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Climate Policy Design November 22, 2008 Holmes Hummel, PhD holmes@holmeshummel.net Politics of a Durable Deal: Justice as Realism Session #2
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Climate Policy Design Pro-Series Targets, Timetables, and Technology Politics of a Durable Deal: Justice as Realism Carbon Price Policies: Questions for Tax and Trade Cap and Trade: Devils in the Details Committing a Carbon Trust: The Trillion Dollar Bargain Essential Complementary Policies: California’s Advantage
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Sufficiency, Security, and Sustainability –AND Rachel Warren’s impact table – vulnerability to climate change impacts! Sharing Burden and Benefits –UNFCCC –Contraction & Convergence –Sequence (Annex I), differentiation – Berlin Mandate and Byrd Hagel resolution –Bali – and G5 statement –Greenhouse Development Rights Addressing Political Mobilization Bias –All claims for justice are strong; what gives? U.S. free rider; held back by Senate; –Physics is stronger than politics: chances are much higher that politics will change – not physics! –What are the political strategies for change? –Intergenerational representation –Interest groups with persuasive power – Open Secrets.org –Constituencies with power to resist Addressing inequality in Climate Policy Design –EJCC and African Americans –CA EJ Declaration –CBPP memo –Hurricane Katrina –Clean Dev’t Mechanism Fund through GEF (offset issues) Recap –Disparity in responsibility –Disparity in capacity –Disparity in burden of mitigation policy – offsets, taxes, etc. –Call for solidarity; allies in the negotiations
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design
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Three Major Energy Quests Sufficiency Security Sustainability
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Energy Systems Drive “Development”
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History of U.S. Energy Consumption 85% of U.S. energy demands are met with fossil fuels. 8% of U.S. energy demands are met with nuclear power. U.S. Energy Information Administration
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World Bank Investments 1947-2007
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Sources: U.N. Food and Agriculture Organization; C. Mayhew & R. Simmon (NASA/GSFC), NOAA/ NGDC, DMSP Digital Archive
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Sources: U.N. Food and Agriculture Organization; C. Mayhew & R. Simmon (NASA/GSFC), NOAA/ NGDC, DMSP Digital Archive When do the moral claims for sufficiency subside…?
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Source: FY2006 Federal Discretionary Budget; Business Leaders for Sensible Priorities How is the U.S. committing its resources? Does not include wars bailouts, stimulus bills… Or anything else on the national credit card
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Source: FY2006 Federal Discretionary Budget; Business Leaders for Sensible Priorities Does not include wars in Iraq and Afghanistan. How is the U.S. committing its resources?
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Source: BP Statistical Review 2004 Famous Nations in U.S. Foreign Relations Map Scaled by Oil Reserves and Shaded by Oil Consumption
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Oil to the Fore in U.S.-China Talks Focus Shifts From Currency By Neil Irwin Washington Post Staff Writer Wednesday, June 18, 2008; D01 Competition for Oil Consumption as a Threat
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IPCC AR4 SYN SPM Fig 7 Communities with less access to power are more vulnerable to climate change impacts IPCC AR4 SYN SPM Fig 7
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Climate impacts intensify as the index of global average temperature rises IPCC AR4 SYN SPM Fig 7
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Climate impacts intensify as the index of global average temperature rises IPCC AR4 SYN SPM Fig 7
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Three Major Energy Quests Sufficiency Security Sustainability Humanitarian welfare Competition for resources Intergenerational justice There are trade-offs in the balance, and structures of power determine who trades. If moral claims for justice are ignored, then no global agreements will be stable enough to persist.
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Implications for Climate Policy 1.Multiple levels of authority with disparate goals Multiple tables for negotiation Multiple vehicles for policy 2.Policy resilience is critical to the long-term humanitarian quest for climate stabilization. 3.Redundancy reduces risk, and coordination accelerates negotiations. 4.The quest is not a single policy that persists for a century… 5.The goal is to maintain a structure for effective policy negotiation that can remain stable even as it transforms over time.
