Does poverty give a country the right to pollute the atmosphere?

In the current worldwide debate about greenhouse gas emissions, the political leaders of the new big polluters (NBPs, especially China and India) attempt to shift the burden of reducing the global flow of new carbon-dioxide-equivalent (CO2E) emissions to the old big polluters (OBPs, mainly Europe, North America and Japan) by claiming the moral high ground, based on two arguments: (1) we are poor, you are rich, and (2) it’s our turn now to pollute.

I will, in what follows, take as given the proposition that (1) global warming is a reality; (2) global warming is a bad thing and (3) that human-made CO2E emissions are a significant contributor to global warming.  The science underlying these propositions is inevitably shaky – as has to be the case for any non-experimental science.  Still I believe that, even if I don’t really know whether my grandchildren are more likely to swim down Oxford Street or to ice-skate down Oxford street, the cost of not doing something about man-made CO2E emissions if they are indeed as harmful as the Greenhouse Lobby argues is vastly greater than the cost of unnecessarily restricting CO2E emissions – an application of the precautionary principle, if you want.

Except for this one-paragraph rant, I will also pass over the question as to whether, in a debate based on moral or ethical arguments rather than on Realpolitik, the official spokespersons for India and China have any special moral standing as representatives of the poor, the weak and the voiceless.  Countries with many poor and powerless inhabitants often are led, ruled and spoken for by rich and powerful men and women (mainly by men).  It grates on me to see moral high horses ridden by persons who have achieved their status as leaders of and spokespersons for their nations as a result of privilege and a ruthless climb up the political greasy pole, kissing up and kicking down, in corrupt, unrepresentative and often violent polities.  I will abide by the rule that the merits of an argument are independent of the character and motivation of the person making the argument.  So let’s look at the argument on its merits.

Just to set the scene, China took over from the US recently as the country with the largest volume of CO2E emissions.  From the Energy Information Agency (US Department of Energy), I reproduce the following estimates of carbon dioxide emissions from all sources of fossil fuel burning and consumption.

These data are from the Union of Concerned Scientists, who obtained them from the Energy Information Agency of the US Department of Energy.

Table 1

Total and per capita flow emissions leagues

  Country Total Emissions(Million metric tons of
CO2)
 

Per Capita Emissions(Tons/capita) 

1. China 6017.69 4.58  (17)
2. United States 5902.75 19.78  (2)
3. Russia 1704.36 12.00 (5)
4. India 1293.17 1.16  (20)
5. Japan 1246.76 9.78  (9)
6. Germany 857.60 10.40  (7)
7. Canada 614.33 18.81  (3)
8. United Kingdom 585.71 9.66  (10)
9. South Korea 514.53 10.53  (6)
10. Iran 471.48 7.25  (14)
11. Italy 468.19 8.05  (12)
12. South Africa 443.58 10.04  (8)
13. Mexico 435.60 4.05  (18)
14. Saudi Arabia 424.08 15.70  (4)
15. France 417.75 6.60  (16)
16. Australia 417.06 20.58  (1)
17. Brazil 377.24 2.01  (19)
18. Spain 372.61 9.22   (11)
19. Ukraine 328.72 7.05  (15)
20. Poland 303.42 7.87  (13)

Note that the twenty countries with the largest current flows of emissions are drawn from a list of 228 countries.  The per-capita emissions ranking is based only on the 20 top countries in the total emissions league.  For future reference I also include a table with the 16 countries with the largest populations.

