Cal- Hungary. But not one tree of the “Vatican Climate Forest” was ever planted. ifornia in 2012 and the Chinese city of In Africa, some reforestation projects have reportedly sold the same offsets Shenzhen in 2013. (For a brief moment in to two or three different buyers. U.K. regulators announced in November 2009, the United States was on the verge 2013 that they had shut down 19 companies for using offset sales to scam of adopting cap and trade: A bill passed investors out of some $38.7 million. the House but died in the Senate.) These systems cover a quarter of civilization’s These crimes point to an inherent flaw in cap-and-trade systems: the difficulty almost 40 billion tons of annual green- of substantiating transactions that involve nothing palpable. “The noteworthy house gas emissions. potential for the carbon market to be exploited,” Interpol says in its report, “rests on a single significant vulnerability that distinguishes it from other markets—the The World Bank values emissions trad- intangible nature of carbon itself.” Put another way, if a man who buys a horse ing at $30 billion. When the looser market never receives it, he’ll pick up on the scam. But if he buys the right, represented for voluntary emissions reductions—that by a numerical code, to emit an invisible gas or the promise that someone else is, those not bound by legal compliance— will emit less of that gas in the future, he might easily be fooled. is included, carbon trading is worth even more. In 2012, it was a $176 billion industry. Perhaps because they were environmental idealists or because they des- perately wanted systems to get off the ground, the creators of carbon mar- With all that money on the line, it’s kets seem to have given little thought to the potential pitfalls of trading. As no wonder that the likes of Beddoes and the Black Dragon’s hacks reveal, protections against crime, from background Randhawa constitute a burgeoning class checks on carbon traders to basic Internet security to unified governance, of criminals—many of them wildly suc- were minimal from the start. Although trading systems have seen security cessful. In the EU, whose cap-and-trade improvements in recent years, fraud has done enduring damage to carbon system is the world’s largest, French ana- markets. Along with credit handouts to polluting industries and the recent lyst Marius-Cristian Frunza, author of the global financial crisis, it has undercut carbon trading’s noble goals. book Fraud and Carbon Markets, estimates that some $20 billion was lost to carbon As Interpol’s report concludes, the “discrepancy between the objectives fraud between the system’s launch in 2005 of the financial players in the market—to maximize profit—and the overall and 2011. According to Interpol, the list of objective of the Kyoto Protocol—to ensure overall greenhouse gas emissions possible carbon crimes goes well beyond are reduced—places diverse pressures on the regulation of the market.” Try- stealing and reselling credits: It includes, ing to save the world and trying to make money, in other words, are two dis- among other offenses, tax fraud, securi- tinct things. It was fraudsters who saw this sooner than anyone. ties fraud, transfer mispricing, and money laundering, plus phishing and theft “of per- The EU’s Emissions Trading System (EU ETS) is the most robust sonal information or identity theft.” And carbon market in the world: Launched in 2005, it covers 31 countries (all cash procured can end up lining dangerous EU members as well as Iceland, Liechtenstein, and Norway), 11,000 man- pockets: In September 2014, prosecutors in ufacturers and power plants, and close to half of Europe’s carbon emis- Italy announced they were seeking the per- sions—or roughly 2 billion tons of carbon dioxide. petrators of a roughly $1.4 billion carbon- trading scam suspected of helping fund “The success of the EU ETS has inspired other countries and regions to terrorist groups in the Middle East. launch cap and trade schemes of their own,” its website boasts. “The EU aims to link up the ETS with compatible systems around the world to form Among the most galling crimes, from the backbone of an expanded international carbon market.” an environmental perspective, are sales of nonexistent credits. Most such crimes As the forerunner in carbon markets, however, the EU ETS is also where the involve carbon offsets—when polluters, first cracks in trading became visible. After peaking near 30 euros in 2008, the usually in the developed world, pay for price per ton of carbon dioxide in the EU ETS now hovers around 5 euros—too low to provide much incentive for companies to lower emissions. The major 36 JAN | FEB 2015

reason for the price crash was the global recession that began in 2009; power And in a coordinated effort in Germany in December 2012, some 500 police officers and cement plants had less production than projected, thus fewer emissions burst into offices and homes in three cities in one day to investigate carbon VAT fraud and less need for carbon credits. Handouts to industry are also partly to blame. at Deutsche Bank, the country’s most sto- ried financial institution. When the EU ETS began, major European emitters lobbied for and were allo- Rather than stopping fraud before it cated free credits—too many, critics say—as a political compromise to ease begins, regulators and law enforcement often played catch-up to criminals, thanks the transition to the new carbon economy. This led to deceit: An investment to weak safeguards included at the incep- tion of the EU ETS. In the late aughts, for banker I spoke to said he helped power plants cook their books to show a need instance, while carbon traders generally went through background checks in their for more handouts. Today, the system is awash with excess credits. country of residence or business, there was one significant exception: Denmark. Fraud has also played a role in undermining the EU ETS. According to Host of the 2009 climate conference, the country wanted cap and trade to work, and Frunza, the French analyst, nearly 60 percent of the money that the system it apparently wanted to remove all barri- ers to success. For several years before the lost to crime between 2005 and 2011 was due to VAT carousel schemes. A VAT summit convened, all it took to open an EU of 20 percent or higher is charged on most goods and services in Europe. As FOREIGNPOLICY.COM 37 foreign tourists to London or Venice know, some purchases are VAT-free if they are taken out of the country. Show a receipt at the airport, and the gov- ernment provides a refund. Many