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design
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Climate Policy Negotiations Invoke (at least) Four Different Concepts of Justice Utilitarianism Retributive Justice Distributive Justice Rawls’ Theory of Justice
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Utilitarianism Basic Description: Greatest Good for the Greatest Number An action is morally justified on the basis of its (expected) outcome. That which delivers society the most aggregate utility is the most just. Utility is a unitless term for value, or “usefulness.” Cost-benefit analysis is based on the concept of utilitarian justice, using dollars to represent utility. Issues Different people hold different values – and some people may implicitly or explicitly be valued differently in a utilitarian frame. Utilitarianism overlooks the distribution of benefits and burdens. Difficult to negotiate a decision between two distinctly different and mutually dependent parties.
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Retributive Justice Basic Description: Eye for an Eye An action is morally justified if it is a proportionate response to a validated offense in the past. The field of criminology is devoted to defining terms of offense. Criminal sentences (incarceration, fines, death penalty) are meted out in measures considered proportionate to the crime. Issues Different societies have different definitions of offense, and different considerations in determining a proportional response. Responding to injury with injury can feed cycles of retribution that may persist for generations and prevent ultimate resolution. Difficult to prioritize conflicting claims.
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Distributive Justice Basic Description: Equality The distribution of things – wealth, power, respect – is just if they are allocated “properly” among different people. Fairness is fundamental but still disputed: should something be distributed in equal measure, or on the basis of some meritocratic measure, or as an entitlement according to status? The income tax structure in the U.S. and laws ensuring equal opportunity reflect deeply felt sentiments toward distributive justice. Intergenerational justice is essentially a distributive justice problem over a dimension of time rather than space. Issues Those with authority to distribute resources often attained that position by having more than “their share” already.
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John Rawls’ Theory of Justice Basic Description: You cut, I choose. Or we’ll cut, and flip for choice. Social and economic inequalities should be arranged so that they are: (a)to the greatest benefit of the least advantaged, consistent with the just savings principle, and (b)attached to offices and positions open to all under conditions of fair equality of opportunity. In order for any change to be accepted as an improvement, it must help the least advantaged party (or representative person). When designing a system that distributes benefits and burdens, use a “veil of ignorance” about the status you may have as a subject of it. Issues Appealing, but difficult to apply.
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Climate Policy Negotiations Invoke (at least) Four Different Concepts of Justice We can stabilize climate change for just a few percent of global GDP – what are we waiting for?? Well, the countries most responsible for this problem should start first – and pay most of the cost. But the Global North nations will soon be surpassed by China and India as major emitters, so we won’t move forward until they have committed to shouldering the burden too. To broker a fair resolution to this dispute, what would that regime need to look like for us to accept it if we woke up tomorrow in a subsistence family in Haiti or China? And if the interests of subsistence families are overlooked, what happens if they reject the terms of an international agreement? If it’s not widely seen as fair, it won’t stick.
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design National blocs - UNFCCC Per Capita - Contraction & Convergence Greenhouse Development Rights
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31 “Countries will be asked to meet different requirements based upon their historical share or contribution to the problem and their relative ability to carry the burden of change. This precedent is well established in international law, and there is no other way to do it.” Al Gore (New York Times Op-Ed, 7/1/2007)
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32 Preamble of the 1992 United Nations Framework Convention on Climate Change “Acknowledging the global nature of climate change calls for the widest possible cooperation by all countries and their participation in an effective and appropriate international response, in accordance with their common but differentiated responsibilities and respective capabilities”
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Global North = Developed = Annex I Global South = “Developing” = Non-Annex IGlobal South = “Developing” Global North = Developed Global South Global North UNFCCC Defined a Global North Bloc
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Derailing Negotiations for a Decade 1995 UNFCCC Council of the Parties: “Berlin Mandate” Parties agree that the Annex I countries should “go first” in sequence, accepting binding targets without obligating Non-Annex I countries. 1997 U.S. Senate Byrd-Hagel Resolution (95-0) “It is the sense of the Senate that— (1) The United States should not be a signatory to any protocol... which would-- (A) mandate new commitments to limit or reduce greenhouse gas emissions for the Annex I Parties, unless the protocol or other agreement also mandates new specific scheduled commitments to limit or reduce greenhouse gas emissions for Developing Country Parties within the same compliance period, or (B) would result in serious harm to the economy of the United States; and… [the Senate requires a high burden of proof that the economic impact is low]
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Justice as Realism for Sustainability Source: Global Climate Action
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Nationalism in Climate Politics U.S. Energy Information Administration (2005) Forecast underestimated: China annual emissions already exceed U.S. Source: U.S. Energy Information Administration
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How does greenhouse gas pollution per person compare between nations?