Table 2

The 16 countries with the largest total population

Rank Country / Territory Population Date % of world population
1 China(excluding Hong Kong and Macau) 1,331,946,446 July 21, 2009 19.67%
2 India 1,166,925,850 02009-07-21
July 21,
2009
17.23%
European
Union
499,673,300 02009-01-01
January 1,
2009
7.38%
3 United
States
306,969,574 02009-07-21
July 21,
2009
4.52%
4 Indonesia 230,729,491 02009-07-21
July 21,
2009
3.41%
5 Brazil 191,466,483 02009-07-21
July 21,
2009
2.83%
6 Pakistan 166,962,000 02009-07-21
July 21,
2009
2.47%
7 Bangladesh 156,836,399 02009-07-21
July 21,
2009
2.32%
8 Nigeria 148,235,170   2.19%
9 Russia 141,837,010 02009-07-21
July 21,
2009
2.09%
10 Japan 127,614,000 02009-07-21
July 21,
2009
1.88%
11 Mexico 111,305,663 02009-07-21
July 21,
2009
1.64%
12 Philippines 94,377,140 02009-07-21
July 21,
2009
1.39%
13 Vietnam 87,017,453 02009-07-21
July 21,
2009
1.28%
14 Germany 82,060,000 02008-12
December
2008
1.21%
15 Ethiopia 79,221,000 02008-07
July 2008
1.17%
16 Egypt 76,947,962 02009-07-21
July 21,
2009
1.14%

Source: Wikipedia. Approximately 4.51 billion people live in these 16 countries, representing roughly two-thirds (66.7%) of the world’s population of approximately 6.76 billion as of February 2009.

Data on cumulative human-made emissions, such as total human-made emissions since the beginning of the industrial revolution, are not available.  However, there can be no doubt that, because of a 100 to 150-year head start in burning fossil fuel on a large scale in industrial processes, today’s rich industrial countries have made a much larger cumulative historical contribution to anthropogenic global warming than the new entrants in the field, such as China, India and other emerging markets and developing countries.

The vast majority of CO2E added to the atmosphere will eventually be absorbed by the oceans. This process takes on the order of a hundred years.  The oceans contain much more carbon dioxide – mainly in the form of bicarbonate and carbonite irons – than the atmosphere and a large but unknown amount is founds in the ocean sediments as methane-carbon dioxide-water clathrates.  The oceans and the biosphere together typically absorb an amount of atmospheric CO2 equal in recent years to just over 55% of new CO2E emissions.  With much larger volumes of CO2E emissions, that absorption rate is of course likely to fall.

For the sake of argument, I will proceed until further notice as if the CO2E absorbed by the oceans, ocean sediments and biosphere pose as much of a threat to humanity as what is currently in the atmosphere.  That way, it is the cumulative flow of past anthropogenic CO2E emissions that is a measure of the damage done by human activity (mainly burning fossil fuels and deforestation), on the further assumption that the optimal level of CO2 concentration in the atmosphere was the level achieved prior to the industrial revolution (about 280 ppmv (parts per million per volume).  The current concentration is getting close to 390 ppmv.

It’s China’s and India’s turn now to pollute

Let’s first take the ‘it’s our turn now to pollute argument’.  This argument starts from the correct observation that the cumulative emission of CO2E by the OBPs is vastly in excess of that of the NBPs and concludes, erroneously, that this entitles the NBPs to emit without restraint until cumulative emission by the NBPs equals or exceeds that of the OBPs.

Typically, those making this argument point to the cumulative flow of emissions by the (now) rich industrial countries (the OECD for short) since the industrial revolution and attribute much of the increase in CO2 concentration in the atmosphere from, say, 280 ppmv before the industrial revolution  to 390 ppmv today to these past OECD emissions.  Say we attribute 100 ppmv of the current CO2 concentration in the atmosphere to past emissions from the OECD countries.

One way to interpret the arguments of the NBPs about the distribution across countries of the global burden of reducing greenhouse gas emissions is that the poorer emerging markets and developing countries are entitled to emit the same cumulative amount of CO2E (measured from the beginning of the industrial revolution, say 1800 or thereabouts) as the rich countries, and that they should therefore not be required to engage in any efforts to reduce emissions (other than what would be dictated by their private cost-benefit analysis) until their cumulative emissions since 1800 exceed those of the rich countries.  There are variations on this theme, such as the NBPs asserting a property right not to reduce their CO2E emissions until their emissions have raised the CO2 concentration in the atmosphere by 100ppmv, relative to some benchmark, but you get the general idea.