commodities, including carbon credits, are also eligible for a refund upon export. Carousel schemes exploit these mechanisms: A shell company run by a criminal syndicate imports carbon credits into a country without paying VAT, and then the credits are passed from one shell company to another until it’s difficult to trace their origin. The last company in the chain takes the credits out of the country, shows the equivalent of a receipt to the government, and asks for its VAT back. VAT fraud is a volume game: Slosh more money through the system, and the 20 percent cut can add up considerably. Around the time of the 2009 U.N. climate conference in Copenhagen—where countries failed to adopt a much-anticipated, legally binding accord to cut emissions—seed money for carousel schemes was typically in the millions of euros, and the money came largely from international criminal gangs, says Frunza. As he put it in the 2013 documen- tary film Carbon Crooks, “It’s mainly the new wave of organized crime described as Middle East organiza- tions—terrorist financing, Far East Asia, ex-Soviet Union—[and] bits and pieces from south and eastern Italy and Israel.” The impact of VAT scams has been enormous. Until it was shut down in 2012 amid falling revenues, the world’s largest carbon exchange was BlueNext in Paris, which was partly owned by the French government and offered an immediate VAT repayment. In one period Frunza studied—November 2008 to September 2009— 90 percent of BlueNext’s trades appeared to be fraud- ulent. French taxpayers lost 1.9 billion euros in less than a year. The price of a ton of carbon, meanwhile, dropped by an estimated 4 euros—at current prices, that means it was cut almost in half—as investors lost faith in the market. Over in the United Kingdom, meanwhile, a criminal gang used a carousel scheme to steal about $60 million over six months; three men were later THE BLACK DRAGON apprehended and sentenced to WAS ARRESTED AT a combined 35 years in prison. HIS PARENTS’ HOME IN 2011.

HACKERS STOLE ist Mark Schapiro in NEARLY 1.2 his 2014 book, Carbon MILLION CREDITS Shock. Almost 1.2 mil- FROM THE CZECH lion carbon credits had CARBON REGISTRY disappeared in a flash, AFTER CALLING IN A part of a wave of hacks BOMB THREAT TO ITS that also hit Austria, HEADQUARTERS IN JANUARY 2011. Greece, and Romania and claimed 45 million euros that month. Authorities halted carbon trading across Europe and tracked stolen credits to regis- tries in Estonia and Poland and eventually to BlueNext. Some credits were successfully resold to buyers, including Royal Dutch Shell and Credit Suisse. When investigators followed the proceeds, the trail led to bank accounts in China, Hong Kong, Dubai, and India, a source told Reuters—and then petered out. Four Brit- ish men reportedly described by prosecutors as “foot soldiers” in a criminal syndicate that perpetrated the Czech Republic hack were sen- tenced in a U.K. court in September 2014. They ETS trading account in the Danish carbon will serve a combined 19 years in prison for setting up temporary trading exchange—until recently, each country in the system had a national exchange— accounts to move and help launder some of the credits. But their bosses are was a name and an email address. Among the 1,300 people who opened accounts, as still on the loose, with the credits they stole and the money they were paid. many as four-fifths of them fraudulently, was someone who gave the name of Indian Complicating matters, some credits stolen in the Czech job—at least 13,100 poet Mirza Ghalib, who died in 1869, along with an address in a Copenhagen suburb. of them—matched the serial numbers of credits stolen the previous year in As Carbon Crooks highlights, after Dan- ish authorities finally began background a major hack of Romania’s carbon registry, and then resold to unsuspecting checks in 2011, the number of registered carbon traders dropped to just 30. buyers. The credits had originally come from the Swiss company Holcim, the There were also early weaknesses in dig- world’s second-biggest cement manufacturer and one of Europe’s biggest emit- ital security and system governance, which varied hazardously across European coun- ters of greenhouse gases. Holcim had lost 1.6 million credits worth 24 million tries’ borders. Months before the Black Dragon struck the U.N. in Germany, Europe’s euros. It tracked them as far as it could, through Liechtenstein and Italy to car- most notorious carbon hack took place on a cold January 2011 day in Prague. It began bon exchanges across Europe. When Holcim hit a wall, the company asked the with a phoned-in bomb threat to a down- town building that, among other offices, European Commission, which manages the EU ETS, to freeze the movement of housed the Czech Republic’s carbon reg- istry. The building was swiftly evacuated. the stolen credits—an easy task, in theory. But officials said they had no author- Police closed down the streets and raced to set up blast barricades. They brought in ity to help. “The recovery of any allowances which are claimed to have been bomb-sniffing dogs. A full day passed before police understood what had happened. The transferred fraudulently is a matter for national law and national law enforce- “bomb scare was a feint to divert traders from noticing exotic cursors moving across ment authorities,” the EU ETS director-general said in a 2010 statement. “The their [computer] screens,” wrote journal- Commission has no powers to block any such allowances in a registry account.” 38 JAN | FEB 2015 Individual countries’ laws, however, would have been a problem even if European officials had stepped in, as property rights differ from one EU mem- ber to another. In the United Kingdom, for instance, stolen property is gener- ally returned. In Germany, on the other hand, an “innocent buyer” might be allowed to hold on to laundered credits bought in good faith. (Some observers believe the European Commission also didn’t want to go rooting around for stolen credits, lest what it found should cause the market to entirely collapse.) Holcim’s quest for its lost credits escalated into a 17.6 million euro lawsuit against the European Commission, filed in 2012. This past September, the Euro- pean Court of Justice agreed that the case was a matter for national, not Euro- pean, authorities and dismissed it. Now Holcim has added legal fees to its losses. Even the main victim of the hack in Romania looks different at close range, however. One reason Holcim had so many carbon credits for criminals to steal was that it was given so many free handouts when the EU ETS was set up.

