Ursula Kreitmair: 2021 Great Plains conference
"How to Design Climate Policy in a Polarized World" with Ursula Kreitmair, UNL Political Science.
Culture is a main determinant of how we think and feel about climate change. As such, culture must be considered when designing mitigation and adaptation strategies to meet the rapid emission reductions necessary to avert the most damaging of climate impacts. Cultural cleavages, both domestic and international, threaten to mire us in political conflict when we need to be working collectively to address this major challenge. This talk uses culture as context to identify limits of current climate policy initiatives and to sketch out viable policy options that may be more palatable to individuals on different sides of the climate divide.
Dr. Kreitmair joined the Department of Political Science as an Assistant Professor in the Fall of 2016. Her research interests lie with environmental policy. In particular, she researches how we might overcome collective action problems underlying (large scale) social dilemmas as found surrounding many environmental issues. Kreitmair uses an inter-disciplinary approach (behavioral economic experiments, computational, and institutional analysis) to refine policy tools used in environmental management based on insights from the behavioral sciences. Kreitmair teaches classes in environmental and public policy and research methods.
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[00:00:00.693](soft instrumental music)
[00:00:10.280]Hi, good morning.
[00:00:11.113]My name is Ursula Kreitmair.
[00:00:12.343]I'm an assistant professor of political science
[00:00:14.680]at the University of Nebraska-Lincoln.
[00:00:16.610]Welcome to my talk
[00:00:17.490]on how to design climate policy in a polarized world.
[00:00:20.820]So to get started, let me set up the challenge
[00:00:23.220]that the globe is currently facing.
[00:00:26.070]On the left here, you see a graphic that displays
[00:00:29.530]the CO2 emissions
[00:00:31.020]that we're currently emitting into the atmosphere.
[00:00:33.580]We are currently at about 42, 43 billion tons
[00:00:36.670]of CO2 emitted.
[00:00:38.740]That's in addition to what is already captured
[00:00:41.550]by force and ocean sinks.
[00:00:45.110]And the pathways here
[00:00:47.890]are the purple and yellow lines,
[00:00:49.800]are essentially the emission pathways
[00:00:51.960]that we can follow if we intend to maintain
[00:00:55.710]or avert temperature increases,
[00:00:59.030]limit them to 1 1/2 degrees Celsius.
[00:01:01.910]And what this suggests is that here we are currently
[00:01:05.320]at this point here,
[00:01:06.650]if we were to limit our temperature increases
[00:01:10.570]to 1 1/2 degrees,
[00:01:12.230]we would need to reduce emissions by about 50%,
[00:01:16.350]that's around 20 mark line here, by 2030
[00:01:20.490]and become neutral, or carbon neutral by 2050.
[00:01:28.390]Carbon neutral means that any emission that is emitted
[00:01:31.830]needs to be offset by either natural sinks
[00:01:35.620]or by technology designed to capture carbon,
[00:01:38.740]which I should add, well we're heavily reliant on that
[00:01:42.090]to meet the 1 1/2 degree goal
[00:01:45.490]technologies are currently not scalable
[00:01:48.380]or economically feasible at this point.
[00:01:50.730]So what is left is
[00:01:54.613]a challenge of having to cut emissions by half
[00:01:58.050]in the next 10 years
[00:01:59.460]and then reduce them to zero in the following 20 years.
[00:02:04.850]And this is a very ambitious challenge
[00:02:08.630]or a very ambitious goal
[00:02:10.690]requiring monumental transition
[00:02:12.960]from a heavily carbonized economy
[00:02:16.840]into one that is run by renewable energy
[00:02:20.360]and has significant changes in behavior
[00:02:23.180]and production in general.
[00:02:28.350]Now, while this seems like a monumental undertaking,
[00:02:33.260]the goal of limiting temperature increases to two degrees
[00:02:38.260]is similarly challenging
[00:02:40.940]albeit with slightly longer timescales.
[00:02:44.030]So if the intent is to limit temperature increases
[00:02:47.950]to two degrees, we would have until about 2040
[00:02:51.000]to have emissions and then somewhat longer until about 2080,
[00:02:56.470]give or take, to drive emissions down to zero.
[00:03:01.010]Now a couple of things to note.
[00:03:04.100]First off, these are the most likely pathways,
[00:03:06.740]so even if emissions were halved in the next 10 years
[00:03:09.900]it's not guaranteed that 1 1/2 degree goal
[00:03:13.700]would actually be feasible or achievable.
[00:03:17.760]A second note to be made here
[00:03:20.950]is that while two degrees seems much more feasible,
[00:03:25.530]it is important to note that the impacts associated
[00:03:28.070]with two-degree temperature increase
[00:03:30.100]compared to 1 1/2 degree temperature increase
[00:03:33.930]So most recent literature, most recent studies
[00:03:36.590]have suggested that we have underestimated impacts
[00:03:39.610]and in particular, in comparison to 1 1/2 degrees,
[00:03:43.580]this 1/2 degree temperature increase
[00:03:46.590]is going to be significant
[00:03:47.740]and it's gonna be significantly damaging to human health,
[00:03:51.472]to environmental health, ecosystems, biodiversity,
[00:03:55.340]and even to our economy and economic growth opportunities.
[00:03:59.020]So, given that this is essentially what the challenge is,
[00:04:04.890]having to cut emissions in the next 10 years significantly
[00:04:08.910]even if we are on track for a two-degree goal,
[00:04:14.090]emission reduction needs to rapidly expand
[00:04:17.260]in the next 10 years.
[00:04:19.140]This type of transition, as monumental as it is,
[00:04:25.010]is made even more difficult
[00:04:27.010]given the political and cultural context
[00:04:29.760]that we find ourselves in.
[00:04:31.120]So on the left here is a graphic
[00:04:33.330]that demonstrates public opinion
[00:04:34.860]regarding whether climate change is actually happening.
[00:04:37.700]This is a public opinion poll
[00:04:39.130]from the Yale Climate Change Communication Program
[00:04:42.030]which has excellent data
[00:04:43.210]on a range of different climate questions.
