THE BLOG

Designing Global Cooperation So It's In the National Self-Interest

05/01/2015 14:44 GMT | Updated 07/03/2015 10:59 GMT

What does it take to secure a meaningful international agreement on tackling climate change? In a year that saw the US and China make historic (but as-yet untested) pronouncements on reducing their carbon emissions, and the UN Framework Convention on Climate Change's meeting in Lima lay groundwork for a multilateral treaty on climate change to be finalised in Paris later this year, 2014 was something of a tease on what could be.

Writing in the New Republic, however, American Lawyer Jacob Bronsther casts a sceptical eye over the much-discussed Lima Climate Change Agreement, and raised doubts whether any such international agreement could succeed. Drawing on Game Theory, Bronsther compares climate change (as others, and I myself, have done) to a 'tragedy of the commons' or 'prisoner's dilemma'. We all know the story - no nation acting alone could possibly hope to do enough to reduce emissions below the (contested) tipping point for irrevocable climate change, yet the costs of throwing in your lot with other nations to tackle the problem can invoke considerable (and unequally distributed) economic costs. For many nations, Bronsther suggests, the option to wait it out and let other nations bear the brunt of those costs, while hoping to eventually reap the benefits of their collective action, is a logic that keeps many state leaders from delivering on the agreements they sign.

The trouble, he implies, is that cooperation is not in each state's rational self-interest in the way that avoiding economic costs is. In the absence of international agreement, the only recourse, he argues, is to invest in alternative climate reduction technologies (for Bronsther, it's air capture) that can be developed cheaply, and with significant benefits for the planet. Crucially, such action, he suggests, can be pursued by small groups or even singular nations, rather than waiting on everyone to act together.

Bronsther's recommendation to invest in technological alternatives is not necessarily wrong; indeed a diverse technological approach to tackling climate change is a good move. But by placing an emphasis on the individual actions of single nations or small groups of nations, Bronsther too quickly abandons the potential for global cooperation.

If climate change were the only global problem we were facing, Bronsther might be justified. But today we're grappling with myriad global problems, from global security to tax havens, and from Ebola to global wealth inequality. Each of these is beyond the power of any individual nation to solve and each requires collective action on a global scale. Rather than a problem to be pragmatically avoided, the achievement of global cooperation is arguably the defining evolutionary challenge of our times. Whether Bronsther is right about the promise of air capture technology or not, it's erroneous to think that we can, or should, avoid addressing the problem of how to secure global agreements to solve global problems - we'll have to work it out at some point.

But he's right about one thing - the key to resolving the international stalemate he describes is in addressing the issue of 'self-interest'. Contrary to what so many presume, global cooperation need not be understood as a utopian or even altruistic goal - it is not necessarily the opposite of selfishness. Rather, cooperation is something that can, if properly designed, be in everyone's self-interest. Indeed, the reason our attempts at global cooperation routinely fail is because they are poorly designed. It's almost as if they're designed to fail.

Before I explain, many might interject that the threat of global catastrophe should itself be enough to incentivize cooperation on a climate agreement. But the important work of Scott Barrett, the Lenfest Earth Institute Professor of Natural Resource Economics at Columbia University, shows why this assertion does not hold. Studying over 20 years of climate change negotiations, Barrett shows that the incentive to cooperate is only sufficient if there is a clear and agreed tipping point (eg. a specific global temperature) which, if passed, everyone knows will result in irrevocable catastrophe. The problem with climate change is that nobody knows or agrees on where that tipping point is. "On climate change," Barrett ruefully points out, "nature is playing her cards very close to her chest". She's not telling us where the tipping point is.

In the absence of certainty on such a threshold, concerns about more immediate threats - like economic costs - naturally flourish and undermine cooperation, so leading to the international negotiation failures we've become all too familiar with. Without a catastrophic tipping point to incentivize cooperation, clearly we need something else. We need, as I've suggested, to look at how cooperation can be designed to be in all nations' immediate self-interest. How, then, can that be done?

One way to do so would be to broaden the terms of negotiation by putting other policy points on the table. By focusing solely on climate change or on any other single issue, we inevitably confine ourselves to a win-lose paradigm. For on any single issue we may care to take, inevitably there will be some nations that win and others that lose - and the losers of course have no incentive to cooperate. Try to solve global problems one issue at a time, as the world is now, and we are designing failure into the negotiation from the start.

However, the combination of multiple issues could create the incentives and trade-offs needed to secure immediate and self-interested cooperation. One example might be the implementation of a global financial transactions tax - the so-called "Tobin Tax" - alongside an agreement on carbon emissions. Tobin is a policy that has long been discussed as a method, not only for calming currency speculation, but for potentially financing climate change mitigation. By introducing the tax at an appropriate level, a massive central fund would be created which could then be used to compensate those nations that might otherwise lose from limiting their emissions. What a nation might lose on the swings it could gain on the roundabouts. Thus, by combining a climate agreement with a Tobin tax, the potential for a win-win outcome for all nations starts to become possible. But continue to confine ourselves to single issues, as we are now, and failure is virtually assured.

Such a discussion, where multiple complementary issues might be combined, necessitates a global scale as well as more detailed investigation. For how else could our nation's leaders bring to bear the full portfolio of our possibilities, or ensure that policy implementation is coordinated to everyone's benefit?

The outcome of Bronsther's recommendation for individual nations to move ahead with alternative climate change technology while relegating the challenge of global cooperation to the back burner is to invite a return to insularity, to the kind of nation-centric thinking that makes it virtually impossible to act at a global level. Even smaller collectives of groups of countries, while more agile, are no less affected by forces acting across national boundaries, and only serve to delay the process by which we must learn to cooperate at increasingly more global, and more complex, levels of governance. What's needed, indeed, is a world-centric level of thinking that sees cooperation in win-win self-interested terms and which consequently designs negotiations for success rather than failure.