What, then, should we do instead? The short answer is to rely more on market mechanisms than government guessing to guide us through the myriad of choices to fuel and generate clean, economical electricity. Fortunately, the most dangerous nuclear activities, like nuclear fuel-making, are uneconomical, as is producing large amounts of nuclear power in oil and gas-rich countries with small electrical grids (for instance, in much of the Middle East). We should also exploit a number of non-nuclear ways to reduce greenhouse gas emissions (the new, popular argument of governments now trying to subsidize additional nuclear projects).

First, we should encourage open international bidding on the construction of large electrical power generators and related fuel-making plants. Winning bids in any national competition should not go to the priciest or the most subsidized project but rather to the option that is the best value for producing a desired amount of clean electricity. Here, one might begin by using the Global Energy Charter for Sustainable Development, a popular treaty which calls for "open and competitive" energy markets. This should be used as a springboard to encourage nations to both open their electrical generation markets up, and to accept the lowest bidder, which more often than not will be a non-nuclear electrical generation option.

Second, we must recognize that to meet tough greenhouse-gas emission goals, a consumption tax on carbon-generating fuels is necessary. When introduced, the tax ought to be made revenue-neutral and progressive through tax reform (including income tax reductions, and rebates for citizens who are poor). This new tax should also be accompanied by an early sunset on all fuel-specific subsidies now in place for nuclear power, natural gas, oil, clean coal, and renewables. Anything less would only stack the deck higher in favor of nuclear energy against safer alternatives such as natural gas, clean coal, hydropower, and renewable resources that are much cheaper.

As the British government noted in its energy review, published July 11, 2006, under these circumstances it would be realistic for firms building and operating nuclear electricity-generating plants to assume the full costs of financing, insuring, and decommissioning them. They also should assume the expense of safeguarding the plants against diversions. Ideally, keeping governments from subsidizing these activities should be a priority not only for national governments, but for trade organizations like the European Union and the World Trade Organization.

Under such a market regime, nations that choose to subsidize any particular form of energy production would be called to account for undermining economic fairness. If they subsidized nuclear activities, they also could also be collared for threatening international security. Certainly, subsidizing nuclear fuel-making (where the world production capacity is projected to exceed demand for the next decade or more) makes no economic sense. Countries might claim that they need to make fuel for energy independence but this is nonsense: the reactors and the fuel-making plants that such an effort requires would have be imported, in most cases along with raw uranium to fuel them.

Would a market regime of this sort stop nuclear proliferation? Probably not. But unlike today's interpretation of the NPT, which ignores suspicious "civilian" nuclear undertakings even when they obviously lack any economic rationale, the market system described would help flag worrisome nuclear activities far sooner—well before a nation came anywhere near making bombs. Would this solution stifle the use nuclear power? No. As noted, a carbon tax would actually favor nuclear power if it is clearly cheaper than clean coal, natural gas, hydropower, and renewable alternatives.

Would the suggestions discussed eliminate the problems posed by a nuclear-ready Iran or North Korea? Unfortunately, again, the answer is no. Only military, economic, and diplomatic efforts to squeeze Iran and North Korea—such as those used on the Soviet Union during the Cold War—can handle those problems now. But the market system suggested would help prevent Iran or North Korea’s patently uneconomic ploys from becoming an international nuclear model for countries now professing an earnest desire to back peaceful nuclear power development. These countries include Indonesia, Burma, Saudi Arabia, Egypt, Turkey, Morocco, Jordan, Yemen, and more. It would certainly be far more effective in promoting nonproliferation than any current American-led effort to subsidize atomic power at home or abroad.