Climate Policy Design

1
Climate Policy Design
Politics of a Durable Deal Justice as
Realism Session 2

• November 22, 2008
• Holmes Hummel, PhD
• holmes_at_holmeshummel.net

2
Climate Policy Design Pro-Series

• Targets, Timetables, and Technology
• Politics of a Durable Deal Justice as Realism
• Carbon Price Policies Questions for Tax and
  Trade
• Cap and Trade Devils in the Details
• Committing a Carbon Trust The Trillion Dollar
  Bargain
• Essential Complementary Policies Californias
  Advantage

3

• Sufficiency, Security, and Sustainability
• AND Rachel Warrens impact table vulnerability
  to climate change impacts!
• Sharing Burden and Benefits
• UNFCCC
• Contraction Convergence
• Sequence (Annex I), differentiation Berlin
  Mandate and Byrd Hagel resolution
• Bali and G5 statement
• Greenhouse Development Rights
• Addressing Political Mobilization Bias
• All claims for justice are strong what gives?
  U.S. free rider held back by Senate
• Physics is stronger than politics chances are
  much higher that politics will change not
  physics!
• What are the political strategies for change?
• Intergenerational representation
• Interest groups with persuasive power Open
  Secrets.org
• Constituencies with power to resist
• Addressing inequality in Climate Policy Design
• EJCC and African Americans
• CA EJ Declaration

4
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

5
Three Major Energy Quests

• Sufficiency
• Security
• Sustainability

6
Energy Systems Drive Development
7
Energy Systems Drive Development
8
History of U.S. Energy Consumption
85 of U.S. energy demands are met with fossil
fuels.
8 of U.S. energy demands are met with nuclear
power.
U.S. Energy Information Administration
9
World Bank Investments 1947-2007
10
Sources U.N. Food and Agriculture Organization
C. Mayhew R. Simmon (NASA/GSFC), NOAA/ NGDC,
DMSP Digital Archive
11
When do the moral claims for sufficiency subside?
Sources U.N. Food and Agriculture Organization
C. Mayhew R. Simmon (NASA/GSFC), NOAA/ NGDC,
DMSP Digital Archive
12
(No Transcript)
13
How is the U.S. committing its resources?
Does not include wars bailouts, stimulus bills
Or anything else on the national credit card
Source FY2006 Federal Discretionary Budget
Business Leaders for Sensible Priorities
14
How is the U.S. committing its resources?
Source FY2006 Federal Discretionary Budget
Business Leaders for Sensible Priorities Does not
include wars in Iraq and Afghanistan.
15
Famous Nations in U.S. Foreign Relations
Map Scaled by Oil Reserves and Shaded by Oil
Consumption
Source BP Statistical Review 2004
16
Competition for Oil Consumption as a Threat
Oil to the Fore in U.S.-China TalksFocus Shifts
From Currency By Neil IrwinWashington Post
Staff WriterWednesday, June 18, 2008 D01
17
Communities with less access to power are more
vulnerable to climate change impacts
IPCC AR4 SYN SPM Fig 7
IPCC AR4 SYN SPM Fig 7
18
Climate impacts intensify as the index of global
average temperature rises
IPCC AR4 SYN SPM Fig 7
19
Climate impacts intensify as the index of global
average temperature rises
IPCC AR4 SYN SPM Fig 7
20
Three Major Energy Quests

• Sufficiency
• Security
• Sustainability

• Humanitarian welfare
• Competition for resources
• Intergenerational justice

There are trade-offs in the balance, and
structures of power determine who trades. If
moral claims for justice are ignored, then no
global agreements will be stable enough to
persist.
21
Implications for Climate Policy

• Multiple levels of authority with disparate goals
• Multiple tables for negotiation
• Multiple vehicles for policy
• Policy resilience is critical to the long-term
  humanitarian quest for climate stabilization.
• Redundancy reduces risk, and coordination
  accelerates negotiations.
• The quest is not a single policy that persists
  for a century
• The goal is to maintain a structure for effective
  policy negotiation that can remain stable even as
  it transforms over time.

22
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

23
Climate Policy Negotiations Invoke (at least)
Four Different Concepts of Justice

• Utilitarianism
• Retributive Justice
• Distributive Justice
• Rawls Theory of Justice

24
Utilitarianism

• Basic Description Greatest Good for the
  Greatest Number
• An action is morally justified on the basis of
  its (expected) outcome.
• That which delivers society the most aggregate
  utility is the most just.
• Utility is a unitless term for value, or
  usefulness.
• Cost-benefit analysis is based on the concept of
  utilitarian justice, using dollars to represent
  utility.
• Issues
• Different people hold different values and some
  people may implicitly or explicitly be valued
  differently in a utilitarian frame.
• Utilitarianism overlooks the distribution of
  benefits and burdens.
• Difficult to negotiate a decision between two
  distinctly different and mutually dependent
  parties.

