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international bodies is particularly problematic in the climate change arena. With the FCC, UNEP, UNDP, UNCSD, UNFAO, WHO, WMO, and the World Bank all playing a role, coordination becomes difficult and accountability limited. Each of these institutions has a distinct mandate and divergent goals, core competences, and practices. This fragmented structure translates into limited environmental cooperation, lost opportunities for synergistic actions, and poor results. In addition, there has been little effort put into aligning the efforts of those with international environmental policymaking responsibilities with the goals and programs of the institutions with economic and development mandates. This means little integration between environmental cooperation efforts and other policies necessary to achieve sustainability goals (Esty, 2004, p.111).

Disagreement Concerning Burden-Sharing Disagreement over burden-sharing represents another source of regime failure (Wiener, 1998; Stavins, 2010), the lack of fundamental reciprocity and the disparate impacts of climate change and costs of mitigation and/or adaptation across countries have been well-documented. The divergent views on national self-interest and whether the risks from climate change merit a significant response cuts across the traditional North-South divide. Europe favours a robust policy response while the United States has not yet agreed to take action. The plea from the island states for emissions controls has fallen on deaf ears in China and India.

Divergent perceptions about the scale, magnitude, and timing of climate change impacts – and thus the costs of inaction – have been exacerbated by disputes over who should bear the costs of intervention. The division is not so much between developed and developing nations (“North-South”) but rather among high-emitting nations as to who should take action and who should pay for emissions controls. Most notably, the United States has been unwilling to commit to action unless all nations (or at least all major emitters) also make commitments. But China, India, and some other emerging economies have pled poverty. They further argue that, as a historical matter, much of the current build-up of greenhouse gases in the atmosphere can be attributed to the nations that industrialized in the 20th Century, particularly the United States and Europe. In response, the United States and others have argued that China and other recently industrialized nations are no longer poor – and that they should bear a share of the burden of ecological interdependence as a price for the huge benefits they have gotten from global economic integration.

This “values divide” has become even more salient with the onset of the economic downturn, as the United States public has become unwilling to bear costs while China does not. Competitiveness tensions exacerbate this sense that free riding by China and India cannot be tolerated. Despite studies highlighting the cost of climate inaction (see generally Stern, 2007), the immediacy of job losses in developed nations has led many United States citizens to believe that the burden of international action would simply be too great unless major trade competitors, such as China and India, share the load.

Negotiation Roadblocks

Large size of the group attempting coordination Climate change negotiations have been strained from a purely practical standpoint by the sheer number of parties involved (Esty, 1999a; Harris, 2007; Stavins, 2010). Growing participation in climate change negotiations has had an inverse relationship with the productivity of the policy dialogue since 1992. While almost 200 countries now participate in the negotiations (up from roughly 150 in the early 1990s) the results have gotten worse, not better (Stavins, 2010; see also Esty and Mendelsohn, 1998). The number of seats at the table and the attention paid to new voices has grown to accommodate rising powers, such as China, India, and Brazil. Although a positive development from Why Climate Change Collective Action has Failed and What Needs to be Done within and without the Trade Regime an inclusiveness standpoint, this expansion has not made getting a consensus any easier. Quite to the contrary, collective action problems become increasingly challenging to solve as the size of the group grows. The logic of reciprocity becomes harder to recognize – and the balancing of divergent interests harder to reconcile (Harris, 2007, p.202). Likewise, the larger the number of parties that are included in a negotiation, the larger the transaction costs that must be incurred to reach an agreement (Stavins, 2010; Olson, 1965, noting ‘organizational costs’ among the difficulties of large group collective action; Esty and Mendelsohn, 1998). Negotiations with such a large group will inevitably fall victim to Arild Underdal’s “law of the least ambitious program,” holding that the effectiveness of an international agreement is limited by the commitment level of the agreement’s least interested party (Victor, 2006, p.90). Progress may thus require the convening of a smaller “key players” group. It might make sense to work out a basic framework among “pivotal states,” (Esty, 1999a) including the top 15 emitting nations and key regional representatives beyond this.

Lack of United States leadership The lack of clear vision and forceful leadership represents another commonly cited functional deficiency in the negotiating process. The reluctance, in particular, of the United States to take a leadership role is seen by many as crippling (Schenck, 2008; Highum, 2006; Harris, 2007, p.222;

Conti, 2010; Sugiyama and Sinton, 2005). As the world’s largest economy, the United States has played a major role in all of the most effective international environmental agreements and efforts (compare, e.g., the success of Montreal Protocol, 1987 which has U.S. support; with the resolute ineptitude of the Kyoto Protocol, 1997, which did not). Without the United States as a guiding and committed voice many nations have been hesitant to make any real commitments. What’s worse is that the actual negotiations are less focused and certainly not at all consolidated as a result (see Section on the Complexity of the System above; see also Ivanova, 2010, p.46, attributing most of UNEP’s deviations from its mandate as the global leader on the environment to the lack of support from member states, particularly the United States). Groups attempting to coordinate action develop intrinsic characters and interests as well as the capacities to pursue an autonomous line of thought, which further explains the need for a powerful guiding influence exerted by an individual leader (Ivanova, 2010, p.47).

