Weighing costs and benefits--a Carbon Based original

In deciding whether to undertake large projects, most managers and policymakers begin with a cost-benefit analysis, or CBA.  The advantage of CBA is its comparative simplicity. The choice with the largest net gains is the one we should select. This method shows a way forward using straightforward assumptions.

Unfortunately, when the first step in an important assessment is a CBA, policymakers have already closed off major alternatives, usually the ones that involve non-economic values.  And in a changing climate, a naive use of CBA creates a strong bias against, for example, cutting greenhouse gas emissions. 

Most economic theory struggles to explicitly addressing environmental goods and ills, which are not so readily translated into costs.  In fact, global warming is a market failure, perhaps the most significant market failure of all.

Most CBA users assume that the environment will remain stable over the life of the endeavor.  Yet climate change jeopardizes that stability. When farm productivity dropped because of environmental degradation during the Dust Bowl, recovery took decades.  A growing frequency of coastal property being inundated and disrupted by storm surges can dramatically alter the environmental picture --and therefore the economic outlook. But economists rarely call attention to these issues.

Environmental goods and ecosystem services are not readily quantified, and thus easy to take for granted in a business-dominated world. Insurance is one business mechanism that quantifies natural disaster costs to some degree, but the point of view is pretty limited and stylized. It's a distorted lens for getting the whole picture of climate change.

Risk is a blind spot for CBA, too. Even a mainstream economist such as Martin Weitzman notes that low probability but high impact scenarios tend to disappear from conventional CBA.  The destruction from Hurricane Sandy is a recent instance. Everyone knew that a hurricane hitting New Jersey and New York had a serious potential for tremendous losses. But long decades between storms lulled everyone, economists included, into postponing decisive action.  This is true even though the Bloomberg administration has actually done more than nearly any other American city. Sandy has shown how inadequate this effort was.

A more fundamental drawback is philosophical.  Cost-benefit analysis embodies norms that persistently steer us toward short-term ventures, consumption, and individualist standards -- the prevailing ideology of our era. The utilitarian bias of economists lead to scant regard to matters of morality, rights and justice. Personal relationships count for little, as does art, and even nature itself except where some natural feature has an obvious dollar equivalent.

In utilitarian style, CBA reduces values to mere preferences, which have to compete with a long list of stakeholder desires.  This group wants to preserve thriving wetlands, but other people want to buy houses that are "close to the land," and the alternatives compete in a CBA. If preserving ecosystem services imposes severe costs in the short term, then standard-issue property development will rule the day. It's left to environmentalists to object that, say, losing wetlands or species will result in overwhelming damage to property in a few years, or decades.

This raises another hitch for cost benefit analysis. CBA pays little attention to how the costs and benefits are distributed through time. By favoring the present generation, it allows those of us alive now to pass our knottiest difficulties on to our children and grandchildren. As I noted in an earlier post about the discount rate, economic theory struggles with how to coherently weigh the standing of later generations. Some economists openly declare that the present goods outweigh future utility -- which is why the future assigned a lower worth, using a discount rate. This may work well enough for financial investments, but it starts falling apart when ethics are involved.  And in climate change, ethics should be at the heart of the matter.

Dispensing with CBA altogether isn't possible, and it would be irresponsible to neglect the balance of costs and benefits of competing climate mitigation efforts. But when it comes to climate change, we have to be aware of the tool's limitations.

Climate change policy should pass a 'human rights test'

Simon Caney provides a philosophical point of view in SciDev.net: The international community recognises climate change as one of the largest problems facing humanity. But while the impacts are often framed in purely economic terms, the challenging ethical questions climate change raises are often overlooked.

These are questions such as what should be the goals of climate policy, and who should bear the burdens of climate change? Who should be included in decision-making about mitigation and adaptation strategies? The human rights framework is a valuable way of addressing these challenges and has clear practical implications for science, technology and innovation.

A human rights framework provides guidance in three ways. First, it helps specify the aims of climate policy. Article 2 of the UN Framework Convention on Climate Change refers to "dangerous anthropogenic interference" — but what counts as "dangerous"?

Many define the goal of climate policy as avoiding an increase of more than two degrees Celsius in global mean temperatures compared with pre-industrial times. But it is far from clear, from a scientific and ethical point of view, why this is the appropriate target, and the process by which it was adopted as a target has been criticised.