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Climate Change is a cumulative problem – annual figures distort the problem frame. ~30% of all the human-made CO2 in the sky is from the United States – and that’s not counting pollution from the production of goods imported for consumption here.
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Global Economic Disparity
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Who owns the sky? Negotiations between nation-states imply governments own the right to the sky (like cell phone frequencies) But if the right to a stable climate belongs to all humans, then are all humans entitled to a share of the sky? Distributing the burden for climate change mitigation on a per capita basis has persistent appeal.
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Contraction & Convergence: Global Commons Institute Equal Per Capita Emission Rights by 2030 for 450ppm CO2
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“Negotiations for a shared vision on long-term cooperative action at the UNFCCC, including a long-term global goal for greenhouse gases (GHG) emissions reductions, must be based on an equitable burden sharing paradigm that ensures equal sustainable development potential for all citizens of the world and that takes into account historical responsibility and respective capabilities as a fair and just approach. 2008 Statement by G5 Countries (Brazil, Mexico, India, South Africa, and China) It is essential that developed countries take the lead in achieving ambitious and absolute greenhouse gas emissions reductions in accordance with their quantified emission targets under the Kyoto Protocol after 2012, of at least 25-40 per cent range for emissions reductions below 1990 levels by 2020, and, by 2050, by between 80 and 95 per cent below those levels, with comparability of efforts among them.”
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44 Distributive Justice Claims for Sufficiency 2 billion people without access to clean cooking fuels More than 1.5 billion people without electricity More than 1 billion have poor access to fresh water About 800 million people chronically undernourished 2 million children die per year from diarrhea 30,000 deaths each day from preventable diseases
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Greenhouse Development Rights $2 million 0%20% 40%60%80%100% The right to development in a carbon-constrained world. Paul Baer & Tom Athanasiou (EcoEquity) Sivan Kartha (Stockholm Environment Institute) Full report available: www.ecoequity.org/GDRs email info authors@ecoequity.org Dataset and tool for examining the calculations presented here and exploring alternatives gdrs.sourceforge.net
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46 Climate Policy must to be relevant to Development Policy About 800 million people chronically undernourished More than 1 billion have poor access to fresh water 2 billion people without access to clean cooking fuels More than 1.5 billion people without electricity If energy development is fundamental to all, what does that mean for a climate regime…?
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Paths to 2°C Stabilization, with Risk
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$2 million 0%20% 40%60%80%100%
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Paths to 2°C Stabilization, with Risk $2 million 0%20% 40%60%80%100%
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Paths to 2°C Stabilization, with Risk $2 million 0%20% 40%60%80%100%
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Thinking about a North-South Carbon Budget $2 million 0%20% 40%60%80%100% 2°C Pathway, at least 2/3 chance
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Thinking about a North-South Carbon Budget $2 million 0%20% 40%60%80%100% 2°C Pathway, at least 2/3 chance Annex I (North) emissions path
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Thinking about a North-South Carbon Budget $2 million 0%20% 40%60%80%100% 2°C Pathway, at least 2/3 chance Non-Annex I (South) emissions path Annex I (North) emissions path What kind of climate regime could allow this to happen?