With a surplus of 17 million credits, the company is fourth on the list of “Carbon be bothered with that shit.” Fatcats” released in October 2014 by the British think tank Sandbag, which lob- bies for an overhaul of Europe’s trading scheme. In 2008 and 2009 alone, when So the EU ETS has upgraded its secu- the carbon market was high but the continent’s overall economy teetered, Hol- cim reaped a 100 million euro windfall from selling some of its government- rity? Tell the Dragon that, and his swag- granted excess. When Holcim sued the European Commission, in short, it was biting the hand that fed it. ger returns. “That doesn’t matter,” he says. In 2015, because of problems like excess credits, the main “It’s all irrelevant.” What matters—what barrier to carbon crime may be wthat credits have become so cheap. But there’s still strong faith in the potential of cap and trade, and a mounting has always mattered—is that such a sys- concern about fraud. tem exists in the first place and that carbon So while officials wait for prices—and global temperatures—to rise, they’re finally tightening security. To better assess carbon-offset projects in the credits are stored on computers connected developing world, the United Nations has upped its oversight of third-party certifiers and improved how it measures whether projects would have hap- to the Internet. The health of the planet is pened anyway, and thus deserve no offsets. (In U.N. speak, it has better “tools available for testing additionality.”) In response to the 2013 Interpol report, meant to be protected by intangible dig- the director of the U.N.’s carbon-offset program defended it in an open let- ter, asserting that “more mention could have been made … of the matura- ital bits. tion that has already taken place in the carbon market.” (At the time, U.N. credits were trading for 61 euro cents a ton.) Interpol has warned that “[r]egulation In Europe, carbon credits are now exempt from VAT in most countries, and monitoring of the carbon market is not making carousel fraud all but impossible, and EU ETS computer security is beginning to match that of stock exchanges. EU member states have replaced yet pervasive.” The Environmental Defense a welter of 30 national registries and their myriad problems—no background checks in Denmark, lax website security in Spain and the Czech Republic, rapid Fund, a champion of carbon markets, has VAT refunds in France—with a pan-European system on a single software platform with one set of security procedures. Europol, the EU’s law enforce- argued that carbon emissions in the EU ment agency with a new mandate to fight cybercrime, monitors accounts. National administrators can block suspect activities immediately, without in particular are now little different from a court order. Backgrounds are reviewed, two parties at a trading office must sign off on every trade, and a waiting period reminiscent of American gun other worldly things—grains, minerals, laws means most transactions have a 26-hour delay. Try to move too many carbon credits in one trade, and an account gets blocked, much as a credit water—that have been made tradable. card company might block a purchase of expensive electronics made in a state different from the buyer’s location. “[W]ill the reforms be enough to prevent As for the Black Dragon, he has done his time—“four prisons, five courts,” security breaches in the future?” the Envi- he says. He didn’t mind prison so much. After all, he’s a hacker, used to being cooped up indoors. “I was fine,” he says. “I was quite popular. I met a few ronmental Defense Fund asked in a 2012 good friends in there.” Inside were guys from the hacker groups Anonymous and LulzSec. One of them, Beddoes says, had been convicted of temporarily review of the EU ETS’s struggles and suc- taking a few websites offline but thought he could pull rank because he was part of LulzSec. “I’m like, ‘Look at my papers,’” the Dragon recalls boasting. cesses. “The same question, of course, can “It was beautiful, the look on his face. Thirty-eight charges. He walked away.” be asked for any electronically networked Beddoes now refers to himself as the Red Dragon. (“There’s no specific meaning—just not black.”) He’s the sole proprietor of Red Dragon Security, system. The challenge of market oversight a consulting firm that advises business clients—so far none of them in the carbon industry—on how not to get hacked. He doesn’t plan on going back confronted by the EU ETS is not unique, to the dark side, though clients keep trying to woo him. “I still get calls from India, Pakistan, Ukraine, South America, France, Germany,” he says. “‘Hey, since theft, fraud, and money laundering is that Black Dragon? You’re a legend! I’m working on a project.…’ Nah, can’t are serious concerns in all markets.” The Dragon agrees: It’s “just like stock markets and things like that. Trading accounts. Pretty simple.” And the more complex the defenses, the more potential for holes—and for complacent defenders, who often stop expecting the worst. “Say I infect your personal computer, use a form grabber, and get your username and pass- word,” Beddoes continues. “Then I can bounce through your web browser onto their system. Then, if I get a virus on your phone as well, even a one-time password, I can use it to verify my identity”—thwart- ing two-step verification, the latest security layer. “You have to fiddle around more,” he says, “but once you’re in, you’re in.” “The more they secure it, the easier it becomes.” Q MCKENZIE FUNK (@McKenzieFunk) is a founding member of Deca, a global jour- nalism cooperative, and the author of Windfall: The Booming Business of Global Warming, out in paperback in January. FOREIGNPOLICY.COM 39



