The Climate Justice Imperative

James K. Boyce

It is time for a new strategy for climate policy in America – a strategy founded on climate justice.

Climate justice has four pillars:

• Action: Climate change will affect us all, but its heaviest costs will fall upon low-income people who live closest to the margin of survival and are least able to afford air conditioners, sea walls, and other types of insurance. Climate inaction is climate injustice.
• Adaptation for all: We cannot prevent climate change altogether. Investments in adaptation are necessary, but how should these be allocated? The conventional economists’ prescription is that investments should be guided by “willingness to pay,” which of course depends on ability to pay. The implications of this logic were spelled out two decades ago in the Summers memorandum that purported to make the case for dumping toxic waste in low-wage countries. Climate justice requires that investment in adaptation should be guided by human needs, not by the distribution of purchasing power.

• Co-benefits: Burning fossil fuel releases not only carbon dioxide but also co-pollutants that endanger human health. Co-pollutant damages per ton of CO2 vary greatly, so it makes sense to reduce emissions where the “co-benefits” of co-pollutant reductions are biggest. Because co-pollutants disproportionately impact low-income and minority communities, integrating them into climate policy is a matter of climate justice as well as efficiency.
• Dividends: A cap on carbon emissions is essential, but instead of giving free permits to polluters – a central plank in “cap-and-trade” schemes – polluters should pay. Permits are valuable: their holders will receive the fossil fuel price increases triggered by the cap. They should be auctioned, not given away, eliminating any need for permit trading. The revenues should be returned to the people as the rightful owners of the atmosphere’s limited carbon-absorptive capacity (or any country’s share of it). The “cap-and-dividend” climate bill proposed by Senators Maria Cantwell (D-Wa) and Susan Collins (R-Me) in 2009 would do exactly this, returning 75% of the revenue directly to the public as individual dividends, and devoting the remainder to clean energy investments.

A climate justice policy would jettison the cap-and-trade strategy that repeatedly has gone down to defeat in Washington. Cap-and-trade was based on a political calculation: give free permits to polluters to win their backing, and this would clear the way for passage of a climate bill.

The calculation didn’t work. The Wall Street Journal denounced cap-and-trade as “the biggest tax in American history,” and Republican opponents took up the cry. House leader John Boehner declared: “By imposing a tax on every American who drives a car or flips on a light switch, this plan will drive up the prices for food, gasoline and electricity.”

President Obama countered that the cost to the average American would be “about the price of a postage stamp per day.” In making this claim, Obama and cap-and-trade proponents confused the cost to the economy of cutting emissions with the cost to households of higher fossil fuel prices. The economic cost will be small: the Congressional Budget Office estimated in 2009 that expenditures on energy efficiency and clean energy investments to reach emission targets would amount to only 18 cents per person per day. But the household cost from higher fossil fuel prices will be substantial. Obama and the CBO were referring to the cost of avoided emissions. Boehner was talking about the cost of emissions that are not avoided, and he was right: a cap would increase prices, just like a tax.

Neither side talked about the real issue: who will get the money that consumers pay in higher fossil fuel prices. Recycling this revenue to the people, as proposed by Cantwell and Collins, would leave most Americans with more money in their pockets, not less. In ducking this question, both sides in the cap-and-trade debate played the public for fools.

Instead of courting the fossil fuel lobby, a climate justice policy would turn to the American people for political support. It would appeal to their economic interests, but just as important, it would appeal to their moral values. When they enter the ballot box, Americans voters think about not only what is in their interest but also what is right.

When it comes to passing laws, Washington politicians typically rely more on support from lobbyists than from the people. But in the case of climate policy, business-as-usual politics has reached a dead end. The time has come for a bold departure. Climate justice is not only a moral imperative. It is a political necessity.