Populists will weaponize the plan as an example of corrupt cronyism

The causal role of perceptions is particularly pertinent in the domain of climate policy. In democracies where a broad segment of the population perceives institutional corruption, a politics of resignation may set in, whereby mass-based interest groups that might otherwise become organized and campaign for greater action on environmental issues are rendered impotent by diminished expectations. At the same time, among citizens who are not particularly concerned about climate change, perceived corruption may reinforce their insouciance. The perception may have this effect by breeding distrust of politicians and cynicism about their motives, inflaming preexisting antipathies to taxes and ‘big government’, and reinforcing beliefs in the logic of laissez-faire (Persily and Lammie 2004). Under such regimes, democratic politicians may neglect to pass stringent, cost-imposing climate policies, insofar as doing so may elicit electoral backlash from both a distrustful public and native carbon-intensive industries (Jenkins 2014). Numerous case studies corroborate these hypotheses. In Australia, the former Prime Minister, Kevin Rudd, has blamed his failed reelection partly on the passage of an unpopular carbon tax (Rootes 2014). A crisis of confidence in the Australian government was a major culprit; a media campaign, promoted by the native mining industry, was waged to cast aspersions on the government’s alleged incompetence in raising energy prices and benefiting certain native (clean energy) companies at the expense of others crucial to national income (energy-intensive mining and manufacturing) (Eckersley 2013). Perceived corruption also bolstered distrust in Spanish and Portuguese political institutions in 2011-12, with subsequent setbacks to climate policy; panel survey evidence suggests that rising distrust had little to do with the financial crisis, but rather with the widespread perception among citizens “that representative institutions are not responsive to their demands and concerns, exacerbated in Portugal by “elite misbehavior” (Torcal 2014, 19). To the contrary, in Scandinavian countries, sustained public trust in non-corrupt political institutions has been a primary enabler of early and sustained support for CO2 taxation (Andersen 2004; Hammar and Jagers 2006). By focusing on the effect of perceived corruption on the climate policies of industrialized democracies, this paper contributes to previous scholarship that has mostly conceived of corruption in its ostensibly more extreme forms (i.e. illicit, quid pro quo, “black” corruption) and has tended to conflate the impacts in democracies and autocracies. The theory herein contains four related assumptions: (1) Institutional corruption, where it is manifest, yields a significant negative effect on the strength of climate policies across industrialized democracies, when 6 Electronic copy available at: https://ssrn.com/abstract=3175064 controlling for relevant political and economic factors. (2) Perceptions of corruption may be taken as a reliable proxy for institutional corruption. Such perceptions are not exclusively or even primarily an outcome of fleeting individual corruption scandals, but are commonly a symptom of an underlying institutional corruption to which all democracies are potentially vulnerable; however the instantiations and causal mechanisms of undue legislative influence may differ cross-nationally, public perceptions serve as an adequate proxy for these gray areas of corruption. (3) The perception of corruption may itself be an independent cause of weak climate policy, by contributing to a politics of resignation among groups of environmentally motivated citizens, and a politics of distrust among environmentally indifferent citizens. Such perceptions are likely to bolster the strategic influence and laissez-faire demands of native energy-intensive industries opposed to climate regulations. (4) Institutional corruption is likely to negatively impact policy areas other than climate change, particularly areas that also involve vested business interests and require long-term foresight, planning, and coordination (e.g. regulating systemic risk to the banking sector). Perceptions of institutional corruption may be most pernicious in legislative domains where there is a significant time lag between the policies enacted and their intended outcomes. While the evidence in this study cannot confirm this cross-policy effect, social scientists ought to test this hypothesis elsewhere and identify the distinctive properties of perceived corruption in other relevant policy domains