Where is the "Free Market" on Global Warming?

Much as its adherents like to pretend that it has “laws” like the hard sciences the so-called “Free Market” is an ideology. It is a powerful and dominant one. As the environmental lawyer and professor Zygmunt Plater, who successfully argued the seminal ESA case TVA v. Hill before the Supreme Court, said at a lecture at Boston University in 2000: “The marketplace economy is the most powerful, intimate, highly articulated, self-energizing human system ever invented (probably including religion).”

There is a vogue these days for forensic or political economic commentary by econo-pundits that apply the mechanisms of the dismal science to pedestrian interests like the incentives that sumo wrestlers have to throw a match or the element of economic interest inherent in seemingly emotional or charitable actions. This manner of commentary is effective at pruning out assumptions and prejudices and coming to near-enough-to-empirical truths (which is why its practitioners are often so smug).

Given all that these analysts have to say, their silence on global warming is deafening. There are mentions of gas taxes here, carbon taxes there, and pollution permit trading everywhere; but these ideas are rarely espoused from the ideology’s barkers. The “Market” as an academic idea has no inherent politics. As an ideology the “Free Market” is distinctly right wing. If you corner one of its intellectually-honest promoters they will admit that the government shouldn’t subsidize private industries, but the talking point is that “burdensome government regulations are interfering with the market place.” I have yet to read or hear of a comprehensive “Free Market” solution to global warming… or even see much in terms of a creative suggestion.

The closest that “the marketplace economy” comes to addressing global warming is via the idea of sustainability. Sustainability is, elementally, the marriage of granola environmentalism with market-economics. It seeks to insert the likely impact on future generations into the economic analyses of contemporary actions. Sustainability, or green economics, is more “green’s” attempt to subsume “economics” then a natural progression of the Free Market ideology. In the USA, I have yet to see it meaningfully manifest itself outside of the west coast or even be properly understood by supposedly liberal media outlets such as the New York Times.

The reason for this silence is that global warming, and the impact of environmental degradation in general, is incompatible with the Free Market ideology. As Professor Plater said in 2000: “For all its dynamism, the marketplace economy has a tragic flaw —that every entity in the marketplace economy basically tends to deal only with things that have some form of price tag attached, where benefits or costs are registered, and each also shares the same tragic logic of cost externalization, so that, wherever possible, they tend to externalize social costs out from the domain of the marketplace economy and into no man’s land… The costs impacted into the economy of nature do not just disappear out of sight out of mind. Nature is not a sink. A river that isn’t there anymore isn’t there anymore.”

Or, the Free Market ideology is excellent at determining the monetary benefits of an acre of forest in terms of the lumber that can be derived from it and the work that will be done to accomplish this. It is incompetent at measuring the same acre of forest’s benefits as a purifier of air and water because these benefits are distributed to everyone, and therefore, also, to no one.

The inability of the Free Market ideology to deal with global warming is profound in the musing of the NY Times columnist, and generally intellectually consistent Free Market ideologue, John Tierney. In one column, a sort of review of “An Inconvenient Truth,” he spends two paragraphs making ad hominine insults about Al Gore and then chastises the film for not noting that in the past many economists’ analyses found that the costs of a stringent carbon abatement program were too high given the uncertainty of the science behind global warming. In other words, Tierney’s stalwarts were wrong about the pre-eminent problem of the 21st century, but it’s okay because they are economists. In his second column, Tierney chastises Al Gore, Laurie David and other famous global warming Cassandras for owning second homes. Gore and David are not beyond reproach, but Tierney’s inability, in contrast to most of his other columns, to present any constructive ideas on global warming reveals the bankruptcy of his Free Market ideology. Faced with a problem that is irreconcilable to his belief-system Tierney resorts to emotional arguments, the exact rhetorical ploy that econo-pundits are so sanctimoniously proud to avoid.

The elastic optimal market will be crucial to mitigating global warming and will remain an important element in societal affairs. The Free Market ideology, however, cannot respond to global warming or maintain the viability of the commons. Al Gore is correct. Global warming is a moral issue.