....Second, a human rights framework should inform the way that the international community tackles the question of how the world should share the burdens of combating climate change.

It is crucial that — whether we follow the 'polluter pays' principle (those who have created the problem should pay) or the 'ability to pay' principle (those who have the greatest wealth should pay) — the costs of combating climate change should not compromise people's fundamental human rights to food, water, life and health.

... Third, a human rights framework requires accountable political institutions that enable those affected to assert and defend their rights....

Declaration of the Rights of Man. Women, too, I suppose

Development must be less about growth, more about wellbeing

Mark Tran in the Guardian (UK): People and their wellbeing need to be at the centre of development, with less emphasis on economic growth, according to a new report, but this requires philanthropic and development organisations to challenge current thinking.

"Development is political," said the final report of the Bellagio Initiative, a six-month exploration into the future of philanthropy and international development. "Not everyone can be a winner at the same time, but if no one among the winners is prepared to give up just a little in order to reach politically sustainable solutions, then we will all lose out. The real wellbeing challenge is not just to find ways to live well, but for us to find ways to live well together."

Care work was cited as an example of an area that would receive greater attention under the new approach. Care for children and the elderly – work often done by women – is systematically undervalued and overlooked in the development agenda, said the report. A case in point was how the burden of coping with the day-to-day challenges of the global economic crisis has fallen unequally on women around the world.

"This means that in times of crisis – because of their neglect of the care agenda – international development and philanthropy organisations are complicit in processes of disinvestment in the raising of children, in building good families and communities and in creating the social contexts in which people can thrive," said the report.

Other areas in need of rethinking included: the consequences of rapid and unplanned urbanisation as both threat and opportunity for wellbeing; the role of the natural environment in protecting and promoting the wellbeing of poor people who depend on it; and how wellbeing is to be considered for people who are increasingly mobile in their search for livelihoods and security...

A village pump in India, shot by Ekta Parishad, Wikimedia Commons, under the Creative Commons Attribution-Share Alike 3.0 Unported license

Ethics for an ‘ecological civilisation'

Suvendrini Kakuchi in IPS: Leading Japanese ecologists are pushing for the concept of environmental "ethics" to influence the upcoming Earth Summit in Rio de Janeiro, an approach they contend will foster accountability towards sustainable development.

"(Environmental) ethics is based on the concept of making people accountable for the preservation of natural resources and biodiversity. By highlighting this aspect, we aim to combat the priority on economic growth that has hijacked previous Earth Summits," said Ryoichi Yamamoto, development expert and professor emeritus at Tokyo University.

Celebrating the 20th anniversary of the first United Nations summit on sustainable development, this year’s conference, dubbed Rio+20, will negotiate on a transition to a green economy in an effort to preserve the planet’s air, land, water and biodiversity.

But activists worry this crucial debate on the planet’s future will once again – as has been the case since sustainable development was launched as a global issue in 1992 – focus too heavily on anti-pollution technologies and the exploitation of natural resources in service of economic growth.  Such an approach, green activists say, has not adequately provided for protection of the planet’s scarce natural resources and delicate ecosystems.

...He told IPS that excellent scientific research, evaluating ecosystems’ vulnerability to economic growth, has provided ample knowledge to influence policy decisions.  "But what is missing is sustainable development based on the perspective of an ecological civilisation, a civilisation that could exist in harmony with natural systems," he said.  The call for an ethical approach to finding solutions in Rio has gained momentum in Japan after the massive natural disaster that hit the northeastern coasts of the country in March 2011. ...

Sento Imperial Palace, Kyoto, Japan - pond view through trees. Shot by Daderot, Wikimedia Commons, under the Creative Commons Attribution-Share Alike 3.0 Unported license

'Ethical Adaptation to Climate Change' envisions the good life in a harsher world

PhysOrg: Think like a planet - and reorganize society to reflect it, says Case Western Reserve University's environmental ethicist Jeremy Bendik-Keymer. That's a new way of thinking about reversing the tide of climate change.

"Don't obsess over your individual actions: counting carbon emissions, changing light bulbs or even developing new technologies for personal use. The only international cure-all for climate change is societal, born of civic protest against the injustice we are visiting on future children," Bendik-Keymer says.

