Climate Equity: What Is It?

Yves here. Readers were wary of the idea of AOC teaming up with Kamala Harris, and this climate equity scheme proves those concerns to be well-founded.

By Peter Dorman, Professor of Economics at The Evergreen State College. Originally published at Econospeak

While action against climate change languishes, the rhetoric keeps getting more intense.  For several years now it hasn’t been enough to demand climate policy; we need climate justice.  We will not only eliminate fossil fuels in a decade or three, we will solve the problems of poverty and discrimination, and all in a single political package.  It sounds good, but what does it mean?

You might look for an answer in new legislation introduced by AOC and Kamala Harris, the Climate Equity Act.  As reported yesterday, it establishes a federal Office of Climate and Environmental Justice Accountability, whose job would be to evaluate all proposed regulations according to their impact on low income communities.  No doubt this would bring more attention to issues at the intersection of green politics and social justice, which is all to the good, but creating new layers of oversight still doesn’t answer the question, what is climate justice?

Is justice about taking care of, say, the bottom 20% of the income distribution?  The bottom half?  Some other number?  And what counts as an impact?

The first thing to notice is that, by limiting matters of justice to low income communities, the bill reinforces a politics that divides the world into the socially excluded, the poorest and most vulnerable, on the one hand and everyone else on the other.  The majority of voters are effectively enlisted as allies of those at the bottom.  This is the consequence of drawing the line where they do.  A very different politics was proposed by Occupy, placing 99% of us in one camp and the top 1% in the other.

The second thing is, again as reported, the bill does not specify what impacts are critical or what criteria should be applied to them; it is a plan to have a plan.  Presumably the justice accountability specialists will know how to do this, which is useful since, apparently, we are still debating it.

The limitations of AOC-Harris become clearer when you consider what the centerpiece of any meaningful climate policy has to be: suppressing the use of fossil fuels, which will entail putting a steep price on them.  (This can be done either with a permit system or taxes, quantity controls or price controls; permits are by far the better option.)  We are talking hundreds of dollars per metric ton of carbon, which translates to several dollars per gallon of gas at the pump and similar added costs for heating, electricity and other energy uses and sources.  Will this have a devastating effect on low income communities?  Absolutely, and it will be nearly as unbearable for everyone below the top fifth or so.  Fortunately, we also know the solution: rebate the carbon money back to the public, using the progressive formula of equal rebates to all households.  This approach does the best possible job of protecting the living standards of the majority of the population, at the same time assuaging, as much as any program can, the fears that might make a stringent carbon policy politically unattainable.

This is not everything a carbon policy has to do, but it is the one part that is non-optional.  It does not single out low income communities for protection, however, and one could argue that every dollar that goes to someone in the middle of the distribution in the form of a rebate is one less dollar for those near the bottom.  If climate justice is simply about that bottom tier, the politics of AOC-Harris are deeply misguided.  On the other hand, we can avoid a lot of superfluous bureaucracy by simply insisting that all, or close to all, carbon revenues be returned to those who pay them in higher energy prices, and that this be done according to a progressive formula like equal lump sums.  That would mean we would stop beating around the bush when it comes to identifying policy impacts and adopt a majoritarian conception of social justice.

Incidentally, the article accepts as proven that low income communities “are disproportionately affected by climate change because they are often in flood zones, near highways or power plants, or adjacent to polluted lands known as brownfields.”  Not really.  It is true that the poor are always more vulnerable to any social or environmental disruption because they can’t afford to prepare for or escape it, but climate change is pretty close to an equal opportunity ravager.  Low elevation land can be at greater risk, as it was with Katrina, but sea level rise particularly endangers coastal property—typically higher end—while forest fires are an existential threat to the high income homeowners who have chosen to nestle their getaways in what they thought would be sylvan paradises.  The real social justice concerns about climate change are global: the truly vulnerable are those living in tropical regions subject to extreme heat, drought and flooding risks, and more violent storms.  I’d love to see legislation that takes that moral emergency seriously.

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  1. Susan the other`

    Does Gail Tverberg like this idea? It sounds like a scheme to keep the oil economy running while transitions are made. And we are definitely gonna need the oil industry and oil itself to make those transitions.

  2. Steven

    Kudos to Naked Capitalism for tracking this “moral emergency” with a seriousness that rises beyond marketing to what was once called (long term) investing!! Yves’ take on electric vehicles, cobalt & rare earth bottlenecks was particularly illuminating.

    Another possible EV issue: zealots often use the reliability and reduced maintenance costs of EVs to push their religion. Last week I took my GM Volt in to address a “Service airbag” message (a circuit problem with GM’s airbags that apparently spreads across product lines and will cost $1100 to fix). Perhaps in an effort to ease the pain, a service advisor mentioned that if I had to replace the battery it could cost up to $14,000 – about $4000 more than the car is worth.

    So here is the issue. Lots of people don’t buy new cars to avoid having to eat front-end depreciation. What is the market for a used EV if you have to pitch it when the battery dies? The reputed durability of EVs is kind of an insult if this is a pervasive problem across product lines,

  3. Ptb

    This needs more discussion.

