Archive for the ‘adler’ Category

The "coward of the county?" A little light on political games and the legal background of EPA`s unavoidable "endangerment" finding

August 30th, 2009 No comments

In April, under a regulatory process that the Bush EPA was compelled to commence by a Supreme Court decision (pursuant to the April 2, 2007 decison in Massachusetts v. EPA, 549 U.S. 497 (2007), in which the Supreme Court determined that greenhouse gases are air pollutants covered under Section 202
of the Clean Air Act, which applies to motor vehicles), the EPA issued
a proposed finding that (i) current and projected
atmospheric concentrations of CO2 and five other greenhouse gases (methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFCs),
perfluorocarbons (PFCs), and sulfur hexafluoride (SF6) threaten the public health and welfare of current and
future generations (due to their
contribution to climate change), and that (ii) emissions
of such gases from motor vehicles contribute to atmospheric concentrations of
key greenhouse gases and thus to the threat of climate change.

The EPA commenced a 60-day public comment period that ended on June 23, but which it has subsequently determined to keep open while it develops its final findings. If the findings are issued, they will compel the EPA to
develop regulatory standards for new motor vehicles under Section 202
of the CAA, and probably as well to develop regulatory standards for utilities, industry and other parts of the economy under other parts of the CAA, which have essentially identical endangerment finding triggers (but which were not the subject of the Supreme Court decision).

The U.S. Chamber of Commerce has now stirred up a bit of a kerfluffle about the EPA`s looming final  “endangerment” decision, by requesting the EPA to adopt an unusual, time-consuming trial-like procedure in reaching its decision. What`s really going here?

While no doubt the Bush Administration would have been delighted to consider such a device of postponing any endangerment decision, the Obama Administration`s lack of interest in further delay (having already extended the hearing process by several months) has earned for them from some conservative corners (Chris Horner of the NRO`s “Planet Gore”) the judgment that it is the Obama administration that is being “cowardly“.  Surely there are excellent arguments to be made that the Clean Air Act should not be used to regulate U.S. industry on climate matters, but it is Congress that passes laws and the President who signs them  into law, not the administrative agencies. The Bush administration and Republican Congress could have forestalled the present situation by amending the CAA to exclude CO2; their lack of interest in doing so has forced this matter into the hands of the Obama EPA.

On the other hand, the Obama administration`s hands have been tied by the Bush administration`s inaction, though it is not doubt happy to use the dangling endangerment finding as a Damoclean sword to get Congress moving on climate change legislation (and perhaps as a backup in case Congress cannot be persuaded). However, as the EPA has considerable discretion in determining when to issue its final determination, it can withhold the endangerment finding until it decides: it is really serious about passing climate change legislation, is ready to put significant pressure on Congress to get it, thinks it can live with Congress comes up with, and is willing to live with the consequences of “failure”, in which case it will have to move forward on promulagating GHG emissions regulations for new motor vehicles.

It`s useful in looking at this situation to ponder just how much wriggle room the EPA actually has on substantive issue.  The answer?  Very little.  On this, allow me to quote from respected libertarian resource law professor Jonathan Adler (Case Western, and commenter at The Volokh Conspiracy legal blog and at NRO):

1.  In an April 22 post at the NRO`s Corner, Adler answers the question “D[oes] the EPA Have a Choice?” (emphasis added)

“Many folks on the right, including Jonah,
have criticized the EPA’s decision to issue an endangerment finding as
some sort of power grab.  Implicit in this argument is the idea that
the EPA had a meaningful choice whether to conclude that the emission
of greenhouse gases causes or contributes to air pollution that can be
reasonably anticipated to endanger the public health and welfare (the
relevant legal standard under Section 202).  I reject this premise, and
I don’t believe one has to accept apocalyptic climate change scenarios
to reach this conclusion.  For one thing, the standard is somewhat
precautionary — the language empowers the EPA to regulate despite the
existence of uncertainty.  For another, it would be very difficult for
the EPA to justify a contrary conclusion under current law.

The Supreme Court’s decision in Massachsuetts v. EPA held
that greenhouse gases were air pollutants under the Clean Air Act
subject to EPA regulation.
  This means that the only question for the
EPA is whether such GHG emissions meet the standard above.  Whether or
not one believes greenhouse gases pose a serious threat, the EPA does
not get to make this decision on clean slate. 
For years the EPA has
been stating that climate change is a serious problem.  Indeed, the
Bush Adminsitration, at the very same time it declined to regulate greenhouse gases under the Clean Air Act,
asserted the Agency’s belief that climate change is a serious problem. 

Therefore, for the EPA to not make an endangerment finding, not only
would it have to argue that the relevant evidence does not support the
conclusion that greenhouse gases could be “reasonably anticipated” to
threaten public health and welfare, but also that the EPA’s many prior
pronouncements about the threat of climate change over multiple
adminsitrations [sic] were wrong.
  Even though courts are quite deferential
to agency interpretations of scientific evidence, this would be a
difficult case to make. 
Courts are more demanding when an agency
reverses course, and the EPA would have an awful lot of contrary claims
to explain away.  Thus, even if the Obama EPA had been disinclined to
make an endangerment finding, I think such a finding could have been
compelled in court.


