Rationing and Climate Change Mitigation: We argue that the rejection of markets, and a commitment to fair shares, is a key part of the value of rationing

Rationing and Climate Change Mitigation. Nathan Wood,Rob Lawlor & Josie Freear. Ethics, Policy & Environment, Feb 19 2023. https://doi.org/10.1080/21550085.2023.2166342

Abstract: In this paper, we argue that rationing has been neglected as a policy option for mitigating climate change. There is a broad scientific consensus that avoiding the most severe impacts of climate change requires a rapid reduction in global emissions. We argue that rationing could help states reduce emissions rapidly and fairly. Our arguments in this paper draw on economic analysis and historical research into rationing in the UK during (and after) the two world wars, highlighting success stories and correcting misconceptions. However, although the empirical details play an important role, the paper is primarily based on philosophical and ethical argument and policy analysis, particularly highlighting the normative assumptions behind policy choices.

We build on Hugh Upton’s work in healthcare ethics, rejecting a broader conception of rationing which conceals significant distinctions between policy options, obscuring the specific advantages of an egalitarian conception of rationing. While some argue for the modernisation of rationing, introducing tradable allowances, we argue that the rejection of markets, and a commitment to fair shares, is a key part of the value of rationing, and precisely what made rationing attractive to the public in the 1940s.

Keywords: Tradable energy quotasCarbon allowancesCarbon TaxEnergy justiceFairnessEquality

5. Objections and Replies

[...]

Keynes and Hayek recognized that there were concerns about the fairness of tax-based solutions, given that it would not be sufficient to tax the rich. For example, according to Bruce Caldwell, Keynes recognized that, if this was to be effective, the ‘tax would have to be extended to the working classes’ because

a tax on the rich would not sufficiently reduce expenditure, so it would not help with the problem of excess demand for consumption goods. (Caldwell & Caldwell, Citation1997 p. 34)

Caldwell states that Keynes tried to ‘soften this unpopular but inevitable truth’ with the ‘novel idea of “deferred pay” or “compulsory savings” provision’ (Caldwell & Caldwell, Citation1997). Instead of taking money away from people permanently, in taxation, money would be taken from people but put into savings that they would only be able to access after the war. This ingenious idea would limit people’s ability to consume but would not permanently deprive anyone of their money. In the case of climate change, however, it would not be clear when – if ever – we would be able to return people’s savings. But if this is what is necessary to make Keynes’ solution palatable, it should be clear that it is the tax-based solution, and not rationing, that becomes less attractive if a permanent solution is needed.

[...]