Marketing

I prefer a free market approach where individuals are empowered with knowledge and make decisions in their own best interests, which would obviously coincide with the best interests of others.
Obviously this is a pipe dream, but it would be my preference.

Decisions motivated purely by individual self interest have been shown not to always lead to the best result for society:

So some form of government intervention is required.

My favourite solution is to use carbon trading, but instead of the difficult system they’re trying to put in now, have it work on REAL carbon fluxes.

Eg you need carbon permits if you dig up fossil fuels or if you chop down trees, permits equal to the carbon content of the fuel/trees. If you sequester CO2 or plant trees, then you are given permits.

There are fewer fuel/timber companies than there are mining/industry/fuel/power/transport/etc companies which are the ones currently covered by carbon trading, so it’s simpler.

Permits would be given to countries with western nations starting off with more but cutting their emissions more quickly. The nations could then do what they wanted with the permits: sell them at auction, give them to companies or retain them. Revenues raised would be for the countries to spend – investing in green tech, cutting taxes or giving a dividend to the population for example.

Simpler than most solutions, and it uses sensible free market principles.

First of all, understand that there is no such thing as a free market. It is a theoretical concept that cannot truly exist in the world. Anything close to a free market requires governmental controls. The most obvious controls are anti-trust legeslation which stops competitive companies from growing into monopolies. Another important goverment role is cohersive protection of ownership: if I own sheep, the police will prevent you from taking their wool without my permission. That important role of prohibiting a company from taking what does not belong to them has been expanded to publically owned national resources, or international resources such as air. If we start with the belief that we all own the air, and no one has the right to polute your air, then government is required to protect your portion of the rights to air. That right can also be extended to air with a natural portion of CO2. A free market solution to any environmental problem does require a governmental organization to determine what damage to the public resources any company is creating and to determine the cost that is to be paid for that damage. Once an acceptable level of emmissions is determined, the rules of supply and demand will work to find the most efficient and least costly way to reduce emmissions. Cap-and-trade is a free market solution. Do not think they are less so because they require a government. EVERY free market requires a government. You would not have competitively priced toothpaste without a goverment protecting competition and preventing people from stealing what is not theirs.

An interesting question, not least because of your statement ‘to believe true free enterprise is the best way to achieve innovation and stimulate creativity’ highlights issues of morality, social injustice, equality of all living things and exploitation of finite natural resources.

We live on a finite planet with finite resources. We claim ownership of other beings, natural systems and finite natural resources. We, humanity, have a long history of exploitation of other human beings, other beings and natural systems. For which no ‘payments’ have ever been made.

Your ‘Free enterprise’ is not FREE at all, it has massive costs to every living thing and to every natural system on our planet. How can we place a price on drinking water, on breathable air? Free enterprise may pay some costs of extraction, transportation, manufacture, but these monetary fees don’t cover the true costs of finite natural resources.

Adding a charge or taxation of companies who contribute ‘above the norm’ towards greenhouse gas emissions, is NOT addressing the problems. That charge can not cover the real costs. That charge would and has, historically, shifted the real costs to other living things and natural systems. The gap between richer and poorer grows. Exploitation of the poorest citizens hides the real costs.

In a free market mechanism a pair of jeans at £3 at Asda, is better than the same pair at £4 at Tesco. The sweat shop worker, the environment, other living beings are shouldering the real costs.

Free enterprise is theft, not free enterprise at all. Until we recognise that we DO NOT own natural finite resources, other beings (including other human beings) and natural systems. Until we understand that we are stealing from the future we will never learn how to really pay the true costs of what we consume.

The solutions lie in a different way of thinking. In recognising and valuing all life forms and natural systems as being equal, having value for being just as they are, not for what they can provide for us. Understanding it is all connected, inter related and interdependent. In reducing overpopulation and over consumption. In working cooperatively with nature and with small groups of people/kin in our locality. In recognising that the world has existed for million of years before us and will continue without humanity. In finding solutions to work with nature not against it.

Browse Deep Ecology, Permaculture and Biomimicry. Those are your solutions.

EDIT

Politicians are in office for such a short term, they deal in political rhetoric, not long term problems and solutions. The motivation for change comes from the individual and they vote the Governments in. World wide Governments have no real responsibility for long term GLOBAL problems that effect all beings and natural systems. Deep ecology changes that thinking.

For people to move somewhere where the air is clean, and then pay to keep it that way, would practically mean that they would have to formulate complex systems of emission rights, permits and emission laws, agreements and contracts with other groups of people, a sophistiated monitoring program and so on.. such an association would start to look a lot like a government. Friedman only recognizes individual action, and fails to recognize the (sometimes limiting) social context of those actions.

Baccheus is right. There is not such a thing as a free market in real life. and not such a thing as an independently operating invisible hand. There is a complex weave of institutions, beliefs, social rules, resources, individuals, groups and artefacts, that allows trade in goods and serivces without a central authority arranging every detail of it. Still, this weave is man made, and governments can destroy, cultivate or alter it.

Setting up a cap and trade system for carbon credits is an addition to this complex weave. Most new parts of the social structure are not internalized immediatly, especially not those that essentially limit particular behaviour (ie the bruning of oil):
it will take a while before carbon credits will have the same rigidness as other institutions such as private property or not pooping on the street. within the current social structure, limiting our actions in a certain brings advantages. Pooping on the street would get me not only a ticket, but also my girlfriends anger.
Only when mitigating GHG emissions brings rewards, or averts punishment, a “climate”-market will start to operate.
A central authority is needed to organize markets – or other emission mitigating structures for that matter – the invisible hand will do nothing until you tell exactly what it is supposed to do. A central authority can anly emerge rightfully if there is a profound sense of collective ownership and commitment. Friedman is dead. for the sake of our environment, lets hope his ideas will die as well.