1 Farm Foundation offered the 30-Year Challenge Policy Competition to promote constructive and deliberative debate of issues outlined in the report, The 30-Year Challenge: Agriculture’s Strategic Role in Feeding and Fueling a Growing World. Farm Foundation does not endorse or advocate the ideas or concepts presented in this or any of the competition entries. ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ SHARED WINNER, CLIMATE CHANGE CATEGORY The Embedded Carbon Valuation System: A Policy Concept to Address Climate Change By Tristan Brown, Dermot Hayes and Robert Brown ABSTRACT: Current proposals to limit U.S. greenhouse gas (GHG) emissions will impose costs on U.S. industry without imposing similar costs on international competitors. The solution is to measure GHG emissions all along the marketing channel and impose the same burden on U.S. imports as is imposed on U.S. products with the same carbon content. Under the proposed policy, most U.S. agricultural exports would merit a subsidy rather than the tax that is currently proposed. This essay shows how to implement this alternative system. All economic activities generate greenhouse gas (GHG) emissions. Until this fact is acknowledged, attempts to regulate GHG emissions will be inefficient and work to the detriment of U.S. agriculture. For example, under current regulatory and measurement systems—such as the IPCC Guidelines for GHG Inventories, California’s Low Carbon Fuel Standard, and the Waxman-Markey Act—when crude oil is imported to the United States, its GHG emissions become the responsibility of the United States because this is where the GHG is released. However, when corn is exported from the United States, the GHG emissions associated with production of that corn are also assigned to the United States rather than to the country buying the corn for use as animal feed.