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climate change

Development Environmental Change Featured Globalization International Development Society and Culture Sustainability

Should We Stop Visiting Paradise? Discussing The Global Politics of Travel Boycotts

Paradise is often marketed as a place without consequences, an escape from the harsh realities of the world. But behind the pristine beaches and mountain vistas in dream destinations like Bali, Hawai’i, and Tibet exist complex political, environmental, and economic struggles. Activists around the globe have called for tourism boycotts, citing reasons such as protecting ecosystems, repairing local economies, and plain old political disagreement. But others have questioned whether these boycotts actually produce meaningful change, arguing that they often harm local communities more than the governments or industries they aim to challenge. It’s an ethical dilemma for any responsible traveler – does staying away from popular tourist destinations truly help the people these movements claim to support, or does it simply shift the consequences onto those who rely on tourism to survive?

In theory, withholding tourist dollars can pressure governments, corporations, or tourism industries to change harmful practices. Some advocacy groups argue that boycotts can draw international attention to issues such as environmental degradation, labor exploitation, or human rights violations, particularly when traditional political pressure does not have much effect. However, research suggests that the economic impact of tourism boycotts rarely targets decision-makers directly. Instead, the financial consequences tend to fall on service workers, small business owners, and local communities who rely on tourism for their livelihoods.

Critics of tourism boycotts also point out that travel avoidance does not always lead to meaningful structural change. Most travelers are not influential enough as individuals to force large-scale reform, especially in countries where tourism revenue is diversified or politically insulated. In many cases, governments can actually redirect tourism marketing to new regions or audiences. As a result, boycotts may function more as symbolic gestures rather than effective tools for reform.

This raises an important question: if avoiding a destination does little to alter political or environmental outcomes, would ethical travel be easier achieved through responsible tourism practices rather than complete withdrawal?

Bali

Bali’s transformation into a global tourism hub has produced severe environmental and infrastructural strain. Rapid development has overwhelmed waste management systems, leading to widespread plastic pollution and water contamination. Luxury resorts and tourism infrastructure consume disproportionate amounts of freshwater, contributing to shortages that affect local farmers and residents. Mass tourism has since accelerated environmental degradation and threatened coral reefs, rice terraces, and traditional water-sharing systems. The Indonesian government’s introduction of tourist taxes and behavior regulations reflects growing recognition of these problems. However, these policies focus more on controlling tourist behavior than addressing the structural drivers of overdevelopment.

Calls to boycott Bali often stem from environmental concern, yet such actions risk oversimplifying the island’s economic reality. Tourism is one of Bali’s primary sources of income, supporting millions of livelihoods across hospitality, transportation, and cultural industries. A sharp decline in visitors would disproportionately harm local workers rather than the large corporations driving unsustainable development. Moreover, the environmental damage in Bali is not caused solely by tourists themselves, but by weak regulation, profit-driven construction, and inadequate infrastructure planning. Rather than abandoning the island, a more effective approach could involve supporting locally owned businesses, advocating for environmental protections, and promoting low-impact tourism. Boycotts may reduce visible harm on a temporary basis, but they do little to address the political and economic systems that created Bali’s tourism crisis in the first place.

Hawai’i

Hawai’i’s tourism industry is deeply entangled with the islands’ colonial history and the ongoing marginalization of Native Hawaiians. While tourism generates billions in revenue, many Native communities face housing insecurity, limited land access, and environmental degradation. Overtourism has contributed to overcrowding, water shortages, coral reef damage, and the commercialization of Hawaiian culture. For some activists, calling for visitors to stay away is a way to protest the exploitation of Indigenous land and the prioritization of tourist comfort over local needs. In this sense, boycotts function as acts of resistance against a system that profits from cultural imagery while at the same time neglecting Native sovereignty.

The economic consequences of reduced tourism complicate this narrative, however. Many Native Hawaiians work within the tourism sector and operate family businesses, cultural tours, and hospitality services. A large-scale tourism boycott risks cutting off vital income streams without addressing the underlying political structures that sustain inequality. The debate surrounding the reopening of Maui after the 2023 wildfires perfectly illustrates this tension. While some argued that tourism was disrespectful during a period of recovery, others emphasized the financial necessity of visitor revenue for local workers. This reveals that tourism boycotts in Hawai’i can carry a symbolic power, but they cannot resolve deeper issues of land rights, governance, and historical injustice.