25
Retributive Justice

• Basic Description Eye for an Eye
• An action is morally justified if it is a
  proportionate response to a validated offense in
  the past.
• The field of criminology is devoted to defining
  terms of offense.
• Criminal sentences (incarceration, fines, death
  penalty) are meted out in measures considered
  proportionate to the crime.
• Issues
• Different societies have different definitions of
  offense, and different considerations in
  determining a proportional response.
• Responding to injury with injury can feed cycles
  of retribution that may persist for generations
  and prevent ultimate resolution.
• Difficult to prioritize conflicting claims.

26
Distributive Justice

• Basic Description Equality
• The distribution of things wealth, power,
  respect is just if they are allocated
  properly among different people.
• Fairness is fundamental but still disputed
  should something be distributed in equal measure,
  or on the basis of some meritocratic measure, or
  as an entitlement according to status?
• The income tax structure in the U.S. and laws
  ensuring equal opportunity reflect deeply felt
  sentiments toward distributive justice.
• Intergenerational justice is essentially a
  distributive justice problem over a dimension of
  time rather than space.
• Issues
• Those with authority to distribute resources
  often attained that position by having more than
  their share already.

27
John Rawls Theory of Justice

• Basic Description You cut, I choose. Or
  well cut, and flip for choice.
• Social and economic inequalities should be
  arranged so that they are
• to the greatest benefit of the least advantaged,
  consistent with the just
  savings principle, and
• attached to offices and positions open to all
  under conditions of
  fair equality of opportunity.
• In order for any change to be accepted as an
  improvement, it must help the least advantaged
  party (or representative person).
• When designing a system that distributes benefits
  and burdens, use a veil of ignorance about
  the status you may have as a subject of it.
• Issues
• Appealing, but difficult to apply.

28
Climate Policy Negotiations Invoke (at least)
Four Different Concepts of Justice
We can stabilize climate change for just a few
percent of global GDP what are we waiting for??
Well, the countries most responsible for this
problem should start first and pay most of the
cost.
But the Global North nations will soon be
surpassed by China and India as major emitters,
so we wont move forward until they have
committed to shouldering the burden too.
To broker a fair resolution to this dispute, what
would that regime need to look like for us to
accept it if we woke up tomorrow in a subsistence
family in Haiti or China?
And if the interests of subsistence families are
overlooked, what happens if they reject the terms
of an international agreement?
If its not widely seen as fair, it wont stick.
29
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

30
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

• National blocs - UNFCCC
• Per Capita - Contraction Convergence
• Greenhouse Development Rights

31

Countries will be asked to meet different
requirements based upon their historical share or
contribution to the problem and their relative
ability to carry the burden of change. This
precedent is well established in international
law, and there is no other way to do it. Al
Gore (New York Times Op-Ed, 7/1/2007)
31
32
Preamble of the 1992 United NationsFramework
Convention on Climate Change

• Acknowledging the global nature of climate
  change calls for the widest possible cooperation
  by all countries and their participation in an
  effective and appropriate international response,
  in accordance with their common but
  differentiated responsibilities and respective
  capabilities

32
33
UNFCCC Defined a Global North Bloc
Global North Developed Annex I
Global North Developed
Global North
Global South Developing Non-Annex I
Global South Developing
Global South
34
Derailing Negotiations for a Decade
1995 UNFCCC Council of the Parties Berlin
Mandate Parties agree that the Annex I countries
should go first in sequence, accepting binding
targets without obligating Non-Annex I
countries. 1997 U.S. Senate Byrd-Hagel
Resolution (95-0) It is the sense of the Senate
that (1) The United States should not be a
signatory to any protocol... which would-- (A)
mandate new commitments to limit or reduce
greenhouse gas emissions for the Annex I Parties,
unless the protocol or other agreement also
mandates new specific scheduled commitments to
limit or reduce greenhouse gas emissions for
Developing Country Parties within the same
compliance period, or (B) would result in serious
harm to the economy of the United States
and the Senate requires a high burden of proof
that the economic impact is low
35
Justice as Realism for Sustainability
Source Global Climate Action
36
Nationalism in Climate Politics
Forecast underestimated China annual emissions
already exceed U.S.
U.S. Energy Information Administration (2005)
Source U.S. Energy Information Administration
37
How does greenhouse gas pollution per person
compare between nations?
38
Climate Change is a cumulative problem annual
figures distort the problem frame.
30 of all the human-made CO2 in the sky is
from the United States and thats not
counting pollution from the production of goods
imported for consumption here.
39
Global Economic Disparity
40
Who owns the sky?