2.  Adler also commented earlier at The Volokh Conspiracy on the likelihood of the EPA prevailing in the case of any industry legal challenge to an endangerment finding, and the next regulatory steps after the endangerment finding (emphasis added):

The proposed findings will now go through a 60-day public comment
period. Shortly thereafter, the findings will be finalized. Industry
and anti-regulatory groups will almost certainly challenge the findings
in court, and their legal challenges will almost certainly fail.
if one doubts the accumulated scientific evidence that anthropogenic
emissions of greenhouse gases contribute to climate change and that
climate change is a serious environmental concern, the standard of
review is such that the EPA will have no difficulty defending its rule.
Federal courts are extremely deferential to agency assessments of the
relevant scientific evidence when reviewing such determinations.
Moreover, under the Clean Air Act, the EPA Administrator need only
“reasonably . . . anticipate” in her own “judgment” that GHG emissions
threaten public health and welfare in order to make the findings, and
there is ample evidence upon which the EPA Administrator could conclude
that climate change is a serious threat.
This is a long way of saying
that even if climate skeptics are correct, the EPA has ample legal
authority to make the endangerment findings.

Once the findings are finalized, the EPA will then be required to
develop regulatory standards for new motor vehicles under Section 202
of the Act. As a practical matter, the EPA will also have to prepare to
regulate greenhouse gas emissions under other portions of the act, as
the relevant endangerment findings necessary to trigger such regulation
are effectively identical to that which triggers motor vehicle emission
regulation under Section 202. Even if the EPA sought to resist such
regulation, it would be relatively easy to force the EPA’s hand through
additional citizen suits, much like the suits that set the EPA on this
course in the first place.

Regulating greenhouse gases under the Clean Air Act will not be a
particularly cost-effective way to reduce the nation’s greenhouse gas
emissions. The EPA and White House understand this, but they also
recognize that, under Massachusetts v. EPA, the agency does not
have much choice. Moreover, the threat of Clean Air Act regulations on
greenhouse gases will create significant pressure upon Congress to
replace such regulation with some alternative, such as the
cap-and-trade program.



Categories: adler, endangerment, EPA, Horner Tags:

Libertarian law prof. Jonathan Adler warns of CO2 regulatory runaway train that Bush bequeathed to Obama; recommends rebated carbon taxes

January 28th, 2009 No comments

Libertarian law professor Jonathan H. Adler, of Case University, The Volokk Conspiracy law blog and NRO contributing editor,  has a post up at NRO explaining why conservatives ought to be pushing for  a “revenue-neutral carbon tax” as the best way to head off what he sees as a looming train wreck of damaging regulatory actions by the EPA, that he argues are mandated by a recent Supreme Court ruling that. 

Here is Jon’s summary of his post:

I have an article up today explaining how the EPA is required to begin regulating greenhouse gases as a consequence of Massachusetts v. EPA.  Of potential note, the new EPA Administrator agrees, telling EPA staff in a memo that she will fulfill the agency’s “obligation” to regulate GHGs under the Clean Air Act while the Obama Administration develops new climate legislation.

Regulating greenhouse gases under existing law will be a disaster, but what’s the alternative?  I’ve endorsed the idea of a revenue-neutral carbon tax.  My friend Chris Horner thinks this is preemptive surrender, but what’s his alternative?  Absent new legislation, EPA is poised to regulate cars, trucks, factories, power plants, and much, much more.  The number of facilities covered by the PSD program alone will increase ten-fold or more without a legislative fix.  I know Horner would like a clean Clean Air Act revision, simply excising greenhouse gases.  But assumig that’s impossible — or, perhaps, once that measure fails — what is his Plan B?

Adler has posted slightly longer summary at The Volokh Conspiracy.

Categories: adler, carbon pricing, EPA Tags:

UK jury approves damage to power plant in defense of a commons/ other private property; libertarians and conservatives freak out

September 12th, 2008 6 comments

See this surprising decision in the UK, letting climate-change protesters/trespassers off the hook for damages resulting from spray-painting a coal plant smokestack, on the grounds that a UK law “allows damage to be caused to property to prevent even greater damage.”

Why is this single jury verdict supposedly the end of the world (as Iain Murray of CEI, blogging at NRO’s Planet Gore would have it)?  Libertarians (Rothbard, Block, Bratland, Cordato) have long argued that:

– we should move away from the statist regulation of polluters and return to a simpler world of a resort towards common law and courts (permitting injunctions on industrial activity for the slightest damage) to defend property; and that

– the issuance of a license allowing a firm lawfully “to pollute and, hence, invade or damage property of other parties” “entail[s} a fundamental and pervasive violation of property rights”; that

– one “observes that any detectable man-made climate change has occurred during periods of inadequate or nonexistent tort protection from air pollution”; and that

– “A sensible and thoughtful first crucial step in assuring a sustainable atmosphere for future generations is to assure adequate tort protection of the personal property rights for current generations“?

It is clear that I am on firm ground in expecting in response to this decision a rush by “skeptical” libertarians and conservatives to demand MORE action by government, rather than less of it.  After all, the defense offered by the greenies in the UK was based on a statute that can be simply amended, and thereby order restored (with nary a pang of concern for fusty old common-law doctrines).

And if this is what we get from libertarians, is there any wonder that greenies – including radicals like Austrian Ed Dolan and libertarians Jon Adler and Ron Bailey – think that resort to some sort of globally coordinated multi-state action is needed to deal with a global issue?

Oh, and let me add – it seems like a “wrong” decision to me, too.

Op-ed by nuclear physicist on climate change: questions for "skeptics"

August 5th, 2008 4 comments

John P. Holdren, an MIT and Stanford-trained nuclear physicist who is professor at Harvard’s Kennedy School of Government and the Department of Earth and Planetary Sciences and director of Harvard’s Woods Hole Research Center, former President and Chairman of the American Association for the Advancement of Science (AAAS), and consultant for the past 35 years at the Magnetic Fusion Energy Division of Lawrence Livermore National Laboratory [yes, this is an appeal to authority] had a short but interesting op-ed in the August 4 Boston Globe.

I think he’s trying to be sensitive, but Holdren may come off a bit arrogant; he’s certainly insensitive to those who are concerned that government may bungle any climate “solution”.  Given his technical knowledge and experience, I hope readers will understand where he’s coming from and encourage them to read the whole thing – which really isn’t too long.