DIRTY PRETTY ROCK COAL IS TRASHING THE ENVIRONMENT, BUT ALSO LIFTING PEOPLE FROM POVERTY. LIKE IT OR NOT, THE FUEL ISN’T BUDGING FROM THE WORLD’S ENERGY MIX. BY KEITH JOHNSON PHOTOGRAPHS BY CHRISTOPHER LEAMAN ON A SPRING DAY IN 2012, A UNION PACIFIC TRAIN GROUND TO A STOP OUTSIDE A SPRAWL- ING construction site in Fulton, a blink-and-miss-it town in southwestern Arkansas. Piled high in the train’s 135 cars was the first batch of black coal from Wyoming, about 16,000 of the 2 million tons needed annually to feed the brand-new John W. Turk, Jr. Power Plant, set to go online within a few months. When officials from the South- western Electric Power Co. (SWEPCO) finally flipped the switch on this 600-megawatt, $1.8 billion structure, it was unusual enough: That year, only four other coal-fired plants in the United States opened their doors. But the Turk plant represented something more, a genuine first of its kind in the country: an ultra-supercritical coal burner fit- ted with cutting-edge metal alloys that allow it to burn low-sulfur coal at exceedingly high temperatures and pressures. That is to say, the Arkansas plant burns coal more efficiently than just about any of its 550-odd peers in the country. Packed with every sort of scrubber to clean up the nasty bits, Turk spits out fewer of the smoggy air pollutants and a lot less of the greenhouse gases that cause global warming. It also can be fitted with new gear to capture greenhouse gas emissions, when such solutions become economically via- ble. Despite the sleek upgrades, it’s still a coal-fired plant, of course. Within its first full year in operation, Turk belched some 3.4 million metric tons of greenhouse gases into the atmosphere, making it overnight one of Arkansas’s five biggest carbon pollut- ers. Nevertheless, the plant bears little resemblance to the hulking, inefficient giants

THE U.S. that have come to dominate the U.S. power sector in faces two contradictory and interrelated challenges: While billions DEPARTMENT recent decades. Those old plants burn coal to gener- of poor people in the developing world need a lot more energy ate electricity, but they do it badly. Most fuel shoveled to pull them out of poverty and drive economic development, OF ENERGY into their giant boilers is turned into heat and smoke, improve life expectancies, and bolster human health, the world EXPECTS COAL and simply wasted; only about 33 percent of the coal also faces a looming and possibly existential threat from climate is turned into power. For ultra-supercritical plants change—caused in large part by greenhouse gas emissions that FIRED PLANTS such as Turk, 40 percent of the coal becomes electric- are the bitter harvest of the world’s reliance on coal and other TO BE AS BIG ity. “It’s a totally different animal,” says Nick Akins, dirty fossil fuels over the past several centuries. IN 2040 AS the president and chief executive officer of American CLEAN TECH Electric Power, SWEPCO’s parent company and one These twin imperatives will clash head-on in November and of the biggest utilities in the United States. “It’s like December this year, when world leaders meet in Paris to try to NOLOGIES, SUCH comparing a ’57 Chevy to today’s Corvette.” A different cobble together something they have never been able to achieve: AS WIND AND animal, perhaps, and one that—despite the fuel’s bad a legally binding global agreement for all countries to cut green- reputation—shows how the U.S. coal industry might house gas emissions. Coal has been both bane and blessing for SOLAR, WILL BE. be saved from extinction. the world for a millennium, and the black fuel will not go gently from its place atop the global energy mix. In 2013, Barack Obama’s administration unveiled tough standards to limit greenhouse gas emissions IT’S FITTING THAT THE FUTURE OF COAL IS FOUND IN ASIA, BECAUSE from new coal-fired plants, and it is working on rules that would do the same for existing power plants. If its history began there too, long before Britain and the rest of the regulations were implemented, estimates the U.S. Europe turned coal into the building block of the modern world. Environmental Protection Agency (EPA), up to one- China began to harness its big coal fields for serious industrial fifth of the country’s existing coal capacity could be purposes by about 1000, making the sprawling city of Kaifeng, a pushed into retirement. These challenges have com- few hundred miles south of Beijing, the soot-blackened epicen- bined with the glut of cheap natural gas—which plum- ter of China’s first, and aborted, industrial revolution. For nearly meted from a high of about $14 per million British two centuries, the Chinese diligently worked to craft a booming thermal units in 2008 to just over $2 per million four metals industry, and by 1098, the country’s poverty relief laws years later—to make new coal-fired power plants a put special emphasis on making sure that poor people had access rarity in the United States. to coal, the only fuel mandarins even bothered to regulate. In fact, among the many novelties that later captivated Venetian Despite all this, coal not only remains the alpha in traveler Marco Polo were the “black stones” the Chinese used in the U.S. electricity mix today—accounting for about their hearths. When he returned to Italy, he brought news of this 40 percent of the power generated in the country (at novel source of energy. 27 percent, natural gas comes in second)—but it will be a fixture well into the future. The U.S. Department At that time, other parts of medieval Europe were starting to of Energy expects coal-fired plants to be as big in 2040 dabble in coal, which was readily available in France, Belgium, as clean technologies, such as wind and solar, will be. and Wales. And before long, ships carried coal up and down the North Sea, a sight that became so prevalent that, by the end of Globally, more coal is mined, moved, and burned the 13th century, “sea-coal” became the term used to distinguish today than at any time in history. And, says the Inter- the fuel from “charcoal.” As the seas reflected coal’s rising impor- national Energy Agency (IEA), global coal consump- tance, so too did the European landscape. The continent’s once- tion will only keep growing another 15 percent over endless forests, which had provided wood for fuel, gave way to the next quarter-century, thanks almost entirely to dank and dangerous coal