Double CO₂ and beyond: benefits, costs and compensation

Economic decisions over what action, if any, to take concerning the greenhouse effect tend to revolve around the social discount rate. Implicitly the debate concerns how to attribute intertemporal weights to welfare and implies a moral stance that is rarely given explicit recognition. Refocusing on the outcomes of current actions emphasises the role of "compensation". A conflict is apparent between the view that the current generation need be unconcerned over the loss or injury caused to future generations because they will benefit from advances in technology, investments in both man-made and natural capital, and direct bequests; and the requirement to avoid harming the innocent. Changes in units of welfare cannot be viewed as equivalent regardless of their direction. In general, doing harm is not cancelled out by doing good. The result is a rejection of the potential compensation principle which underlies the current economic stance, and a reconsideration of the acceptability of "compensation" altogether. The concept of human rights and a non-utilitarian perspective are used to show how cost-benefit analysis denies the existence of inalienable rights, and economics limits the moral considerability of harm.