[00:04:46.160]And here in particular,
[00:04:48.460]the blue line here depicts
[00:04:53.531]how Liberal Democrats feel
[00:04:54.750]about whether climate change is happening
[00:04:57.200]and the dark red line here
[00:04:59.620]depicts conservative Republican attitude
[00:05:02.780]towards climate change and whether it is occurring.
[00:05:05.300]As you can see, Liberal Democrats
[00:05:07.690]are virtually 100% in agreement
[00:05:11.540]that climate change is happening
[00:05:13.080]while conservative Republicans,
[00:05:15.750]only half of them or less than half of them
[00:05:17.810]actually believe in climate change.
[00:05:19.700]While this is a significant divergence or polarization,
[00:05:24.760]this type of polarization holds true
[00:05:27.490]for a number of these climate questions,
[00:05:29.560]whether it's human-caused,
[00:05:31.470]how worried individuals are
[00:05:32.910]about the impacts of climate change
[00:05:34.870]and what type of policies should be implemented
[00:05:37.460]to tackle climate change.
[00:05:38.980]While some of these questions
[00:05:41.460]result in slightly less diversion,
[00:05:44.120]such as whether CO2 should be regulated as a pollutant,
[00:05:49.250]which is positive that there might be more agreement there,
[00:05:53.750]it demonstrates that there are significant cleavages
[00:05:57.710]in society that need to be accounted for
[00:06:01.500]in a number of different ways.
[00:06:03.670]First off, it is important to understand
[00:06:06.270]that this divergence is a reflection
[00:06:09.570]of different worldviews,
[00:06:11.090]a different understanding of the world
[00:06:13.020]and climate change as a problem within it.
[00:06:15.820]So that means in any kind of climate communication
[00:06:19.890]focus on scientific argument is less persuasive
[00:06:23.420]than building trust
[00:06:24.890]and building some kind of common understanding.
[00:06:28.010]However, while that is an important factor
[00:06:32.470]and is critical in changing the climate debate
[00:06:35.860]it is not sufficient in tackling the climate challenge
[00:06:41.240]that I've laid out in the previous slide.
[00:06:44.010]In particular attitudinal change
[00:06:46.020]and coming to this kind of agreement is a slow process.
[00:06:48.820]Well, the time we know that I've laid out,
[00:06:52.180]or the IPCC rather has laid out
[00:06:54.450]in terms of how emissions need to change
[00:06:57.120]in the coming 10 years
[00:06:58.530]really does not allow for that kind of timeframe.
[00:07:01.290]What that means is,
[00:07:04.310]not just for communication but also for policy,
[00:07:07.860]we need to be mindful
[00:07:10.310]of this political and ideological cleavage.
[00:07:14.870]So really, policy makers need to design policy
[00:07:19.710]with this cultural context in mind
[00:07:22.420]to ensure that policy that is being implemented
[00:07:27.020]is actually going to be effective
[00:07:29.150]and is going to be implemented in the first place.
[00:07:31.520]And in fact, up until recently,
[00:07:34.570]the narrative has favored optimal policy,
[00:07:39.970]or what would be the best policy
[00:07:42.720]to reduce emissions very quickly
[00:07:45.200]without necessarily considering
[00:07:47.310]how likely it is to be implemented in the first place.
[00:07:50.690]And if it was to be implemented
[00:07:52.640]how effective it is going to be given this divergence
[00:07:55.867]and this very diverse attitudinal context.
[00:08:02.470]So, what I'm going to argue is,
[00:08:06.830]we need to be very mindful of this context,
[00:08:10.230]not just when debating climate change
[00:08:12.430]but also when thinking about what types of policies
[00:08:16.550]should or could be put forward and policy makers
[00:08:21.160]are more likely to be able to achieve effective policy
[00:08:24.640]if this cultural context is considered.
[00:08:27.960]In fact, I'm going to demonstrate
[00:08:31.220]that when ignoring this cultural context
[00:08:35.340]policies are less likely to be implemented
[00:08:37.470]and less likely to be effective.
[00:08:39.370]And I'm going to do so
[00:08:41.812]with two examples that have been relatively prominent
[00:08:44.610]in a climate policy narrative
[00:08:47.100]and that is individual responsibility
[00:08:49.110]to minimize carbon footprint and carbon pricing
[00:08:53.500]which is the favored systemic policy
[00:08:57.180]or the policy to make systemic changes to society
[00:09:00.690]that has received a lot of attention and support
[00:09:03.960]from economists but also
[00:09:06.770]market-oriented conservative policy makers.
[00:09:10.290]So, let's take this one by one to look at
[00:09:13.660]how effective these policies actually are
[00:09:16.170]given the cultural context that we are facing.
[00:09:21.390]So to start off with limits of individual action,
[00:09:27.864]it is important to understand
[00:09:30.269]what individual action can achieve
[00:09:32.820]and what it can't achieve.
[00:09:34.170]And when the narrative or policy advocate
[00:09:39.850]for individual action,
[00:09:41.840]it is critical to see this in context.
[00:09:45.610]And first off, there are some limits to individual action
[00:09:49.080]just simply by the fact that carbon emissions
[00:09:51.690]are somewhat systemic,
[00:09:53.680]meaning that even if individuals
[00:09:55.880]were to reduce their consumption,
[00:09:59.810]for instance, if they were to switch over their cars
[00:10:04.490]to electric vehicles,
[00:10:06.290]they are unable to reduce emissions to zero,
[00:10:11.110]or even to the 50% that is laid out by the IPCC.
[00:10:16.910]And that is because the electricity sector at the moment
[00:10:20.800]currently is still heavily reliant on fossil fuels.
[00:10:23.550]Only about 20% of electricity is currently being produced
[00:10:27.250]from renewable sources, meaning that individual action,
[00:10:30.560]even if it is more pro-environmental
[00:10:36.060]in terms of using electric vehicles,
[00:10:38.310]there are limits to the actual emission reductions
[00:10:40.850]that can achieve.
[00:10:42.870]So that would require some more systemic changes
[00:10:46.900]to the actual sources of electricity to change
[00:10:50.160]our overall emissions that we emit.
