A Stern Warning

Professor David Campbell

Under the Climate Change Act 2008, the UK has made a binding commitment to an immensely ambitious and costly programme of ‘decarbonisation’ so that (let us allow for the purposes of argument) its anthropogenic greenhouse gas emissions in 2050 will be 80% less than they were in 1990. Putting aside the myriad other issues which an assessment of the wisdom of this commitment must take into account, its basic rationality depends on the likelihood of other countries making comparable commitments. Decarbonisation is intended to mitigate global warming. But global warming is, precisely, a global issue. Emissions anywhere in the world contribute to the global concentration of greenhouse gases. Merely unilateral action by the UK, responsible for 2% of global emissions, would be irrelevant. And again putting aside the myriad issues this time arising from the policies of other countries, unless China (though India essentially is a duplicate case) dramatically alters its energy policy, then not merely what the UK does but what all of the developed world does is irrelevant. The emissions of China alone have made, and her projected emissions will make, a reduction in the global concentration of greenhouse gases mitigating global warming impossible. Because of China’s (and India’s) economic performance and projections, a policy of global emissions reduction could never succeed, has signally failed, and can never possibly succeed. In this situation, the UK’s domestic policy amounts to trying to empty a bath with a spoon whilst China is filling it with a bucket (with India standing behind with another bucket).

Some perception of the seriousness of this problem informed the views of the more sophisticated of those who laid the treaty framework of international climate change policy. By their very design, the 1992 Framework Convention and its 1997 Kyoto Protocol could not possibly secure global reductions, and, indeed, they gave an explicit permission to developing countries, in which category China was included (as was India), to prioritise economic growth over emissions reduction. The sophisticated defence of this treaty framework nevertheless was that it got the ball rolling when insistence on an actually binding and biting global reductions agreement would have meant no agreement at all. This was meant to change at the 2009 Copenhagen Conference, but pressing for such an agreement there did indeed lead to no agreement. The Conference was saved from utter embarrassment only by the action of a self-selecting group of five countries including China, India and the USA which, entirely outside of the UN negotiating procedures, produced the Copenhagen Accord, a very general document of no legal status, under which other countries were invited to give ‘notifications’ of their unilateral climate change intentions. Though many claims are made for the significance of the Accord which legal analysis shows to be excessive or outright fanciful, neither the Accord nor the notifications can possibly be interpreted as a binding and biting global emissions agreement.

Diplomacy at subsequent Climate Change Conferences has turned on the claim by the UN Climate Change Secretariat, supported by numerous governments including that of the UK and the EU, that such an agreement will be reached at the Paris Conference to be held at the end of this year. It is this that has kept the climate change negotiations going after the fiasco of Copenhagen. Very importantly indeed for the position in the UK, the Committee on Climate Change, the agency established under the 2008 Act which is charged with advising the Government, has recommended continuation with the decarbonisation policy because of the prospect of an agreement in Paris.

This recommendation is based on so overoptimistic a belief about what will happen in Paris, itself based on an extremely limited understanding of the law and diplomatic history of international climate change negotiations, that it really does not deserve to be called advice at all. ‘Advice’ implies balance, but this quality is entirely absent from the Committee’s recommendation. However, I have written about this elsewhere and it is not to this that this blog is directed. It is to a curious and unfortunate coincidence.

The principal argument for mitigation is The Stern Review, a 2006 review of the economics of climate change policy carried out for the UK government by the distinguished welfare economist Sir Nicholas, now Lord, Stern, one of the world’s most influential figures in the formulation of climate change policy. The Stern Review essentially concludes that mitigation will be far cheaper than a general policy of ‘adaptation’ to the effects of global warming as they materialise. The Stern Review is very largely an abstract economic argument and in its 700 pages there is no other than fleeting consideration of the plausibility of establishing the legal and institutional framework necessary to achieve global reductions. As such it is a textbook example of the criticism the late Ronald Coase levelled at most welfare economics, that they are mere ‘blackboard economics’ which work beautifully on the blackboard but have no prospect of actually being put into practice.

