Policy responses to climate change

Historic trend in atmospheric carbon (Source: NASA)

This week came previews of an upcoming report from the Intergovernmental Panel on Climate Change, the scientific group created in 1988 to aggregate climate research and make reports to the United Nations. Drafts of the report include an estimate of 95 percent likelihood that human activities are the primary cause of an undoubtedly warming planet; that overall warming over the next century will be somewhere from 2.7 to well over 5 degrees; and that sea level would likely rise from 10 to 21 inches, depending on how much action is taken to curb emissions. Some scientists interviewed have expressed frustration at what they see as excessive caution by the IPCC.

A complicating factor to the science is that while there are models aplenty, it is impossible to predict with much precision what the impacts of climate change will be on specific areas. Should North Carolina, for example, plan for drought, floods, rising sea levels, famine or pestilence? And how much? (This is at the moment an academic question, because the North Carolina legislature has apparently forbidden their officials from planning for any climate changes at all (Harish 2012). But the Tarheel State is better than their government, and eventually will get serious.) Similarly it is impossible to attribute any single heat wave, or violent storm, or flood to climate change.

That said, getting serious about climate change would seem to be the prudent thing to do now, if not a decade ago. Granted that, as a few dissenting scientists remind us, "global warming" may be manageable, or what warming has been observed in recent decades may be a mere statistical anomaly. Or it may be that the tons of carbon dioxide and other greenhouse gases our species has put into the atmosphere each year are as harmless as a pop song, and that any climate change is due to something else. Even so! It may not work out the way they suggest; it seems prudent to allow the possibility that climate change could happen. It is pointless to wait until certainty has reached 100 percent, as that doesn't happen this side of heaven. As a recent "Freakonomics" podcast noted, the worst predictors are those that are dogmatic i.e. insist on their chosen outcome without taking into account new data or changing conditions. It also seems prudent to note that virtually everyone who studies climate professionally has found something is up, and it's unlikely to be pretty when it happens. They could all be wrong, or they could all change their minds tomorrow, but it's imprudent to expect this to happen just because it would make our lives easier, and/or because it would serve as comeuppance to that weenie Al Gore.

The main obstacles to climate action are political, not scientific. The public is split over climate change: 65 percent in a recent Pew Research Poll said warming was occurring, but only 42 percent said it was due to human causes. 33 percent said it was a "very serious" problem, 32 percent said it was "somewhat serious." (Polling Report, http://pollingreport.com/enviro.htm) My sense--no data here, just a hunch--is that these are soft numbers, and that if climate policies were proposed that threatened to impact people's lifestyles those numbers would go down. Anyway, Adam Frank of the University of Rochester noted this week that the proportion of the public that believes the climate is changing has by some measures declined since 1989 despite accumulating evidence (Frank 2013).

It's worth thinking about what options are available to governments in mitigating climate change. Five potential policy instruments, listed in reverse order of intensity, are (a) persuasion, (b) market mechanisms, (c) taxing and spending, (d) regulation, and (e) government management (Kraft and Furlong 2013: 103-107).

Persuasion is providing information, such as through public service announcements or presidential speeches, intending to sway public action. The assumption is that if you knew more about the issue, and what you could do about it, you would stop contributing to the problem and start contributing to the solution. The problem with persuasion as a sole instrument is that most people have heard the information already; it's far from clear that actions by a few persuadable individuals would bend the curve. If everyone reading this blog traded their car in for one that got half the gas mileage, it wouldn't make things that much worse. Put another way: We've run anti-drug ads for decades, but we still use law enforcement too.

On the other end of the intensity spectrum is government management. This is the dreaded "government takeover." There is, in this case, nothing for the government to take over. It can't nationalize every single source of pollution, since there are so many, and anyhow much of the carbon comes from non-commercial uses, like people driving cars or barbecuing on charcoal grills. There's been discussion of geoengineering the climate, and government could operate it, but that's extremely hypothetical at this point, not to mention the cost and ethical concerns. (Jeff Goodell of Rolling Stone has written a book on the subject of geoengineering, How to Cool the Planet (Houghton Mifflin Harcourt, 2010); an interview with NPR's Scott Simon is here.)

Which leaves us with three main approaches: regulation, such as requiring certain levels of gas efficiency or types of fuels; taxing, particularly raising gasoline taxes to discourage use of fuels that contribute to climate change; and the intriguing cap-and-trade approach, which is a market mechanism.

