Chapter IX of Rio Plus 20 Document by Cho Tab Khen Zambuling (Alfredo Sfeir-Younis)
IX. Our Public Goods
Another way nature and its many phenomena are seen in policy making as “public goods”. The theory and practice of public goods is vast and it is not the intention to address all of that here. The essence of the above is to take into account the fact that these goods, like nature, belong to all citizens of the world and not just to one group of individuals or nations. They belong to the public and there are, in principle, little limitations to their consumption worldwide. In the case of public bads, like pollution and diseases, one would also need to take into account the external impacts of one group who create the bad (e.g., air pollution) in relationship to the rest of the world. One may pollute in one part of the world but the effects will be felt everywhere. Thus, the production of CO2 by one country will affect global warming and ozone layer depletion somewhere else.
This is why the issue of global warming is seen as a public good, requiring public intervention. In other words, the existing market structures and the forces of supply and demand are not effective enough to address the phenomenon in question. Markets are concerned mainly with economic efficiency and not with attaining socially and collectively acceptable outcomes. In many cases these negative external effects are the result of the lack of property rights, the inadequate participation of those finally affected, and of many other institutional, human and social factors.
There is a famous case in institutional economics that is addressed under the heading of The Tragedy of The Commons. This tragedy often happens when there is not a clear system of property rights over the resource in question. Since nature is without a status of being, every person uses it to its advantage, no matter what happens to the available stock or to the other potential users. In the end the resource is depleted and the people depending on that resource suffer a great deal, if not, potential beneficiaries vanish in an economic and social sense. There are many debates with regard to the best instruments to address the public good nature of global warming or the public good nature of any aspect of our external environment.
One of these instruments is to assign private property rights. These private rights impose a clear form of exclusion (from those who have no rights) and eliminate “free riding” over the resources in question. Today, there are many countries that take a“free ride” in utilizing clean air available to all countries in the world. They pollute without any desire to respect the collective interest for the quality of the ‘global’ clean air available. Thus, global warming represents some form of the Tragedy of the Commons. Another suggestion to manage these public goods is to enact and enforce regulations and assign, for example, production or consumption quotas linked to certain levels of emissions. Often, these instruments require lots of good data and a very accurate system of monitoring. Yet another suggestion is to create a surrogate market for emissions or pollution rights (permits), via planting trees or acting around any other form of positive contribution to clean air. And, there are many more instruments.
Experience shows that it is often difficult to deal with the public good nature of environmental management (including global warming) as it depends on the will, capacities, leadership, and vision of governments with respect to the functioning and welfare of our collectives. Unfortunately, there are no worldwide agreements that are supported by every nation. Or, when these agreements are in place they are not necessarily respected, enforced and acted upon. At the root of the management of a public good is a consensual and holistic vision, accompanied by a high level of collective consciousness needed to attain that consensual vision. Judging by the results and by the actual state of our external natural environment, collective consciousness seems to be lower than desirable and, thus, the management and use of many of our public goods are creating public bads: pollution, desertification, global warming, ozone layer depletion, biodiversity depletion… The view, that global warming is a public good, goes one step beyond a concept of nature as a commodity to be exploited indiscriminately. Thus, it raises awareness of the need for collective action and collective responsibility.
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