On the Soapbox

Here is an idea that I recently read about: why not treat the combating of global warming as a form of insurance? Businesses and industry are no strangers to the notion of insurance: paying a small amount of money now to guard against the unlikely event of a loss of a much larger amount of money in the future. The main stumbling block for environmentalists is the argument that a catastrophe is unlikely because the scientists are overestimating the effects of global warming. While I personally do not believe in this argument (it is the product of an elaborate propaganda campaign against science), there are many people who do take stock in such a view. And therein lies the beauty of marketing of this as a form of insurance because one can now sell the idea of fighting global warming without having to convince people that catastrophe is a likely scenario.

PS: It puzzles me to see conservatives, who are typically very risk-adverse (remember Reagan's rather expensive military-buildup insurance policy against Soviet aggression?), take such a risky position on global warming by refusing to do anything. I suspect that this may be because environmental legislation have historically involved heavy-handed regulations instead of market-oriented methods of rectifying the pricing failures of environmental externalities. On that note, the Kyoto Protocol, which aims to cap greenhouse gases through an emissions-trading market, is a fine example of a market-oriented solution.

PPS: Yea, yea, I know, there is one big glaring problem with this whole insurance idea: The Tragedy of the Commons. But if the marketing is done in such a way as to convince people that they do have a tangible stake in the outcome, then this idea may still be workable.