But since I have you here, allow me to quote liberally:

skeptics about [climate change] tend to move, over time, through three stages. First, they tell you you’re wrong and they can prove it. (In this case, “Climate isn’t changing in unusual ways or, if it is, human activities are not the cause.”)

Then they tell you you’re right but it doesn’t matter. (“OK, it’s changing and humans are playing a role, but it won’t do much harm.”) Finally, they tell you it matters but it’s too late to do anything about it. (“Yes, climate disruption is going to do some real damage, but it’s too late, too difficult, or too costly to avoid that, so we’ll just have to hunker down and suffer.”) …

The few with credentials in climate-change science have nearly all shifted in the past few years from the first category to the second, however, and jumps from the second to the third are becoming more frequent.

Their arguments, such as they are, suffer from two huge deficiencies.

First, they have not come up with any plausible alternative culprit for the disruption of global climate that is being observed, for example, a culprit other than the greenhouse-gas buildups in the atmosphere that have been measured and tied beyond doubt to human activities. (The argument that variations in the sun’s output might be responsible fails a number of elementary scientific tests.)

Second, having not succeeded in finding an alternative, they haven’t even tried to do what would be logically necessary if they had one, which is to explain how it can be that everything modern science tells us about the interactions of greenhouse gases with energy flow in the atmosphere is wrong.

Members of the public who are tempted to be swayed by the denier fringe should ask themselves how it is possible, if human-caused climate change is just a hoax, that:

  • The leaderships of the national academies of sciences of the United States, United Kingdom, France, Italy, Germany, Japan, Russia, China, and India, among others, are on record saying that global climate change is real, caused mainly by humans, and reason for early, concerted action.
  • This is also the overwhelming majority view among the faculty members of the earth sciences departments at every first-rank university in the world.
  • All three of holders of the one Nobel prize in science that has been awarded for studies of the atmosphere (the 1995 chemistry prize to Paul Crutzen, Sherwood Rowland, and Mario Molina, for figuring out what was happening to stratospheric ozone) are leaders in the climate-change scientific mainstream.  …
  • US polls indicate that most of the amateur skeptics are Republicans. These Republican skeptics should wonder how presidential candidate John McCain could have been taken in. He has castigated the Bush administration for wasting eight years in inaction on climate change, and the policies he says he would implement as president include early and deep cuts in US greenhouse-gas emissions. …

    The extent of unfounded skepticism about the disruption of global climate by human-produced greenhouse gases is not just regrettable, it is dangerous. It has delayed – and continues to delay – the development of the political consensus that will be needed if society is to embrace remedies commensurate with the challenge. The science of climate change is telling us that we need to get going. Those who still think this is all a mistake or a hoax need to think again.

    (emphasis added)

    Holdren is focussed on arguments regarding science, and so fails to address questions as to the efficacy of proposed solutions involving government action, which questions are of course important.

    Although Austrian and libertarian observers may have very useful things to add to the policy discussion, it seems fair to say that, except for a few such as Jonathan Adler, Gene Callahan, Edwin Dolan, Sheldon Richman and Bruce Yandle, many have preferred not to discuss policy but to focus either on climate science or on the motives of those self-deluded religious, fascist creeps who think that there may be a problem.

    While concerns about science and motives are perfectly legitimate, let me add a few points that Austrian “skeptics” ought to consider:

    – Austrians tend to view “environmental” problems not as harms to a disembodied “environment”, but as real problems involving conflicts in individual/firm plan formation that arise because of a lack or clear or enforceable property rights in particular resources or large information, transaction or enforcement costs that make contracting difficult

    Are there clear or enforceable property rights with respect to emissions of GHGs, or the atmosphere or climate more generally?

    Is private contracting a practical way for individuals and firms with differing preferences as to climate or GHG emissions to meaningfully express such preferences?

    – What lessons does history teach us about the exploitation of open-access resources that are not protected by accepted rules among the relevant community of users?  If there are problems with such resources, how have such problems been addressed in the past, with what degree of efficacy?

    Jim Hansen warns of slow-motion disaster and welcomes future public trials of fossil fuel CEOs for buying government delay

    June 27th, 2008 5 comments

    Prominent climatologist Dr. James Hansen, Director of the NASA Goddard Institute for Space Studies and Adjunct Professor of Earth and Environmental Sciences at Columbia University, who has long been warning of the long-term consequences of man’s essentially uncontrolled experiment with the world’s climate through emissions of GHGs (CO, methane and CFCs), soot and agricultural practices, has recently ramped up his message that urgent action is needed in order to avoid triggering “dangerous” climate change in the form of rising temperatures and an irreversible melting of the Greenland and Antarctic ice caps. 

    1.  Hansen has apparently decided that it is time to take the gloves off in a battle that he thinks requires government action, which action he views as having been delayed by fossil fuel firms that have benefitted from (and underwritten efforts to stall movement away from) the status quo.  Accordingly, in order to shift the political balance, Hansen has decided to call not merely for decreases in GHG emissions, but direct leverage against the fossil fuel companies (in an op-ed at the Huffington Post):

    Special interests have blocked transition to our renewable energy future. Instead of moving heavily into renewable energies, fossil companies choose to spread doubt about global warming, as tobacco companies discredited the smoking-cancer link. Methods are sophisticated, including disguised funding to shape school textbook discussions.

    CEOs of fossil energy companies know what they are doing and are aware of long-term consequences of continued business as usual. In my opinion, these CEOs should be tried for high crimes against humanity and nature. If their campaigns continue and “succeed” in confusing the public, I anticipate testifying against relevant CEOs in future public trials.

