Justice & Collecting payment for Climate Change Mitigation & Adaptation

Ethics of Global Health

PHIL420 | Chris Lowry

25NOV13

Climate change is a wicked problem that will have massive consequences to humanity in a short time frame. There are numerous potential solutions to the problem that generally fall under the categories of mitigation and adaptation. Mitigation is the prevention of the effects of climate change through minimizing emissions and increasing carbon sinks. Adaptation is making changes to human infrastructure and behavior to respond to a warmer climate and higher sea levels. A pressing practical concern is how those with a duty to pay will pay for the implementation of solutions. Duties to pay are often cited to fall under the overarching ethical frameworks of the ability to pay principle and the polluter pays principle. Simon Caney’s hybrid view successfully synthesizes both of these framework to identify who has duty to pay. But because climate change is a large, complicated problem and I believe we will likely need different ethical frameworks that complement each other to apply to different parts of the problem. Specifically, we will need an ethical framework that helps to delineate how those who have a duty to pay will actually pay. Carbon taxes or a market for trading carbon credits are both options for a payment method. They are for disincentivizing carbon emissions and for generating capital to both mitigate and adapt for climate change. It is important that we finance potential geo-engineering solutions to prevent catastrophic climate change, and that we help to finance the adaptation for climate change for those vulnerable. They follow as potential options in a larger ethical framework that will help us execute duties that the advantaged have towards avoiding catastrophic climate change. Given these two options, a philosophical discussion of the ethics of each may help us to decide on a preferred choice. I will argue that a carbon tax aligns more with Nussbaum’s Fundamental Entitlements and that a carbon market aligns more with Rawl’s Difference Principle. I will conclude that this alignment demonstrates the superiority of the carbon tax and fundamental entitlements because of the potential for the carbon market and difference principle to be abused and ultimately unproductive in a time sensitive battle to prevent catastrophic climate change. This essay will draw from papers in PHIL 420 from weeks two and ten, cited at the back.

 

Climate change is the most pressing issue facing humanity at this time and has large implications for global health. Bill Mckibben’s article “Global Warming’s Terrifying New Math” points out that the scale of both our contribution to the problem and it’s immediate impacts pose a huge risk to humanity. The warming of the planet of even a couple degrees celsius will have serious consequences on our global environment creating a new climatological normal that involves hotter and drier climates, higher sea levels, and more severe storms. These consequences will likely have the most severe effect on the global poor living in equatorial regions, who are currently also vastly underserved by any kind of global health apparatus. Movements away from coastal areas will cause rapid densification of existing inland spaces with more pressure on societal resources and more severe storms will mean larger casualty listings. It is of utmost importance that we attempt to prevent the effects of anthropogenic climate change from occurring in the first place through mitigation efforts and equally important that we adapt and help others adapt for the inevitability of some climate change occurring. The complexity of the problem means that there are various options for mitigation and adaptation that must be considered, but there is overarching agreement that the problem is highly time sensitive. Severe consequences of climate change will be seen within a generation if we continue emitting greenhouse gasses at the current rate. Ideally, we should focus efforts on the mitigation and potential reversal of climate change so that we don’t have to deal with the costs and complications that will arise from its impacts and adaptation efforts. It has been difficult to garner support for this preventative mitigation effort because of public disagreements over climate change and the lack of salience for its effects.

 

There are two different ethical models towards climate change action regarding responsibility. These are the Polluter Pays Principle (PPP) and the Ability to Pay Principle (ATP). The PPP is essentially that those currently or historically responsible for the emissions that cause climate change should bear the cost of mitigating and adapting for it. ATP suggests that because climate change is a global problem that affects the whole of humanity, the costs should be distributed among those who can pay at all. As Simon Caney points out in his article “Climate Change and the duties of the advantaged”, there are various problems with each of these models alone. Though PPP does target the more obvious culprits of climate change (developed nations) and assigns more specific ownership over duties, it is very difficult to quantify exactly how much these obvious culprits have emitted over time and if they can be held culpable for emitting when climate change was scientifically unknown. PPP also covers current developing nations that are emitting, raising the question of whether these players should pay if they are simply trying to catch up with developed nations. Caney argues that they should pay in accordance to the benefit they derived from their emissions regardless. The ATP attempts to rectify what is missing with the PPP but it is challenging to come up with an appropriate global formula to assign who should justly bear what proportion of the cost, and ignores prior injustice. Caney suggests that any successful model should be at least a synthesis of PPP and ATP and provides a hybrid model. He claims that a hybrid model is a forward looking approach that accounts for historical emissions. This generally means that if you are more advantaged and have generated this advantage more from pollution intensive means, you should pay more. He calls this the Poverty Sensitive Polluter Pays Principle. Caney claims that the hybrid view supports either a cap & trade carbon market system or a system of progressive carbon taxes.

