Thursday, 21 April 2011

Why American Electric Power v. Connecticut doesn't matter

Greenwire reports that the justices of the US Supreme sounded skeptical of the plaintiffs' claim that greenhouse gas emissions by American Electric Power, the world's largest greenhouse gas emitter, and four other named defendant investor-owned electric utilities, could constitute a common-law public nuisance that could result in legal liability to the State of Connecticut, the Open Space Institute, and a handful of other states. I would reserve judgment; the tone of oral argument is not a great predictor for how justices will vote or for the outcomes of cases, and in the case of public nuisance for emitting greenhouse gases, there are a lot of hard questions that need to be asked whether you're inclined to rule in favor or not.

I wrote an article back in 2008 that climate litigation like this was not likely to be a very effective way to reduce greenhouse gas emissions. Looking forward and finding an ideal plaintiff -- which I concluded was the Inuit people of Canada, the US, Denmark (through its territory of Greenland), and Russia -- and pitting it against the most vulnerable defendants -- American Electric Power and a longer list of other emitters -- the chances of prevailing on a common law nuisance suit were.... OK, but not fabulous. There are just too many leaps that a court of law would have to make in order to find that AEP and the others actually did something significant to harm the Inuit people, when even a large aggregation of the greatest emitters in history did not contribute more than about 8-10% to the existing stock of greenhouse gases. And if winning this "ideal" case was going to be challenge, what does that say about all the other climate change cases that could be brought? (Note: the article benefited from the detailed comments of Matthew Pawa, attorney for plaintiff Open Space Institute; while disagreeing with my ultimate conclusion, Pawa acknowledged the hurdles he needed to overcome to win.)

But there is another reason that environmentalists should not become too enamored of climate litigation: it perpetuates a myth that climate change is the fault and responsibility of a few evil barons of industry. It is not. It lies with us: certainly all of us living in affluent countries, but even those of us with small carbon footprints. We have done this to ourselves, and it is misleading to think that we can vindicate ourselves by sticking it to The Man. This is the specious tack taken by the Canadian NDP and the British Columbia NDP, which have attacked carbon taxes proposed by the Canadian Liberal Party and implemented by the BC Liberal Party. What we need is a price on carbon, so that all of us Canadians, Americans, and everybody else feels the pain of contributing to the climate change problem. A carbon tax does this, and does this best under most politically realistic scenarios.

Please don't complain to me about regressiveness until you've studied the literature. There will be some regressiveness to carbon taxes; that much has to be acknowledged and addressed. But there are many subtleties that have been ignored in the discussion about distributional impacts of carbon pricing. First of all, revenue recycling can and should address some of that. Dallas Burtraw and his colleagues at Resources for the Future have carefully modeled the effects of carbon pricing on different demographic and regional groups, and explored ways of recycling revenue to reduce impacts. And second, recent research seems to suggest that when government programs that provide aid for the poor are indexed to inflation, that the regressiveness problem is narrowed. This is of little comfort to those whose government benefits will *not* increase with inflation, but it is a start, and the kind of subtlety that has been ignored in the debate about regressiveness. Thirdly, do we define "poor" as people with low income? That fails to capture the affluence of two large groups of people: students and retirees. And finally, of all of the offenses that we visit upon the least fortunate in affluent societies, we're going to hold climate policy hostage until we fix income inequality?! Bailing out General Motors, perhaps the most stubbornly inefficient long-lived corporation in the history of human industry -- this insult to generations of American taxpayers is more important than climate change? The edgy language in this post is not targeted at the poor; it is targeted at those who purport to care about the plight of the poor, but haven't devoted the time to think through the various complicated issues around carbon pricing and distributional impacts, but would rather just use the poor as a political lever.

No comments:

Post a Comment