Why Climate Reforms Must Last
Urgency is required, but going too far, too quickly, too recklessly could create even greater threats in the future. We need a middle way.
We lambast the generations ere ours for fuelling the climate crisis. We castigate our politicians now for failing to recognise and deal with the crisis. We will be condemned more than either if our actions aren’t proportionate to the crisis.
That means ensuring that we move quickly to stop global warming at source, and that we don’t fall short of what is required, both in the material sense of removing carbon from the atmosphere, and in the sense of courage and bravery, against the critics, the interest groups, and the warnings of reactionary economics.
But it also means that our reforms must be considered and appropriate — not destroying the economy but reforming it, not destroying lives and businesses but improving them. Both the extreme libertarian climate argument — that the free market will ensure that there are sufficient new jobs in new industries — and the extreme socialist argument — that the state should command and control natural resources and common goods — threaten these objectives.
There are two principal issues: the sustainability of the reforms concerning the long-term climate outcomes, and the economy.
Of these, the economy threatens to derail climate action the most. We need solutions that raise money for state investment in renewables, energy storage, and research, without damaging the economy by restricting businesses and choice.
The carbon tax is an essentially good idea — it can be used to hit large corporations the highest, and with effective tracking systems, we can target overseas emissions to ensure that carbon isn’t being exported to countries with more lax regulation.
The highly developed nations of the Far East and the West make up the bulk of the world’s consumption: 17% of the world’s population consumes 80% of its resources. However, most products aren’t made by the 17%, meaning that emission exportation is simple at present for companies.
Yet this also gives politicians here great power. Tax companies based on the emissions of their products at the point of consumption, and they can’t dodge the tax, they just have to pay. If every one of the countries which make up this 17% introduced a carbon tax today (although such a speedy introduction definitely isn’t desirable), then we could be well on our way to ending the crisis — not just for now, but well into the future.
The carbon tax — and we could throw in a methane tax as well — works because it is so simple. The basic principle is that by making something a bit more expensive, they can still use it, but they might think twice.
And for any libertarians who don’t like the idea of government intervention in the market, the market only works when everything is included in it.
If I buy a hamburger, I don’t currently pay for the negative impacts of my consumption on those who suffer — including my fellow citizens who breathe worse air as a result, or Maldivians who might find their country underwater soon. All I currently would pay for is the cost of the hamburger to the company, plus a bit extra if I’m comfortable with the markup.
Introduce a tax on carbon and methane, though, to internalise this externality, and the market then includes my impact. Maybe I now have to pay 5% or 10% more, or perhaps the company takes on the cost, persuading it to change its sources or methods — or even start selling veggie burgers instead. Now, the cost of my behaviour is included in the price, and that means a better, more functional market.
Equally, for the critic inclined to want a command-and-control state solution, we need to ensure that our economy, which works reasonably well for most things, isn’t ignored and undermined as a result of our efforts. Putting the defects of capitalism to the sword is great — but challenging the humble market when we could help it instead seems reckless.
We won’t be able to deal with the issues of climate change if we have economic chaos or a much smaller economy as a result of socialism. We tried socialism, on a very large scale, for a rather large amount of time — and it didn’t work. State capitalism and state intervention to aid the functioning of the market are legitimate solutions, but socialism less so.
Climate reforms must keep all onside, and they must last. Solely relying on negative emissions technology, for example, will create future problems regarding how we avoid extreme cooling. The detail of the reforms is key, because we must ensure equilibrium in the future between warming and cooling, and this equilibrium must be dynamic, responding to our changing energy needs.
There seems little sense in fundamental reforms to our political and economic sense. But equally, we cannot hang ordinary people out to dry with laissez-faire “the market will provide” solutions. Where the state can invest, it should, and where the state can aid the functioning of the market, it should.
And by the same token, we cannot leave our future generations with the same or even worse problems than we currently face. We have to get it right this time, to ensure a more prosperous and peaceful world for our children and grandchildren. Simply put, we must succeed for our successors.