This is an example of one of the problems with negotiating global warming abatement that avoids the issue of caps on developing countries. Without caps on all countries, industry will do crazy things like oil from shale, dumping way more CO2 into the atmosphere than conventional oil, but oh it's ok because it's in a developing country. Never mind the oil will probably mainly be exported to feed the appetites of the developed world and not really contribute to raising living standards in the country where it's produced. If there is a loop whole for developing countries, it will just lead to the developed world exporting our worst industries to those areas not being watched.

As long as crude is as expensive (=valuable) as it is now, the industry will be willing to use higly inefficient (=carbon-intensive) ways of producing it.
The first thing we need to do is invest heavily in alternatives. Once the research- en capital investments are done in alternative energy, it will become so cheap that it will drive the value of crude down. Once it costs more to develop shale-oil than it's worth, they will obviously leave it where it is.
That's why we need massive investments of tax-money in the research and implementation of renewable energy.
We invest hundreds of billions in military equipment, which doesn't harm the economy, since it's a big boost for economic activity.
If we would invest the same kind of money in wind, solar, nuclear,... it would stimulate the economy much more than the needed taxations would harm it.
Firstly, the tax money would almost completely be invested in the own economy, and secondly the very cheap energy (because capital investment is already paid for) would stimulate the economy again, while driving down the price of crude.
This in turn would starve oil-dictators and terrorist-sponsors, while making shale-oil projects uneconomical.

The US, EU and Japan should start with such policy. Very fast other nations like China and India will follow. Though, it's necessary we start fast : once they have lots of coal-plants up and running, it will be much more difficult to shut them down. If at the moment coal is 10% cheaper than wind, they will do coal. Once their plant is built, the difference becomes much larger than 10%, since the capital investment for their plant is already made.
On the other hand, for wind the advantage is even bigger : since capital investment for wind is almost the only cost, once it's built there's no way coal can ever become cheaper.
The same logic goes for shale-oil. Now they will be making huge capital investments because oil-price is so high. The total cost of shale-oil will be high, and maybe uneconomical at a crude price of 60$. But once the investments are made, further expoitation will be economical at a much lower crude-price. So, even if the crude drops to 40$, it will still be economical do do further production, since the capital investment is already been paid for. It's important that the price of crude drops below these tresholds before the big investments are made, otherwise it will be much harder to stop them producing it (since they will want at least to pay back their investments).

That's why we need a Marshall plan - scale investment in alternative energy (nuclear included).
Just like that Marshall plan gave a huge economic, military and security advantage to the US at a relatively low cost (without it Europe would probably have become part of the USSR), the advantage of such a new plan will return much more (to the world) than it will cost.

Alain:

Wouldn't massive production of alternative liquid fuels support and encourage the continued use of more inefficient ICE vehicles with all the negative side effects etc.

A super Marshall Plan to accellerate the production of much cheaper more efficient electric energy storage devices would promote the use of PHEVs and BEVs, thus reducing (even eliminating) the need for more fossil fuel with less GHG.

Part of this plan should address the production and distribution of more clean electricity for our PHEVs and BEVs and to replace current coal fired plants.

@Jim,

You are operating under a few misunderstandings.

Signing Kyoto is different from following Kyoto dictates.

The phony socialist Greens of the EU signed the Kyoto protocol and then promptly and cynically did nothing about it. They believe that lying is OK, as there is no such thing as concepts of honor or truth.

The entire world including the developing third world increased their anthropogenic CO2 emissions by 18% over 1990. The sanctimonious EU, increased its CO2 emission by 21% over 1990, or worse than China or India,even while hectoring everyone else about their self-proclaimed superiority.

The US which treats its promises as binding, bipartisanly refused to sign Kyoto; but actually sought to reduce it CO2 emissions. Many homes, and businesses were insulated, construction and appliance standards revised, and industry undertook massive reconstruction.

For example, the US steel industry has been totally rebuilt, and uses one third or less of the energy it used to need to make a ton of steel. Did you ever hear boasting about that? No? Why not?

The auto industry has built and rebuilt numerous factories to be much more energy efficient, and when I say that, it consists of both domestic and foreign firms manufacturing in the US.

The result is that the US has essentially ceased increasing CO2 to the atmosphere from its industry over the 1990 Kyoto targets. More change is coming too. The electrical utility industry has on order, enough new plants to cut by one third to one half its electrical generation from fossil fuels by 2020. Have you heard of that? No? Why not?

Not to mention that the Ground Transport sector, the consumer of the majority of fossil fuels, is beginning to convert and substitute electrons for hydrocarbons. That tidal wave of change is coming as well.

Finally, the US is not the worst polluter. That is a convenient canard. We produce the majority of the world's goods, but do not emit the majority of the world's pollution, nor anywhere near the majority of CO2. China does.

If we treated the land set asides, and land use restrictions we impose, as Kyoto concessions, the warped accounting of Kyoto would be different. What is the difference whether a human being plants a tree, or lets a seed fall to protected ground, and sprout into a tree? By the warped accounting of Kyoto, there is a difference to a UN bureaucrat.

A tree is not a tree, to them. A human-planted tree is a carbon sequester; a naturally spouted tree on land protected and reserved for forest, is not, and is irrelevant, to them. However... A tree is a tree. Period.

Therefor allowing natural reforestation to count, as well as human-planted trees, in CO2 emission accounting, the US is already actually decreasing its CO2 emissions below its former levels. The only country actually meeting the Kyoto targets!

Have you heard of that? No? Why not?

Stan:

Isn't USA exporting billions of tonnes of CO2 when you import $$$ billions of manufactured goods from China-India-Japan-Malaysia-Mexico-Canada + $$ billion of crude oil from Alberta tars sands + $$ billions of ethanol from Brazil etc?

Dont forget that the 2 million/barrel/day imported from Alberta created huge amount of GHG over there. The 100 new coal fired power plants in China are being built to supply manufactured goods to the world and mostly to USA.

It is so easy to shift a major part of our GHG to other nations and claim that we are doing well and even better than others.

The very huge USA yearly trade deficit says most of it.

If USA would compile all the GHG created to produce all imported goods, the USA per capital GHG would go from 22 tonnes/year to something as high as 30 or 40 tonnes/year.

What about biochar? Biofuels can be made from non-food materials using pyrolysis methods, with biochar as a residue. The biochar can then be used as fertilizer on cropland with two benefits: increased soil fertility and the sequestering of many tons of carbon.