Taxes work better than regulations at encouraging energy conservation, whether we're doing it for conservation's sake or for limiting pollution. That's because taxes affect the price of using energy--driving, for example--in ways that make the energy user bear more of the social costs of energy use (Nivola and Crandall 1995). Regulating gas efficiency actually makes driving less expensive. It would reduce energy use, and the carbon it produces, only if people drove exactly the same amount as they did before the regulation. But if regulation forces more gas-efficient vehicles, then the cost of driving per mile goes down, and people may choose to respond by driving more, living farther out, and other ways of defeating the purpose.

Requiring gasoline include ethanol seems to me pointless, at least if we're talking about the 10% blend using corn-based ethanol that most cars can use. Or the point is to create business for corn farming businesses. That is not what we're driving towards here, if you'll pardon the pun.

Increasing taxes on gasoline, electricity, and other forms of energy add to the cost of using them, and hence make the cost-sensitive user use less. Given our experience with demand-driven gasoline price increases since 2007 or so, it would take a whopper of a tax increase to affect driving habits, and even then it would affect them slowly because that's how America has arranged itself. Even small tax increases are politically unpopular. But this is an option if we choose to get serious. (An additional problem is that the tax would fall more heavily on some people than others, like rural residents, traveling sales people, and drivers of old cars who can't afford new ones. This would require some consideration.)

Cap-and-trade is a favorite of economists, and was included by the George H.W. Bush administration in the Clean Air Act amendments of 1990 to regulate emissions of the acid rain precursors sulfur dioxide and nitrous oxide, with considerable success (Conniff 2009, Broder 2009). In the 2000s the George W. Bush administration proposed a cap-and-trade regime for mercury, which I opposed at the time, thinking that mercury is so poisonous it probably requires tighter regulation than a cap-and-trade mechanism would provide. Despite its Republican origins, and John McCain's support for the approach in his 2008 presidential campaign, congressional Republicans have derided climate change proposals as "cap-and-tax," and that became an article of faith for 2012 presidential candidates (Good 2011). The Democratic-controlled U.S. House narrowly passed a cap-and-trade bill in June 2009, but it was blocked in the Senate.

The 2009 bill, dubbed the American Clean Energy and Security Act, would have created permits to emit carbon dioxide. Large and small polluters would purchase tradable permits from the government in an auction that would simulate a market in pollution ("trade"). The total amount of emissions allowed ("cap") would be reduced over time, with the eventual goal of reducing CO2 emissions by 83 percent by 2050 (Kraft 2011: 59-60). Similar approaches have been adopted in Australia, the European Community, and the U.S. state of California.

Politically we seem far from taking any meaningful action against climate change. But given the scientific consensus, and the likely dire consequences of inaction, we can't afford to wait much longer.

SOURCES

John M. Broder, "From a Theory to a Consensus on Emissions," New York Times, 16 May 2009, http://www.nytimes.com/2009/05/17/us/politics/17cap.html?ref=capandtrade&_r=0

Richard Conniff, "The Political History of Cap and Trade," Smithsonian, March 2009, http://www.smithsonianmag.com/science-nature/Presence-of-Mind-Blue-Sky-Thinking.html

Adam Frank, "Welcome to the Age of Denial," New York Times, 21 August 2013, http://www.nytimes.com/2013/08/22/opinion/welcome-to-the-age-of-denial.html?src=ISMR_AP_LO_MST_FB

Justin Gillis, "Climate Panel Cites Near Certainty on Warming," New York Times,  20 August 2013, http://www.nytimes.com/2013/08/20/science/earth/extremely-likely-that-human-activity-is-driving-climate-change-panel-finds.html?smid=tw-share

Chris Good, "Almost Every 2012 Republican Has a Cap-and-Trade Problem," Atlantic, 13 May 2011, http://www.theatlantic.com/politics/archive/2011/05/almost-every-2012-republican-has-a-cap-and-trade-problem/238776/

Alon Harish, "North Carolina Bans Use of Latest Scientific Predictions of Sea-Level Rise," ABC News, 2 August 2012, http://abcnews.go.com/US/north-carolina-bans-latest-science-rising-sea-level/story?id=16913782.

Michael E. Kraft, Environmental Policy and Politics (Longman, 5th ed, 2011).

Michael E. Kraft and Scott R. Furlong, Public Policy: Politics, Analysis, and Alternatives (Sage/CQ Press, 4th ed, 2013).


Pietro S. Nivola and Robert W. Crandall, The Extra Mile: Rethinking Energy Policy for Automotive Transportation (Washington: Brookings Institution, 1995).

Andrew C. Revkin, "Can Cities Adjust to a Retreating Coastline?" Dot Earth, 22 August 2013, http://dotearth.blogs.nytimes.com/2013/08/22/can-cities-adjust-to-a-retreating-coastline/