mines. Homes in England were rede- big and fast-growing economies in Asia. signed to feature long brick chimneys to whisk away coal smoke. By the middle of the 16th century, historian Ian Morris has noted, Simply put: While the United States is just now find- “the average Londoner was already burning nearly a quarter of a ing ways to try to keep coal a viable part of its power ton of coal each year.” The pollution, however, didn’t go unnoticed. system, the rest of the world is riding even greater By then, English kings had toyed with torture, taxes, and bans technological advances to a brighter future for the on burning coal due to its noxious side effects—but to no avail. dark fuel. China alone has about 50 plants that are Queen Elizabeth I, toward the end of the century, tried a novel at least as big as and more efficient than Arkansas’s solution to address visible environmental damage by prohibiting Turk plant; Germany and Japan in the past decade coal burning while Parliament was in session; again, this was not have built several ultra-supercritical coal-fired plants successful. (This ban, however, neatly anticipated the strategy of as good as or better than American Electric Power’s modern Chinese leaders, who, four centuries later, periodically finest. Still, all those gleaming plants, along with the curb coal use ahead of big international events, such as the 2008 inevitable controversies that surrounded their con- Summer Olympics in Beijing.) struction, underscore the fact that the world today 42 JAN | FEB 2015

Coal fueled Britain like no other country before. By the 18th the geopolitical puzzle. In fact, the one provision of THE IEA EXPECTS century, the English and Welsh countrysides were dotted with the draconian Versailles peace treaty that most con- GLOBAL COAL mines. To satisfy the country’s demand, coal miners dug deeper cerned economist John Maynard Keynes wasn’t that CONSUMPTION and deeper into the earth until they tapped underground water Germany had to accept blame for the war; rather, it TO JUMP 15 tables; flooding became a constant concern. That headache, was that the Allies had completely sundered Germa- PERCENT BY though, inspired innovation. Thomas Newcomen, a British iron- ny’s coal industry, which, he darkly foretold, would 2040, WITH monger and Baptist preacher, turned to coal’s power and, around again lead to economic revolution and bloodshed. MOST OF THAT 1710, created the first practical steam engine that pumped water GROWTH from great depths, enabling miners to produce more coal more DECADES LATER, THE CENTER OF THE GLOBAL ECONOMY COMING IN THE cheaply. Within a few decades, these engines were improved, NEXT DECADE. and they ultimately powered Britain’s textile looms and the iron is no longer in Europe, but in Asia. However, the same horses of the railroad industry. In fact, the need to move bulky problems pertain: Are China, India, and the other big coal from mines to factories led to one of Britain’s most important, Asian economies condemned to repeat the Western, if little-remembered revolutions: the creation between 1760 and coal-fired experience? 1830 of a sprawling, internal system of canals—ultimately snak- ing some 4,000 miles—that enabled coal transport, as well as the As history shows, without energy there is no eco- delivery of manufactured goods around the rest of the country. nomic growth. From 1000 to 1820, global growth averaged about 0.2 percent a year. Since then, But coal’s importance wasn’t limited to economic development. growth has been 10 times higher. Modern prosper- Much as the quest to secure access to petroleum has shaped for- ity, in other words, is built upon the vast amounts eign policy for the United States, Europe, the Middle East, and of chemical energy first unleashed by coal. And Asia over the past century, coal loomed over 19th-century geopol- there has been no better student of this lesson than itics. Beginning around the middle of that century, coal-fueled China. It has relied on smoldering coal to achieve steamships largely replaced sailboats in the world’s merchant a nearly four-decade economic metamorphosis— marines and navies—for the first time, global shipping was not lifting more than 600 million people out of poverty, hostage to the fickleness of winds and tides. Yet coal-burning even as it housed them in polluted cities—that has vessels required huge amounts of the black rock, which, in turn, transformed a once-backward agrarian state into the required coaling stations in order to refuel while cruising. Conse- world’s second-largest economy. quently, grabbing and defending such overseas stations became a primary concern of most great powers. Those that had access Meanwhile, this economic miracle has created a to coal depots in every ocean could move around the world with large, relatively wealthy Chinese middle class that ease; those without were at the mercy of other countries. has brought an ecological consciousness to the Mid- dle Kingdom. Environmental nightmares, especially Britain’s hold on distant ports in Sierra Leone, Yemen, and the choking air pollution fundamentally caused by South Africa, among other places, owed as much to the need the country’s overwhelming reliance on coal, have in to shovel tons of coal into hungry ship boilers as it did to any recent years sparked huge protests by people question- other imperial mission. As renowned British historian Niall Fer- ing the legitimacy of the unelected leadership in Bei- guson has noted, the string of overseas coaling stations, from jing. But with state subsidies still set at about 3 percent Sierra Leone to Cape Town to Aden, formed the sinews of Brit- of China’s GDP in 2011, according to the International ain’s globe-spanning maritime empire. And that was true for Monetary Fund, the country’s consumption of dirty newer, informal empires as well: In the wake of the 1898 Spanish- energy will continue for decades, both underpinning American War, the United States grabbed Hawaii and Guam in and undermining the country’s government. part because of their late 19th-century