Tibet

Tibet presents one of the most explicitly political arguments for tourism boycotts. Travel to the region is strictly regulated by the Chinese government, with guided tours often promoting state-sanctioned narratives that minimize political repression and cultural control. Critics argue that tourism in Tibet functions as a form of soft power, normalizing Chinese authority while limiting opportunities for authentic cultural expression. From this perspective, tourism boycotts are an act of protest against human rights violations, surveillance, and restrictions on religious freedom.

Yet, the impact of these boycotts is contested. Over-tourism is not a significant issue in the region, and tourism can provide important income for local communities. For some Tibetans, interaction with international visitors offers opportunities to share their cultural traditions and to maintain economic stability. A complete withdrawal of tourists may reduce global awareness of Tibetan identity rather than strengthen it. While boycotts can express political opposition, they do not directly challenge China’s control over the region. Instead, they risk isolating Tibetan communities even further. This showcases a central weakness of tourism boycotts, where symbolic resistance does not necessarily translate into material or political change, especially when confronting powerful state actors.

What Does This Mean?

Tourism boycotts are usually rooted in good intentions, but their real world impact is far more complex than it appears. While boycotts can certainly raise awareness and symbolize ethical resistance, they rarely lead to meaningful structural change. This does not mean travelers should ignore the consequences of their choices; however, environmental protection, Indigenous rights, and human rights reform require political action, corporate accountability, and sustainable development policies. Responsible tourism, support for local communities, and advocacy for systemic reform may ultimately offer a more effective path. Paradise may never be consequence-free, but ethical engagement rather than absence creates the greatest potential for positive change.

Image Credit: Wikimedia Commons.

April 6, 2026 0 comment

Climate Change Development Economics Energy Environmental Change Featured Global Health International Development Sustainability

The Dark Side of Going Green

written by Chaitanya Kishore

Goal 13 of the UN’s Sustainable Development Goals calls for action against climate change through cutting greenhouse gas emissions by increasing the use of renewable energy sources. But, in order to make renewable energy sources—such as wind, solar, or geothermal power—viable for widespread use, rechargeable batteries are needed to store the energy produced. Lithium-ion batteries are the most commonly used rechargeable because of their high energy density, low maintenance, and high power delivery. Two of the most used materials in the production of lithium-ion batteries are lithium and cobalt. Despite mining for minerals like lithium and cobalt having lower carbon emissions than burning fossil fuels, mining often leads to pollution and environmental degradation.

The push towards renewable energy sources as the solution to climate change hides the darker side of resource extraction needed to produce this technology. In an effort to avert the climate change crisis through technology developed from lithium-ion batteries, a new environmental crisis may be starting from the mining needed to produce them. The mining needed to produce lithium-ion batteries primarily occurs in developing countries where the economic benefits of mining are often put before the environmental harms. Two areas that reflect this ongoing environmental and social crisis resulting from lithium and cobalt mining are the Atacama Desert in Chile and Democratic Republic of the Congo.

Chile is the second largest producer of lithium in the world, behind only Australia, and one of the world’s biggest deposits of lithium is located under the salt flats in Chile’s Atacama Desert. To mine the lithium below the desert, lithium brine is mixed with groundwater and brought to the surface. This mixture is left to evaporate to then be collected and used in lithium batteries. The extraction of groundwater for the mining process has led to a drought in the region and many wetlands in the area have dried up as well.

The area surrounding the Atacama Desert, which is home to many indigenous communities, have been impacted by the water shortages as a direct result of lithium mining. In an interview about lithium mining with BBC, Faviola Gonzalez, a biologist living in an indigenous community in the Atacama Desert, said, “Who are the electric cars going to be for? Europeans, Americans, not us. Our carbon footprint is much smaller. But it’s our water that’s being taken. Our sacred birds that are disappearing.” Indigenous communities like the Colla and Lickanantay have seen the rivers they get their water from dry up. These communities now rely on tankers to bring water to them and are powerless in doing more to stop the mining since mining companies have control over the land and water resources.

