November 17, 2013
It would have been useful if the NYT had made this point in an article that discussed the impact of global warming on the developing world. After noting the destruction caused by events related to climate change, like the typhoon that hit the Philippines and the droughts afflicted wide areas across Africa and the Middle East, the piece tells readers:
“The United States and other rich countries have made their opposition to large-scale compensation clear. Todd D. Stern, the State Department’s envoy on climate issues, bluntly told a gathering at Chatham House in London last month that large-scale resources from the world’s richest nations would not be forthcoming.
“‘The fiscal reality of the United States and other developed countries is not going to allow it,’ he said. ‘This is not just a matter of the recent financial crisis. It is structural, based on the huge obligations we face from aging populations and other pressing needs for infrastructure, education, health care and the like. We must and will strive to keep increasing our climate finance, but it is important that all of us see the world as it is.’
“Appeals to rectify the injustice of climate change, he added, will backfire. ‘Lectures about compensation, reparations and the like will produce nothing but antipathy among developed country policy makers and their publics.'”
The position that the United States finds it inconvenient to compensate poor countries for the damage it has caused them runs directly counter to the United States usual position in international forums where it typically is the strongest proponent of property rights. In this case the United States is effectively arguing that it will not compensate poor countries for the damage it has done to their property (and lives) because they can’t force it do so. It would have been helpful if the article had explicitly noted this departure from the normal U.S. position.
It would have also be useful to note that Stern is 100 percent wrong on the economics. For the foreseeable future the United States, along with most wealthy countries, face no realistic budget constraints. With economies operating well below full employment additional government spending would help to boost demand, employment, and growth. The only obstacle to more spending is a bizarre cult of budget balancers that dominates politics in the United States and Europe in defiance of all available economic evidence and theory.