It turns out one of the most interesting sites for emissions quantification work is the DC-based World Resources Institute. Consider this point from their review of forestry-related emissions assets in developing countries:
“For carbon financing to work, developing countries need to demonstrate that they can quantify market-quality emission reductions at either a subnational or a national level. This includes setting credible baselines (known as reference scenarios) showing that deforestation has not simply shifted from one place to another (known as leakage) and making certain that the emissions reductions will be permanent.”
What interests me here is how the quantification requirements needed to create commercial-grade carbon assets form the intersection of carbon finance and human practices in developing countries. Those with a perspective critical of development institutions, especially governance work, will quickly point out that the most likely scenario is that the credibility of these assets will be weak, but they will remain tradable anyway because a) they’re valuable and b) there are few short-term consequences to poorly enforced standards. This is the sort of concern raised often by NGOs – WRI, for instance – and they do so out of an understanding of their own watchdog role concerning climate change mitigation.
Another possibility is markedly increased seriousness about these kinds of problems, and development of new techniques for capacity training, measurement and verification, and governance credibility.
From a research perspective, the important thing to note is that we have no obligation to decide in advance whether to be cynics (I mean realists) or optimists. We also are not obliged to use research as a way to decide whether or not carbon assets are credible. In fact, we can note that as under-resourced as they are critical NGOs have been keeping track of these issues even if not in the detail the issues deserve. Different disciplines can approach novel questions.
An anthropological approach might pose these concerns in terms of intersecting domains of human practices. We have carbon markets – people buying and selling carbon commodities. We have quantification practices – say, WRI, the carbon auditing organizations, the work sellers must do to produce standardized assets, the concern buyers have in ensuring enforcement is rigorous. And we have the governance work of (in this case) developing countries with forest-based assets, the watchdog groups, the capacity building initiatives. Within these domains of human practices, conceptual problems can be posed – say, the structures of power/knowledge, problems of space and distribution, whether or not any decisive shift has occurred in the interminable problems of development interventions, the status of development as redistribution, the links between politics and capitalism. . .
For me the strongest question concerns the relational ontology of atmosphere that emerges from these numerical informational practices. Specifically, the object being constructed is the carbon asset, but this bears a relation to ‘atmosphere,’ namely the long term stakes of climate stability, rights to climate security as well as rights to economic ‘use’ of the atmosphere. A relational ontology approach here foregrounds the connection ethics-ontology, which is to say the mutual relation of subject and object. (In a future post I will make the case that ethics slides into politics, putting into question the choice of terms I use here – or perhaps noting the ways ethics and politics become indistinct within practices of liberalism characterized by personal action.)
Like the emergence of long term climate scenario modeling and its role in making climate change a real issue, the tension here is between remarkably different time scales. Specifically, atmosphere is medium- to long-term, punctuated by intense climate events. But commercial transactions are short term, while market emergence is medium term at best – say 10-30 years. Shifts in US policy on climate change at the tail-end of the Bush administration were in part the effect of industry demands for clear signals on climate policy. But the other side of this, as Nicholas Stern (The Global Deal,2009) points out, is that an ethical question has to be posed about the rights of people who don’t exist yet.
Fascinatingly, economists routinely discount the value of future lives at a striking rate. Stern argues that this makes no sense ethically or politically, and instead the only legitimate ethical discount for future lives is that there is some possibility that some catastrophic event will end life on earth (say, a meteor strikes the planet). This, too, is quantified. Nordhaus, one of the most prominent climate economists who he takes to task for being misguided on this point, uses a discount rate of 2%. 1.5% is also common. “If a pure-time discount rate of 2% is selected, then a life that starts in 2010 would be assigned approximately twice the social value of a life that starts in 2045. … In other words, someone born later counts for less. In effect, this is discrimination by date of birth” (83). Stern uses an annual rate of 0.1% to account for the possibility of the demise of humanity by some cause other than climate change.