This hybrid model is very useful in suggesting systems of payment in general, but does not provide insight into which option for facilitating duty is better. As implied by Caney, the solution is a dichotomy- either a carbon market of a system of taxes. Both would work individually as practical solutions for retrieving payment from those specified by his hybrid model. This suggests that we need an ethical model that might specifically generate insight into this decision that will complement the poverty sensitive polluter pays principle/ history sensitive ability to pay principle. Firstly, we must develop a basic understanding of the differences between a cap & trade carbon market and a system of carbon taxes. The cap & trade system is essentially a stock market for limited carbon emissions. Carbon emission “stocks” would be limited to only the total amount that we may safely emit in a year to avoid catastrophic climate change. Possession of a stock allows a company or person to emit that specified amount of carbon into a common public space, the atmosphere. The limited amount of stock incentivizes a move towards lower emissions, but also allows companies that are high emission to purchase more stock. Theoretically the price of carbon would be steadily driven up and these market forces would drive down total emissions. One disadvantage is that a carbon market is difficult to manage consistently.  It is more complex, involving trading, and typically a new apparatus that must be built from scratch. A carbon tax system is much simpler while also having a number of options for implementation. It would essentially mean that a tax is levied on the purchase on any good or service that emits carbon, on property usage that is emissions intensive, or on businesses emitting carbon. This would disincentivize consumers and businesses from acting in a way that emits greenhouse gases by factoring in the costs of the externalities of those actions. A carbon tax can be implemented by any government with a pre-existing system of taxes and can be exempted for the least advantaged (Caney, 221). Both have the disadvantage of potentially damaging economies. The advantage of both markets and taxes is that if executed properly they both disincentivize emissions and potentially raise capital for climate change mitigation and adaptation.

The carbon market aligns most closely with Rawls’s difference principle as a supporting ethical framework. The difference principle is a maximizing principle that recognizes that equality of opportunity it the most important, not necessarily total equality, because inequality can create more favourable group outcomes. The general principle is that the only condition where improvements to the more advantaged groups is justified is when it improves the advantage of the least fortunate. (Rawls, 53)  Rawls seeks to identify which inequalities are fair as some are necessary for the good of a society. The concept of a carbon market can be understood in this way. Market forces of cap & trade allow for an unequal distribution of carbon stock, but a formal opportunity for all players to access this stock. It offers opportunities for high emission companies that perform mission-critical roles in the economy to continue operating at the expense of the purchasing of stock, and for new carbon neutral companies to operate without having to purchase the stock. It would allow for inequality in the amount of emissions companies are allotted, and a higher price means there would be more opportunity for innovation and for new players to enter. In all, it encourages the best use of carbon emissions, favoring meeting the needs and mitigating the effects and raising money to deal with the effects of climate change for the least advantaged. Naturally, the limit to this equality of opportunity is a company’s access to cash and capital to purchase the stock. But in the context of limiting carbon emissions to mitigate climate change, this system is effective in allowing companies that have high emissions but efficient business processes that generate cash to pollute more if it generates more benefit to the least advantaged in society. It means that inefficient companies that generate a lot of pollution but are not producing goods and services that generate a strong enough cash flow will not be able to purchase the carbon stock. This would mean that the carbon that is emitted unequally is at least emitted for the highest benefit to the least advantaged in society. It encourages success in a way that acknowledges the limits of our climate. The system would also steadily disincentivizes emissions overall by a steadily rising cost of carbon, also encouraging energy and economical innovation. These systems must be global in order to favour the global disadvantaged and to avoid a potential carbon off shoring loopholes. The entire world should be subject to this dynamic price of carbon.  But essentially, it favours a purposeful inequality order similar to the difference principle. The cap and trade allows inequality in allotments of carbon emissions in order to maintain efficiency.

The carbon tax aligns most closely with Nussbaum’s Capabilities and Fundamental Entitlements principle as a supporting ethical framework. This principle is a more goal-oriented approach that lists outcomes that should be met. Originally, these were a list of core but universal human capabilities that should be considered for meeting needs. It works affirmatively to grow people’s capabilities in their lives by providing benchmarks to work towards. The Capabilities and Fundamental Entitlements principle sets out general affirmative outcomes and sets certain thresholds as the thing to work towards. (Nussbaum, 41) Carbon tax can be understood this way by implying a goal and providing a direct measure to achieve the goal. We understand certain potential negative outcomes, and we know the general thresholds we need to meet in order to avert them. A carbon tax directly identifies and seeks to meet a list of capabilities that are at work in an economy that contribute to these climate change thresholds and works to meet them. This is simply that carbon is a contributor and if used a price should be paid to compensate for the negative effect. It is more about equality of contribution based on consumption, similar to the polluter pays principle but it can be progressive with different levels to reflect the ability to pay. A carbon tax is more focused on providing a direct and global disincentive for carbon use to mitigate the problem and raise funds for adaptation directly. In this way it focused on a list of outcomes and a direct means of achieving the outcomes, rather than maximization in a new business condition with a secondary effect of improvement.