    The fossil-industry maintains its stranglehold on Washington via demagoguery, using China and other developing nations as scapegoats to rationalize inaction. In fact, we produced most of the excess carbon in the air today, and it is to our advantage as a nation to move smartly in developing ways to reduce emissions. As with the ozone problem, developing countries can be allowed limited extra time to reduce emissions. They will cooperate: they have much to lose from climate change and much to gain from clean air and reduced dependence on fossil fuels.

    (emphasis added)

    Is this rhetoric appropriate?  Certainly not, even as the frustration that underlies it is an understandable manifestation of the frustration that is common (and perhaps unavoidable) in politicized fights over the use of government to satisfy one’s preferences over the preferences of others (viz., “rent-seeking”).  Granted, much is at stake (particularly if Hansen’s views of the risks are correct), and my sympathies are with Hansen (I am persuaded that his concerns have merit, and the rent-seeking by fossil fuel firms is undeniable), but such rhetoric is inappropriate as long as it is unsupported by allegations of actual criminal behavior – as opposed to simple frustration that the fossil fuel firms have been effective in lawfully manipulating the political system for their private gain. 

    While a libertarian may sanction the use of moral suasion and opprobrium – even civil litigation – to strong-arm one’s opponents, calling for criminal sanctions by the state against those have successfully manipulated politicians and bureaucrats is a step that simply compounds the underlying illness of statist rent-seeking.

    One suspects that Dr. Hansen is simply playing a public relations game, and is not serious about the “state trials”, as he has not called for the firms to be muzzled, but rather expressed his opinion and hope that they should some day be held to account for their actions.  Well, Dr. Hansen is certainly entitled to his opinion AND to castigate fossil fuel firms for behaviors that he objects to; while his rhetoric is disturbing, at least he’s only volunteering to be a witness and not prosecutor, judge and jury.

    Sadly, differing preferences over how to use resources are inevitably politicized when there are no clear owners of such resources or ownership is socialized through government ownership or regulation.  The fossil fuel companies and their heavy users have clearly been rather adept at manipulating political levers up until now; whether Dr. Hansen’s effort to turn up the heat on them will be effective or simply provides them with more ammo remains to be seen.

    2.  On another level, I do think that Hansen’s rhetoric on this is unfortunate, as it is likely to detract from his scientific message, which he elucidates very well in articles, presentations and scientific publications available at his Columbia U. webpage (linked above).  It also draws attention away from his specific policy positions, which have been critical of pork and bureaucratic management of the type presented by the Warner-Lieberman bill.   Hansen has recently expressed strong preference for a simple carbon tax that is fully rebated on a per capita basis, as further noted in the same op-ed (in which Hansen sounds very much like George Will, who also prefers a carbon tax over cap and trade):

    Carbon tax on coal, oil and gas is simple, applied at the first point of sale or port of entry. The entire tax must be returned to the public, an equal amount to each adult, a half-share for children. This dividend can be deposited monthly in an individual’s bank account.

    Carbon tax with 100 percent dividend is non-regressive. On the contrary, you can bet that low and middle income people will find ways to limit their carbon tax and come out ahead. Profligate energy users will have to pay for their excesses.

    Demand for low-carbon high-efficiency products will spur innovation, making our products more competitive on international markets. Carbon emissions will plummet as energy efficiency and renewable energies grow rapidly. Black soot, mercury and other fossil fuel emissions will decline. A brighter, cleaner future, with energy independence, is possible.

    Washington likes to spend our tax money line-by-line. Swarms of high-priced lobbyists in alligator shoes help Congress decide where to spend, and in turn the lobbyists’ clients provide “campaign” money.

    Hansen’s “tax and 100% dividend” proposal, which he floated earlier this month, is based on Peter Barnes’s “Sky Trust” cap and dividend approach outlined in “Who Owns the Sky: Our Common Assets and the Future of Capitalism” (Island Press, Washington, D.C., 2001) and reviewed here.

    3.  Libertarian legal scholar Jonathan Adler cited Hansen’s op-ed at the Volokh Conspiracy blog; I copy below a few comments that I noted in response:

    Jon, first, let’s not forget that Hansen is specifically addressing not only oil cos but also the coal firms like Peabody and Massey – firms that are leaving massive messes because either they deal in publicly owned and bureaucratically administered land or because they’ve managed to capture the police, prosecutorial, judicial and political machinery where they operate, as well as the favor of the administration and federal regulators [see my blog post here].

    Second, all of his words about public trials notwithstanding, Hansen is obviously waging battle in the courts of public opinion, which is obviously something he has every right to and, far from infringing libertarian principles, seems entirely consistent with them. As Gene Callahan has recently noted,

    One way negative externalities can be addressed without turning to state coercion is public censure of individuals or groups widely perceived to be flouting core moral principles or trampling the common good, even if their actions are not technically illegal. Large, private companies and prominent, wealthy individuals are generally quite sensitive to public pressure campaigns.

    After all, if libertarians had their way and government stepped out of the roads and regulatory businesses, it’s long been the libertarian position that private actions, including lawsuits against road owners, would lead to voluntary collective actions and large damage suits that would better manage resources by incentivizing reductions in pollution and other externalities. (In this context, there are, of course, private action suits now under way against the major fossil fuel firms for climate change damage; these face obvious hurdles, but a libertarian might wish for success, simply to breathe a little more life into common law remedies and take the pressure off of the demands for state action.)

    Libertarians do not, as a matter of principle, object to informal public pressure. It is simply Hansen’s implication that criminal trials are more appropriate than the common law tort mechanism – which is sadly not too well known and admittedly rather withered due to the success in polluters in subverting injunctive remedies and in capturing the resulting regulatory process – that offends.