[00:10:53.980]Second, a limiting factor to individual action
[00:10:57.370]is the limited willingness to actually change behavior
[00:11:02.100]to minimize carbon footprint.
[00:11:04.290]And to a certain extent, there are going to be ceilings
[00:11:08.190]as to how much the carbon footprint can be minimized
[00:11:11.610]in the first place
[00:11:12.590]especially given these systemic limits.
[00:11:18.760]Generally speaking, individuals or households
[00:11:21.330]cannot reduce their electricity consumption,
[00:11:25.860]for instance, to zero.
[00:11:28.009]So, there are some limits in this regard
[00:11:31.280]but in addition to that,
[00:11:33.500]there is a lack of appetite from significant portions
[00:11:39.748]of the population to make significant cuts and emissions.
[00:11:45.490]And that is for a number of reasons,
[00:11:48.140]one of which is ideological and cultural,
[00:11:51.040]that some individuals don't foresee climate change
[00:11:54.550]to be as severe a threat
[00:11:55.830]to their wellbeing and livelihood as others
[00:11:58.360]and are thus less moved to actually reduce emissions.
[00:12:04.050]In addition to that, because a lot of the narrative
[00:12:06.870]surrounding individual action
[00:12:08.380]has been in terms of catastrophizing delay in action
[00:12:13.730]or inaction, it makes it easier for individuals
[00:12:16.720]who disagree with climate change at the first place,
[00:12:20.120]it makes it easier for them to dismiss
[00:12:22.050]these types of calls for action,
[00:12:24.990]makes it easier for individuals
[00:12:26.750]to cast this line of reasoning off
[00:12:31.640]as hyperbolic and hence
[00:12:36.544]this inattention to ideological differences
[00:12:39.080]and the narrative of catastrophizing
[00:12:41.450]thus limits the effectiveness of individual action.
[00:12:47.460]And then third consideration for limits to individual action
[00:12:51.160]are that, as a whole, it is not always apparent
[00:12:56.870]what the most effective ways of limiting emissions is.
[00:13:01.710]So for instance,
[00:13:03.520]if you have a choice
[00:13:05.120]between purchasing organic produce, for instance,
[00:13:09.610]or local produce, it is not immediately apparent
[00:13:12.440]which one would have a lower carbon footprint
[00:13:14.880]even if the goal was to reduce it.
[00:13:17.420]So there are limits in that way too
[00:13:20.530]of individual action because individuals systematically
[00:13:24.560]are uncertainty about what the most effective task
[00:13:28.240]or effective action would be.
[00:13:32.560]So, taking that into consideration,
[00:13:37.160]say policymakers were interested
[00:13:39.750]in systematically providing information,
[00:13:43.450]educating the public
[00:13:44.820]and then providing some kind of incentives
[00:13:46.520]to encourage pro-environmental action.
[00:13:49.220]So, that is done in a number of different policies,
[00:13:52.140]a number of different ways.
[00:13:53.290]The first one is that individuals
[00:13:55.290]are monetarily incentivized to behave
[00:13:59.210]in a pro-environmental way.
[00:14:01.200]So one way would be to pay individuals.
[00:14:03.700]Another policy approach is to sway individuals
[00:14:07.740]and to persuade them to reduce their emissions
[00:14:12.280]or increase pro-environmental behavior.
[00:14:14.740]Both of these run into some issues,
[00:14:16.800]especially when it comes to ignoring political
[00:14:22.030]and cultural context.
[00:14:23.870]When it comes to paying individuals,
[00:14:26.320]effectiveness of this policy is limited
[00:14:28.660]by who it actually is targeting.
[00:14:31.760]And to a large extent, sort of...
[00:14:34.320]Let me give you an example of policies
[00:14:38.660]that are encouraging individual behavior
[00:14:42.040]or pro-environmental behavior.
[00:14:43.410]And this would be tax credits to purchase electric vehicles.
[00:14:49.110]This has somewhat limited impact because, again,
[00:14:52.330]it targets only individuals
[00:14:54.860]that are already likely to drive smaller cars.
[00:15:00.330]It's less likely to be persuasive or to sway decision-making
[00:15:05.420]of individuals who drive larger cars such as SUVs
[00:15:12.860]or light duty trucks,
[00:15:14.980]that they're less likely to trade in these vehicles
[00:15:19.440]for an electric vehicle
[00:15:21.470]even with some kind of tax incentive.
[00:15:23.930]So the impact given that this is not cognizant
[00:15:29.430]of the cultural divergence in the country,
[00:15:32.730]the impact is gonna be relatively low
[00:15:34.630]because you're really targeting individuals
[00:15:36.530]who are already relatively pro-environmentally inclined.
[00:15:42.570]In addition to that,
[00:15:44.280]when you provide some kind of monetary incentives,
[00:15:48.020]you run the risk of crowding out,
[00:15:50.370]or motivational crowding out,
[00:15:51.820]which means actually having fewer individuals sign up
[00:15:56.300]or purchase electric vehicles,
[00:15:58.260]because this behavior
[00:16:01.180]is no longer purely motivated
[00:16:03.020]by the desire to achieve some kind of emission reduction
[00:16:07.320]or behave in a pro-environmental way
[00:16:10.040]but rather is motivated by the monetary incentive.
[00:16:14.160]Which means if these individuals
[00:16:16.160]feel like they are now doing it for the wrong reason,
[00:16:19.100]or it might appear that they're doing it
[00:16:20.447]for the wrong reason,
[00:16:22.380]they are less likely to actually
[00:16:24.410]make these pro-environmental purchases.
[00:16:29.300]And you've seen this kind of effect that happens a lot
[00:16:32.320]in terms of blood donations.
[00:16:34.250]If you actually provide monetary incentives
[00:16:36.500]to provide blood, to give blood, you see a drop in donations
[00:16:41.040]given that individuals don't wanna seem
[00:16:42.880]like they're just doing it for the money.
[00:16:49.180]This particular behavioral incentive
[00:16:52.590]is gonna be particularly problematic
[00:16:55.190]for individuals who are pro-environmentally inclined
[00:16:57.780]in the first place.