Despite the harmful damage done to communities and resources surrounding the Atacama Desert, the Chilean government and mining companies have planned to increase lithium mining in response to increasing demands for lithium batteries. The government launched a National Lithium Strategy to increase production and expand private investment in lithium mining in 2023. There have also been talks by government officials to increase lithium mining by up to 70%. Additionally, the Chilean state-run mining company launched a partnership with a private Chilean mining company, Sociedad Quimica y Minera de Chile (SQM), for a 30 year lithium mining partnership starting in 2031. SQM has announced plans to reduce water use by 60% when it begins mining in 2031. However, it may be too late to implement these changes to protect the surrounding environment due to already widespread drought conditions and dried up wetlands.

Similarly, the Democratic Republic of the Congo (DRC) produces nearly 70% of the world’s cobalt, having the highest concentration of cobalt deposits in the world. Cobalt mining, as well as copper mining, has led to toxic mining runoff—polluting rivers that provide water to many of the DRC’s largest cities. While speaking about the stream near his home with Kuwait Times, Heritier Maloba, resident of Lubumbashi in the DRC, said, “In this stream, the fish vanished long ago, killed by acids and waste from the mines.” The water now poisons nearby communities as the high concentrations of metals and acids in the polluted water have led to respiratory illnesses, birth defects, and metabolic disorders. The runoff is also poisoning the land around the mines and has been connected to the killing of crops and worms which are indicators of soil health. Cobalt mining has also been threatening forests in the DRC, which serve as carbon sinks. Mining in the DRC specifically has led to a decrease in over 13,000 hectares of forest since 2001.

The people of the DRC have been exploited for decades to mine the valuable minerals located in the country. Following the colonization of the area that is now the DRC by King Leopold II in 1876, the Belgians set up a system of resource extraction while forcing the people that lived there to work on plantations and mines through brutal violence. Minerals including cobalt from the DRC were used to fuel the Industrial Revolution in Europe and to produce the weapons used in the World Wars, while workers who mined them worked under inhumane conditions. This exploitation continues today because of the increasing demand for cobalt.

The majority of the cobalt mines in the DRC are no longer locally controlled due to a deal signed in 2009 by then-President Joseph Kabila with the Chinese government, where the DRC gave China mining rights for infrastructure funding. Now, 15 out of the 19 largest cobalt and copper mines in the DRC are owned by Chinese companies, meaning much of the economic wealth generated by these mines is not going back to the local communities being directly harmed by them. Although China does provide infrastructure funding to the DRC in exchange for mining rights, the DRC ranked 180th out of 193 countries on the Human Development Index. Chinese mining companies have also been accused of using mining revenue to meddle in DRC elections and continue to perpetuate poor working conditions in cobalt mines.

We must recognize that many of us living in the Global North are far removed from the devastating environmental and human consequences of the mining required to make the products we use on a daily basis, beyond just renewable energy. Can you imagine going through your day without using your phone and laptop or not using an electric scooter or electric vehicle to get around? I know I use my phone and laptop regularly throughout the day and many students at UCLA use their electric scooters to commute to class. With this in mind, we must recognize our demand for such products is contributing to the accelerating environmental degradation in many areas of the world. The negative effects of mining for minerals used in the production of lithium-ion batteries is a problem that is not going away any time soon.

It must be also recognized that the solution to climate change can’t be just switching from burning fossil fuels to mining nonrenewable minerals. Communities living near the mines have no say in stopping the mining process since the mines are often owned by the government or by private mining companies. Change needs to be made by governments and the private sector to prevent any further irreversible damage to human health, natural resources, and biodiversity. While one solution could be improving the mining technology used to be less destructive, the more permanent solution may be to find more sustainable, less resource intensive rechargeable batteries that can replace lithium-ion batteries. One sustainable alternative is the sodium-ion battery, which uses sodium instead of lithium, since sodium can be more easily obtained from sources such as seawater.

Image Credit: Wikimedia Commons.

