Climate Change Economics — Comments Sought
I am writing a reply to this hit-piece in Slate, “Save the Earth in Six Hard Questions: What Al Gore doesn’t understand about climate change.” [link fixed]
You can probably imagine what I’m going to say, but I’d love any thoughts or ideas for links you have (hopefully today).
October 24th, 2007 at 1:48 pm
Link is broken. Try this:
http://www.slate.com/id/2176156/
October 24th, 2007 at 1:55 pm
Well, let me be the first to say there’s some major stupid going on over there at Slate. Not sure if I can get past this bit of nonsense:
5. Just how rich are those future generations likely to be? If you expect economic growth to continue at the average annual rate of 2.3 percent, to which we’ve grown accustomed, then in 400 years, the average American will have an income of more than $1 million per day—and that’s in the equivalent of today’s dollars (i.e., after correcting for inflation). Does it really make sense for you and me to sacrifice for the benefit of those future gazillionaires?
October 24th, 2007 at 3:58 pm
You need to hit Slate with win-win. Why act now to save ourselves and future generations at the same time:Some of the legislation proposed to reduce greenhouse gases has to do with energy efficiency in new buildings, and in retrofitting residences for the poor. These programs will save energy, save money, and save greenhouse gases.
October 24th, 2007 at 4:25 pm
That whole article is based on a demonstrably false premise.
That economics has some sort of validity in the real world.
It hasn’t.
It’s more akin to a religious cult than a science.
The basic assumptions of so-called economists (who, ironically, know little of economy and instead promulgate a creed of consumption and waste with no regard to physical limits) have been refuted many times over.
Essential reading: E. F. Schumacher, Herman Daly, Nicholas Georgescu-Roegen, and a whole bunch of others who realise that economics is more delusion than reality.
October 24th, 2007 at 4:55 pm
Joe,
Authors of these type articles are of the same caliber as those criminals who produce computer viruses to create havoc simply because they can. Where’s the accountability?
October 24th, 2007 at 6:34 pm
The basic idea of points 1 and 2 seems to be that we don’t have perfect information so we can’t do anything. Point 1 additionally seems to suggest that “economists and politicians” are behind the consensus for global warming rather than “physical scientists”. Point 2 seems to suggest that the ability to grow wheat in Alaska is going to offset the damage caused by New York going underwater.
Point 3 is kind of bizarre. I guess it throws the idea of leaving the world to our descendants on its head by suggesting that our descendants do not deserve a world better than what we have. I believe that an improved environment is a benefit to us today as well as being a benefit to future generations.
Point 4 seems, well, pointless. There’s no point in planning for the future since there might not be a future anyway. I certainly hope all of our traffic engineers, medical researchers, and technologies don’t adopt this viewpoint.
Point 5 calls for a hail mary. We just muddle along and hope for the best. Why not smoke and hope that they cure cancer before you get it?! It’s the opposite of point 4, trading hopeless pessimism for eternal optimism. I guess they’re covering all the bases.
Point 6 seems to be an adjunct to point 2. I think the idea is that global warming could have good or bad effects. We risk losing the good effects if we are not willing to risk the bad effects.
Actually, I think point 6 kind of throws his whole argument on its head. It suggests that we would be “risk averse” not to find out where global warming takes us. I would rather think that we would be “risk averse” not to do everything we can to stop global warming and bring the environment back into equilibrium. Why is it cowardly not to want to live through the consequences of global warming? How can it be courageous not to stand up to the challenge which global warming presents?
I like the way he suggests that this inane column is somehow equivalent to the work that Al Gore has done to win his Nobel Prize. My, Mr. Landsburg has a seriously overinflated view of his own importance.
I won’t even bother to read the napkin calculation. If predictions about climate change should be the work of physical scientists then I’m not sure I’m interested in the scribblings of a journalist.
