There has been much discussion in free market circles about market-based solutions to global warming that minimize the threat that big government poses to property rights. But less attention has been paid to the threat that greenhouse gas emitters themselves might pose to private property. This is the issue that Jonathan Adler, Professor of Law and Director of the Center for Business Law & Regulation at the Case Western Reserve University School of Law and Indur Goklany, author of The Improving State of the World: Why We’re Living Longer, Healthier, More Comfortable Lives on a Cleaner Planet discuss in this edition of Reason Roundtable in two radical and provocative essays.
I like Shikha Dalmia’s introductory essay, particularly where she says
Indeed, regardless of whether climate change eventually turns out to be real or not, the libertarian goal ought to be to ensure the protection and advancement of freedom – and all its attendant institutions: free markets, limited government and property rights. These rights enhance human welfare by allowing individual choice and experimentation and creating an incentive for individual entrepreneurship and economic growth. But more: they are both the base of – and bulwark for – all other rights. They have normative value quite apart from their utilitarian value.
Jonathan Adler’s essay focuses on thinking about climate policy from a property rights perspective, and I think he’s broadly correct throughout. But his discussion leaves a gaping hole: there are substantial transaction costs associated with a property rights approach, given existing institutions. Some policy change is required to reduce the transaction costs that currently reduce the capacity of the global network to achieve private ordering. Bringing either tort claims or nuisance claims in this highly diffuse and distributed situation would be prohibitively costly. So how do we use his insights to help us design a set of institutions that enable private climate ordering to occur?
I encourage you to read all three essays.