Alligators in the Arctic and How to Avoid Them Climate change is a matter of extreme urgency. Integrating science and economics,thisbookdemonstratestheneedformeasurestoputastrictlid oncumulativecarbonemissionsandshowshowtoimplementthem.Using the carbon budget framework, it reveals the shortcomings of current pol- icies and the debates around them, such as the popular enthusiasm for individual solutions and the fruitless search for ‘optimal’ regulation by economists and other specialists. On the political front, it explains why businessoppositiontothepoliciesweneedgoeswellbeyondthefossilfuel industryrequiringamoreradicalrebalancingofpower.Thiswide-ranging study goes against the most prevalent approaches in mainstream econom- ics, which argue that we can tackle climate change while causing minimal disruption to the global economy. The author argues that this view is not only impossible, but also dangerously complacent. Peter Dorman isProfessor EmeritusofPolitical Economyatthe Evergreen State College in Olympia, Washington Alligators in the Arctic and How to Avoid Them Science, Economics and the Challenge of Catastrophic Climate Change Peter Dorman Evergreen State College UniversityPrintingHouse,Cambridgecb28bs,UnitedKingdom OneLibertyPlaza,20thFloor,NewYork,ny10006,USA 477WilliamstownRoad,PortMelbourne,vic3207,Australia 314–321,3rdFloor,Plot3,SplendorForum,JasolaDistrictCentre, NewDelhi–110025,India 103PenangRoad,#05-06/07,VisioncrestCommercial,Singapore238467 CambridgeUniversityPressispartoftheUniversityofCambridge. ItfurtherstheUniversity’smissionbydisseminatingknowledgeinthepursuitof education,learning,andresearchatthehighestinternationallevelsofexcellence. www.cambridge.org Informationonthistitle:www.cambridge.org/9781316516270 doi:10.1017/9781009029582 ©PeterDorman2022 Thispublicationisincopyright.Subjecttostatutoryexception andtotheprovisionsofrelevantcollectivelicensingagreements, noreproductionofanypartmaytakeplacewithoutthewritten permissionofCambridgeUniversityPress. Firstpublished2022 AcataloguerecordforthispublicationisavailablefromtheBritishLibrary. LibraryofCongressCataloging-in-PublicationData names:Dorman,Peter,author. title:AlligatorsintheArcticandhowtoavoidthem:science,economicsandthe challengeofcatastrophicclimatechange/PeterDorman,EvergreenStateCollege (WashingtonState). description:Cambridge,UnitedKingdom;NewYork,NY:CambridgeUniversity Press,2022.|Includesbibliographicalreferencesandindex. identifiers:lccn2021050502(print)|lccn2021050503(ebook)|isbn 9781316516270(hardback)|isbn9781009014731(paperback)|isbn 9781009029582(epub) subjects:lcsh:Climaticchanges–Economicaspects.|Fossilfuels–Environmental aspects.|Carbondioxidemitigation. classification:lccge195.d6752022(print)|lccge195(ebook)| ddc333.72–dc23/eng/20211217 LCrecordavailableathttps://lccn.loc.gov/2021050502 LCebookrecordavailableathttps://lccn.loc.gov/2021050503 isbn978-1-316-51627-0Hardback CambridgeUniversityPresshasnoresponsibilityforthepersistenceoraccuracy ofURLsforexternalorthird-partyinternetwebsitesreferredtointhispublication anddoesnotguaranteethatanycontentonsuchwebsitesis,orwillremain, accurateorappropriate. To Bill Steel (1916–2017), who set the course. CONTENTS List of Figures, Maps and Tables x Preface xiii Introduction: When Alligators Go North 1 AWarningfromthePast 1 AWarningfromtheFuture 5 MappingaNewEconomicsandPolitics 9 Defogging 12 1 Carbon Accounting for Planet Earth 17 CarbonandLifeoverGeologicalTime 18 TheEarthSurfaceCarbonCycle 24 Feedback 29 CarbonandClimate 32 TheCarbonConundrum 35 2 The Risks of Climate Change, or Why Carbon Budgets Need to Be Binding 37 ASpectrumofRisks 38 BeyondCalculation:TheThreatofaClimateCatastrophe 45 TheEconomicProblem 47 3 Measurement: Myths and Distractions 53 TheFootprintFetish 54 EconomicComplexityandtheLimitstoMeasurement 56 TakingCarbonMeasurementontheRoad 60 AuditingtheCarbonAudit 63 GlobalCarbonMeasurement:FromTargetstoBudgets 68 GlobalCarbonBudgeting:DifficultbutPossible 72 TheClimateChallengeinNumbers 76 4 It’s about Fossil Fuels 80 TheCrusadeagainstEconomicGrowth 83 AChoiceofCrusades 89 SalvationthroughSilviculture? 92 viii / Table Of Contents 5 Costs and Consequences 111 TheCentralityofFossilFuels 112 ABriefDetour:WhataboutJobs? 114 WhatDoWeTalkaboutWhenWeTalkaboutDecarbonizingthe Economy? 115 GettingtoZeroWillNotCostMuch:UnlessItDoes 119 AnIntroductiontotheArtofModelingClimateMitigation 124 AFirstPassattheModelResults 128 TheCostsofClimateMitigationWhenYouReadthe FinePrint 130 TheProblemofCapital 140 It’sNotHopeless 144 WhyHonestyaboutCostMatters 147 6 The Carbon Policy Toolkit 150 AForkintheRoad:TaxesandPermits 152 ButTaxesandPermitsAreDifferent,andItMatters 156 Exemptions,HandoutsandOffsets:TheArtofPolicyFailure 165 CarbonPricing:ARealityCheck 173 RealWorldOffsets:TheCaseoftheClean DevelopmentMechanism 179 TheRestoftheToolkit 183 7 The Global Dimension 190 ColdComfort:Refrigerators,AirConditionersandTheir ConsequencesforCarbonEmissions 191 WhyCooperate? 196 FromTop-DowntoBottom-UpCoordination 200 TheClimateClub:PrivilegesofMembership 204 CarbonRevenuesandClimateFinance 207 ClimateandDevelopment:ASharedAgenda 211 WhataboutTrade? 213 8 Political Economy for Alligators 219 CarbonandCapital 221 TallyingtheThreattoWealth 224 CapitalandthePoliticsofClimateChange 230 FollowtheCarbonMoney 236 TheCompetitionforCarbonRevenues 242 FromPoliticalEconomytoPoliticalAction 247 ix / Table Of Contents Appendix: Demystifying the Economics of Climate Change 252 TheQuestfortheSocialCostofCarbon 252 TheSocialCostofCarbon:AChimera 257 TimeOutforFish 259 TheDilemmaofScale 265 MoreEconomics,LessInformation 267 What’stheAlternative? 273 Notes 275 References 304 Index 341