W. Arthur Lewis: Evolution of the International Economic Order
Paul Krugman on Labor Market Deterioration

Jeremy Waldron on Cass Sunstein

I've never understood the enthusiasm some people I talk to fairly regularly have for Cass Sunstein. Jeremy Waldron seems to share my puzzlement:

Jeremy Waldron: A lot of Sunstein's recent work has had this quality: scolding us for our self-righteousness.... In Worst-Case Scenarios, the scolding tone becomes more unpleasant when Sunstein confronts the critics of the US refusal to ratify the Kyoto Protocol, aimed at reducing carbon emissions. Many of the critics, he says, come from countries where the likely effects of climate change will be very grave and where the costs of subscribing to the Kyoto carbon caps are quite low... in the United States: the costs... of lowering the very significant level of carbon emissions is unacceptably high, and the bad effects of climate change will not be felt in the US so much as in other parts of the world. So Sunstein devotes a long second chapter to a defence of the American position. He acknowledges that it's a self-interested calculation: only costs, benefits and catastrophes for Americans are considered. Sunstein understands that this sort of calculation may be morally inappropriate:

...The emission of greenhouse gases could even be viewed as a kind of tort, producing damage for which emitters, and those who gained from their actions, ought to pay. For example, energy and gasoline prices in the United States have been far lower than they would have been if those prices had included an amount attributable to the increased risks from climate change -- risks that threaten to impose devastating harm on people in other countries.

One would have thought that this dimension of worst-case analysis is all-important, and that Sunstein is just the person to explore systematically the difference that attention to the moral aspects of the distribution of costs and harms would make to the modes of analysis that he considers.... He concedes that Americans may have a special obligation to mitigate the harm they have caused. He points out several times, however, that poor people suffer too as a result of over-regulation. And he is reluctant to abandon a method of measuring losses by how much people would pay to avoid them, even though it is hopelessly flawed by the fact that poor people would pay less simply because they have less.... Sunstein asks:

Why should people be forced to pay an amount for regulation that exceeds their willingness to pay? People are making their own judgments about how much to spend to avoid various risks -- and those judgments should be respected.... To be sure, we might believe that a measure of redistribution is appropriate.... But... regulation need not, and often does not, amount to a subsidy to those who benefit.... When the government eliminates carcinogenic substances from the water supply, water companies do not bear the cost; it is passed on to consumers in the form of higher water bills.

Sunstein knows that matters are not as straightforward as this, and that the distributive issues that occasionally trouble him indicate deeper and more structural difficulties with the kinds of analysis he favours. Mostly he just observes that these questions are all very complicated and that he prefers to "return to simpler matters", i.e. rational choice calculations uncontaminated by distributive complexities....

[T]here is a considerable opportunity-cost to the rest of us in his failure to devote more sustained attention to issues of rich and poor, advantaged and disadvantaged. Justice is out of fashion among rational choice theorists, and it is a pity that Worst-Case Scenarios does not fly in the face of fashion in a more determined way. It would have been a better book had it spent more time on the issues of distributive and corrective justice that attend the prevention of catastrophic harm.