The time discounting concern for economists poses a specific ethical (political) problem (which economists may or may not take up) because the discipline addresses the issue of putting long term climate risks in terms of costly short term decisions. The ethical problem is inherent in the ontology of atmosphere, which has a specific temporal and risk character. So, in some sense this is a different version of the ethics-ontology question posed above in terms of forestry emissions reductions.
The relational ontology as I’ve posed it has to do with the different time scales of carbon assets and atmosphere but, as we see in very specific terms concerning ecological practices in developing countries, the relational ontology always maps onto spatial extention and related distributional effects. Here, quite literally, the temporal object atmosphere manifests in the detailed interactions between people in developing countries, practices of forest ecology, and the embodied, enforced enumeration of commercial grade carbon.
Funny, I wonder if the economists have a discount rate for people who live in other countries (instead of in the future). Or maybe the insurance companies keep track of that?
Accounting for Atmosphere 
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July 12, 2009 at 20:30
siva arumugam
Nice blog, Jerome. On economists and their attempt to discount future lives: I haven’t looked this up but I imagine that 2 percent or 1.5 percent is essentially an estimate of long term real interest rates. The “trick” to discounting future lives being valuing them now and then discounting that amount by an inflation-adjusted risk-free interest rate.
But I don’t think you could simply ignore this move by economists and substitute a much lower rate or even zero, with the latter being the obviously right thing to do. One big limiting uncertainty has to do with the very existence of any market, not least because they’re tied to the existence of particular governments. Regarding the latter and “risk-free” interest rates, the longest US debt instrument is a mere 30 years. The Spanish government, which has the worst credit risk in West Europe, recently issued a 40 year bond just to display their collective cojones or something. England has a tiny amount of perpetual debt (from the turn of the last century I think) and also just recently issued some 50 year debt.
Basically 50 years or so seems to be the viable outer limit of what’s acceptable to investors. It’s the limit of what’s calculable.
Perhaps if it’s not possible to calculate the value of sovereignty beyond 50 years (with the “discount” implicitly going to zero around then pretty quickly), it’d be impossible to value the subjects of sovereigns beyond then too? Just a totally random thought, and I’m looking forward to a post on ontologies!
July 13, 2009 at 13:43
jeromewhitington
Hi Siva,
Thanks for reading and for the insightful comment. I think there’s two points to be made that are especially anthropologically pertinent. First, Stern – former chief economist of the World Bank, mind you, so I presume he’s authorized to speak on such issues – does something very interesting on the point you raise about discounting. He argues that economists need to engage in a different kind of practice, namely ethical reflection. He refers directly to John Rawls, while his language often evokes Amartya Sen. He explicitly denies the economists’ common practice of referring to actual market practices as justification of radical “pure time” discounts. (The sovereign discounts you refer to may not be pure time discounts, but could have some other justification? I don’t know enough about it, although it raises fascinating questions about sovereignty.) Referring questions of value to measured market behavior, he argues, is simply not up to the challenge of climate change. Economists need to engage in different practices in relation to a new object.
(Radical time discounts play a major role in arguments that long term costs of climate adaptation will be very small compared to present costs of action.)
In Anthropos Today Rabinow identifies his informants as “entrepreneurial managers [of biotech labs who] …were involved in a transformation of their previous scientific, or medical, selves into a new role that was often not yet fully defined…” (86). It strikes me that something exactly like this is at stake here, but configured across very different problems and practices.
In fact – and this is the second question I would raise – the problem at least in part is creating a specific temporality for costly practical decisions whose pay-off is a long time away in both political and economic terms. Carbon regulation asks for initially high costs of action for benefits that will accrue, in practical terms, first to other people (people who will suffer first from climate impacts, and people who are not yet born), and then later only far off in the future, at earliest perhaps 30 years from now but in more likelihood 50-100 years in the future.
One question I’m left with is, what similar practices exist in which costly present commitments are made against uncertain future payoffs that far in the future? It may well be that there aren’t any; if so, carbon regulation will stand as a very unique practical achievement, especially given its global scope.