[00:16:58.790]So we see here,
[00:17:02.657]when individuals are monetarily incentivized
[00:17:05.140]to change their behavior,
[00:17:07.530]if you are, or if policymakers are not cognizant
[00:17:10.800]of how this might impact
[00:17:13.820]different segments of the population,
[00:17:17.140]the effectiveness of this type of policy
[00:17:18.990]is going to be somewhat limited.
[00:17:22.200]The second point I wanna make here
[00:17:24.380]is the alternative policy
[00:17:26.980]rather than provide monetary incentives
[00:17:29.450]is to sway individuals through persuasive messaging,
[00:17:33.130]such as providing individuals with information
[00:17:36.700]as to what others are doing to limit their emissions.
[00:17:39.700]And this is heavily used
[00:17:42.070]in electricity consumption, for instance,
[00:17:45.370]to improve energy efficiency
[00:17:47.370]and reduce electricity consumption.
[00:17:49.360]A number of utilities have sent their customers
[00:17:53.790]in their bills information on what neighbors
[00:17:56.740]or similar households, how much electricity they're using
[00:18:00.840]and especially how much energy-efficient households
[00:18:05.130]This type of norms-based messaging,
[00:18:07.170]so creating some kinda social norm
[00:18:08.900]that other households
[00:18:10.690]or households that use a lot of electricity
[00:18:15.450]may want to abide by
[00:18:16.970]is actually quite effective
[00:18:18.810]in terms of reducing carbon emissions
[00:18:22.540]through reduction in energy or electricity consumption.
[00:18:26.930]A number of studies demonstrate
[00:18:28.200]that there is about a 2% reduction
[00:18:31.370]in electricity consumption
[00:18:33.840]following these kinds of messages.
[00:18:35.400]That seems relatively low,
[00:18:36.930]but given that this type of reduction in electricity demand
[00:18:42.400]is similar to one that you would find
[00:18:44.380]if you hiked electricity prices by 10 to 30%.
[00:18:49.060]So this is a considerable amount of electricity reduction.
[00:18:56.480]However, again, without considering cultural
[00:19:00.870]and ideological context,
[00:19:04.170]there are limits to the effectiveness
[00:19:06.130]or how scalable this type of policy is.
[00:19:10.060]First, not all households
[00:19:13.640]are going to reduce their electricity demand
[00:19:15.750]by similar amounts or in a similar way.
[00:19:18.360]In fact, there are a number of households...
[00:19:21.340]So, this type of messaging is particularly effective
[00:19:24.610]for liberal households.
[00:19:27.390]These households reduce their energy demand
[00:19:29.620]by two to four times the actual average amount.
[00:19:35.070]And in comparison, more conservative households
[00:19:38.760]are more likely to opt out of this type of messaging
[00:19:42.080]and are also less likely to reduce their emissions
[00:19:46.080]and rather some households even increase
[00:19:48.690]their electricity demand for a number of reasons.
[00:19:51.630]So depending on who you are targeting with this,
[00:19:59.410]the policy implementation might actually result
[00:20:01.800]in increases in electricity demand.
[00:20:03.760]So again, without being very cognizant or mindful
[00:20:07.010]of the different attitudes
[00:20:09.100]that different segments of the population have
[00:20:11.080]towards environmental behavior and climate change,
[00:20:14.660]policy design can actually be limited in its effectiveness.
[00:20:18.350]And the final point to make in terms of individual action
[00:20:23.960]is that while these social norms messaging
[00:20:28.610]can be problematic and/or less effective, rather,
[00:20:32.070]for certain segments of the population,
[00:20:34.840]they can also create a negative impact
[00:20:39.460]in follow-up behavior.
[00:20:41.820]So for instance, moral licensing studies suggest that
[00:20:46.490]if you sway an individual to act particularly
[00:20:49.890]pro-environmental in one area
[00:20:51.820]such as reducing electricity demand or consumption,
[00:20:56.160]they may then increase their demand or emissions
[00:21:04.080]in other areas because they already feel
[00:21:06.780]like they've committed and have already done their part
[00:21:10.500]in trying to solve climate change
[00:21:14.039]or commit pro-environmental action.
[00:21:19.610]Policy makers might not be able to encourage
[00:21:22.820]additional pro-environment to behavior.
[00:21:25.030]It's just a shift in terms of how environmental behavior
[00:21:28.330]is distributed more towards,
[00:21:29.970]for instance, electricity consumption
[00:21:31.970]than reducing miles traveled in the car.
[00:21:37.030]So, this is going to be particularly an issue
[00:21:42.280]for individuals who don't feel
[00:21:44.860]that pro-environmental behavior is a moral issue.
[00:21:48.140]So again, this is going to be more of a problem
[00:21:50.840]for certain segments
[00:21:52.240]of the ideological spectrum versus others.
[00:21:55.610]And again, this is where careful consideration
[00:21:58.350]of this type of ideological cleavages
[00:22:00.850]is important in policy design to craft effective policy.
[00:22:06.910]So, I've mentioned that limits to individual action,
[00:22:11.870]the effectiveness of individual action
[00:22:14.230]to a certain part comes down to
[00:22:17.150]that it does not change systemic carbonization
[00:22:20.440]of the system or of the economy.
[00:22:23.700]And one of the major policies that has been proposed
[00:22:27.460]or put forward for decades now has been carbon pricing.
[00:22:32.260]You might be familiar with these types of schemes.
[00:22:34.480]They're essentially an attempt to create a carbon market
[00:22:40.040]by either placing a tax or a price on carbon,
[00:22:44.720]and then either trading emissions in a cap-and-trade system
[00:22:48.580]or essentially just imposing a carbon tax or fee.
[00:22:53.460]I'm gonna be focusing on carbon fees or taxes here
[00:22:56.900]right now, but similar reasoning and arguments
[00:23:01.790]apply to a cap-and-trade system.
[00:23:04.760]So carbon pricing, generally speaking,
[00:23:07.390]is seen as a very effective tool
[00:23:10.280]at reducing in CO2 emissions.
[00:23:13.060]It's also seen as a very cost-effective tool.
[00:23:15.670]So we can actually reduce emissions by a greater amount
[00:23:20.010]given that the cost of doing so is lower.