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54 Burden-sharing in a global climate regime National Obligation: share of global mitigation and adaptation costs based on… Capacity: resources to pay without sacrificing necessities Income (PPP), excluding income below the $20/day development threshold Responsibility: contribution to the climate problem Cumulative CO 2 emissions starting in 1990, excluding “subsistence” emissions (i.e., emissions corresponding to consumption below the development threshold)
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Income and Capacity 55 National income distributions showing portion of income (in green) that can be considered “capacity”
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Emissions vs. Responsibility Cumulative fossil CO 2 (since 1990) showing portion that can be considered “responsibility” 56
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57 National Obligations based on capacity and responsibility populationincomeCapacity cumulative emissions (1990-2010)Responsibility Obligation (RCI) United States 4.620.729.723.333.931.8 EU (27) 7.221.627.915.920.524.8 United Kingdom 0.93.14.22.12.93.7 Germany 1.24.15.63.44.65.2 Russia 2.03.22.96.35.93.9 Brazil 2.92.82.31.41.21.8 China 19.712.55.915.77.56.6 India 17.25.20.84.20.70.8 South Africa 0.7 0.61.61.40.9 LDCs 12.51.50.10.60.00.1 Annex 1 18.857.275.156.573.474.6 Non-Annex 1 81.242.824.943.526.725.4 All high income 15.155.275.650.971.474.3 All middle Income 46.736.423.442.227.824.8 All low Income 38.28.51.06.90.9 World 100%
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What are the costs? 58
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Global Mitigation Burden 59 National “Obligation Wedges”
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0 60
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Example: U.S. vs China 61
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Implications for United States US mitigation obligation amounts to reduction target exceeding 100% by 2025 (i.e., “negative emission allocation”). 62
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Implications for United States Physical domestic reductions (~50% by 2025) are one part of the US’s “twofold obligation”. The second part is MRV support for international reductions. 63
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Implications for China China’s mitigation obligations are not trivial, but are small compared to China ’ s mitigation potential, and can be discharged domestically. 64
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Implications for China The majority of the reductions in the South are driven by industrialized country reduction commitments. 65
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Greenhouse Development Rights A climate regime must: –Ensure the rapid mitigation required by an emergency climate stabilization program –Support the deep, extensive adaptation programs that will inevitably be needed –While at the same time safeguarding the right to development Greenhouse Development Rights –Defines and calculates national obligations with respect to a development threshold –Allows those people with incomes and emissions below the threshold to prioritize development –Obliges people with incomes and emissions above the threshold (in both the North and South) to pay the global costs of an emergency climate program Greenhouse Development Rights, EcoEquity
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Greenhouse Development Rights This framework can satisfy all four major theories of justice: - utilitarianism - retributive justice - distributive justice - Rawls’ theory of justice But to prevail, it must be supported by a strong solidarity movement within the OECD countries that have the highest responsibility and capacity to respond.
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68 Final Comments The scientific evidence is bracing. Carbon-based growth is no longer an option in the North, nor in the South. A rigorous, binding commitment to North-to-South flows of technology and financial assistance is necessary. Domestic reductions in the North are only half of the North’s obligation. In principle, a commitment from the consuming class in the South is also necessary. In reality, there will need to be a period of trust-building. The alternative to something like this is a weak regime with little chance of preventing catastrophic climate change This is about politics, not only about equity and justice.
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design
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Negotiating Concepts of Justice Clear utilitarian interest in stabilizing climate change Clear distributive justice claims against the U.S. and other OECD nations – and the present generations Clear retributive justice claims mounting with impacts What’s going on…?
