Wednesday, December 15, 2010

Basically, we're screwed

[Wednesday's post! Which is appropriate, as it is full of woe.]

I have this theory that there are really only two (successful) ways out of treaty negotiations* - at least, environmental and economic negotiations (I'm uncertain whether defense treaties fit).

Let me approach this backwards, by talking about why I think the climate change negotiations have been so relentlessly unsuccessful. My belief is that this has been the case because the issue area combines two characteristics that, in combination, close off the two standard success routes.

First, the issue area is systemic rather than bounded. By this I mean that the implications of a major energy transition promise upheaval throughout virtually all areas of industry and human life. There are potential losers in every industry. (Of course, there are also by the same token potential winners in every industry - but the losses are easier to engage with than the gains, which are ambiguous and difficult to predict; and humans are risk averse to start with.) In a bounded issue area, a limited set of arenas is affected, meaning that potential losers are a limited set.

In bounded cases, it is therefore easier to build a coalition of supporters from industries and arenas that are not subject to direct disruption from the proposed treaty, assuming any reasonably large or widespread potential gain from a treaty. The area of ozone depleting substances was this sort of area: it ultimately only required disruption of a small subset of the economy. In a systemic issue area, there is no potential coalition of unaffected supporters to be accessed. You have to try to convince lots of people who will be affected that they will ultimately be winners from the deal. That's much harder, as long as the path to winning remains ambiguous. And, of course, the more systemic an issue is, the larger its total costs likely are, which makes everything harder in a general way.

So climate change is systemic, and that makes it hard. Do we have examples of successful systemic treaties that might suggest how we could get out of this trap? Well, kind of. I would argue that both the WTO and the EU are systemic deals. And here's the second problem. Both of these deals probably succeeded in large part because the benefits they provide are club goods - you cannot access them without signing on. This can force nations to sign on even when they're facing systemic effects. But a climate treaty would provide a public good; there's no pressure to agree.

So: treaties have two escape routes to success. If they're bounded, you can escape via domestic support from unaffected parties. If they're not bounded, you'd better hope they're either a club good or can be transformed into one somehow. Thus far, all the treaties I've looked at fit into one or the other of these (or are an epiphenomenal result of one of the starred options below). If they're both systemic and public, you might be screwed - and that's climate change.

Lately I feel I should tag all my posts with either "optimism" or "pessimism".

* There are also two ways to get a desired outcome that don't really require treaty negotiations: have a hegemon who can force everyone to do what they want, or have an actor or set of actors that are independently motivated to provide your public good whether or not others cooperate. Neither of these applies to climate change either.

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