Turning the clock back would be a great solution to many problems.  Unfortunately, for all practical intents and purposes, the arrow of time moves but in one direction.  The past is a bygone.  Until we develop a commercially viable technology that enables us to Hoover CO2E out of the atmosphere and capture it safely, the stock of past emissions is not a choice variable or an instrument of policy.  Only the flow of new emissions is.

The NBPs are telling the OBPs that the sins of the fathers will be visited on their children.  The current inhabitants of the OBP nations have to pay for the global negative externality created by their ancestors.  Is that right or moral?  I would not hold anyone responsible, morally or financially, for the actions of any ancestors or indeed for most is his or her own actions before they reached the age of discernment/majority.  If you believe in re-incarnation, you could entertain interesting questions as to whether the CO2E intergenerational liability is inherited through the biological parent or through the previous link in the chain of re-incarnation.  Do any OBPers get re-incarnated as NBPers or vice versa?

Is the claimed responsibility an individual or a collective responsibility? If it is a collective responsibility, on what level of collectivity (collectiveness?) does it fall?  The nation state?  The Empire (the United Kingdom’s imperial past in India could make for interesting discussions).

The NBPs logic would appear to include the assumption that the effect of past OBP CO2E emissions on the wellbeing of the NBPs occurs exclusively through the contribution of these past emissions on the current atmospheric concentration of CO2.  One could make the argument that the NBPs have been massive beneficiaries, directly and indirectly, from the activities enabled by past CO2E emissions by the OBPs.  Through the gains from trade, emigration and technology transfer, the NBPs are vastly better off than they would have been if the OBPs had stuck to the spinning wheel and the hand loom.

It is an fascinating question why the previously dominant cultures and economies of China and the Indian subcontinent went into hibernation and decline from the mid sixteenth century until the late 20th century.  But four or five centuries of political, social, economic and technological failure don’t constitute a very good case for special treatment in the carbon emissions stakes.

My key point is that this ceteris paribus re-running of history – asking us to determine what would have happened to OECD living standards (and indeed to living standards in China and India and the other NBPs) if from about 1800 on there had been a world-wide carbon tax or a cap and trade scheme of the kind now being proposed – is idiotic.  That was then, this is now.  Grow up and stop whining that life and history aren’t fair.

Too many people

The argument that ‘it’s our turn now to pollute’ gets even sillier when it is stated not as a right to a given total amount of cumulative CO2E emissions, but as the right to a given per capita amount of cumulative CO2E emissions.  As can be seen from the Table.  China is the number 1 ‘flow’ polluter, with India in 4th position in 2006, having just overtaken Japan and closing fast on Russia, but in per capita current flow terms, China’s CO2E emissions place it 17th out of the 20 countries listed in Table 1, and India comes last.

The only sensible response to this observation is: “yes indeed; and so what?”

First, the externality associated with greenhouse gas emissions relates to the total amount added to the atmosphere, not to the amount emitted per capita.  A given quantum of CO2E emissions does an equal amount of global harm, regardless of whether it is produced by 2 over-fed Americans or Europeans or by 100 under-fed Indians.  Those who bang on about per capita emissions appear not to understand the ‘technology’ of the global environmental externality created by CO2E emissions.  This may also be a good time to remind the reader of the fact that some small fraction of the past OBPs’ CO2E emissions has by now been re-absorbed by the oceans and the biosphere, and no longer represents a negative global externality.  The weight of the sins of the fathers, and of our own youthful sins, depreciates slowly as time passes.  Another thousand years and much of it will be gone.

Second, we know that there are a lot of people in China and India.  As Table 2 shows, out of an estimated total world population of 6.77 billion, China accounts for 1.33 billion and India for 1.67 billion.  The entire EU has a population of 500 million and the US 307 million.

