The EU Emissions Trading Scheme: Protection via Commodification?

Market-oriented approaches to protecting nature like the European Union Emissions Trading Scheme (EU ETS) are often either uncritically embraced or dismissed as neoliberal policy developments that facilitate accumulation and further subject nature to the perversities of markets. I cast doubt on both interpretations. Hewing closely to Karl Polanyi’s own logic, I show that market-oriented schemes like the EU ETS are better characterized as Polanyian countermovements that are, in fact, helping to “re-embed” the European economy in more ecologically sustainable relationships with nature. The more general corollary is that Polanyian countermovements reacting to the disembedding effects of markets may themselves include market mechanisms. Ironically, though, it is exactly the embedding effects of market-oriented environmental policy that may undermine its effectiveness for addressing global-scale ecological problems like climate change.