    On the policy end, of course Hansen does have a statist proposal, but it is probably the cleanest one out there: the carbon tax and 100% rebate proposal, which would put all carbon tax revenues back in the pockets of Americans and than cut short alot of the rent-seeking and pork-management efforts now underway. That’s why George Will has recently concluded that a carbon tax is the best approach.

    Climate change damage and property rights: do Lockean principles require Western nations to compensate poorer ones?

    June 13th, 2008 No comments

    Dedicated libertarian law professor Jonathan Adler and longtime libertarian policy analyst Indur Goklany discuss the above issue at in a Roundtable entitled “Climate Change and Property Rights” hosted by Shikha Dalmia of the Reason Foundation and made available online last week.

    [Update:  Ron Bailey discusses the Adler/Goklany debate here.]

    As both Jon Adler and Indur Goklany are serious and even-handed, fortunately the discussion includes none of the cheap, sneering dismissals of the moral issues (as “climate welfare” such as I addressed earlier on these pages and more recently on the main blog, where an author dismisses as “absurd” and another poster labels “beautiful propaganda” my suggestion that Lockean views must be seriously considered when addressing claims that the use of the atmosphere should be shared) that tends to be the hallmark of shallow, reflexive and emotional engagement so frequently encountered here at Mises and elsewhere from purported libertarians with respect to climate change and other environmental issues.

    Unfortunately, the exchange between Adler and Goklany is far too academic, and neither commentator makes any effort to seize common ground (and climate change concerns) to push for liberalization of agricultural trade or other institutional changes that would (i) materially improve wealth (and ability to adapt to climate change) in poorer nations and (ii) enhance needed mitigation and adaptation efforts at home.

    Both Adler and Goklany appear to agree on the fundamental, Lockean-based principles underlying their discussion and would probably agree that, even though the nations that benefit most from climate change (and from the long period of GDP growth when GHG emissions have not been priced) have at least a moral obligation to be concerned about an uncompensated shifting of costs to other (largely poorer) nations, it is nigh impossible to build a legal case mandating compensation. 

    I suppose both Adler and Goklany probably also agree that (1) climate change is likely to further bedevil the development problems in poorer nations, which are least capable of adapting to such changes, (2) development problems in such countries is largely related to the failure of governing elites to protect property rights and capital, and (3) traditional development aid has in large measure failed and instead served to benefit well-connected elites from both sides.

    I am curious (4) what both Adler and Goklany think about proposals that do not amount to compensation, but recognize the interest that the West has in aiding growth and climate adaptation in the developing world, such as the proposal reported last Friday in Osaka by Treasury secretary Hank Paulson for the Group of 8 industrialized nations to back a special $10 billion fund to help developing countries fight global warming and (5) why they (and other libertarians) do not seem to see that climate change concerns in many way present golden opportunities to urge positive governmental changes, such as greater free trade (and roll back of domestic agricultural subsidies and import restrictions), greater freedom in domestic energy markets, the desirability of allowing accelerated depreciation and lowering capital gains taxes, etc.

    Why are libertarians so reluctant to focus on a positive agenda that would actually do some good?

    In note that, back in July 2000, Adler proposed a “no regrets” domestic deregulatory agenda when he was associated with CEI: “Greenhouse Policy Without Regrets: A Free Market Approach to the Uncertain Risks of Climate Change“; Jon has subsequently been rather quiet with respect to any specific climate change policy agenda.  Cato has just published an essay by Goklany, “What to Do about Climate Change“, in which Goklany essentially argues that a focus on mitigation (GHG reductions) is a relatively expensive and in effective way to combat climate change or advance well-being (particularly of the world’s most vulnerable populations), as compared with adaption efforts that would reduce vulnerabilities to climate-sensitive problems that could be exacerbated by climate change.

    As I have previously noted, there are several libertarians who have recently been urging constructive libertarian approaches to climate change:

    • Edwin Dolan, in his Fall 2006 Cato Journal essay, Global Warming: Rethinking the Market Liberal Position, analyzes relevant Lockean considerations and cautions that market liberals appear to be hamstringing their own analytic strengths by falling into a reflexive and conservative mind-frames that benefit established economic interests.
    • Sheldon Richman of the Foundation for Economic Education also recommends Dolan’s essay and calls for less wishful thinking and greater engagement by libertarians in the December 8, 2006 edition of The Freeman:  The Goal Is Freedom: Global Warming and the Layman.
    • Gene Callahan makes a similar warning in his essay How a Free Society Could Solve Global Warming“, in the October 2007 issue of The Freeman.
    • Bruce Yandle, Professor Emeritus at Clemson University, Senior Fellow at PERC (the “free market” environmentalism think tank) and a respected thinker on common-law and free-market approaches to environmental problems, has in PERC’s Spring 2008 report specifically proposed a A No-Regrets Carbon Reduction Policy.

    I further note that Shikha Dalmia of the Reason Foundation hosted a similar roundtable on climate change policy in October 2006.

    Bad news and needed institutional change: Climate change, water and water rights

    May 14th, 2008 No comments

    Climate change is having a significant impact on water supplies in the US Southwest and elsewhere.  Scientists increasingly that these impacts can be attributed to human influences on climate – but that is to some degree besides the point.  Presently, water is very poorly used and allocated in many places, due to poorly working markets and politicized government ownership of catchment and regional and municipal distribution networks and other interference.  Consumers do not face marginal costs of water acquisition. 

    Not merely to ease the impact of future climate change but also to deal with existing problems, a concerted move to clearer water rights and competition in water supply is needed.  This will necessarily be a sticky process, but one that needs addressing.

    Some relevant links and summaries are below.

    “climate change has dramatically altered the water flow over the past 50 years in several Western states.

    “These changes, which include more winter precipitation falling as rain instead of snow, an earlier snow melt, and new river patterns, combined with a general warming of the region, could cause a “crisis in water supply” for the Western United States, said the authors.

