Planet Money recently described the social cost of carbon (as calculated by the US government) as the "most important number you've never heard of".
They went on to pretty harshly criticize the new calculation of that value, on the basis that it doesn't include the costs of Americans emitting carbon incurred by people in other countries.
Poorer countries will be disproportionally impacted by global warming, so when you remove that consideration the social cost of carbon ends up being a couple percent of what it was previously.
But I'm not as comfortable jumping to their conclusion that American regulations should weigh (as part of their cost-benefit) the costs incurred by others. Part of it is a legal concern about jurisdiction and international cooperation. But another is, if we pay all the costs, the more fair accounting only tracks our benefits.
The jurisdictional issue is a little strange, but my concern is that, there are actual zero sum international decisions companies make. Not many, but some – the archetypal example is, when they can choose relatively freely, doing business in America or elsewhere. And to hold American companies to account for the negative impacts on other countries would push all those companies to countries America would wish to not have the global influence those companies bring. Is it so unfair to workers in China, to have a company move to America, that you'd prefer China grow as a superpower instead?
And if we want to shield American companies from the unjust laws of the more corrupt governments of the world, we cannot zealously defend e.g. a Saudi's moral right to live a life free from pornography. I'm sure that upsets them, but we simply can't have that standard. If Bangladesh floods, we could likely resettle them nearby at lower cost than preventing global warming. But they'd lose their homeland. And so, far from being an absurd example, even with the social cost of carbon, America has adopted some of the sacred values of a foreign culture – the right to live where their ancestors did. There's no meaningful difference, no weighing that can be made, between sacred values. None that I've found, at least.
But perhaps a more basic attack on the old standard is, what on Earth is the purpose of a cost-benefit calculation where the groups paying the cost and the groups getting the benefit are different? I'm honestly curious. If these things weren't denominated in dollars I'm not sure anyone would even suspect they can be compared. They aren't the same unit. So why have a procedural roadblock for cost-benefit analysis unless you only want policies that basically help the people you impose them on? I hate to be pedantic, but this is obviously the purpose of the rule. If they wanted to protect sacred values, there would be no limit to regulation. No matter the cost, protect what is right. That isn't what we want here, obviously. So why pretend we used to be doing the due diligence we really weren't?