Both principles can exist in the larger hybrid model of duty. This exercise helps us to make a choice between two methods of facilitating that duty. Given that climate change is a potentially catastrophic problem with a very short time frame for action as described above, we must approach it in a pragmatic manner. Therefore, the alignment of both these potential payment solution with theories of justice and the advantages and disadvantages of each makes it seem as the carbon tax approach would be the more effective option. It is clear that we need decisive action in order to mitigate climate change or else we will see some of the catastrophic effects. A carbon tax provides a direct route to this by generating the funds to deal with climate change while universally disincentivizing consumption leading to pollution. This strategy, as with any tax, risks severely damaging our economies. But if it leads us to a better chance of avoiding catastrophe, this would likely have a better overall effect for the global population. A carbon tax offers a more easily enforceable option that directly confronts the core problem. A carbon market is a compromise that follows a traditional train of economic thought, but is not focused enough on solving the environmental problem and overarching risk to civilization but instead on salvaging an economic paradigm that arguably created the problem. Though it may be able to support payments for future adaptations by keeping an economy in top form, the uncertainty of the length of time it would take for market forces to drive up the price of carbon to a level that truly disincentivizes its use is uncertain. How long does a market have to operate for prices to reach the right level to reduce emissions and raise funds for avert climate change?  Trading could reduce price level if certain segments of the market work together to lower the price, and there is high incentive for playing and speculating in this market especially by high polluters. There is also a question of how to get high polluting players, essential for the success of the scheme, to enter the market. This means that it is not a directly effective means of mitigation. That assumes that the system will not be abused. McKibben talks about the massive resources of the oil industry. A carbon market could easily be played to the advantage of the highest polluters; so that essentially oil & gas could continue to operate as normal even considering they are the highest emitters. A tax system for carbon is at least being applied through the existing government tax apparatus, which can already deal with and disincentivize abuse. Pairing these alternatives for methods of facilitating duties to pay helps make the decision a little more clear. The alternatives seem to be between a maximization technique that has an indirect opportunity to mitigate climate change, or an outcome-based technique that seeks to directly mitigate and adapt for climate change. Due to the urgency of the climate change situation, we need to work towards specific ends like those proposed in a capabilities based technique. A carbon-tax focused payment method would be ideal for this end.

In this paper I argued that in the context of global climate change, the Rawlsian Difference Principle supports a carbon market system and the Nussbaumian Fundamental Entitlements principle supports a move towards a carbon tax as measures to mitigate and raise funds to adapt to consequences. These ethical relationships support a carbon tax as the superior opportunity in the context of a rapidly approaching global crisis and a philosophical framework to back it up. This argument is meant to provide a sub-model for Caney’s hybrid duty model as a way of evaluating next steps for the actual collection of payment in the Poverty Sensitive Polluter Pays Principle and History Sensitive Ability To Pay Principle. The more important implication of this argument echoes the issues surrounding the complexities of the climate change problem as a whole. Climate change is so large and complex that single ethical models might not capture its intricacies or provide a framework for dealing with the immediacy of the problem. Just as we might need to break the problem up in chunks in order to deal with it through our existing economic and political systems, it may be useful to be philosophically flexible. We should continue to develop philosophical frameworks that approach climate change from the different disciplinary perspectives, and we should be open to synthesis and layering in our approach. This papers focus on the payment issues surrounding the mitigation of climate change is essential to the topic of global health. The impacts of climate change, if not dealt with, will likely make all of our current efforts and problems with justice surrounding global health seem extremely simple. No philosophical movement towards a more just global health distribution is complete without a consideration of the impacts of climate change. Assigning duty and methods to fulfill duty to mitigate climate change is therefore of utmost importance to a comprehensive look at the ethics of global health. We need to focus on meeting thresholds to avert a crisis, rather than managing inequalities to support a system that is leading us into the crisis. A comparison of Nussbaum and Rawls philosophy in the context of payment for climate change set by Caney makes this very clear.

Word Count: 3012

References

Caney, S. (2010). Climate change and the duties of the advantaged.Critical Review of International Social and Political Philosophy, 13(1), 25.

McKibben, B. (2012, August 2). Global Warming’s Terrifying New Math.Rolling Stone.

Nussbaum, M. (2007). Capabilities as fundamental entitlements: Sen and Social Justice. Feminist Economics.

Rawls, J. (1971). 11. Two Principles of Justice. In A Theory of Justice. Cambridge, Mass.: Harvard University Press.

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