The United States hesitation on climate change has been driven by many reasons including ideology, shifting scientific attitudes, and partisan politics. But economic concerns, magnified by the severe 2008 downturn, have shaken the United States public’s belief in globalization in general and trade liberalization in particular (Ahearn, 2009). Diminished competitiveness, leading to job losses and a perceived “hollowing out” of the United States industrial base, has angered many Americans – intensifying the need for creative thinking at the trade-environment interface. In the United States, popular opinion now holds that China, India, and other new developing nation competitors have profited at the expense of the United States – and thus cannot be exempted from bearing a share of the burden of environmental collective action. Thus, the United States, will not act until China and India commit to taking a share of climate change responsibility. And China and India will not make any such commitment until the United States shows that it will take the issue seriously, creating a chickenegg problem. This negotiating standoff has completely stalled the possibility of any real collaborative efforts to mitigate climate change.

Lack of Institutional Discipline The breakdown in climate change cooperation has been further exacerbated by lack of a robust mechanism to ensure reciprocity and maintain the discipline of shared burdens. Without a wellfunctioning global environmental governance regime, those who will be asked to make sacrifices and bear costs cannot be sure that others will do the same (cf. A. Chayes and A. H. Chayes, 1998, pp.9–17,

Daniel Esty and Anthony Moffa

detailing the reasons for non-compliance with international treaty obligations, including, inter alia, the indeterminacy of treaty measures). Fear of free riding and non-compliance with agreements makes concluding a serious climate change action commitment all the more difficult.

The structure of the climate change challenge – which requires parties to bear costs and forbear certain actions (which, when viewed from a national perspective yield benefits that exceed costs) – makes cooperation especially difficult. The logic of reciprocity may be insufficient to maintain discipline. In the face of a problem which has benefits that derive entirely from future risks not faced and costs not borne, the global environmental regime seems hopelessly inadequate. The advantages of international cooperation are much easier to make vivid where nations face the loss of perceived opportunities for gains. Thus, success in advancing a regime of global climate change cooperation seems hard to imagine without linkage to the broader structure of global governance – and the trading system in particular.

From a WTO point of view, such linkage may well be unwanted and appear burdensome. But the inescapability of the trade effects on the environment and environmental impacts on trade have been well-documented (Esty, 1994b, 2001; Charnovitz, 2008, 2007). So the real issue is not whether but how this relationship will be managed. And to be clear, absent a carefully worked out tradeenvironment structure, and in the face of significant uninternalized externalities in the form of greenhouse gas emissions, the trading system will (however inadvertently) produce results that are economically inefficient, lower social welfare, and produce fundamental unfairness across nations and within societies as well as on an intergenerational basis – not to mention generate significant environmental degradation.

How a Global Environmental Organization Addresses the Identified Shortcomings As the previous section demonstrates through the diagnosis of regime failure, improved global environmental governance is essential to climate change policy progress. The current gaps in issue coverage and a lack of clear lines of authority plague the international environmental regime in general and the prospect for action on climate change in particular. At present, no international institution seems up to the task of coordination. This gap needs to be filled. A Global Environmental Organization that is carefully crafted to avoid the identified pitfalls of regime failure and tightly coordinated with the trade regime provides a potential solution.

Climate change makes manifest the need for an overarching mechanism to support international cooperation in response to transboundary environmental problems (Esty, 1996, p.150; Lee, 2010, pp.328, 329, 336, arguing that global regulation from some type of world government organization may be the most efficient and only practical means of overcoming a climate change collective action problem). What is needed is a 21st century international organization that is sharply focused, lean, agile, and effective in leveraging the strengths of the rest of the international governance system to attain better environmental results (Ivanova, 2010, p.54). Although some observers have suggested that UNEP could fill this role, it was originally conceived as a “program” not an institution, and it has never been able to grow into conception broader institutional role because of the pathologies described previously (part I supra).

Some scholars have taken note of UNEP’s shortcomings and concluded that no international body has any real hope of solving a collective action problem of the magnitude of climate change (Ostrom, 2010, p.552, ‘Simply recommending a single governance unit to solve global collective-action problems—because of global impacts—needs to be seriously rethought.’). But the limitations of UNEP and the absence of systematic synergies with current U.N. bodies offer no real argument against the creation of a GEO (Esty and Ivanova, 2002, p.197). Indeed, the existing difficulties argue for overhauling the international environmental regime rather than tinkering with reforms to UNEP.

Why Climate Change Collective Action has Failed and What Needs to be Done within and without the Trade Regime Undoubtedly, sovereignty concerns will make creation of any new international institution problematic. But, ecological interdependence is inescapable. The fact of our shared biosphere makes the issue not whether to have an international environmental policy mechanism, but what sort of institution to have. In this context, a new GEO offers an attractive option as it could be specifically designed to address the identified systematic failures that plague the current system.

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