Without a binding and biting global agreement, the mitigation policy is irrational, and no amount of discussion of the effects of global warming or the desirability of avoiding them makes any difference to this; indeed it does not speak to it. A policy which cannot be put into effect has infinite costs, and so one does not need Lord Stern’s mathematical facility to conclude that incurring the enormous costs of the mitigation policy is unjustifiable, or that mitigation cannot possibly be cheaper than adaptation. But despite what the more clear headed realised was the case from the start and what everyone should have concluded after Copenhagen, those responsible for UK, EU and international climate change policy have adamantinely maintained that such an agreement will be reached. As I have noted, UK climate change policy turns on the Committee on Climate Change continuing to maintain this.

But at the beginning of this month, Lord Stern and some of his colleagues published a report in which they concluded that no such binding and biting agreement will be reached in Paris. The ‘Paris summit should not be regarded as just a one-off opportunity to fix targets’, indeed, ‘The ambitions and plans agreed at the Paris summit in December 2015 should be regarded as a critical initial step’. After a quarter of a century of climate change negotiations has yielded less than nothing, we are now told that the Conference on which all hope has been pinned since Copenhagen should be regarded merely as an ‘initial step’! Lord Stern and his colleagues have been forced to do this because, as of the end of April, only 35 countries, 28 of them the members of the EU, and not including China and India, had made the statements they had been asked to make of the climate change action they were prepared to take. Even though Lord Stern and his colleagues paint what can only be called an hallucinatorily positive picture of the statements made, to maintain that Paris would be a success in light of this had gone beyond the bounds of credulity.

Those attending to Lord Stern’s views had, however, seen this coming. He has for some time been entering an escape clause into the policy he has insisted the UK and other nations should pursue. In the Preface, written in October 2014, to the recently published version of some very prominent lectures he gave in 2012, he has pondered whether ‘looking for formal international sanctions within an agreement that have [sic] real bite may be a mistake’. Were it not for the immense waste caused by the mitigation policy, it would be a highly amusing coincidence that, just as the Committee on Climate Change was advising the UK Government that it should proceed on the expectation of a mitigation agreement in Paris, the UK’s leading advocate of mitigation was saying that such an expectation ‘may be a mistake’!

And where has Lord Stern left us? Though without the necessary reductions agreement at the start, the mitigation policy could never succeed, it was very arguable that proceeding without such an agreement was a necessary diplomatic manoeuvre. But after Copenhagen, that an agreement would never be reached was indisputably clear. However, the negotiations have proceeded on the basis that things would be made put right in Paris. And now that this can no longer be maintained, the mitigation policy is not to be dropped, rather the necessity of the formerly essential agreement is to be dropped. This is not merely a matter of a diplomatic stance. The mitigation policy has cost the citizens of the UK tens of billions and, to the extent it is rolled out, it will cost trillions. Lord Stern would have us now continue to pay these costs in the interests of continuing with the negotiations apparently sine die. Rather than abandon his policy, Lord Stern has abandoned rationality in policy formulation. In the terms of the great sociologist Max Weber, his attitude is not technically rational but is ‘value rational’, ‘that is, determined by a … belief in the value for its own sake or some ethical, aesthetic, religious, or other form of behaviour, independently of its prospects of success’.

David Campbell is a Professor of Law at Lancaster University Law School. He is a leading commentator on the law of contract and commercial law and on forms of public regulation of economic activity. He has previously studied the foot and mouth disease outbreak of 2001.  His most recent book with Linda Mulcahy and Sally Wheeler is Changing Concepts of Contract: Essays in Honour of Ian Macneil (Palgrave Macmillan 2013).

You can find out more about David’s research at http://www.lancaster.ac.uk/fass/law/profiles/david-campbell


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