That's also the message from Ethical Adaptation to Climate Change: Human Virtues of the Future's editors Bendik-Keymer and Allen Thompson from Oregon State University.

..."The standard definition of adaptation is about coping to protect our business as usual model of development. We take that a step further and think adaptation requires ethics –a new frame for development. We should change our form of life to assume responsibility keyed to a planetary scale," said Bendik-Keymer, the Elmer G. Beimer-Hubert H. Schneider Professor in Ethics at Case Western Reserve.

The volume, aimed at both theorists and practitioners working on the emerging international architecture of climate regulation and climate philosophy, starts at the global level.

Ethical Adaptation to Climate Change (MIT Press) is a call for reorganizing both our conception of good character and our understanding of institutions to allow humans to flourish in the climate we have substantially affected for the next thousands of years....

Nasa scientist: climate change is a moral issue on a par with slavery

Severin Carrell in the Guardian (UK): Averting the worst consequences of human-induced climate change is a "great moral issue" on a par with slavery, according to the leading Nasa climate scientist Prof Jim Hansen. He argues that storing up expensive and destructive consequences for society in future is an "injustice of one generation to others".

Hansen, who will next Tuesday be awarded the prestigious Edinburgh Medal for his contribution to science, will also in his acceptance speech call for a worldwide tax on all carbon emissions.

In his lecture, Hansen will argue that the challenge facing future generations from climate change is so urgent that a flat-rate global tax is needed to force immediate cuts in fossil fuel use. Ahead of receiving the award – which has previously been given to Sir David Attenborough, the ecologist James Lovelock, and the economist Amartya Sen – Hansen told the Guardian that the latest climate models had shown the planet was on the brink of an emergency. He said humanity faces repeated natural disasters from extreme weather events which would affect large areas of the planet.

"The situation we're creating for young people and future generations is that we're handing them a climate system which is potentially out of their control," he said. "We're in an emergency: you can see what's on the horizon over the next few decades with the effects it will have on ecosystems, sea level and species extinction."...

The medallion of the British Anti-Slavery Society, from 1795

Future generations risk 'enslavement' without a vote now

Damian Carrington's Environment Blog at the Guardian (UK): It's a new year, so let's start with a new idea: a democratic body to safeguard the basic needs and fundamental interests of future people.

That is the proposal of Rupert Read, a philosopher at the University of East Anglia, in a report called Guardians of the Future for the think tank Green House. The core idea is both radical and straightforward: a council of "Guardians of Future Generations", chosen like a jury from the general public, would sit above the existing law-making bodies and have two core powers. A power to veto legislation that threatened the basic needs and interests of future people and the power to force a review, following suitable public petition, of any existing legislation that threatens the interests of future people.

After the UN climate change summit in Durban in December I wrote, our current glacial progress in tackling global warming is piling costs and hardship onto our descendents in a way that will make the current global debt crisis seem minor by comparison. The changes to our economic, food, energy and water systems needed to adapt to changing climate get more expensive the longer we leave them. So ideas about how to represent the interests of people yet to exist are welcome.

I asked Read why he took on the issue. "It came from the worry that it is clear that the current institutions of government are not working and are not future proof," he said. "It also came from a philosophical direction: seeking for a way take the future seriously and in a democratic way."

"The proposal being made here is that we give future people en masse the nearest possible equivalent to the vote," he says. The need for democratic representation of unborn people led Read to the idea of a "super-jury". "Random selection would emphasise that we all share this responsibility for future people, and that none of us and all of us are ideally placed to do this vital job," he writes in the report....

A misty valley in Swift's Creek, Victoria, Australia, shot by Fir0002, flagstaffotos.com.au, Wikimedia Commons, under the terms of the GNU Free Documentation License, Version 1.2 only

Real Climate Economics -- a new website

A website that’s worth a look: The Real Climate Economics website offers a reader’s guide to the real economics of climate change, an emerging body of scholarship that is consistent with the urgency of the problem as seen from a climate science perspective.

As the climate policy debate intensifies, economic analysis is playing an increasingly central role. The case for inaction is no longer argued on the grounds of skepticism about the science; instead, some have claimed that it will be too expensive to take more than token initiatives. There is now extensive economic analysis that challenges and refutes this idea. The peer-reviewed literature demonstrates that there is rigorous economic support for immediate, large-scale policy responses to the climate crisis.