[00:23:23.830]And the reason it does so is by imposing a fee
[00:23:28.850]or a certain tax per ton of CO2 emitted,
[00:23:34.050]it essentially makes fossil fuel intense activities
[00:23:39.350]more expensive relatively speaking
[00:23:41.780]to climate friendly activities that rely, let's say,
[00:23:47.160]on renewable energy sources.
[00:23:49.290]So the relative price is in favor of renewable sources
[00:23:54.830]meaning that there is going to be a shift
[00:23:56.490]towards renewable sources
[00:23:58.210]towards more carbon-friendly activities
[00:24:01.140]so that taxation can be avoided.
[00:24:05.580]And this means three things.
[00:24:09.370]First off, this type of policy provides an incentive
[00:24:14.060]to decrease carbon emissions across all industries.
[00:24:17.920]So it's not gonna be limited to individual
[00:24:19.810]or household action, this type of policy,
[00:24:22.940]because it makes
[00:24:24.130]all fossil fuel intense activities expensive
[00:24:27.490]is going to transition to renewable sources
[00:24:32.480]or more carbon-friendly sources across all industries
[00:24:35.810]because money can be saved across all of these sectors.
[00:24:39.500]Second, because there's a cost to every single ton of carbon
[00:24:45.550]that is emitted,
[00:24:47.310]there is an incentive
[00:24:48.690]to continuously reduce carbon emissions,
[00:24:52.130]continuously improve efficiency
[00:24:53.970]and to innovate and create technologies
[00:24:55.870]that allow you to do so
[00:24:57.290]in various systematic way,
[00:24:59.050]and permanently shift you
[00:25:01.360]to a less carbon-intense mode of doing things.
[00:25:05.570]So it really encourages innovation and technology.
[00:25:09.380]And finally, in addition to those two factors,
[00:25:13.280]it also encourages low cost mitigation,
[00:25:18.110]carbon mitigation to happen first of all.
[00:25:21.190]So essentially allows the economy
[00:25:24.400]to take the low-hanging carbon emission fruit, so to say,
[00:25:30.350]and permit those sources of relatively expensive ways
[00:25:35.640]of mitigating carbon emissions.
[00:25:37.330]So for instance, there are certain industries
[00:25:39.520]that are heavily reliant on CO2 or carbon
[00:25:43.180]and not for energy sources
[00:25:45.530]that can be transitioned to renewable,
[00:25:47.490]but for the product itself.
[00:25:49.856]So for instance, concrete is very carbon-intense
[00:25:57.990]and is difficult to decarbonize,
[00:26:02.440]meaning that that type of activity might still continue
[00:26:06.760]while other activities where it's much cheaper
[00:26:08.670]to transition to renewables is going to be done first
[00:26:11.750]and is going to be done most cheaply.
[00:26:14.100]So essentially, by targeting or focusing
[00:26:17.580]on this low-hanging fruit,
[00:26:19.870]this type of policy is going to result
[00:26:21.570]in the most cost-effective way of mitigating climate change
[00:26:25.590]or reducing our emissions.
[00:26:27.680]Now, given that this is such a cost-effective
[00:26:32.050]and effective policy,
[00:26:34.370]you would expect to see significant movement
[00:26:37.440]or implementation of this type of policy.
[00:26:40.040]However, as you'll see in a moment,
[00:26:42.780]this has been proposed for decades or discussed for decades,
[00:26:47.140]and it has been proposed to Congress for numerous years
[00:26:51.040]and has not left Congress.
[00:26:54.450]Let me just show you here.
[00:26:58.070]These are the carbon pricing bills proposals
[00:27:00.890]that have been put forward in Congress all last four years.
[00:27:05.370]There are numerous of those,
[00:27:07.110]some of them are actually proposed every single Congress
[00:27:12.250]and there is no scarcity of good proposals
[00:27:17.030]regarding carbon pricing but it has not made it,
[00:27:21.090]it hasn't passed through Congress so far.
[00:27:26.570]So this essentially means,
[00:27:28.090]given that this policy is great on paper
[00:27:33.290]looks to be very effective
[00:27:34.620]and looks to be very cost-effective,
[00:27:39.710]it's not clear why it hasn't passed yet.
[00:27:42.560]But I argue it's because it hasn't taken cultural
[00:27:45.350]and ideological factors into consideration in it's design,
[00:27:50.050]which has really limited its feasibility
[00:27:54.110]or political accessibility
[00:27:58.658]and has meant that it hasn't passed so far.
[00:28:01.340]So a couple of things to think about here.
[00:28:04.460]To explain why carbon pricing schemes
[00:28:07.610]have not yet passed through Congress.
[00:28:11.560]One important factor to acknowledge here
[00:28:15.550]is that carbon pricing schemes
[00:28:17.060]really emphasize the costs of carbon mitigation
[00:28:21.450]rather than the benefits.
[00:28:22.950]The benefits are very diffuse.
[00:28:24.610]It essentially is carbon or climate change impacts averted
[00:28:31.750]which hopefully we will never feel
[00:28:35.460]meaning that it's hard to really assess
[00:28:38.550]how great the benefit is going to be
[00:28:41.024]except for numbers in reports.
[00:28:43.960]Meanwhile, costs of this type of proposal
[00:28:48.155]are going to be very tangible and very visible.
[00:28:51.780]In fact, carbon pricing scheme
[00:28:55.340]is going to increase the cost of gas, for instance,
[00:28:59.600]which is most individuals are very cognizant of,
[00:29:04.920]it is highly publicized.
[00:29:06.890]Even if you're just driving through town,
[00:29:09.740]you see these prices everywhere.
[00:29:12.470]So it's easy to spot that in addition if utilities,
[00:29:17.650]if electricity bills go up considerably
[00:29:20.190]it's again very noticeable.
[00:29:22.080]So these costs are very tangible
[00:29:26.070]and they're also nearly enough distributed
[00:29:28.650]so that they focus on the fossil fuel industry,
[00:29:33.810]which allows the opportunity for very organized resistance
[00:29:39.660]where that can then capitalize
[00:29:41.280]on the message of costs are going up,
[00:29:45.730]you will have to pay more in terms of gas,
[00:29:48.470]you will have to pay more for electricity.
