Social Policy Bonds aren't always the best way of solving a social or environmental problem. When such a problem has a clearly identified (and universally acknowledged) cause, or set of causes, then direct action, usually done, or organised, by government, is probably the most efficient way of solving it. Much of the raison d'etre of government arises from its ability to raise revenue to solve our social problems. Dealing with military threats, providing basic sanitation and transport infrastructure, and elementary education are examples of solutions that are usually best funded via, and designed, by government.
Other problems are trickier: crime, for instance, or health and education beyond universally achieved basic levels. Or, at the global level, risks of nuclear conflict. Tried and tested approaches can help, and many dedicated, hard-working people follow these, with some, limited, success. But, in my view, these problems have so many causes, and the relationships between cause and effect can change so radically over time, and differ so widely between geographic areas, that the one-size-fits-all, top down, approaches that characterise government action just don't work. Especially when our goals are inescapably long term in nature, we need diverse, adaptive approaches that government does not do well. It is for these goals, I believe, that the Social Policy Bond concept can show the most marked advantage over any other approach.
I am not sure about climate change. A correspondent, who knows a lot more about the science than I do, tells me that it is now beyond doubt that the causes of climate change (or climate breakdown, as George Monbiot puts it) are anthropogenic greenhouse gas emissions. If this is the case, then perhaps my suggested solution of Climate Stabiity Bonds aimed at addressing the depredations caused by climate change to human, animal and plant life might not be optimal. The most efficient solution might be to target greenhouse gas emissions directly, either through a carbon tax, or cap and trade, or (possibly) by a Social Policy Bond issue targeting the composition of the atmosphere.
Theoretical efficiency, though, isn't the only criterion. I said 'univerally acknowledged', in my first para, above. And I've written many times here and on the SocialGoals.com website about the importance of buy-in. For dealing with climate change, which is going to require the expenditure of massive resources, upfront, for an uncertain and inherently long-term benefit, buy-in is as elusive as it is crucial. I don't know whether there will ever be enough buy-in globally to deal adequately with greenhouse gas emissions. The Climate Stability Bond approach might yet have presentational advantages and more palatable money flows than such elegant solutions as a carbon tax. Any presentational advantages would be due to people's more readily identifying with the direct targeting for reduction of the impacts of adverse climatic events, whether they be short term - and televisual - such as hurricanes, or long term and drawn out, such as desertification. The money flows would be more palatable because, essentially, payment is for results: Climate Stability Bonds would not be redeemed until all targeted goals had been achieved. Another possible advantage of the bond approach is that it could be more ambitious than simply trying to return our atmosphere to something like its pre-industrial state. With a much greater global population than (say) 150 years ago, climatic disasters on an appalling scale would still occur, even if that very remote goal were achieved and sustained. A bond approach could, amongst other goals, target those disasters for reduction.
Set against those possible advantages is the more practical one of the atmosphere's composition being much more readily measurable than the multiple goals of a Climate Stability Bond regime.
I''ll conclude inconclusively, by suggesting that perhaps the best approach would be to target (1) atmospheric composition and (2) the impacts of adverse climatic events, independently. Social Policy Bonds could be used to achieve either goal, or both, or neither. Much depends on how willingly people will pay upfront for the abstract-sounding goal of aiming to reduce greeenhouse gases in the atmosphere to their pre-industrial levels.