    “‘Our results are not good news for those living in the western United States,’ wrote the researchers, led by Tim P. Barnett, a research marine geophysicist at the University of California, San Diego, adding that his findings make “modifications to the water infrastructure of the western U.S. a virtual necessity.”

    More on the same story here:  Decline in Snowpack Is Blamed On Warming:

    “The persistent and dramatic decline in the snowpack of many mountains in the West is caused primarily by human-induced global warming and is not the result of natural variability in weather patterns, researchers reported yesterday.

    “Using data collected over the past 50 years, the scientists confirmed that the mountains are getting more rain and less snow, that the snowpack is breaking up faster and that more rivers are running dry by summer.

    “The study, published online yesterday by the journal Science, looked at possible causes of the changes — including natural variability in temperatures and precipitation, volcanic activity around the globe and climate change driven by the release of greenhouse gases. The researchers’ computer models showed that climate change is clearly the explanation that best fits the data.

    “We’ve known for decades that the hydrology of the West is changing, but for much of that time people said it was because of Mother Nature and that she would return to the old patterns in the future,” said lead author Tim Barnett of the Scripps Institution of Oceanography at the University of California at San Diego. “But we have found very clearly that global warming has done it, that it is the mechanism that explains the change and that things will be getting worse.”

    “There is a 50 percent chance Lake Mead, a key source of water for millions of people in the southwestern United States, will be dry by 2021 if climate changes as expected and future water usage is not curtailed, according to a pair of researchers at Scripps Institution of Oceanography, UC San Diego.

    “Without Lake Mead and neighboring Lake Powell, the Colorado River system has no buffer to sustain the population of the Southwest through an unusually dry year, or worse, a sustained drought.  In such an event, water deliveries would become highly unstable and variable, said research marine physicist Tim Barnett and climate scientist David Pierce.

    “Barnett and Pierce concluded that human demand, natural forces like evaporation, and human-induced climate change are creating a net deficit of nearly 1 million acre-feet of water per year from the Colorado River system that includes Lake Mead and Lake Powell. This amount of water can supply roughly 8 million people. Their analysis of Federal Bureau of Reclamation records of past water demand and calculations of scheduled water allocations and climate conditions indicate that the system could run dry even if mitigation measures now being proposed are implemented.

    “We were stunned at the magnitude of the problem and how fast it was coming at us,” said Barnett. “Make no mistake, this water problem is not a scientific abstraction, but rather one that will impact each and every one of us that live in the Southwest.”

    The underlying paper has been published by the American Geophysical UnionLake Mead could be dry by 2021

    A research team, led by a group at Columbia University’s Lamont-Doherty Earth Observatory (LDEO) in Palisades, N.Y., reveal in this week’s Science that southwestern North America will likely be saddled with increasingly arid conditions during the next century. This drying effect, the researchers say, is directly related to man-made climate change and will demand new methods for managing water resources in the region. …

    In fact, the researchers believe the current six-to-seven-year drought in the region is the beginning of this drying trend. “The current drought is related to the warming due to the greenhouse gases,” says Ting. “In the past, El niño [would] disappate the drought, but now it’s not able to stop the drought.”

    Normally, the El Niño and La Niña weather systems are largely responsible for cyclical precipitation and drought in the Southwest. El Niño brings in moisture from the tropics (by the warming of the ocean, which condenses water into the lower atmosphere that is then shuttled into the subtropical regions), whereas La Niña essentially does the opposite, causing cold ocean temperatures in the equatorial eastern Pacific. The latter phenomenon is believed to be the culprit behind both the 1930s dust bowl and a widespread drought in the Southwest during the 1950s.  

    “The drought that we’re taking about is not La Niña,” Ting explains, referring to the current dry system. “That is associated with the greenhouse gas warming.” While the consequences are similar, the actual effect on the oceans is very different, she says. Instead of a cooling in the tropics, there will be a uniform warming of the ocean, which will push the Pacific jet stream farther north. As a result, “Canada does get quite a lot more rain,” Ting notes, whereas “the whole state of California, for example, will be much drier.”

     More on the same study here:

    • Forbes, May 14, 2008:  The Water-Industrial Complex

       In 2001, a water shortage in America’s Pacific Northwest wiped out nearly a third of the U.S. aluminum industry. Low precipitation levels in the Cascade Mountains during the preceding winter robbed local reservoirs of the water needed to turn the massive turbines inside the region’s main hydroelectric power plant, the Bonneville Power Administration. Electricity prices skyrocketed. Over the course of a few months, roughly a dozen aluminum plants closed. Nearly a decade later, only one has reopened.

    • Jonathan Adler, The Volokh Conspiracy, March 12, 2008:  Climate Change and Water

    Abstract of law review article:  “Demographic changes and existing water use patterns have placed tremendous pressures upon water supplies, particularly in the West. Global climate change will exacerbate pressures on water resources. The gradual warming of the atmosphere is certain to change the distribution and availability of water supplies, with potentially severe consequences for freshwater supplies. While climate change will have a significant impact on water resources through changes in the timing and volume of precipitation, altered evaporation rates, and the like, the precise nature, magnitude, timing, and distribution of such climate-induced changes are unknown. This uncertainty complicates the task of water managers who are already faced with escalating demands. This article argues that climate change, and its projected effects on water use and supply, calls for a fundamental reexamination of water institutions. In particular, this article suggests that market-based institutions are well suited to address the additional pressures on water supplies due to climate change. Many aspects of water markets, including their flexibility, decentralized nature, and ability to create and harness economic incentives, make them particularly well suited to address the uncertain water forecast. A gradual shift toward water marketing and market pricing will improve the management of water supplies, ensure more efficient allocation of available water supplies and encourage cost-effective conservation measures.