January 4, 2026 0 comment

Environmental Change Featured Security Security and Conflict Society and Culture The International Economy

The Problem with Pandas: Rethinking Climate Change and the Environmental Movement

written by Amber Murakami-Fester

By Amber Murakami-Fester

The International Panel on Climate Change (IPCC) released an in-depth report earlier this year that seemed just short of a climatic Armageddon. The report, released in three parts in September, March, and April, detailed the results of an extensive assessment of scientific literature on climate change in the past six years. Findings, perhaps unsurprisingly, were bleak: the concentration of carbon dioxide in Earth’s atmosphere has increased by forty percent since pre-industrial times, sea levels have risen nineteen centimeters from 1900 to 2010 worldwide, and will only continue to rise. Human influence on the climate system, the report further emphasizes, is evident.

Scientists have long vouched for the direct effect humans have had on global warming. Some even propose that we have entered a new geological time period, dubbing it the Anthropocene, a name that refers to the fact that humans have affected nearly “every aspect of Earth on a scale akin to the forces of nature,” according to the Anthropocene website. The term gained popularity in 2012 among scientists but remains little more than a scientific buzzword, as several geologists maintain that there is not enough evidence to suggest that we are in an entirely new geological epoch.

The Anthropocene, buzzword or not, and the IPCC report together underscore one thing—the potency of human activity on our planet: we have managed to accelerate our effect on the world around us since the advent of the Industrial Revolution. This means the outcome for the natural world in the coming centuries will largely reflect the environmental decisions that people make today. It turns out that the side-effects of human activity aren’t limited to the apocalyptic indications of rising sea levels and global temperatures either. Human beings have the capacity to shape not only the climate, but have a huge say, for better or for worse, in which species of plants and animals will survive into the future as well.

The panda, for example, has been the cuddly mascot of the World Wildlife Fund (WWF) since its inception in 1961 and has played a large role in eliciting emotional and monetary support for the environmental movement. BBC wildlife expert Chris Packham, however, made ripples in 2009 when he declared that giant pandas should be allowed to die out. Although human reduction of its habitat has spurred the panda’s endangerment, the argument goes, pandas are naturally slow to reproduce and rely heavily on one food source (bamboo). From an evolutionary perspective, this puts the panda at a severe disadvantage. The panda’s habitat has further been so depleted that pandas will likely never be able to survive by themselves in the wild again. Despite this, millions of dollars are spent every year to save the panda from extinction—something Packham calls “one of the grossest wastes of conservation money in the last half-century.”

It’s not just the panda, of course; other animals have received a significant amount of funding and media attention as well, becoming mascots of sorts for the environmental campaign. Leonardo DiCaprio co-funds a tiger conservation project with the WWF, and France is set to spend three million Euros on an effort to save an endangered hamster species. But why the panda, the tiger, the hamster, the polar bear, the whale and the friendly dolphin? Why not the American burying beetle, the Chinese alligator, or the little known pangolin, all of which are critically endangered species as well? People seem to favor the survival of animals that play powerful parts in our imagination; being cute or at least humanized in the media, in effect, helps your specie’s chance of survival. Humans further have the formidable capacity to pick and choose which endangered species are worthy of our attention and will survive into the future—the Anthropocene indeed.

This goes for national parks as well. The national park system grew out of the American preservation movement beginning in 1872 with the creation of Yellowstone National Park, and has undoubtedly saved vast swaths of land from development. It is, however, far from being politically neutral. Would Yosemite have been preserved, for example, if Theodore Roosevelt did not equate it to being the most beautiful place on Earth? If Yosemite, in effect, was not aesthetically pleasing, would it still exist today? The national park, a concept grounded in the American nostalgia for the last frontier of the “wilderness,” also reinforces the idea that humans and nature simply cannot coexist without the former destroying or tainting the latter. The creation of Yosemite National Park, for example, ironically required the removal of the Yosemite Indians who had been living in the valley for thousands of years.