The articles included here generally reflect and build on the following principles:

• Risk and uncertainty are fundamental to the climate problem; the magnitude and the irreversibility of uncertain, but possible, worst-case climate impacts dominate the analysis of policy options.
• Ethics and equity are inseparable from economic analysis; there are deep questions of fairness between rich and poor today, and between present and future generations, at stake in the debate.
• The severity of the problem and the scope of the required response are so great that marginal analysis of small changes and modest adjustments of market-based instruments are inadequate to the task of understanding and protecting the earth’s climate….

Sand dunes encroaching on Nouakchott, capital of Mauritania, shot by Georg Gerster, NASA

Wild side of the law -- giving nature rights

Comment by Begonia Filgueira and Ian Mason in the Guardian (UK): If societies express their values through the laws they make, one single legal change would completely transform our understanding of the ­relationship between nature and humankind: giving nature rights. And that change would be our best weapon in fighting climate change because it would give nature a voice on how we regulate the earth. The idea of "wild law" has been around since the 1960s, when writers questioned whether trees should have standing. But now enacting those ideas is a matter of our survival on this planet.

Laws that recognise the world as a legal person with rights and remedies that can be enforced nationally and internationally would create a duty of care towards the environment. It is strange that we have a duty of care towards our "neighbour", but that in law nature is not considered our neighbour. If we value the natural world we need for life, we can prove it by giving it and its components – rivers, forests, species, habitats, ecosystems – sufficient standing in law to enable proceedings to be brought on their behalf. Our legal system already does this for "non-­persons" such as companies, charities, clubs and others.

Give the sea rights, and overfishing would not be a matter of quotas set by governments but of balancing the rights of fish and humans. If the atmosphere could be a legal entity, its representative would have a say in carbon trading. A river with a right to flow continually being harmed by damming would require the courts to intervene in deciding whether the human need is greater than that of the river to subsist. This is not as far fetched as it sounds.

…Practically, how do we do this? Our courts could expand the definition of who our neighbour is to include nature and thus create a legal duty of care toward the earth. At EU level we then pass a declaration of nature's rights, which would, like the declaration of human rights, be implemented by each of the member states in an Earth Rights Act like our Human Rights Act. This would be enforced by our national courts and influence the regulators' decision-making….

"The Dream," by Henri Rousseau, 1910

Adaptation has its limiits

Kate Ravilous in Environmental Research Web: The mercury is rising and, whether we like it or not, the world's climate is going to change significantly over the coming decades. For some people this will mean suffering frequent summer heat-waves, for others it will be coping with floods, or an increased likelihood of tropical storms. One way of mitigating climate change is to accept that it is going to happen and help people to adapt – a philosophy that current policy makers are considering. However, in a paper published in Climatic Change, Neil Adger from the Tyndall Centre for Climate Change Research at the University of East Anglia, UK, and colleagues argue that there are limits to adaptation and that we would be unwise to rely solely on adaptation as a mitigation measure.

In the past mankind has shown great ingenuity in overcoming changes in climate and adapting to unfavourable conditions. Irrigation and terracing has enabled farmers to grow crops on what would otherwise have been marginal land. The advent of weather forecasting has allowed people to prepare for bad weather and minimise the damage it causes. Meanwhile, we are all able to share the risk of extreme weather events by purchasing insurance.

So can we continue to adapt successfully, maintaining a relatively stable, peaceful and prosperous society despite the challenges of a rapidly changing climate? To answer this question Adger and his colleagues have examined some of the assumptions associated with adaptation, and have come up with four domains that they believe underscore the limits to our adaptation.

In their paper the researchers urge policy makers to consider ethics (how and what we value), knowledge (how and what we know), risk (how and what we perceive) and culture (how and why we live) when assessing adaptation strategies.....

Photo of waves at Asilomar Beach in California by Tewy, Wikimedia Commons, under the terms of the GNU Free Documentation License, Version 1.2

Collier: I don't buy economists' case for fighting climate change

Paul Collier in the Guardian (UK) points out some flaws in relying on a utilitarianism for making climate change decisions: The 2006 Stern report brought the legitimising power of orthodox economics to the emotive battleground of global warming. In his Review on the Economics of Climate Change - widely regarded as the most important and comprehensive analysis of global warming to date - Lord Stern argued that in cold cost-benefit terms, it made sense for the present generation to make sacrifices because the benefits to future generations would be so substantial.… Post-Stern, that battleground has now shifted to ethics. Superficially, this is surprising: environmentalists have long occupied the moral high ground. Yet the challenges have come from two ethical positions that, viewed from the left, cannot be readily dismissed.