    “The basic point of the article is that insofar as climate change will disrupt existing water supplies in somewhat uncertain and unpredictable ways, we need water institutions that are flexible and adaptive, and that encourage greater efficiency in water use and allocation. In this way, climate change strengthens the already-strong case for water markets. Market-driven transfer and pricing of water resources will not eliminate the consequences of warming-induced changes in water supplies, but they will make these changes more manageable.”

    Like oil, water is an essential part of doing business in almost every industry, and unexpected shortages can trigger potentially catastrophic consequences. The trouble for investors: Companies disclose very little if any information about their exposure to water-related risks.

    “This is not an area that companies like to discuss quite frankly,” says Carl Levinson, an economist at J.P. Morgan and the principal author of the recent report Watching Water: A Guide to Corporate Risk in a Thirsty World. “They don’t want to call attention to a vulnerability and that applies very much to the water scarcity issue. Investors in general know very little about what is going on in companies’ supply chains.” …

    “Sooner or later, the way in which the world adapts to shortages is with price,” says Levinson. “So my expectation is that water is going to become increasingly costly as an input for all kinds of purposes, and when that happens you’ll see a lot more interest in conserving water.”

    Categories: adler, climate change, water rights Tags:

    "Climate Change, Evidence and Ideology"

    February 6th, 2008 7 comments

    Libertarian law prof. Jonathan Adler has a brief but interesting post up at the Volokh Conspiracy blog, explaining something of the internal conflict he faces in favoring limited government but acknowledging that it is likely that man is pushing the climate in ways that generates costs that merit concern:

    Great post, Jon.  I think that there are many Austrians who understand WHY there might be a climate change problem to which man contributes, as the atmosphere is an open-access resource, in which there are no clear or enforceable property rights that rein in externalities or that give parties with differing preferences an ability to engage in meaingful transactions that reflect those preferences. 

    But, flawed human beings that we are, we have difficulty truly keeping our minds open (subconscious dismissal of inconsistent data is a cognitive rule) and we easily fall into tribal modes of conflict that provide us with great satisfaction in disagreeing with those evil “others” while circling the wagons (and counting coup) with our brothers in arms.

    Sadly, this is very much in evidence in the thread to your own post.

    Categories: adler, climate, cognition, commons Tags:

    Not Climate Change Welfare, But Capitalism and Free Markets

    January 21st, 2008 No comments

    … is what poor countries need.  So corrrectly argues Keith Lockitch of the Ayn Rand Institute, in a new article that responds to the agreement, by the delegates of industrialized nations at the December climate change conference in Bali, to activate an “adaptation fund” that would help undeveloped nations cope with projected climate change threats (such as disruptions to agriculture and decreased water availability).

    But while thought-provoking, Lockitch fails to explore his chief premises and wastes his insights by falling into enviro-bashing – suggesting that failed development is all enviros’ fault, and that these do-gooders want to waste our tax dollars while keeping the poor in their place.  This might gratify his emotions but generates considerably more heat than light.

    Lockitch correctly observes that:

    • The world’s poorest can barely cope with day-to-day survival, let alone with unproven threats projected to occur over decades. Imagine having no electricity or access to clean drinking water. Imagine having to cook your meals over an open fire, breathing smoke and ash every day. Billions around the world survive at a subsistence level because they lack the elements of industrial capitalism that we in the developed world take for granted: power plants, factories, modern roads and hospitals, cars, refrigerators, and countless time- and labor-saving devices.
    • What poor countries need is not climate adaptation welfare … ; what poor countries need is to become rich countries. They need to embrace free markets and private property rights and attract the investment of profit-seeking entrepreneurs to create wealth and drive economic growth.”

    This last point is Lockitch’s most powerful, as it is clear that it has been corrupt, kleptocratic governance and the lack of clear and enforceable property rights that has hamstrung development in the third world.

    However, Lockitch’s analysis is disappointing in several regards:

    1.  He fails to explain that “climate change welfare”, in the form of transfer payments to developing nations and funding of particular “adaptation” projects, is just as likely to be wasted and diverted to the pockets of local elites and First World contractors as have been the past several decades of “development aid”.  Clearly, simply throwing good money after bad is no solution.  It is puzzling that Lockitch fails to affirmatively make his strongest case.

    2.  He falls prey to “Enviro Derangement Syndrome” and unfairly lays the suggestion of “climate change welfare” at the feet of enviros, even though it has long been a part of the mainstream discussion that developing nations, while being least prepared to cope with climate change and having made only minor contributions to it, are likely to bear the greatest brunt of climate changes. 

    Says Lockitch:  

    “If environmentalists were really concerned about people in undeveloped countries, they would be helping them to bring about what they really need: industrial development. … Yet, it is precisely the adoption of industrial capitalism by undeveloped countries that environmentalists reject. Not only do they not want poor countries to become rich, they are trying hard to force rich countries to become poor by capping carbon emissions and abandoning industrialization. Despite their feigned concern for the world’s poor, the measures proposed by environmentalists pose a far greater threat than any possible changes to the earth’s climate.”

    The charge of pushing “climate change welfare” as a means of keeping developing nations down is a rather grotesque one to lay at the feet of environmentalists, many of who for decades have been working at helping local groups to protect their property rights against governments and powerful elites.

    While Lockitch is certainly correct to note the ambivalence that some enviros express regarding to further development in the poorer nations, such ambivalence reflects real problems, as noted below.  But obviously it is governments, and not enviros, who are running the international climate discussions.  “Environmentalists” are certainly players, but that there are plenty of others with agendas of their own surely can’t escape the thinking man’s attention, can it?