This is not an ideology that died out in the nineteenth century; it continues to shape conservation movements both in the US and abroad to this day, sometimes problematically. A similar story unfolded recently in Botswana in the Central Kalahari Game Reserve, where San people, commonly known as Bushmen, who had been living on the land for generations were forcibly removed by the Botswanan government beginning in 1997. Although the national park was opened in 1961, the San were not seen to be problematic until the early 80s, when diamonds were discovered on the reserve. Since then, the government has tried to force the San people off of their ancestral homeland, prohibiting hunting and use of water boreholes on the premise that the San were damaging the environment. Although the San won the drawn-out legal battle for the right to live in the reserve in 2006, hunting in certain areas of the reserve was outlawed again in January of 2014, citing the declining population of certain animal species. Conservation, it seems, is not as simple as removing humans from nature.

It is perhaps an understatement to say that a lot of work needs to be done in the environmental movement today. Denying the existence of climate change simply isn’t a viable option anymore—perhaps John Oliver demonstrated this best when he staged a “statistically representative” debate on the existence of climate change on his comedy show Last Week Tonight. The discussion we need to be having, he emphasized, is not whether climate change is real, but what we are going to do about it.

Maybe, though, we need to take it a step further. As we move forward and continue to make as much an impact on the Earth as we have in the past 200 years, it seems necessary to re-examine the pitfalls of the environmental movement as well, because the political ideologies that underlie the movement will inevitably continue to change the natural world. What sort of world do we want to live in come another 200 years? That decision, terrifyingly enough, is something that we, as governments, businesses, and individuals, must be making today.

So: pandas or no pandas? The choice is ours, it seems, more than ever. Welcome to the Anthropocene.

June 2, 2014 854 comments

Environmental Change Featured

Economic Uncertainty for Canada’s Northwest Passage

written by thegeneration

by Sam Geldin
Contributing Writer

The alarmingly shrinking expansion of Arctic sea ice, which receded to an unprecedented annual minimum last autumn of 2012, presents nations like Canada with a wildly uncertain future.

Not only does this seasonal low, along with harbingers like shifting precipitation patterns and rising sea levels, attest to the now globally-observed increase in yearly average temperature, it reasonably reinforces the likelihood of the Intergovernmental Panel on Climate Change’s (IPCC) estimates forecasting summer Arctic sea ice to vanish entirely by the end of the century, once an outlandish prospect. Likely in part due to human activities such as the burning of fossil fuels, the Northwest Passage that eluded countless adventurers searching for a maritime shortcut from Europe to Asia might suddenly emerge as a modern reality and point of contention. While an economically viable Northwest Passage offers Canada opportunities for enhanced trade and resource access, conflicting regional effects of climate change and ambiguous international responses to highly-contested polar boundaries will ultimately outweigh such a route’s benefits for the country’s interests.

With an already burgeoning population of skilled workers, Canada’s economic potential appears only magnified by more accessible fishing grounds; millions more ecotourists hoping to witness polar bears and other vestiges of the melting Arctic; and untapped oil and natural gas deposits (approximately 13% and 30% of global undiscovered reserves respectively, according to the US Geological Survey)—all of which are associated with Arctic sea ice retreat.

However, while considerable absence of thick multiyear ice may allow costly tankers, barges, and cargo vessels extended traveling ranges, sharp remnant chunks of sea ice and land-borne icebergs will ensure slow, seasonally variable, and treacherous summer transport through the briefly ice-free Northwest Passage.

Though a thinner atmosphere and accelerating albedo feedback cycles (where iceless ocean absorbs more ice-zapping heat) accentuate the rate of warming over northern polar regions, unimproved net agricultural yields and deteriorating ice-dependent winter roads could complicate shipping gains. In other words, warmer temperatures may boost production of crops northward of currently arable land, but drier conditions may ultimately decrease harvests in southern prairies. In the same way, increased ice-free sea transit during a short window of time at the end of summer probably will not offset the economic hindrances of losing months-long service of ice roads and rail routes that depend on cold temperatures for stability to deliver regional resources and valuable commodities like diamonds, petroleum, and grain by land.Especially considering how increased international market exposure will not only incline maritime arteries like the Panama and Suez Canals to lower their tolls, but also spell an uncertain fate for competing “destinational” shipping interests locally supplying and servicing booming outposts like Churchill, Iqaluit, and Tuktoyaktuk, the thought of Canada reaping lucrative profits in all economic sectors from a functional Northwest Passage in the coming decades certainly lies on thin ice.