• Negotiations between nation-states imply
  governments own the right to the sky (like cell
  phone frequencies)
• But if the right to a stable climate belongs to
  all humans, then are all humans entitled to a
  share of the sky?
• Distributing the burden for climate change
  mitigation on a per capita basis has persistent
  appeal.

41
Contraction Convergence
Equal Per Capita Emission Rights by 2030for
450ppm CO2
Global Commons Institute
42
(No Transcript)
43
2008 Statement by G5 Countries(Brazil, Mexico,
India, South Africa, and China)

• Negotiations for a shared vision on long-term
  cooperative action at the UNFCCC, including a
  long-term global goal for greenhouse gases (GHG)
  emissions reductions, must be based on an
  equitable burden sharing paradigm that ensures
  equal sustainable development potential for all
  citizens of the world and that takes into account
  historical responsibility and respective
  capabilities as a fair and just approach. 

It is essential that developed countries take
the lead in achieving ambitious and absolute
greenhouse gas emissions reductions in accordance
with their quantified emission targets under the
Kyoto Protocol after 2012, of at least 25-40 per
cent range for emissions reductions below 1990
levels by 2020, and, by 2050, by between 80 and
95 per cent below those levels, with
comparability of efforts among them.
44
Distributive Justice Claims for Sufficiency

• 2 billion people without access to clean cooking
  fuels
• More than 1.5 billion people without electricity
• More than 1 billion have poor access to fresh
  water
• About 800 million people chronically
  undernourished
• 2 million children die per year from diarrhea
• 30,000 deaths each day from preventable diseases

44
45
Greenhouse Development Rights
The right to development in a carbon-constrained
world.
Paul Baer Tom Athanasiou
(EcoEquity) Sivan Kartha (Stockholm
Environment Institute) Full report
available www.ecoequity.org/GDRs email
info authors_at_ecoequity.org Dataset and tool for
examining the calculations presented here and
exploring alternatives gdrs.sourceforge.net
2 million
46
Climate Policy must to be relevant to
Development Policy

• About 800 million people chronically
  undernourished
• More than 1 billion have poor access to fresh
  water
• 2 billion people without access to clean cooking
  fuels
• More than 1.5 billion people without electricity
• If energy development is fundamental to all,
• what does that mean for a climate regime?

46
47
Paths to 2C Stabilization, with Risk
48
Paths to 2C Stabilization, with Risk
2 million
49
Paths to 2C Stabilization, with Risk
2 million
50
Paths to 2C Stabilization, with Risk
2 million
51
Thinking about a North-South Carbon Budget
2C Pathway, at least 2/3 chance
2 million
52
Thinking about a North-South Carbon Budget
2C Pathway, at least 2/3 chance
Annex I (North) emissions path
2 million
53
Thinking about a North-South Carbon Budget
What kind of climate regime could allow this to
happen?
2C Pathway, at least 2/3 chance
Non-Annex I (South) emissions path
Annex I (North) emissions path
2 million
54
Burden-sharing in a global climate regime

• National Obligation share of global mitigation
  and adaptation costs based on
• Capacity resources to pay without sacrificing
  necessities
• Income (PPP), excluding income below the 20/day
  development threshold
• Responsibility contribution to the climate
  problem
• Cumulative CO2 emissions starting in 1990,
  excluding subsistence emissions
  (i.e., emissions corresponding to consumption
  below the development threshold)