appeal as stepping stones for the U.S. coal-powered fleet to cross the Pacific. The Roosevelt Even before China’s top leaders announced a “war Corollary to the Monroe Doctrine—which asserted the U.S. right to on pollution” in the spring of 2014, the country had use force to keep Europeans out of the Western Hemisphere—was been fumbling toward a solution, attempting to har- one way for famously pro-navy President Theodore Roosevelt to ness the market to tackle smog and launching seven neuter any threats: Without coaling stations in the Americas, Euro- regional pilot cap-and-trade programs. (Like other sim- pean fleets would be hard-pressed to challenge the United States. The growing industrial might of Europe, as well as an endless appetite for coal, further fueled existing and soon-to-be-lethal tensions. Alsace and Lorraine created strain between France and Germany for the half-century leading up to World War I. Part of that was driven by simple nationalism, but the region was also very rich in coal and iron, making it a highly coveted piece of FOREIGNPOLICY.COM 43

CHINA’S ilar plans, early Chinese experiences have been frus- under which China will seek to peak its greenhouse gas emissions COAL CON trated by the market price for coal pollution because sometime around 2030. Although China announced no binding SUMPTION the price is too low to discourage the fuel’s use on emissions limits, it said it hopes to ramp up its share of zero-car- INCREASED simple economic grounds.) But China also set out to bon power sources to 20 percent by 2030. To achieve that goal, employ more direct, top-down methods to clip coal’s China would need to build between 800 and 1,000 gigawatts of 2.8 TIMES wings. It introduced ambitious targets to reduce coal clean power in 15 years. In other words, between now and 2030, BETWEEN consumption by 2017 in some particularly dirty cities China would have to essentially duplicate the entire U.S. electric- 2000 AND and provinces, including Beijing. Other provinces are ity system, but only with renewable energy and nuclear power—a under orders to reduce their rate of growth in coal con- herculean task, given that the zero-carbon energy capacity from 2012. sumption. If all targets are met, says environmental wind, solar, hydro, and nuclear power throughout the entire world group Greenpeace, China could save 350 million tons of today amounts to about 1,800 gigawatts. coal—or 10 percent of current consumption—by 2017. The country’s latest five-year plan, the economy’s mas- As world-beating as China’s growth in clean energy has been ter blueprint, also calls for a cap on national coal con- in recent years, it still lags behind coal’s growth. In 2013, the sumption of about 4.2 billion tons in 2020, compared energy generated from new fossil fuel facilities (almost exclu- with consumption of about 3.6 billion tons in 2013. sively coal-powered) was 27 times that of new solar power. And while China’s economy grows and a proliferating middle-class China is also looking to diversify its energy sources. charges smartphones and cranks up air-conditioners, the pop- In 2014, in a bid to get more natural gas, which emits ulation will require more energy than before. Today, each person half the carbon dioxide that coal does, Beijing inked in China uses, on average, some 3,300 kilowatt-hours of electric- a gas deal with Moscow worth hundreds of billions of ity per year—a fraction of the energy consumption in rich coun- dollars. Months later, Chinese President Xi Jinping tries. (Germany uses about 7,000 kilowatt-hours per head, South and Obama shook hands on an ambitious climate deal Korea over 10,000, and the United States more than 13,000.) To 44 JAN | FEB 2015

The John W. Turk, Jr. Power Plant in Fulton, Arkansas, is one of the most efficient coal plants in the United States. meet its current demand, China has already built about 500 giga- United States to become the world’s second-biggest INDIA WILL watts of coal-fired power plants in the past decade—that’s half as coal addict by 2020, the IEA now estimates. SURPASS big as the entire U.S. power sector. To respond to future needs, THE UNITED analysts expect that China might need to bring online about 300 “India’s development imperatives cannot be sacri- STATES AS additional gigawatts of coal power by 2020. ficed at the altar of potential climate changes many THE WORLD’S years in the future,” Piyush Goyal, India’s minister of SECOND WHILE ACCESS TO ENERGY EXPLAINS THE ECONOMIC GROWTH THAT power, coal, and renewable energy, said in late 2014, BIGGEST COAL according to the New York Times. “The West will have ADDICT the world experienced during the past two centuries, huge pock- to recognize we have the needs of the poor.” Goyal has BY 2020, ets of the globe today—where people use less energy, make less waded right into the middle of what environmental THE IEA NOW money, and live shorter lives than their energy-flush counter- writer David Roberts has said is the “signal moral issue ESTIMATES. parts—are just getting warmed up. India is one such place. of our time.” Which is the greater evil: helping cause climate change by investing in much-needed but still- Hoping to steal a page from China’s recipe book for economic dirty energy projects, or condemning the world’s poor success, India is gunning to revitalize its economy by, among other to their lot? Does the fight against the first evil pre- things, linking to the grid its 300 million people who lack access clude real progress in the second? Or is there a way to to electricity. In 2014, India laid out its plan to double the coun- develop clean, affordable energy that both protects the try’s production of domestically mined coal—to more than 1 bil- environment and promotes growth by, for example, lion tons per year—by the end of the decade. A few months later, building coal-fired plants that can capture and bury Prime Minister Narendra Modi started paving the way, sweeping their harmful emissions? away environmental regulations meant to hamstring the pell- mell development of dirty industries—a strategy that doubles For the developing world, as India’s struggles show, down on the original Chinese blueprint in order to try to lift hun- simply getting power at all is a huge challenge. Glob- dreds of millions of Indians out of poverty. India will surpass the ally, for the 1.3 billion people who lack electricity of FOREIGNPOLICY.COM 45