Recent statistical investigations of Canadians involved in Arctic affairs highlights general support, despite varying methods, for polar development, yet vying foreign claims for unsettled sea territory, fossil fuel and marine resources, and multinational sovereignty over Arctic waterways overshadow Canada’s own strategic Northwest Passage development plans.

Since the evaporation of Cold War era tensions, a recent surge in Arctic militarization and charged nationalist rhetoric over extending northern maritime boundaries up to 200 nautical miles from shore in accordance with the United Nation’s EEZ (exclusive economic zone) recognition prompts heated international stalemate and demonstrates how effects of climate change blur traditional notions of sovereignty over land and resources. While locals draw resources from frozen waterways the same way as on land and Canadian officials assert authority over inter-island marine passages, multinational (particularly American) critics identify an increasingly navigable Arctic shipping route in a global light, as linking two nationless bodies of water, further complicating proper recognition.

Already, Russia’s move to stake its flag over the North Pole in 2007 and Canada’s calls to construct another costly Arctic military base in Resolute Bay and strengthen its fleet of patrol ships and icebreakers (securitizing steps not unlike those of other Arctic nations) reinforce the inescapable, often superseding role that politics will play in shaping the uncertain fate of the Northwest Passage amidst climate change. Even as warmer temperatures thaw a region primed for increased economic activity, international boundary delineation over shifting environmental factors and competing national interests ultimately possess the power to encourage or discourage greater economic interconnectivity of Canada’s Arctic ports with North America and beyond.

References

1. Maria-José Viñas, “Arctic Sea Ice Hits Smallest Extent In Satellite Era,” NASA, September 19, 2012, accessed October 13, 2012, http://www.nasa.gov/topics/earth/features/2012-seaicemin.html.

2. Intergovernmental Panel on Climate Change, Climate Change 2007 Synthesis Report: Summary for Policymakers (IPCC Fourth Assessment Report, 2007; http://www.ipcc.ch/pdf/assessment-report/ar4/syr/ar4_syr_spm.pdf).

3. L. C. Smith, The World in 2050: Four Forces Shaping Civilization’s Northern Future (Plume, New York, 2011).

4. L. C. Smith, Agents of change in the new north. Eurasian Geography & Economics 52, 30-55 (January/February 2011). http://www.sscnet.ucla.edu/geog/downloads/297/396.pdf

5. J. Parsons, J. Dinwoodie, M. Roe, Northern opportunities: a strategic review of Canada’s Arctic icebreaking services. Marine Policy 35, 549-556 (July 2011). http://www.sciencedirect.com/science/article/pii/S0308597X11000182

6. H. Gerhardt, P. E. Steinberg, J. Tasch, S. J. Fabiano, R. Shields, Contested sovereignty in a changing Arctic. Annals of the Association of American Geographers 100, 992-1002 (September 2010). http://www.tandfonline.com/doi/abs/10.1080/00045608.2010.500560

7. S. Chaturvedi, in Global and Regional Problems: Towards an Interdisciplinary Study, P. Aalto, V. Harle, S. Moisio, Eds. (Ashgate, Burlington, VT, 2012), chap. 8.

April 15, 2013 396 comments

Environmental Change

Ensuring the Sustainability of Multinational Cap and Trade Policy

written by thegeneration

Cap and Trade

by Trisha Parikh

Climate change may have taken a backseat to other issues in the United States, but around the world, countries and states are collaborating to ease their footprint on the global climate. With an increase in extreme weather patterns, droughts, food shortages, and the threat of rising sea levels, the effects of climate change are a reality. Regulation has finally manifested itself in many countries around the world as cap and trade measures. Cap and trade is known to be a more aggressive form of climate change policy, but its effectiveness when applied on a multinational scale has been questioned by policy makers, environmentalists, and economists.