One challenges the elitism that is implicit in overriding democracy: according to the utilitarian calculus the government should value the interests of the future far more highly than most voters would do. Indeed, if we are guilty of radically undervaluing the future, then this neglect applies not just to carbon emissions, but to all the other ways in which we could help the world of the future. The government should force us to save far more than we do, perhaps by subsidising bequests instead of taxing them - in the utilitarian calculus there is nothing special about curbing global warming as a means of benefiting the future. Are we radically neglecting the future by not saving enough?

…Personally, I doubt whether the utilitarian calculus is the right ethical framework in which to think about global warming. It gives us numerical answers, but it just does not feel as though the calculus captures my concerns. …Is there an ethical basis for being concerned about global warming that does not depend upon the notion that quite generally we are radically negligent about future people? I think that there is, but this concern depends upon a rights-based notion of ethics rather than on utilitarianism. Most professional economists will at this point stop reading because they will think that rights are a quagmire. But here goes.

Natural assets such as biodiversity, and natural liabilities, such as carbon, are not owned by the current generation, because we did not create them. We have them because previous generations passed them on to us, and we are obliged to do the same. If we deplete natural assets, or run up natural liabilities, we have an obligation to compensate future generations in some other way…Ultimately, in a democracy our policy decision rules must rest on ethical principles that are widely shared by citizens. I suspect that most people feel that they should reduce carbon emissions, but the key issue is why? Is their motivation better captured by the utilitarian calculus used by economists, or by a sense of custodial obligation towards our natural legacy, of which carbon is but one instance?

Jeremy Bentham's "Auto-Icon" at University College London, shot by Michael Reeve, Wikimedia Commons, under the terms of the GNU Free Documentation License, Version 1.2

Does nature have rights? Ecuador may say yes

The Guardian (UK): The South American republic of Ecuador will next week consider what many countries in the world would say is unthinkable. People will be asked to vote on Sunday on a new constitution that would give Ecuador's tropical forests, islands, rivers and air similar legal rights to those normally granted to humans. If they vote yes - and polls show that 56% are for and only 23% are against - then an already approved bill of rights for nature will be introduced, and new laws will change the legal status of nature from being simply property to being a right-bearing entity.

The proposed bill states: "Natural communities and ecosystems possess the unalienable right to exist, flourish and evolve within Ecuador. Those rights shall be self-executing, and it shall be the duty and right of all Ecuadorian governments, communities, and individuals to enforce those rights."

Thomas Linzey, a US lawyer who has helped to develop the new legal framework for nature, says: "The dominant form of environmental protection in industrialised countries is based on the regulatory system. Governments permit and legalise the discharge of certain amounts of toxics into the environment. As a form of environmental protection, it's not working. In the same way, compensation is measured in terms of that injury to a person or people. Under the new system, it will be measured according to damage to the ecosystem. The new system is, in essence, an attempt to codify sustainable development. The new laws would grant people the right to sue on behalf of an ecosystem, even if not actually injured themselves."

Until now, all legal frameworks have been anthropocentric, or people-based. To file an environmental lawsuit requires a person to provide evidence of personal injury. This can be extremely difficult. To provide a conclusive link, say, between a cancer and polluted drinking water is, legally speaking, virtually impossible….

Get off my lawn -- the law is on my side. So says this American saltwater crocodile. This photograph was taken at La Manzanilla, Jalisco State in Mexico, on the Pacific Coast, by Tomás Castelazo. Wikimedia Commons, under the Creative Commons Attribution ShareAlike 2.5 License

New book: The Sustainability Mirage

From Scientific Blogging.com, a notice of an interesting sounding book Anybody read it yet?: Sustainable development thinking got environmental issues onto the agenda but it may now be stopping us from taking serious action on climate change and other crucial planetary issues, argues John Foster, a freelance writer and teacher and honorary Research Fellow in Philosophy at Lancaster University, UK in his new book "The Sustainability Mirage: Illusion and Reality in the Coming War on Climate Change."

