He draws a parallel to a previous global challenge, ozone depletion. The Montreal Protocol for the protection of the ozone layer, signed in September 1987, is commonly regarded the only successful international treaty in matters regarding global environmental risks. Sunstein thinks there is an important lesson to be learnt. The lesson is the application of cost-benefit analysis (CBA). Ronald Regan who was at the helm at the time of the treaty negotiations, is the unlikely hero in this story. Sunstein writes:
“The Reagan administration was generally skeptical about costly environmental rules, but with respect to protection of the ozone layer, Reagan was an environmentalist hero. Under his leadership, the United States became the prime mover behind the Montreal Protocol, which required the phasing out of ozone-depleting chemicals.”We are told that Reagan (like Obama!) embraced CBA. Because the trick worked the first time round, we should expect similar success this time, or so we are made to believe.
Sunstein correctly points out that the US, and other countries as well, would be well advised to explore energy efficiency gains for economic reasons alone. This makes perfect sense and no one in their right mind should object to these aims (albeit Sunstein is silent on necessary long term climate policies). However, it gets a little more complicated than this. In effect Sunstein is trying to rewrite the history of ozone politics, reducing the chain of events that led to the successful reduction of CFCs to an imaginary application of the principle of CBA. Below I will show that this is not borne out by the facts. But before I do so, I should make clear that there are two crucial issues involved here: the problem of international agreement, and the problem of its implementation.
Montreal was – by and large - successful on both fronts. As we know, Kyoto is failing on both. One problem is the non participation of important countries, like China, India and the United States. The other is the problem of implementation. Even countries in the Kyoto club do not succeed in cutting their emissions (they can only claim modest success because of shifting production overseas). Sunstein has an immediate interest in the prospects for a more active role of the newly elected US government, and there is nothing wrong with that. It gets problematic where he invokes a historical precedent in order to nudge Obama towards a policy which seemed to have worked in the past. This imaginary precedent is CBA. The only problem is it didn’t play a decisive role in ozone politics. It was not the reason for the US driving an ambitious treaty in Montreal.
In its eagerness to prevent further CFC regulations, the Reagan government applied tactics that backfired. Benedick provides many historical details about these mistakes (I recommend reading especially chapter 5 of his book, called ‘Forging the US position’). If anything, Montreal was achieved not because of Reagan’s support, but despite his long time resistance. An advocacy coalition in favor of stringent CFC controls eventually prevailed in the US, and internationally. Many historical contingencies played a role, such as the US CFC manufacturers trying to level the playing field with their European competitors (after all there was noting comparable to the Clean Air Act in Europe). Another contingency was the fact that the EU gave up its resistance to an international treaty after German Greens were elected to parliament for the first time. By the way, little of these contingencies had much to do with getting the science settled, still a prevailing myth in ozone history (propagated by Benedick himself and Mostafa Tolba). For example, the UK, a hardliner against regulations until after Montreal, was simply outmaneuvered at the EU level (quoting uncertain science as a reason for their opposition). It came to accept the fait accompli after the ‘greening of Margaret Thatcher’.
No matter what led eventually to the agreement in Montreal, the phasing out of the problematic gases was not such a big deal as had been claimed by industry. Process and product substitutes became quickly available and the initial ambitiously looking targets could be over-fulfilled within years. No such prospects lie in wait with climate policy. Even if the international community were to somehow to agree to ambitious mitigation targets, these would be just a piece of paper, a dead treaty. At present, there are no prospects for the successful implementation of ambitious mitigation targets, as Sunstein acknowledges.
We know of one famous attempt to apply CBA to climate change. This is Lord Stern’s report which tried to make the case of climate mitigation to the UK Chancellor of the Exchequer, arguing that it pays to pay for prevention. After some years of official endorsement, this approach seems to lose its political credibility (having lost its academic credibility some time ago, some would say from the very beginning).
All of this is no argument in principle against CBA. And it is no argument against increasing energy efficiency everywhere, on the contrary—such efforts are good and should be seen as ‘no-brainers’. All I am arguing is to stick to the known historical facts when pretending ‘to learn from past success’. If the story does not stack up, it is not a good starting point.
Sunstein tries to appeal to Republicans, saying “Look, your great former president did this with ozone, not based on crazy environmental principles, but on the basis of sober analysis of costs and benefits.” Again the political aim of building bridges is commendable. But the historical foundations are not sound.