OKLAHOMA any sort, shunning a gleaming, new, reliable coal-fired Rich countries, led by the United States and those in Western HAS ABOUT 23 power plant on climate-change grounds is almost an Europe, have essentially made climate change, rather than allevi- impossible luxury. Compare: Oklahoma has about ating energy poverty, their main energy-policy focus. Meanwhile, GIGAWATTS 23 gigawatts of installed power plants to serve fewer outfits such as the World Bank and other Western-dominated mul- OF INSTALLED than 4 million people; Pakistan, too, has about 23 giga- tilateral lending organizations have all but banned funding for POWER PLANTS watts—while desperately trying to bring power and new coal-fired plants in the developing world. Even the poorest light to a population that is almost 50 times larger. parts of the developed world are finding it hard to convince the TO SERVE World Bank to help them; Kosovo, in southeastern Europe, is hav- FEWER THAN The problem is especially acute in areas of the world ing trouble getting the body to underwrite the construction of a 4 MILLION PEO that are still growing quickly. Out of the more than 900 modern coal-fired power plant that could help alleviate crushing PLE. PAKISTAN, million people living in sub-Saharan Africa, fewer than power shortages that cripple its economy. Environmental cam- TOO, HAS ABOUT 300 million have access to electricity. For instance, paigners around the world have urged the financial institution to 23 GIGAWATTS, fewer than 10 percent of people in the Democratic consider renewable energies such as wind and solar power rather WHILE DESPER Republic of the Congo can plug anything into a wall; than dirty, brown local coal. That’s the kind of recipe the Obama ATELY TRYING TO fewer than 20 percent of Kenyans can do so. Even pop- administration favors for other benighted locations. Its “Power BRING POWER ulous countries with enough money to fund nuclear Africa” initiative, a plan to bring energy to the parts of Africa AND LIGHT TO weapons programs struggle with the challenge of pro- that don’t have any, is heavy on small-scale renewable energy. A POPULATION viding power for their people: One out of 10 Pakistanis goes completely without electricity, and many more But for much of the world, coal is merely a dirty fuel, not a dirty THAT IS suffer from infrequent and unreliable access to power. word. And the idea of the rich world speaking of the urgent need ALMOST 50 But even when the world’s poor have a plug, they don’t to fight climate change by killing coal is shortsighted, some critics TIMES LARGER. use it in the same way that people in rich countries argue. Pakistani investor Irfan Ali, who now lives in the United do. Per capita electricity consumption in Congo is a States, says, “Such policies and discussions are relegating liter- scant 105 kilowatt-hours per year. That’s enough juice ally millions of people to poverty.” For more than a decade, Ali to keep a single 100-watt light bulb lit for about six has led a quixotic fight to drum up interest in an untapped coal weeks. In Kenya, annual per capita consumption is a field in the Thar Desert in southeastern Pakistan. The goal of the mere 155 kilowatt-hours; in Pakistan, that number is consortium he manages, TharPak, is to use advanced technology just 449 kilowatt-hours per person. to build coal-fired plants capable of capturing their carbon emis- sions—a big green step beyond Arkansas’s cutting-edge Turk “Inadequate energy infrastructure risks putting plant—and thereby turn a vast natural resource into a driver of a brake on urgently needed improvements in living economic development in a region that could use some. standards,” the IEA concluded in 2014 in its first-ever special examination of sub-Saharan Africa’s energy Inspired by America’s bountiful reserves—such as the massive needs. Bill Gates, the philanthropist and co-founder coal deposits found in Wyoming’s Powder River Basin, home to of Microsoft, says that his travels through Africa have more than 40 percent of America’s coal—Ali says that growth brought home the desperate plight of students try- shouldn’t be left untapped in the ground. “If you look at what ing to study under street lamps. “In the rich world, [that coal] basin has done for the United States historically,” he we are right to worry about conserving energy, but in says, “it is in my mind one resource that rivals, if not exceeds, poor places, people need more energy,” he wrote on the positive economic impact on the economy that oil has had.” his blog last June. He wants energy to be both afford- Thar’s coal reserves, if used for power, could provide Pakistan able and clean, in order to fight energy poverty and with fuel for decades—if not centuries—the Pakistani govern- climate change at the same time, and he stresses the ment and private companies say. need for poor people to have access to the kind of ener- gy-fueled economic development that made the West- A few years ago, Ali tried to lasso support from Washington ern world what it is. (He is investing in novel nuclear for the project, arguing that energy-powered economic develop- energy technologies.) ment will contribute to increased security in Pakistan. Despite the project’s “technical and economic development merit,” the U.S. Agency for International Development wrote in a letter, funding for Pakistan is “currently directed to other priority proj- ects.” Ali vows to continue with or without U.S. help, and he has been in talks with several firms in China—which, as it happens, is investing more than $30 billion in the next five years to upgrade Pakistan’s power sector. TRYING TO ENSURE AN ENERGY FUTURE FOR THE DEVELOPING WORLD by turning to the template of the past dismays plenty of people. 46 JAN | FEB 2015

