Liberal Institutions In Changing Climate

This image, which was originally posted to, was uploaded to Commons using Flickr upload bot on 03:01, 29 August 2010 (UTC) by Pauk (talk)

In six months, parties to the 1997 Kyoto protocol will meet in Paris at the United Nations Climate Change Conference to reach binding and universal agreement on climate. The overarching goal of the convention will be the reduction of greenhouse gas emissions to limit the global temperature increase to 2°C above preindustrial levels. Given the international disagreement regarding the burden sharing of emission reductions and the ongoing unwillingness to commit to binding emission goals, it is hard to believe that this conference will be a success.

There is no common ground between developed, emergent and underdeveloped countries. Whereas Europe struggles with its ambitious climate goals, emergent countries realize that stringent emission reductions impede economic development. The only way out is to end the mantra-like demand for binding emissions reductions and to focus on working solutions. Although nobody knows if a stringent mitigation strategy really works, history shows that economic development is an effective way to cope with a changing climate.

Economic freedom is not only the main driver of economic development and wealth, but is also of great importance for the adaptation of our societies to a changing climate. In developing countries, economic growth is the most effective way to create resilience against the expected damaging consequences of climate change. In addition, economic growth and productivity gains unleash the resources that could be invested in mitigation efforts. Therefore, the answer to the question about the right political institutions in a changing climate is economic freedom.

Empirical evidence shows that economically free countries are wealthier and provide better quality of life for their citizens. Wealthy countries are much more disaster-resistant than poor, underdeveloped countries. Scientific uncertainty related to anthropogenic contributions to climate change emphasizes the importance of adaptation against mitigation. While adaptation always protects against undesirable consequences of climate change, mitigation is only effective if there is a strong causality between GHG-emissions and global temperatures. Therefore, adaptation makes it possible to delay stringent mitigation until we get a better understanding of climate change, more effective mitigation, and cheaper GHG-avoidance.

Unfortunately, climate policy prioritizes mitigation at the present stage while adaptation attracts relatively little attention. A lot of resources are wasted in inefficient and isolated efforts to curb GHG-emissions. This does not only take up a lot of scarce resources in developed as well as in developing countries, it is also a threat to economic and individual freedom. More and more spheres of life are regulated in the name of fighting climate change. Liberals have a simple, but effective answer to this challenge. Free market institutions and individual liberty promote economic development and human resilience to a changing climate. So far, coercive and centrally planned regulation induced by climate change alarmism delivered a disappointing outcome. If the negotiating parties in Paris again ignore this lesson, the convention will be nothing but an expensive symbolic gesture.

Steffen Hentrich