[00:29:51.310]In addition to that, costs are also disproportionately
[00:29:55.530]affecting lower-income households,
[00:29:59.200]meaning that if utility bills go up,
[00:30:03.360]given that they are larger proportion of income
[00:30:07.550]for lower income households,
[00:30:09.600]these households are gonna be hit more substantially.
[00:30:14.250]Now, a lot of these carbon pricing proposals
[00:30:18.720]are actually recommending
[00:30:20.340]that the revenues taken in from this tax
[00:30:23.060]are essentially returned to households in monthly checks
[00:30:29.420]essentially just to make this a revenue neutral tax
[00:30:35.520]and provide benefits, especially to low-income households
[00:30:39.150]that would receive more back than they actually spend
[00:30:42.640]in terms of utility bills.
[00:30:46.160]The problem with this is that the costs are still so visible
[00:30:50.960]and there's studies to suggest that public opinion
[00:30:54.640]is going to focus on these costs
[00:30:56.800]over the benefits potentially received
[00:30:59.610]from government checks for a number of reasons,
[00:31:02.760]suggesting that there is less public support,
[00:31:06.750]even for proposals that plan on returning
[00:31:10.096]the actual tax revenue to households.
[00:31:15.710]Second important factor in considering
[00:31:19.590]and thinking about how political and ideological cleavages
[00:31:23.690]are limiting the implementation of this particular policy.
[00:31:29.370]Given that this policy is essentially a tax,
[00:31:32.040]and in particular, conservatives are opposed
[00:31:37.250]to increases in taxation,
[00:31:41.240]there's going to be limited support from Republicans
[00:31:44.570]to actually pass these particular bills.
[00:31:48.400]This is particularly important in a setting
[00:31:50.850]as is currently the case where the Senate is split 50/50
[00:31:55.220]between Republicans and Democrats,
[00:31:57.690]where every additional vote from Republicans is necessary
[00:32:04.724]and important to actually passing
[00:32:07.520]a significant piece of legislation
[00:32:10.190]as carbon pricing would be.
[00:32:14.220]Even though carbon pricing, given its cost effectiveness,
[00:32:18.430]is much more supported by conservatives
[00:32:21.720]than alternative climate policies
[00:32:23.470]such as emission standards and other regulatory mechanisms
[00:32:28.540]to actually reduce emissions,
[00:32:31.080]there is still a large concern about public support
[00:32:34.700]and if Republican lawmakers
[00:32:37.160]were to put their weight behind this,
[00:32:39.790]whether they run the risk
[00:32:43.680]of having to run primaries and there...
[00:32:47.630]Of losing their seats essentially,
[00:32:49.440]by being primaried by more conservative individuals,
[00:32:53.150]and hence they are less likely to support this.
[00:32:58.120]Generally speaking though, this kind of concern
[00:33:00.500]and the very real concern where a number of conservatives
[00:33:04.690]who have supported this have then faced,
[00:33:08.950]even more conservative primary challengers,
[00:33:12.540]has led to an increase in polarization in Congress,
[00:33:16.520]which means that it's even less likely that even the policy,
[00:33:23.040]even if it's somewhat of a compromise, can get passed.
[00:33:27.090]So this is one way how carbon pricing,
[00:33:32.110]by sort of emphasizing costs over benefits,
[00:33:34.940]by sort of not being sufficiently mindful
[00:33:38.630]of the political realities
[00:33:40.610]or the political polarization in Congress,
[00:33:43.380]has led to somewhat of a lack of implementation.
[00:33:47.510]There's also concern that even if carbon pricing was passed
[00:33:53.570]that it's not going to be as effective
[00:33:55.470]as is suggested on paper.
[00:33:57.600]So as I mentioned on the previous slide,
[00:34:00.410]carbon pricing is seen as a highly effective
[00:34:03.220]and cost-effective way of reducing emissions.
[00:34:05.580]But that is unfortunately not clear
[00:34:11.080]how it would actually play out in reality.
[00:34:13.240]There is some evidence to suggest that
[00:34:15.750]in the political process of actually passing carbon pricing,
[00:34:21.462]the cost or the tax, the price on carbon,
[00:34:24.860]would be lowered significantly to get it passed
[00:34:27.760]and get some kind of consensus
[00:34:30.710]or have some conservative lawmakers sign onto it.
[00:34:34.690]Which means, the lower the price that is imposed on carbon,
[00:34:39.050]the less-effective it is actually going to be
[00:34:41.150]in changing behavior and creating incentive
[00:34:43.350]to transition over to renewables
[00:34:46.720]or to innovate and create more renewable technology.
[00:34:51.650]And one way to demonstrate this is that the IPCC
[00:34:56.270]calculates that a carbon price
[00:34:57.680]would have to be around $135 to $6,000,
[00:35:01.840]somewhere in between, per ton of CO2 emitted,
[00:35:06.130]to reduce emissions sufficiently
[00:35:09.560]to avert the 1 1/2 degree temperature increase
[00:35:12.880]that I mentioned at the very beginning.
[00:35:15.440]Now, contrast that with what the proposals
[00:35:17.950]are actually proposing.
[00:35:20.690]So the 11 proposals that we just looked at previously
[00:35:25.840]range between $15 and $52 as starting price.
[00:35:31.040]They increase yearly but not to the extent necessary
[00:35:35.230]to actually create the kind of incentives
[00:35:39.110]necessary to change emissions
[00:35:40.860]or reduce emissions sufficiently
[00:35:46.267]for society or the globe to meet the 1 1/2 degree goal.
[00:35:50.360]Now, in addition to that, there is a concern
[00:35:53.990]that there is actual support from industry
[00:36:00.340]for carbon pricing schemes.
[00:36:02.260]While this seems as a positive,
[00:36:05.500]one of the reasons that there is concern for this
[00:36:07.500]is because there is an argument that industry believes that
[00:36:12.970]if they push for carbon pricing,
[00:36:15.080]they can avert or avoid any other regulation.