    One nitpick, maybe a big one, is rebating carbon taxes per person/household etc. This puts a heavier burden on those forced to travel to work (i.e. can’t afford to live in the city or inner suburb). While that kind of pressure is exactly the point of a carbon tax, I would suggest that the other half of the policy, investment in respectable mass transit (as opposed to subsidizing Tesla’s and Uber’s) is equally essential.

    That said, the US’s gas tax being too low is a big reason we favor heavy single occupancy vehicles.

  4. boz

    If you were to price carbon properly, the transportation sector in particular (I’m isolating it here) would have to rocket its prices.

    Bye bye free delivery. Bye bye amazon prime. In fact, maybe bye bye Amazon Web Services. Bye bye Amazon.

    It would drive down economies of scale and (could) help local producers competitive again.

    Nestled in amongst all that is those who can afford to will pay the higher prices, but the poor won’t (and quite reasonably so, if given the choice).

  5. p fitzsimon

    As an element of social equity aviation fuel, boating fuel should be hit harder than other transport fuels. Also, home heating fuel should see less of a carbon tax since options to reduce heating costs for many have been played out,e.g. insulation.

    1. Ptb

      that’s a really good point. home heating fuel = natgas. better insulation and house design go a long way, but after that, the northern states would see an exodus from detached houses and into larger buildings (lower surface area/volume ratio, hold heat better in winter…). From a carbon point of view, makes sense to be honest. Would mess with real estate though.

  6. taunger

    Second article shilling for carbon taxes on NC in one week. I thought we agreed that neoliberal, market-based policies were anti-thetical to actual change, and that concrete material benefits are the way to go.

    I can answer the question differently: “Will this have a devastating effect on low income communities? ”

    Yes, so install energy efficient and renewable energy generating machines on all low income housing, and charge rentiers a fee if they don’t.

    See how easy that is? No “carbon tax” necessary.

    1. Grebo

      How will that reduce the carbon use of industry? How will that discourage gas guzzling vehicles?

      It won’t, and they far outstrip low income housing in carbon use. I don’t think you fully grasp the scale of the problem.

      Taxes are not usually considered a market-based policy. If they are sized so the dividend exceeds the cost to the poorer half of the population I don’t see the devastation.

      Improving the efficiency of housing should be done too of course.

  7. Math is Your Friend

    “Yes, so install energy efficient and renewable energy generating machines on all low income housing,”

    This is another ‘magic bullet’ solution that people like to hand-wave as ‘the answer’.

    In fact, such microgeneration approaches are often either vastly less effective than proclaimed by their advocates, as ususally installed, or cause major issues with the stability of the electric grid while forcing other generating systems to operate in an inefficient way.

    Real world experience is showing that too much solar and wind in a grid leads to stability problems and more use of fossil fuels in balancing output and demand, while often running things like gas turbines at inefficient loads… and while needing all the capacity and distribution for centralized generation but only using it part time.

    There is some good news on this front, however. It seems that some of the newer reactor designs, particularly small modular reactors, can respond to load changes on a scale of minutes rather than hours.

    As well, they are small enough to be built in a manufacturing facility, and just fuelled and transported to their installation site, speeding construction hugely, while cutting costs.

    Modular reactors would also save lives when compared to the ineffectual rooftop microturbines as far fewer people would be killed. Working on top of buildings is dangerous. I say ineffectual, because studies have shown that fluid dynamic effects greatly hinder operation unless the turbine is a reasonably significant height above buildings, thus clearing various turbulence and drag effects.

    An electric grid is complicated enough without adding tens of thousands or millions of additional variable source/sink/synchronization devices of indeterminate quality and maintenance standards.

    And don’t even think about claiming we can solve it all with software. It’s bad enough when the issues are isolated in individual airplanes, and limited to manufacturing errors.

    When conflated with the problem of securing such a mess against cyberattack, grid connected microgenerators are a security and reliability nightmare. If you want to see the scope of the problem, check out available information about security and the Internet of Things, which is essentially what would be in play.

  8. Math is Your Friend

    “How will that reduce the carbon use of industry?”

    It probably would not.

    The carbon requirements of creating and sustaining just an electric transportation sector, as a reading of some of the posts here about a need to increase production of some minerals by a factor of hundreds or thousands of times current production will suggest.

    Adding in generating and distribution systems, early replacement of vehicles, ancilliary demands of infrastructure, revamping of manufacturing, redesign and rebuilding of operational facilities, and so on, and it seems entirely possible that carbon requirements will go up.

    Add that to the ‘Brexit effect’ as other countries see the economic and practical mess that the process creates, leading them to decide to have no part of such things, and global carbon effects are unlikely to end on the low side of neutral.

    That’s not an analytical conclusion, of course, as a lot of the data does not exist and won’t until we see what the real world hit is like, but that does seem the way to bet.

    Please note that current figures generally are either theoretical, vendor/advocate driven, or derived from inherently and sometimes artificially ‘electric friendly’ environments and use cases, and are unlikely to be representative of a broader range of situations. One example might be use of HOV lanes for single driver EVs… which is an advantage now, but meaningless as the number of EVs increase, with loss of current advantages to time, efficiency, and convenience.