Many environmentalists heartily reject the notion that 20th- could improve the quality of life are missing, from century ideas of energy—including big, centralized power plants reliable power for hospitals to power plants needed to sending out electricity over a grid—are the only or best way for meet- run water-purification systems. In Congo, the infant ing power needs in the new century. Just as the advent and wide- mortality rate is 86 deaths per 1,000 live births; in spread deployment of mobile phones enabled many poor countries Pakistan, it’s 69 per 1,000, compared with just 3 in to leapfrog a generation in their communications development, Germany and 6 in the United States. energy plans should shed the architecture of the past, they argue. By contrast, China’s remarkable progress in reduc- “You don’t see anybody standing up and saying we need to roll ing infant mortality in recent decades goes hand in out landline telephones to every rural village,” says Justin Guay, hand with the country’s breakneck, coal-fired growth. one of the leaders of the Beyond Coal campaign at the Sierra Club, In 1980, China’s infant mortality rate was 48 deaths the environmental group that battled the Turk plant’s construc- per 1,000 births—a level roughly comparable to tion for years. The lack of energy access in today’s developing Kenya’s or Ethiopia’s today. Now, China’s infant mor- countries, he says, is a sign that centralized energy development tality rate is just 11 per 1,000 births. And even though is not the answer. Better to take advantage of huge technologi- recent research suggests that air pollution is lower- cal and economic advances in small-scale renewable energy, he ing Chinese life expectancy, that’s in part because says, in order to bring clean-power options to isolated regions. “I life expectancy had increased by about eight years think there’s a real big gut-check question the development com- between 1980 and today. munity needs to ask itself: If grid extension and the construction of power plants and coal are just so wonderful for poor commu- THIS YEAR, EVEN WHILE ALL EYES WILL BE ON DEVEL- nities, why has it failed so miserably, and why do we expect any different outcome if we double down on that existing approach?” oping countries to see whether they finally agree to The reliance on coal indeed comes with heavy costs. Just look at share the pain of mandatory emissions reductions at China. The country’s air pollution, much of which can be chalked up to its reliance on coal, costs at least 3 percent of GDP per year— the big climate conference, India will be opening its THE NATURAL or more than $250 billion—according to World Bank and Chinese RESOURCES government estimates. The Natural Resources Defense Council coal sector to fresh investment in hopes of ripping out DEFENSE COUN estimates that China’s air pollution kills almost 700,000 people a CIL ESTIMATES year. Meanwhile, the U.S. EPA expects that the Obama administra- tons of coal from the ground. China, for all its climate THAT CHINA’S tion’s tough, new power-plant rules will save between 2,700 and AIR POLLUTION 6,600 lives per year by reducing the incidence of respiratory dis- aspirations and clean-air concerns, will cut the ribbon KILLS ALMOST eases from power-plant emissions. The National Research Coun- 700,000 cil concluded a few years ago that coal-fired electricity imposes on about 30 gigawatts of coal-fired plants, enough to PEOPLE A YEAR. a whopping $65 billion penalty on the U.S. economy each year due to air pollution. Indeed, by some measures, coal’s nasty side power all of the Netherlands. Even in the United States, effects more than cancel out the economic benefits provided by the electricity it generates. Several economists concluded in a 2011 the fight over energy’s past, present, and future will paper published in the American Economic Review that burning coal for electricity in the United States produces as much as $5 rage on in 2015 with the opening of a cutting-edge of damage for every $1 of benefits. plant: The Kemper facility in Mississippi will be the Yes, coal might kill and costs money, the fuel’s champions counter, but so does lack of electricity. “As far as energy poverty first large-scale coal-fired plant in the country that is concerned, not having electricity is more detrimental to public health,” argues American Electric Power’s Akins. can capture and store most of its carbon emissions. It Poor families in places without power often rely on dirty cook- could show the way for the perfect marriage between stoves—a major source of indoor air pollution that leads to more than 4 million deaths every year, according to the World Health coal’s reliability and green concerns—were it not for Organization (WHO). Or take the Ebola virus: The WHO hopes to have a couple of million doses of a vaccine ready this year—but its outsized $5 billion-plus price tag, which makes it they will be useless if they can’t be stored at minus 80 degrees Celsius, a very tall order in West African countries with low elec- one of the most expensive power plants ever built in tricity-access rates and frequent blackouts. Similarly, infant mor- tality in countries without reliable access to energy is much higher the United States. than in the developed world, partly because so many things that Meanwhile, people in Kosovo will discover if rules are meant to be broken when the World Bank— weighing the evils of dirty energy against the evils of none at all—decides whether its coal-financing ban still allows it to back coal-fired plants under exceptional circumstances, such as a lack of any real potential for cleaner alternatives. “There are circumstances out there where there is just no other option,” said World Bank President Jim Yong Kim in a 2014 speech. If Kosovo ultimately has no real- istic alternatives to a new coal-fired plant, he said, “I think we would have to consider it because peo- ple have a right to energy.” Q KEITH JOHNSON (@KFJ_FP) covers the geopolitics of energy for FOREIGN POLICY. FOREIGNPOLICY.COM 47