The Ethics of Emissions Trading
One of the most widespread strategies aimed at mitigating climate change is emissions trading. Also referred to as cap-and-trade or carbon trading, it has been the subject of much debate, drawing criticism ranging from claims that the resulting changes will be too modest, to claims that the system will result in job losses. Some researchers, however, have taken issue with emissions trading because they view them, at best, as ethically nebulous and, at worst, ethically defunct. Today’s post examines some of the ethical objections to emissions trading.
At its heart, emissions trading is a market-based approach wherein a central authority (usually a government) sells or provides a limited number of permits that allow companies to emit a specified amount of pollution. If a company doesn’t need all its permits, it can sell them to companies who anticipate they will require additional permits, thus creating consequences for polluting and incentives toward reduction. Whether or not the market should be used to solve certain problems, though, is at the heart of much of the ethical debate.
Michael Sandel, a political philosopher and lecturer at Harvard, argues precisely this in his book What Money Can’t Buy: The Moral Limits of Markets. Sandel’s argument is that there are many things which should not be bought and sold, one of them being the right to pollute the environment. Environmental protection, he says, is inherently vested in “civic values” and the introduction of market choices cause a “corrosive effect” to the underlying ethical values they are meant to protect. For Sandel, placing a monetary value on the environment is wholly inappropriate and “undermines the spirit of shared sacrifice that may be necessary to create a global environmental ethic.”1
Other researchers have voiced similar objections, holding that commodification undermines the ethical obligation citizens have to protect the planet by allowing the market to create a space where wealthy countries or businesses can “buy their way out of the duty not to despoil the environment.”2 That is, by treating the atmosphere as a commodity to be sold, businesses and people begin to focus less on the ethical offense of pollution and think of paying for additional permits as “the cost of doing business.”3
There is also the issue of inequity between developed and developing countries. The fact that permits can be bought and sold, critics such as Sandel say, puts developing countries in the position of being “financially incentivized into reducing their emissions in order to cover the increasing or non-diminishing emissions of other agents.”4 Developing countries are essentially forced to choose between emitting more CO2 than they otherwise would have in order to use the credit, selling their permits to businesses who are scheduled to overshoot their limits, or choosing to not use some permits because they want to protect the environment. Ultimately, the inequity between developed and developing countries enables wealthier countries to avoid or delay the changes needed to reduce pollution under an emissions trading scenario.
While there are numerous objections and counter-responses to such ethical misgivings, it’s obvious that climate policy is fraught with pitfalls. With a myriad of stakeholders vying for their concerns to be incorporated, it’s certainly unrealistic to think everyone will be completely satisfied. The hope, though, is that competing concerns can be properly addressed and integrated into an effective policy.
1 Coyle, Diane. (2012, May 5) What Money Can’t Buy: The Moral Limits of Markets, By Michael Sandel.The Independent Online, Retrived from: http://www.independent.co.uk/arts-entertainment/books/reviews/what-money-cant-buy-the-moral-limits-of-markets-by-michael-sandel-7711785.html
3 Burkeman, Oliver. (2009, October 30). ‘Whether we are arguing about MPs’ expenses or assisted suicide, we need to engage with the moral ideals underlying our political debates’ The Guardian Online. Retrieved from: http://www.guardian.co.uk/books/2009/oct/31/michael-sandel-interview-oliver-burkeman