The logic in the argument of the NBPs comes unstuck especially badly here.  If the overdeveloped world is held accountable for the choices of past and present generations that produced large past emissions of CO2E and resulted in today’s high atmospheric concentration of CO2E, then surely today’s inhabitants of China and India should be held accountable for the individual and collective choices of past and present generations of Indians and Chinese that have resulted in the oversized populations of these countries? The selective application of the ‘your ancestors broke it, you own it’ logic by those who advocate special lenient treatment for today’s poor countries in global efforts to reduce greenhouse gas emissions is deeply intellectually dishonest.

What remains of the plea to go easy on China and India and the other New Big Polluters?

What remains is the statement: China and India are poorer than the USA and Western Europe.  So we want special treatment.

Poverty is an argument for aid, if aid can be given effectively, that is, in a way that does not harm those whom it is intended to help.  Is messing around with global efforts to control greenhouse gas emissions an effective way to grant aid?  I don’t think so.

A uniform global tax on all CO2E emissions is the first-best way to tackle global warming.  Uniform means the same regardless of whether the emissions result from the consumption and production activities of the rich or of the poor.  If this leads to hardship, the first responsibility lies with the fiscal authorities in the countries involved.  Domestic public spending and tax revenues (including the revenue from the new carbon tax) can be used to address unbearable poverty.

An inferior alternative to a global tax on all CO2E emissions is a global cap and trade scheme.  It is inferior to a tax on carbon emissions because for it to create the right incentives (equivalent to a tax) for reducing CO2E emissions, it requires an efficient secondary market for CO2E emissions permits.  Such markets are costly to operate and can be manipulated.  Even if they are competitive, they can, like all financial markets, be distorted by bubbles, herding and other forms of dysfunctional behaviour.  Finally, cap and trade has, through the Clean Development Mechanism, created a large, still growing and largely phony ‘offsets’ industry.  This allows credits created in developing countries through investments/actions that save CO2E emissions there (relative to some counterfactual and generically non-verifiable scenario), to be sold to would-be polluters in the industrial countries.  Despite the occasional island of honesty, the additionality industry has by and large become a racket and should be wound up.

I cannot take seriously the argument that, for countries like India and China, the resources aren’t there right at home to deal with the poverty implications of a carbon tax or an equivalent cap and trade scheme.  Both countries spend vast amounts of resources on their military; indeed both countries have significant nuclear arsenals. The poverty argument may be valid for a country like Bangladesh or for many of the Sub-Saharan African countries.  Aid to address poverty, regardless of what causes that poverty, is not merely justified but a moral duty, provided there is a reasonable chance that the aid will do what it is intended to do.  Wasting money is not the main concern.  The main concern should be to do no harm.  Every care should be taken to ensure that aid to poor countries does not become aid to rich people in poor countries, or succour to despots.

I don’t blame the Chinese and Indian authorities too much for giving it the old college try, by playing on the post-colonial, affluenza-driven guilt and angst feelings of the old big polluters and arguing that special treatment be granted in the next stage of the world-wide attack on global warming to low income countries with large populations.  That’s Realpolitik for you.  Dishonest and contemptible, but part of everyday fare in politics.

They did, however, underestimate the intelligence of their interlocutors by coming up with two real whoppers: (1) the West has polluted for two centuries – it’s our turn now to pollute; and (2) sure, China may now be the biggest contributor to new global greenhouse gas emissions, with India not far behind, but because there are so many of us (for reasons that have nothing to do with us), we really are just tiny polluters if you look at it in the proper, per capita, way.  By the same token, Russia’s emissions per acre are the lowest in the world.

We should recognise these arguments for what they are: self-serving cant.

Maverecon: Willem Buiter

Willem Buiter's blog ran until December 2009. This blog is no longer active but it remains open as an archive.

Professor of European Political Economy, London School of Economics and Political Science; former chief economist of the EBRD, former external member of the MPC; adviser to international organisations, governments, central banks and private financial institutions.

Willem Buiter's website

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