Cap and trade, also known as emissions trading, is a market-based solution to global warming that transforms the right to “pollute” into a commodity that can be traded in the free “carbon” market. In contrast to carbon taxes, which are a form of carbon pricing levied on producers in direct proportion to their greenhouse gas (GHG) emissions, cap and trade policies place an upper limit, or “ceiling,” on the quantity of emissions. An important distinction is that while cap and trade might be better suited for some regions, carbon taxes or other price-based regulations might be more effective in others. For example, the Environmental Protection Agency (EPA) states that cap and trade is well-suited for local and regional emissions since it must be tailored to a specific area’s economic characteristics and demand for pollution. Some places that are currently pursuing or employing cap and trade regulation include Australia, New Zealand, South Korea, Japan, China, the European Union, parts of Canada, and California.

International cooperation on climate change has taken place since the adoption of the Kyoto Protocol in 1997. Many countries have since pledged to decrease their GHG emissions and cut down on the use of nonrenewable energy sources. The U.S. EPA has pledged to decrease GHG emissions by 25% of 2010 levels by 2020. The EU has a similar goal of reducing emissions by 20% of 1990 levels by 2020. The advancement of cap and trade policies to achieve these goals shows a different side of international cooperation. Countries are using each other as models for the implementation of cap and trade and integrating their carbon markets with neighboring regions. The most recent example is the California and Canada partnership, in association with the Western Climate Initiative. The California Air Resources Board (ARB) is working with its equivalents in British Columbia, Ontario, Quebec, and Manitoba to create a program through which pollution permits can be bought and sold on the carbon markets of international partners (projected to begin in 2013).

Thus, the real concern that arises is whether cap and trade is sustainable when these carbon permits are traded in large, global carbon markets—which are more difficult to regulate. Cap and trade on a national scale has been successful in the past. The EPA’s Acid Rain Program to control sulfur dioxide emissions in 1990 was widely successful and resulted in social savings of over $70 billion per year, with the benefits outweighing costs at a 40:1 ratio. The trading of permits for sulfur dioxide emissions only occurred nationwide under this policy. However, when employed on a larger scale, the carbon market can be volatile and subject to the influence of external forces such as politics and differences in trade regulations between countries.

The European Union Emissions Trading System (EU ETS) demonstrates how a well-functioning policy can turn into chaos when applied on an international scale, where prices and quantities are not carefully regulated. First, the EU failed to accurately estimate how many permits would be necessary and issued a surplus of carbon offset permits leading to a price collapse (permits were bought at almost no cost). Trying to set a quantity limit for 30 nations that differ in their industrial composition and emissions is a complex task. Second, the quantity of the permits issued has been under significant political influence by lobbyists asking for more offsets than initially allocated as a “subsidy” to certain energy sector firms (estimated to account for £20 billion or $32.2 billion through 2012). This defeats the primary purpose of having a cap and trade mechanism: to set limits on carbon permits. Yet, when applied in a smaller setting, the policy is relatively safe from extensive political involvement, it accounts for differences between regions, and price volatility can be monitored carefully.

The success of cap and trade policies, as they begin to link together countries and span across larger regions, will rely heavily on learning from previous experiences such as the EU ETS. Cap and trade policies that are implemented with precision, transparency, and regulation have the potential to generate changes in the climate that can set the world back on course to reducing GHG emissions. The economic incentives generated by successful cap and trade policies are unparalleled in that they maintain competition between firms and thus, encourage green investment. Countries that are in the early stages of creating their emissions trading programs, such as Japan and China, should construct the program with mechanisms built within it to adjust quantities regionally and to carefully monitor the market. Cap and trade has empirically proven to reduce GHG emissions, but, what remains to be seen is how these various international carbon markets will interact with each other in the future, and whether or not they will spur the use of “greener” energy sources to create sustainability of the policy and the global environment in the long term.

Facts and figures from the California Air Resources Board, the Carbon Trade Watch, Council on Foreign Relations, Environmental Protection Agency, and Western Climate Initiative.

Photograph from the Wikimedia Commons

Trisha Parikh is an undergraduate student at UCLA majoring in Economics and Political Science. She is a co-editor with The Generation.

November 2, 2012 2 comments