    They also do not illustrate the side effects and feedback effects that will occur when the number of electric vehicles rise to the level that they affect or change current facilities, economics, and operation.

    Furthermore, we have yet to see a significant emergence of the full EV lifecycle, which in a full EV scenario could produce hundreds of millions of tons of battery waste (post use batteries, not the manufacturing waste, which is another issue), nor have we seen the potential problems with large vehicular accidents involving significant numbers of EVs producing electric and fire hazards to rescuers… or the effect of such an accident stranding thousands of EVs on a highway during severe snowstorm conditions (which is where a lot of high count mass collisions occur).

    In less dire circumstances, consider the equivalent of running out of gas. Today if that happens to me, I can call someone. A tow truck or a friend can show up, and a single small, relatively light (maybe 14 kg) container of fuel can be poured into my tank, and I am good for another 200 km – easily enough to drive to more fuel. A battery with that much power would be 1000 kg or more, and it can’t be transferred in 3 minutes. Nor can the tow truck replenish its reserve fuel in a few minutes. In such a case, then, you are looking at a tow, and more tows, and more tow trucks, and…

    How many other side effects have not been considered? I don’t know if there are any good cost estimates for EV manufacturing when demand for key materials is ten times world production… but what would happen? And how long would it take to satisfy those needs?

    And what would the economic distortions caused by this do to other key sectors of the economy? Are EVs more important for funding than x-ray machines? Do MRI units need the same rare earths as EVs? Do brownouts due to EV charging put people in danger? Do we train more mining engineers or surgeons? Do we need more electricity workers to maintain expanded distribution systems, or more teachers?

    There are a lot of unanswered safety, environmental, resource, and economic questions at this point.

    I personally think this may be a result of too narrow a focus, only really condsidering one thing to be important (greenhouse gasses) while ignoring other inter-related issues.

  9. Ian Perkins

    “The real social justice concerns about climate change are global: the truly vulnerable are those living in tropical regions subject to extreme heat, drought and flooding risks, and more violent storms. I’d love to see legislation that takes that moral emergency seriously.” – Absolutely.
    Also, although it’s not what I’d call a question of ‘justice’, how do we persuade countries such as Saudi Arabia to stop producing fossil fuels?

    1. drumlin woodchuckles

      We persuade countries such as Saudi Arabia to stop producing fossil fuels by stopping the use of fossil fuels. If Zero Market existed anywhere for fossil fuels, countries such as Saudi Arabia would have Zero Incentive to keep producing them.

      So the question is: how can the fossil-fuel non-producing regions of the world exterminate fossil fuels from any presence whatsoever in their energy portfolios? Because until the need for fossil fuels is exterminated, the hopeless quest to encourage countries like Saudi Arabia to stop producing them is a fool’s endeavor.

      1. Ian Perkins

        Sorry, the question is: how can we (or, if you like, the fossil-fuel non-producing regions of the world) exterminate fossil fuels from any presence whatsoever? Exterminating them from the energy portfolios of non-producing countries won’t achieve much if Russia, Venezuela, the Gulf countries, Nigeria, Libya, Canada, India, Australia and the USA etc continue producing and consuming them.

        1. drumlin woodchuckles

          Ahh . . . you have now broadened the category of fossil producers to countries which both use AND produce.

          The question was much easier when you had limited it to countries “like Saudi Arabia”, because countries “like Saudi Arabia” are the countries which have nothing except coal or oil or gas to sell.

          Broadening the question to cover countries like Russia/Nigeria/America/Canada/etc. makes the answer more difficult. The “seek de-warming” community will somehow have to assume such utter and totally commanding power within their societies that they can crush and exterminate all resistance to global de-warming coming from the coal, gas and oil sectors. Until those sectors are defeated and broken down to a level of zero political influence, they will own and run the governments of all the countries you name . . . and not just America.

          The problem Professor Hudson described of our Ruling Class devotion to Oil Now Oil Forever! in order to assure American dominance through American control of all possible oil from every possible wherever is just a particular instance of the Big Fossil sector of each of these countries keeping their respective governments wedded to Oil Now Oil Forever! As you note, Russia ( which is certainly not supportive of American Oil World Dominance) is still supportive of Russian Oil Now Russian Oil Forever! . . . for example.

          So what can be done? Every Movement has to start with a Culture, and perhaps a Mass Political Global De-Warming Movement will have to start with a culture of several hundred million people each showing and teaching eachother how to live as Low Fossil a life-long lifestyle as possible in order to show Onlooker Society how such Low Fossil lifestyling can be bearable and endurable . . . and to make up a cultureload of people strong enough and numerous enough to support a Mass Movement of Political Conquest and Fossil Abolition.
          People who think that is “a” viable Theory of Change can form themselves into a TAG ( Theory Action Group) devoted to living out that theory to see where it goes. Other TAGs will certainly be doing their own things to advance their own TOCs ( Theories Of Change).

          If you don’t believe that either that or something else can be done, then perhaps it is time to open up our freezers and Kiss Our Ice Goodbye.

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