And, finally, he admits that Al Gore’s book and speeches are based on what he considers to be the best science available! But, he criticizes Gore for leaving out all the underlying data. Al Gore condenses the information in a way that everyone can understand. His is the role of a popular science author like Carl Sagan, Isaac Asimov, or Brian Greene. Anyone who is interested in the deeper science can start at Al Gore’s presentation and dive in from there. Al Gore’s work does nothing to prevent that. And, in fact Al Gore would be very pleased to see people get more into the research.
October 24th, 2007 at 10:36 pm
My quick and dirty analysis suggest that replacing fossil fuel fired power plants with a nuclear base, and by electrifying surface transportation, will bring very substantial secondary economic benefits to society. So much so, in fact, that the benefits may more than pay the capitol costs of replacing the CO2 generating technology. Eliminating fossil fuel technology will significantly reduce heath care costs, since fossil fuel technologies are the primary source of respiration related health problems.
Electrifying surface transportation, would include using plug in hybrids with 50 mile battery ranges, and urban trucking with 200 mile battery range. Inter urban and interstate transportation would be handled by electrified railroads, with long distance trucking eliminated.
The secondary benefits of this electrification would be a further savings of health care costs, and saving on imported crude oil. That saving will benefit the consumer, as well as the national economy, since imported crud will no longer be a drag on the international balance of payment.
The costs of reactors can be controlled by developing a system of mass production, that would enable hundreds of reactors to be built quickly and for a far lower prices than the current system of custom building reactors.
October 25th, 2007 at 12:20 am
Landsburg asks good questions about human activity and harm or good, but most of the article is solipsist pap. The assumption of unending linear economic expansion sets up a straw man. The idea that we’ve no responsibility to future generations went out with Epicurus. Economics aside, it is the fundamental ethic of any species to propagate and assure its prosperous survival. I think it is overly sensitive to call this a hit piece, just a little snarky. Would you agree with his assertion that the most thoughtful assessment of climate change is the Stern Review?
October 25th, 2007 at 3:05 pm
The underlyng presumption that our progeny will be gizillionaires is flawed in two ways.
First, it presumes that we can have economic growthe at 2.3% in a world in which we are forced to make defensive and unproductive investments in sea walls, fire suppression, new water supplies, dealing with refugees, combatting spreading diseases etc. etc. As Sterns notes, reacting to GW will cost us a great deal, and will profoundly cut economic growth, so this kind of growth will not occurr.
Second, even assuming such growth were to occurr, there seems to be an assumption that currency and natural suppoort systems are fungible and substitutable ( see Herman Daley’s excellent discussion on the difference between substitutable resources and complimentary ones — in For the Common Good and in several essays and articles). Resource economists refer to this as cash fetishism.
Another good source to check out is Robert Costanza’s work on the value of ecosystem services — in a seminal article in Scientific American and later in a book Costanza et. al. attempted to monetize the value of 17 key ecosystem services — each of which would be profoundly effected by GW.
Finally, we can’t grow 2.3% with fossil fuels; they will become increasingly expensive (even coal has double in the last 5 years or so) and that will further retard economic growth. Essentially the mirror of RFF’s point in A Sterner Report
These neoclassical economic arguments are of course, fatuous — they are based on assumptions that don’t exist in the real world.
October 25th, 2007 at 5:28 pm
In this new religion, we don’t believe in economics? Umm, I see.
October 26th, 2007 at 12:38 am
I’ll be consistent with my previous posts.
In our 13 trillion dollar economy, we tax federal, State and local governments 4 trillion dollars. Change a trillion of that property, income, social security and sales taxes to a fossil fuel/carbon tax. We still get the government services from it, and it will help us to reduce carbon dioxide released into the atmosphere.
If we change how we tax, why should it then be included as a cost in the fight against global warming. It is an amount of taxes we are already paying, even if it’s unenthusiastically. All those economic calculations the author makes clumsily can be made with no cost to complience.
We don’t have to implicitly spend treasure to fight global warming. We just have to change how we tax ourselves when we fund our government services.
October 26th, 2007 at 1:11 am
Ronald,
The problem is politicians never replace an old tax with a new one. They just add the new one on.