[00:36:20.570]And by watering down the actual carbon price,
[00:36:24.090]this type of policy might not be as stringent
[00:36:28.370]and not be as painful for industry
[00:36:31.265]as one would otherwise expect
[00:36:35.070]and not transition to more renewable sources of energy.
[00:36:41.370]So final note to make here in terms of reasons to believe
[00:36:47.230]that the effectiveness of carbon pricing
[00:36:49.980]might be somewhat limited given the ideological landscape.
[00:36:53.770]And I'm thinking about how it needs to be watered down
[00:36:56.540]to actually pass Congress.
[00:36:59.340]One other concern might be that
[00:37:02.930]previous carbon pricing schemes
[00:37:04.440]that have been imposed in other countries
[00:37:06.317]such as in the EU or elsewhere, in Canada for instance,
[00:37:13.880]have actually resulted in less innovation than expected.
[00:37:18.210]They've resulted in significant reduction in emissions,
[00:37:22.060]but not nearly the type of emission reduction
[00:37:25.880]necessary for meeting the 1 1/2 degree goal.
[00:37:32.462]And there's evidence to suggest really that
[00:37:34.950]rather than creating innovation
[00:37:37.280]and technological improvement,
[00:37:39.200]that carbon pricing are really just more effective
[00:37:44.090]at shifting two different technologies
[00:37:47.910]rather than creating new technologies.
[00:37:49.107]And at this point in a setting, we're really looking for...
[00:37:56.610]For significant transition in terms of technology
[00:38:00.580]or creation of technology that is not quite there yet.
[00:38:04.790]So this type of policy might not be effective
[00:38:11.163]in bringing about the emission reduction
[00:38:13.200]that would be envisioned for a 1 1/2 degree goal.
[00:38:18.673]So let me just finish off this discussion
[00:38:24.120]by reviewing possibly a better approach
[00:38:27.660]that actually takes some of these political
[00:38:29.630]and ideological cleavages into consideration.
[00:38:32.970]And I think about this in terms of policy makers
[00:38:37.710]having to design policy
[00:38:40.910]with cultural and political context in mind,
[00:38:45.250]rather than trying to push for a particular policy
[00:38:48.440]despite political and cultural context.
[00:38:51.310]And a couple of design features are important here.
[00:38:55.330]First off, an emphasis of benefits over cost.
[00:39:01.380]If policymakers are trying to persuade
[00:39:05.500]or trying to demonstrate
[00:39:09.895]that mitigation policies are positive
[00:39:14.670]even to individuals who don't believe in climate change,
[00:39:17.150]it is important to highlight the benefits
[00:39:20.120]such as job opportunities in an energy transition,
[00:39:23.890]and there's a plethora of studies that suggest
[00:39:32.950]that there are numerous more jobs
[00:39:35.040]in the renewable energy sector
[00:39:37.810]compared to the fossil fuel sector.
[00:39:41.510]Well, there's always a question of whether these jobs
[00:39:43.970]are of similar quality.
[00:39:45.560]That's a separate debate.
[00:39:47.640]But just by emphasizing these benefits in policy,
[00:39:52.240]that already sort of speaks to some of this ideological
[00:39:55.820]or attitudinal divide.
[00:39:58.230]Second, policy needs to consider
[00:40:03.010]or explicitly include individuals
[00:40:05.500]from across the climate divide.
[00:40:07.340]So this means,
[00:40:09.930]acknowledging that for some of these individuals,
[00:40:13.720]at least in their viewpoint,
[00:40:16.060]these policies are more detrimental to their way of life
[00:40:20.010]than threat of climate change.
[00:40:22.150]And in fact, this is going to be the case
[00:40:25.710]in a number of areas
[00:40:28.200]where they would face significant job loss
[00:40:31.840]from transitioning away from fossil fuel industries
[00:40:35.120]or in rural areas that are heavily relied, for instance,
[00:40:44.150]on industries that have a relatively high carbon footprint.
[00:40:48.340]So one way to think about this is,
[00:40:51.570]or one policy that has demonstrated this ability
[00:40:55.130]to speak directly to these individuals
[00:40:56.940]who are otherwise not part of the benefits
[00:41:02.080]are subsidies for wind energy, for instance.
[00:41:05.430]A lot of wind energy is set up in rural areas,
[00:41:10.970]which has resulted in close to...
[00:41:14.150]Well, not close to it.
[00:41:15.247]$760 million of state and local taxes being paid
[00:41:19.870]of wind companies that set up in rural areas
[00:41:22.670]that significantly boosts, for instance,
[00:41:26.220]budgets for education for schools,
[00:41:27.930]for hospitals, and so forth,
[00:41:29.900]where rural areas have been neglected to a certain extent.
[00:41:36.750]And in addition, it actually pays direct payments
[00:41:41.210]to land owners in rural areas, farmers, and ranchers
[00:41:46.720]who can lease their land for wind turbines.
[00:41:50.450]So this is a direct economic benefit
[00:41:52.700]that speaks to individuals who are more likely
[00:41:55.470]to be critical of climate policy otherwise.
[00:42:01.760]Third point here, as I mentioned, given that there is a...
[00:42:08.150]If the 1 1/2 degree goal is to be met,
[00:42:11.200]there is a requirement for systematic
[00:42:14.470]or large-scale transition from a carbonized economy
[00:42:19.610]to a green economy.
[00:42:22.460]And that is gonna require significant improvements
[00:42:24.910]in technology and in making renewables.
[00:42:28.630]While it is competitive in certain areas,
[00:42:30.970]it's not competitive in every part of the country
[00:42:35.090]and technological advances are necessary
[00:42:37.410]to make that cost competitive and make this a reality.
[00:42:41.350]So policy to address this emission reduction goal
[00:42:50.677]needs to provide some incentive for research and development
[00:42:53.620]to actually improve the technological basis
[00:42:56.400]that the U.S. has currently.
[00:42:58.280]In addition to that, by emphasizing research and technology,
[00:43:02.730]it can emphasize the benefits of U.S.
[00:43:05.251]becoming a world leader in green technology
[00:43:10.354]and the opportunities that arise in terms of economic growth
[00:43:13.040]and jobs for that as well.