Sustainable development's attempted deal between present and future will always collapse under the pressure of 'now' because the needs of the present always win out, he says. Inevitably, this means movable targets and action that will always fall short of what we need. Ultimately, sustainable development is the pursuit of a mirage, the politics of never getting there.

To escape the illusion, he states that society must break through to a new way of understanding sustainability by focusing on the deep needs of the present, not slippery obligations to the future. That means rising to the carbon challenge now, not trying to micro-manage the longer-term, and looking to science for orders of magnitude and direction, not a game-plan.

His book outlines alternative thinking on energy usage, governance, education and the role of enterprise in the cultural aspects of the war on climate change. "This thoughtful and original study throws important critical light on the dominant orthodoxies about sustainable development, and suggests a radically new direction. Foster argues compellingly that present approaches embody floating standards and bad faith, trapping societies into inaction. I suspect this is a seminal piece of work," says Professor Robin Grove-White, former Chair of Greenpeace UK….

Experimental philosophy movement explores real-life dilemmas

A University of North Carolina press release reports on a new book about experimental philosophy – a field that seems pertinent for climate questions: Imagine a business executive who thinks: “I know that this new policy will harm the environment, but I don’t care at all about that – I just want to increase profits.” Is the business executive harming the environment intentionally? Faced with this question from a University of North Carolina at Chapel Hill philosopher, 82 percent of people polled said yes. But then UNC scholar Joshua Knobe changed the word “harm” to “help.” This time, the executive thinks: “I know that this new policy will help the environment, but I don’t care at all about that – I just want to increase profits.” Is the business executive helping the environment intentionally? This time, only 33 percent of respondents said yes.

These are the sorts of questions posed in a new movement called experimental philosophy, where scholars leave their armchairs to talk to people directly about how they form their opinions and values. A new book by Knobe and University of Arizona philosopher Shaun Nichols being published this month is the first volume to discuss the controversial approach that is challenging conventional notions about the discipline.

“Experimental Philosophy” (Oxford University Press), edited by Knobe and Nichols, brings together seven “greatest hits,” considered the most influential papers in experimental philosophy. It also includes several provocative new papers, including an introductory chapter by Knobe and Nichols, “An Experimental Philosophy Manifesto.”

…Studies like the one involving the business executive and the environment can help get at the roots of philosophical debates, Knobe said. “Experiments like these are beginning to suggest that people’s ordinary way of understanding the world is suffused through and through with moral considerations.”

“This sort of research is important not only for its philosophical implications but also for what it tells us about how people ordinarily think,” Knobe added. “The more we know about how people make moral judgments, the more we will be able to understand how people come to blame each other and enter into conflict.”…

A flowchart of consensus-based decision-making, created by Grant Horwood (aka "frymaster"), Wikimedia Commons, under the terms of the GNU Free Documentation license, Version 1.2

Weighing our own prosperity against future generations

Scientific American has a thoughtful piece about the ethics of climate change. Well worth a look: Climate change raises a number of ethical questions. How should we—all of us living today—evaluate the well-being of future generations, given that they are likely to have more material goods than we do? … By emitting greenhouse gases, are the rich perpetrating an injustice on the world’s poor? How should we respond to the small but real chance that climate change could lead to worldwide catastrophe?

Many ethical questions can be settled by common sense. Sophisticated philosophy is rarely needed. All of us are to some extent equipped to face up to the ethical questions raised by climate change. For example, almost everyone recognizes (with some exceptions) the elementary moral principle that you should not do something for your own benefit if it harms another person. True, sometimes you cannot avoid harming someone, and sometimes you may do it accidentally without realizing it. But whenever you cause harm, you should normally compensate the victim.

…In going about our daily lives, each of us causes greenhouse gases to be emitted. Driving a car, using electric power, buying anything whose manufacture or transport consumes energy—all those activities generate greenhouse gases that contribute to climate change. In that way, what we each do for our own benefit harms others. Perhaps at the moment we cannot help it, and in the past we did not realize we were doing it. But the elementary moral principle I mentioned tells us we should try to stop doing it and compensate the people we harm…

John Stuart Mill would have had some thoughts on the subject. From Wikimedia Commons