54
55
Income and Capacity

National income distributions showing portion of
income (in green) that can be considered
capacity
55
56
Emissions vs. Responsibility
Cumulative fossil CO2 (since 1990) showing
portion that can be considered responsibility
56
57
National Obligations based on capacity and
responsibility
population income Capacity cumulative emissions (1990-2010) Responsibility Obligation (RCI)
United States 4.6 20.7 29.7 23.3 33.9 31.8
EU (27) 7.2 21.6 27.9 15.9 20.5 24.8
United Kingdom 0.9 3.1 4.2 2.1 2.9 3.7
Germany 1.2 4.1 5.6 3.4 4.6 5.2
Russia 2.0 3.2 2.9 6.3 5.9 3.9
Brazil 2.9 2.8 2.3 1.4 1.2 1.8
China 19.7 12.5 5.9 15.7 7.5 6.6
India 17.2 5.2 0.8 4.2 0.7 0.8
South Africa 0.7 0.7 0.6 1.6 1.4 0.9
LDCs 12.5 1.5 0.1 0.6 0.0 0.1
Annex 1 18.8 57.2 75.1 56.5 73.4 74.6
Non-Annex 1 81.2 42.8 24.9 43.5 26.7 25.4
All high income 15.1 55.2 75.6 50.9 71.4 74.3
All middle Income 46.7 36.4 23.4 42.2 27.8 24.8
All low Income 38.2 8.5 1.0 6.9 0.9 0.9
World 100 100 100 100 100 100
57
58
What are the costs?
58
59
Global Mitigation Burden
National Obligation Wedges
59
60
National Obligation Wedges
0
60
61
Example

• U.S. vs China

61
62
Implications for United States
US mitigation obligation amounts to reduction
target exceeding 100 by 2025 (i.e., negative
emission allocation).
62
63
Implications for United States
Physical domestic reductions (50 by 2025) are
one part of the USs twofold obligation. The
second part is MRV support for international
reductions.
63
64
Implications for China
Chinas mitigation obligations are not trivial,
but are small compared to Chinas mitigation
potential, and can be discharged domestically.
64
65
Implications for China
The majority of the reductions in the South are
driven by industrialized country reduction
commitments.
65
66
Greenhouse Development Rights

• A climate regime must
• Ensure the rapid mitigation required by an
  emergency climate stabilization program
• Support the deep, extensive adaptation programs
  that will inevitably be needed
• While at the same time safeguarding the right to
  development
• Greenhouse Development Rights
• Defines and calculates national obligations with
  respect to a development threshold
• Allows those people with incomes and emissions
  below the threshold to prioritize development
• Obliges people with incomes and emissions above
  the threshold (in both the North and South) to
  pay the global costs of an emergency climate
  program

Greenhouse Development Rights, EcoEquity
67
Greenhouse Development Rights

• This framework can satisfy all four major
  theories of justice
• - utilitarianism
• - retributive justice
• - distributive justice
• - Rawls theory of justice
• But to prevail, it must be supported by a
  strong solidarity movement within the OECD
  countries that have the highest responsibility
  and capacity to respond.

68
Final Comments

• The scientific evidence is bracing. Carbon-based
  growth is no longer an option in the North, nor
  in the South.
• A rigorous, binding commitment to North-to-South
  flows of technology and financial assistance is
  necessary. Domestic reductions in the North are
  only half of the Norths obligation.
• In principle, a commitment from the consuming
  class in the South is also necessary.
• In reality, there will need to be a period of
  trust-building.
• The alternative to something like this is a weak
  regime with little chance of preventing
  catastrophic climate change
• This is about politics, not only about equity and
  justice.

68
69
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

70
Negotiating Concepts of Justice

• Clear utilitarian interest in stabilizing climate
  change
• Clear distributive justice claims against the
  U.S. and other OECD nations and the present
  generations
• Clear retributive justice claims mounting with
  impacts
• Whats going on?

71
Policy-makers manage many types of risk.

• including risks that their institutions
• will lose political or economic authority
• will precipitate conflict in an armored world
• will be held liable for damages or losses
• will no longer permit them to remain in power