[00:43:14.436]So it's a win-win in terms of creating a greener future
[00:43:18.830]but also providing economic growth.
[00:43:21.740]And finally, policy needs to be cognizant of interest groups
[00:43:30.190]and be mindful...
[00:43:32.750]Policymakers need to be mindful
[00:43:34.760]that carbon pricing schemes, for instance,
[00:43:37.900]where costs are really highlighted over benefits,
[00:43:41.970]are going to make it less
[00:43:43.850]or more likely that political interest groups
[00:43:46.940]can organize and avert to say policy, for instance.
[00:43:52.180]There are ways to circumvent that
[00:43:56.650]in terms of providing standards.
[00:44:00.440]So, how much renewable energy utilities
[00:44:04.130]have to provide by when
[00:44:06.740]which are easier to implement
[00:44:08.970]in part because they don't necessarily,
[00:44:10.990]not all of them have to go through Congress,
[00:44:13.520]and in part because they are also easier to monitor
[00:44:22.570]Just to wrap things up,
[00:44:25.130]let me just finish up on a positive note saying that
[00:44:29.890]where climate policy in the U.S. is headed currently,
[00:44:33.800]and there is actually a move towards designing policy
[00:44:38.620]in the context of cultural and ideological differences.
[00:44:45.610]And the Biden Administration has put climate change
[00:44:49.610]at the forefront of their agenda with very ambitious targets
[00:44:53.050]such as 100% renewable electricity generation by 2035
[00:44:57.090]and a carbon-neutral economy by 2050.
[00:45:01.780]And in doing so,
[00:45:05.000]the approach that has been taken by the administration
[00:45:07.790]has demonstrated that they are mindful
[00:45:11.240]of the polarized setting that they're in.
[00:45:14.270]And in fact, they have emphasized benefits over costs
[00:45:17.160]by framing the carbon agenda or the climate agenda
[00:45:20.650]as a jobs creation program
[00:45:22.820]with focus on environmental justice
[00:45:24.460]and demonstrating heavily
[00:45:27.263]that this has national security benefits
[00:45:30.770]in terms of limiting the threats to military assets
[00:45:39.090]and producing foreign threats.
[00:45:42.250]In addition, they are purposefully
[00:45:45.360]including individuals from across the climate divide
[00:45:47.720]by looking at integrating rural areas
[00:45:51.870]in terms of carbon sequestration
[00:45:53.590]and providing some kind of financial incentive
[00:45:57.150]to actually improve or change tilling techniques
[00:46:01.250]to capture carbon.
[00:46:03.530]They are prioritizing research and development
[00:46:06.370]by essentially infusing climate change
[00:46:09.970]into all departments and agencies.
[00:46:13.990]So agencies are,
[00:46:17.050]it looks like are going to be required
[00:46:18.400]to have some climate plans in place.
[00:46:21.750]In addition, they've just unveiled or will
[00:46:24.560]in a couple of days,
[00:46:26.110]unveil a 2 trillion infrastructure plan
[00:46:29.840]which has a significant budget for research and development
[00:46:33.240]of critical technologies
[00:46:34.590]and also is aiming to change the infrastructure
[00:46:38.020]so as to make it easier for individuals to, for instance,
[00:46:43.090]move to an electric vehicle
[00:46:44.920]by having electric charging stations around the country.
[00:46:49.800]And then finally, there is evidence
[00:46:53.900]that the administration is mindful
[00:46:56.770]of some of the interest groups
[00:46:58.660]that are going to be heavily involved
[00:47:03.710]in determining legislative policy
[00:47:07.830]and are somewhat circumventing this by proposing standards
[00:47:15.220]for renewable energy production or goals
[00:47:18.740]as to how much renewable energy utilities
[00:47:20.930]have to produce by when
[00:47:22.390]and by proposing car emission standards
[00:47:24.700]which is something that the Department of Transportation
[00:47:27.520]and the EPA does on a regular basis anyway,
[00:47:30.330]but this would be ramping up these types of standards.
[00:47:34.010]So it seems, in conclusion, first off,
[00:47:37.220]that the Biden Administration and the current trajectory
[00:47:40.900]seems to be more cognizant of the cultural context
[00:47:46.410]of policy design.
[00:47:48.430]And it really speaks to this idea that climate policy
[00:47:54.330]needs to be designed in a realistic sense.
[00:47:58.570]And especially if the goal
[00:48:00.170]is to limit temperature increases to 1 1/2 degrees,
[00:48:04.100]this means that cultural and ideological cleavages
[00:48:09.390]need to be considered
[00:48:10.350]because there's evidence to suggest that optimal policy
[00:48:14.380]or what looks to be optimal on paper
[00:48:17.710]has a lower likelihood of implementation.
[00:48:19.730]So as we saw, optimal policy of carbon pricing
[00:48:23.100]is less likely to pass Congress.
[00:48:26.340]In addition to that optimal policy,
[00:48:28.340]when it does get implemented,
[00:48:30.430]it may be less effective in part
[00:48:32.860]because it gets watered down
[00:48:34.140]by the politically polarized system.
[00:48:40.220]But it also is not always accepting
[00:48:45.100]or cognizant of cultural differences
[00:48:48.920]that might reduce the effectiveness of policy
[00:48:51.420]as we saw with individual action.
[00:48:54.070]So policy makers looking to meet this very ambitious
[00:49:01.810]and challenging goal of limiting temperature increases
[00:49:04.970]to 1 1/2 or two degrees Celsius,
[00:49:07.590]will need to consider these political
[00:49:09.670]and cultural cleavages
[00:49:11.130]to design more impactful climate policy
[00:49:14.100]even if this policy might not be ideal on paper
[00:49:18.530]in the end policy and policy outcomes happen in reality.
[00:49:23.500]And without accounting for these cultural differences,
[00:49:28.540]it is less likely that policy is going to achieve
[00:49:31.630]the types of goals that is being put forward
[00:49:36.340]not just by policy makers but by the climate system itself.
[00:49:42.500]That's it from me.
[00:49:44.270]Thanks for listening.
[00:49:45.103]And if you have any questions, I'll be around.
[00:49:48.790](soft instrumental music)
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