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Policy-makers manage many types of risk. …including risks that their institutions: will lose political or economic authority will precipitate conflict in an armored world will be held liable for damages or losses will no longer permit them to remain in power
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100%
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Household Net Worth (2004) Percentage of U.S. Households Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. U.S. Distribution of Household Net Worth 0%20% 40%60%80%100%
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Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. U.S. Distribution of Household Net Worth Percentage of U.S. Households 0%20% 40%60%80%100% $300,000 $100,000 $200,000 Household Net Worth (2004)
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Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. U.S. Distribution of Household Net Worth 0%20% 40%60%80%100% $2,200 $81,800 $243,200 $300,000 $100,000 $200,000 Percentage of U.S. Households Household Net Worth (2004) To include Top 20%, we need a larger scale.
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U.S. Distribution of Household Net Worth Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. $2 million Percentage of U.S. Households 0%20% 40%60%80%100%
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U.S. Distribution of Household Net Worth 0%20% 40%60%80%100% $2,200$243,200 Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million $2,200$243,200 90%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% 90% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million $576,300 Next 10%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% $576,300
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% $1,764,000 Next 5%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% Next 5% Next 4% $1,764,000 12%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% Next 5% Next 4% $1,764,000 12% 25%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% Next 5% Next 4% $14.7 million 12% 25% $16 million
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% Next 5% Next 4% $14.7 million 12% 25% $16 million Next 0.5% Top 0.5% 9%
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U.S. Distribution of Household Net Worth $2 million 0%20% 40%60%80%100% Bottom 80% 15% Next 10% 13% Source: State of Working America, 2006; 2004 data in Tables 5.7 and 5.9; real estate included. Percentage of U.S. Households Household Net Worth (2004) $2 million 90% Next 5% Next 4% $14.7 million 12% 25% $16 million Top 0.5% Next 0.5% 25% 9%
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Wealth Disparity Distorts Democracy
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Politics of a Durable Deal: Justice as Realism Sufficiency, Security, Sustainability Concepts of Justice Sharing Burden and Benefits Political Mobilization Bias Addressing Inequity in Climate Policy Design
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Environmental Justice & Economic Justice Introduce these two dimensions
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Federal Climate Negotiations
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Auto Coal USCC Big Oil Federal Climate Negotiations Big Green Utilities
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Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Market Mechanism Declining Emissions Cap Utilities Cap & Trade
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Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Carbon Sequestration Cost Containment Market Mechanism Declining Emissions Cap Free Pollution Allowances Utilities Cap & Trade
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Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Declining Emissions Cap Carbon Sequestration Cost Containment Market Mechanism Industry Unions Trade Protection Free Pollution Allowances Utilities Jobs Protection Cap & Trade
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Free Pollution Allowances Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Declining Emissions Cap Carbon Sequestration Cost Containment Market Mechanism Industry Trade Protection Jobs Protection Civil Society Adaptation Funds Rebates to Low-Income Unions Utilities Cap & Trade
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Free / Auction Pollution Allowances Unions Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Declining Emissions Cap Carbon Sequestration Cost Containment Market Mechanism Industry Unions Trade Protection Utilities Jobs Utilities Civil Society Adaptation Funds Rebates to Low-Income Cap & Trade
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Auto Coal USCC Big Biz Big Oil Big Green Federal Climate Negotiations Declining Emissions Cap Carbon Sequestration Cost Containment Market Mechanism Industry Trade Protection Jobs Civil Society Adaptation Funds E.J.? Rebates to Low-Income Tighter Targets Plan B Complementary Policies Unions Utilities Free / Auction Pollution Allowances Cap & Trade
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E.J.? Auto Coal Utilities USCC Industry Big Biz Big Oil Unions Big Green Federal Climate Negotiations Civil Society Cap & Trade
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E.J.? Auto Coal Utilities USCC Industry Big Biz Big Oil Unions Big Green Federal Climate Negotiations New England Mid-Atlantic South Texas Midwest California Civil Society Urban, Liberal Democrats Cap & Trade
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Targets, Timetables, and Technology Politics of a Durable Deal: Justice as Realism Carbon Price Policies: Questions for Tax and Trade Cap and Trade: Devils in the Details Committing a Carbon Trust: The Trillion Dollar Bargain Essential Complementary Policies: California’s Advantage Climate Policy Design Pro-Series
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