72
U.S. Distribution of Household Net Worth
2 million
73
U.S. Distribution of Household Net Worth
Household Net Worth (2004)
Percentage of U.S. Households
Percentage of U.S. Households
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
74
U.S. Distribution of Household Net Worth
300,000
200,000
Household Net Worth (2004)
100,000
Percentage of U.S. Households
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
75
U.S. Distribution of Household Net Worth
300,000
243,200
200,000
To include Top 20, we need a larger scale.
Household Net Worth (2004)
100,000
81,800
2,200
Percentage of U.S. Households
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
76
U.S. Distribution of Household Net Worth
2 million
Percentage of U.S. Households
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
77
U.S. Distribution of Household Net Worth
Household Net Worth (2004)
2 million
2,200
243,200
Percentage of U.S. Households
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
78
U.S. Distribution of Household Net Worth
15
Bottom 80
2 million
2,200
243,200
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
79
U.S. Distribution of Household Net Worth
15
Bottom 80
Next 10
2 million
576,300
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
80
U.S. Distribution of Household Net Worth
15
Bottom 80
13
Next 10
2 million
576,300
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
81
U.S. Distribution of Household Net Worth
15
Bottom 80
13
Next 5
Next 10
1,764,000
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
82
U.S. Distribution of Household Net Worth
Next 4
15
Bottom 80
12
13
Next 5
Next 10
1,764,000
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
83
U.S. Distribution of Household Net Worth
Next 4
25
15
Bottom 80
12
13
Next 5
Next 10
1,764,000
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
84
U.S. Distribution of Household Net Worth
16 million
14.7 million
Next 4
25
15
Bottom 80
12
13
Next 5
Next 10
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
85
U.S. Distribution of Household Net Worth
16 million
14.7 million
Next 0.5
Top 0.5
9
Next 4
25
15
Bottom 80
12
13
Next 5
Next 10
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
86
U.S. Distribution of Household Net Worth
16 million
14.7 million
Next 0.5
Top 0.5
9
25
Next 4
25
15
Bottom 80
12
13
Next 5
Next 10
2 million
90
Source State of Working America, 2006 2004 data
in Tables 5.7 and 5.9 real estate included.
87
Wealth Disparity Distorts Democracy
88
(No Transcript)
89
Politics of a Durable Deal Justice as Realism

• Sufficiency, Security, Sustainability
• Concepts of Justice
• Sharing Burden and Benefits
• Political Mobilization Bias
• Addressing Inequity in Climate Policy Design

90
Environmental Justice Economic Justice

• Introduce these two dimensions

91
Federal Climate Negotiations
92
Federal Climate Negotiations
Auto
USCC
Coal
Utilities
Big Green
Big Oil
93
Federal Climate Negotiations
Auto
USCC
Big Biz
Market Mechanism
Cap Trade
Coal
Utilities
Big Green
Big Oil
Declining Emissions Cap
94
Federal Climate Negotiations
Cost Containment
Auto
USCC
Big Biz
Market Mechanism
Cap Trade
Coal
Carbon Sequestration
Utilities
Big Green
Free Pollution Allowances
Big Oil
Declining Emissions Cap
95
Federal Climate Negotiations
Trade Protection
Cost Containment
Industry
Auto
USCC
Jobs Protection
Big Biz
Market Mechanism
Unions
Cap Trade
Coal
Carbon Sequestration
Utilities
Big Green
Free Pollution Allowances
Big Oil
Declining Emissions Cap
96
Federal Climate Negotiations
Trade Protection
Cost Containment
Industry
Auto
USCC
Jobs Protection
Big Biz
Market Mechanism
Unions
Cap Trade
Coal
Carbon Sequestration
Utilities
Big Green
Free Pollution Allowances
Big Oil
Civil Society
Declining Emissions Cap
Rebates to Low-Income
Adaptation Funds
97
Federal Climate Negotiations
Trade Protection
Cost Containment
Industry
Auto
USCC
Jobs
Jobs
Big Biz
Market Mechanism
Unions
Unions
Cap Trade
Coal
Carbon Sequestration
Utilities
Utilities
Big Green
Free / Auction Pollution Allowances
Big Oil
Civil Society
Declining Emissions Cap
Rebates to Low-Income
Adaptation Funds
98
Federal Climate Negotiations
Trade Protection
Cost Containment
Industry
Auto
USCC
Jobs
Big Biz
Market Mechanism
Unions
Cap Trade
Tighter Targets Plan B Complementary Policies
Coal
E.J.?
Carbon Sequestration
Utilities
Big Green
Free / Auction Pollution Allowances
Big Oil
Civil Society
Declining Emissions Cap
Rebates to Low-Income
Adaptation Funds
99
Federal Climate Negotiations
Industry
Auto
USCC
Big Biz
Unions
Cap Trade
Coal
E.J.?
Utilities
Big Green
Big Oil
Civil Society
100
Federal Climate Negotiations
Industry
New England
Midwest
Auto
USCC
Big Biz
Unions
Cap Trade
Mid-Atlantic
California
Coal
E.J.?
Utilities
South
Big Green
Big Oil
Civil Society
Urban, Liberal Democrats
Texas
101
(No Transcript)
102
Climate Policy Design Pro-Series

• Targets, Timetables, and Technology
• Politics of a Durable Deal Justice as Realism
• Carbon Price Policies Questions for Tax and
  Trade
• Cap and Trade Devils in the Details
• Committing a Carbon Trust The Trillion Dollar
  Bargain
• Essential Complementary Policies Californias
  Advantage