    Further, “conservative” and “skeptical” analysts like Bjorn Lomborg ( and Indur Goklany ( have also prominently argued that the wealthy world, in lieu of establishing carbon prices at home, should be making investments in helping the third world to adapt and develop.  Even further, libertarian analysts like Jonathan Adler (law prof. at Case U. and blogger at the Volokh Conspiracy) have argued that since the developed nations are chiefly responsible for climate change, they owe an obligation to compensate the developing world for damages (  Adler’s conclusion flows directly from Lockean property rights principles.

    In addition, Lockitch’s assertion that “the measures proposed by environmentalists pose a far greater threat than any possible changes to the earth’s climate” is unexplained and unsupported – what measures?  How are they a threat to the world’s poor?  The general shape of the international discussion (and certainly under Kyoto) is that the developed nations will act first, to be followed by developing nations as their wealth (and climate contributions) grow.  How are unilateral actions by wealthy nations to address climate change hamstringing the poor?  The chief policy tool discussed so far – pricing carbon emissions in the developed world – should dampen demand for fossil fuels in the wealthier countries, thereby dampening price pressure and resulting in a net price subsidy to developing nations.  In response to such measures, industry in wealthy nations will develop more efficient energy technologies and reduce the costs of such technologies, for the indirect benefit of the developing nations, which will not shoulder any burdens for their growing carbon emissions until later.  Aren’t these net subsidies to poorer nations?

    And far from “forc[ing] rich countries to become poor”, figuring out how to manage a global commons like the atmosphere, while it may have the effect of imposing a cost on the release of carbon, is basically aimed at privatising externalities, with the intention of increasing the efficiency of private transactions and net wealth.  Climate change is, of course, just one of a broad range of pervasive problems that occur when markets encounter resources that are not clearly or effectively owned or managed.

    3.  Most importantly, while Lockitch correctly diagnoses the illness – poor countries need to “embrace free markets and private property rights and attract the investment of profit-seeking entrepreneurs to create wealth and drive economic growth” – he simply fails to address what wealthy nations SHOULD be doing, if anything, to assist the cure.  This, of course, is the main dodge, because Lockitch fails to own up to the true difficulties involved in trying to help the developing nations. 

    Trying to build “soft” infrastructure in the form of rule of law and property rights (ending kleptocracy and theft of “public” resources) is tremendously difficult – perhaps a problem that is even more difficult than the wealthy nations deciding how to share the pain of GHG reductions (as I noted in comments to a post on Amazonian deforestation here:, the wealthy nations have a hard enough time doing the easiest things to speed development of poorer nations, which is simply to open import markets by removing domestic tariffs, import restrictions and subsidies.  Rather, it seems that the richer nations have to feed their more powerful elites first, while hamstringing competition from poorer nations in products for which they should be able to exploit a comparative advantage.  If Lockitch was truly interested in helping the poor of developing nations, you’d think he’d note how enduring rent-seeking at home serves to keep the poorer nations down.

    And if the wealthy nations should do something to help poorer nations, which seems implicit in Lockitch’s analysis (if not conventional aid, then aid to build soft, governance infrastructure), then can’t some of those efforts easily dovetail with efforts to establish carbon pricing in the wealthy countries?  Why couldn’t aid budgets be funded by carbon taxes at home, for example?  And can’t demand for “carbon credits” help to establish incentives to improve governance infrastructure in poorer nations?  In other words, “mitigation” (efforts to limit climate change) in developed nations need not conflict with any efforts to help poorer nations “adapt” to climate change or otherwise become wealthier.

    4.  Lockitch asserts that the concern of enviros for the world’s poor is “feigned”, but this is a cheap and unproductive ad hominem – and one that can easily be turned around.  While some enviros may not understand the institutional sicknesses that hinder development, this illness has been fed much more by governments and corporations at home than by enviros, many of who have been involved in the long, hard effort to build local infrastructure and to protect traditional private and community property rights. 

    On the other hand, just what is it that evidences that Lockitch himself – or other skeptics – have any “real” concern for the world’s poor?  Does the wheel of this concern ever hit the road, or is it simply spinning noisily, to welcoming nods from  domestic special interests who benefit from the continuation of climate externalities?

    A key insight of Austrian economics relating to the environment is that man does not harm the environment per se, but that social welfare or efficiency problems arise because of interpersonal conflict associated with irresolvable inefficiencies – inefficiencies that cannot find a solution in the entrepreneurial workings of the market process because of institutional defects associated with the lack of clearly defined or well enforced property rights.  (See Roy Cordato,  It is both ironic and disappointing that many Austrians and others similarly minded, rather than focussing on the difficult task of conflict resolution in the case of the climate, seem to prefer the emotional rush of conflict itself over analysis and bridge- and consensus-building.  But this is nothing new (and is certainly tempting, given our tribal nature)( 

    No one owns the world’s atmosphere, so all are entitled to their opinions about managing it.  And clearly the world continues to struggle with the rapid exploitation of other unowned, “public” or poorly defined or protected physical resources, in the face of growing populations, growing markets and technological advances that lower the costs of access to the commons.  I suggest that rather than ad hominems, we would be better served by frankly acknowledging problems of this nature and starting to build shared understandings.  The writings of Elinor Ostrom are a good place to start:

    In honestly engaging on these issues, it is perfectly appropriate – nay, essential – to be aware of the self-interests of various participants and to caution against the problems of rent-seeking, “rent-farming” by politicians, and frequently unaligned incentives of bureaucracies.

    5.  Finally, this is a quibble, but Lockitch is wrong to assert thay developing nations need to “industrialize”.  What they need to do is to better govern themselves by protecting investments, markets and human rights, and then getting out of the way of their people.  What results will be these countries’ own path, which will naturally differ from Western industrialization (leapfrogging it in some ways).