Thursday, January 31, 2013

Ethics of emissions trading

"Emissions trading sounds like a compelling idea in principle but the practicalities are much less attractive. [...] it's depoliticized over-consumption (i.e. we are told it no longer matters who causes what harms, provided we all pay the right amount) [...] emissions trading carries a series of practical problems. A weak cap means increased emissions but a tight cap, based on a effective climatic targets would likely lead to regressive social consequences, for instance, privileging a Londoners' stag party over a Polish OAPs' warmth."

- Dr John Broderick in "Should we stop worrying about the environmental impact of flying?", Guardian 31st Jan 2013.

This neatly summarises one of my concerns with emissions trading schemes. The question of the relative social good associated with a particular set of emissions is assumed to be answered through a direct equation with the economic cost of that good. If a stag party for a rich Londoner costs as much as heating the home of an elderly Polish couple, then these social goods are deemed equivalent, despite the fact that one is a luxury while the other may well be a necessity under certain circumstances. In some ways, it is a similar issue to the globalisation of the food market. If there are wealthy people willing to pay for a luxury cash crop on another continent, this is taken as justifying the eradication of local food autonomy in a developing country.

But not all goods are commensurate on a common scale. It is not possible to put a price on everything. The logic of the market is not universally applicable.


Mister Tim said...

But what's the alternative? An effective price on carbon in one country alone, even in the absence of a trading market, still gives rise to the same issue - but it's still probably the most efficient way of reducing energy usage and carbon pollution.

byron smith said...

One alternative (with its own serious drawbacks, though it does avoid the problem mentioned) is personal carbon rationing. This would ensure that the emissions associated with basic necessities (heating an OAP's home) are not treated the same as a Londoner's stag party, since the former would (presumably) be covered by the initial allocation, while the latter would not.

Having said that, I think that a high enough carbon tax with equal dividends paid to all citizens would have a similar effect. Yes, the OAP's energy bill would rise, but they would receive a check that should more than offset the loss. The Londoner's check would be the same absolute size, and so would probably not cover the air tickets to the stag party (whose price would also rise dramatically).

byron smith said...

In general, there are many alternatives to the logic of the market, depending on context. While market logic is applicable in some instances, it is no universal language ensuring morally defensible outcomes in all situations.

Mister Tim said... is no universal language ensuring morally defensible outcomes in all situations

I doubt very few people this side of Ayn Rand on the political spectrum would think that the market was meant to, or even could, ensure morally defensible outcomes. The point is usually that markets create efficient outcomes, or perhaps, they are the most efficient way of allocating resources, etc. The problem for most societies then is, who decides what is a moral outcome? And how do you determine it?

Yes, a Christians we have answers and views, but in our largely secular countries it gets very messy as soon as you start working through the politics.

Unknown said...

There is some apples and pears here.

The stag party for the rich provides employment and income for someone who might not otherwise receive either. Heating for impoverished couple is an opportunity for charity.

Both are defensible from a Christian understanding. Jesus seemed to be in favour of big parties even as he enjoined compassion for the less fortunate.

Carbon trading is a bad idea as it obviates the need to reduce emissions if that is the ultimate goal.