Summers, Lomborg, Tabarrok, and Cowen on climate change

by on March 11, 2014 at 1:41 am in Economics, Law, Science | Permalink

There was a brief symposium, here are the results:

Larry Summers

President Emeritus of Harvard University, Former Chief Economist of the World Bank

My sense is that cap and trade is not the route to the future. It did not make it politically in the US at a moment of great opportunity in 2009. And European carbon markets have been plagued by constant problems. And globally it’s even harder. My sense is that the right strategy has three major elements. First, as the G20 vowed in 2009, there needs to be a concerted phase out of fossil fuel subsidies. This would help government budgets, drive increases in economic efficiency and substantially reduce global emissions. Second, there needs to be assurance of adequate funding for all areas of basic energy research. As a practical matter my guess is the world will produce non fossil fuel power in the next 25 years at today s fossil fuel prices or it will fail with respect to global climate change. Third, there is a strong case for concerted carbon taxes to further discourage greenhouse gas emissions. But this is a follow-on step for after the elimination of fossil fuel subsidies.

Bjorn Lomborg

Director of the Copenhagen Consensus Center and adjunct professor at Copenhagen Business School

The only way to move towards a long-term reduction in emissions is if green energy becomes much cheaper. If it cost less than fossil fuels, everyone would switch, including the Chinese. This, of course, requires breakthroughs in green technologies and much more innovation.

At the Copenhagen Consensus on Climate (fixtheclimate.com), a panel of economists, including three Nobel laureates, found that the best long-term strategy to tackle global warming was to increase dramatically investment in green research and development. They suggested doing so 10-fold to $100bn a year globally. This would equal 0.2% of global GDP. Compare this to the EU’s climate policies, which cost $280 billion a year but reduce temperatures by a trivial 0.1 degrees Fahrenheit by the end of the century.

Alex Tabarrok

Bartley J. Madden Chair in Economics at the Mercatus Center, George Mason University

Neither the developed nor the developing world will accept large reductions in their standard of living. As a result, the only solution to global climate change is innovations in green technology. A carbon tax will induce innovation as people demand a way to avoid the tax. A carbon tax, however, will be more politically acceptable if technologies to avoid the tax are in existence before the tax is put into place. Prizes for green innovations can blaze a path down a road that must be traveled, making the trip easier. The L-prize successfully induced innovation in LED technologies, the X-Prize put a spacecraft into near space twice within two weeks and Google’s Lunar X prize for putting a robot on the moon is close to being awarded. Prizes have proven their worth. To speed both the creation and diffusion of green technology, green prizes should be awarded at the rate of $100-$200 million annually.

Tyler Cowen

Professor of Economics, George Mason University

This is a problem we are failing to solve. Keep in mind it is not just about getting the wealthy countries to switch to greener technologies, but we also desire that emerging economies will find green technology more profitable than dirty coal. A carbon tax is one way forward but the odds are that will not be enough and besides many countries are unlikely to adopt one anytime soon. Subsidies for technology could occur at a very basic level and we could make a gamble that nuclear fusion will finally pay off. We also need a version of green technology that will fit into existing energy infrastructures and into countries which do not have the most reliable institutions. The most likely scenario is that we will find out just how bad the climate change problem is slated to be.

There are further responses at the link.

Addendum: Ashok Rao adds comments.

Sanjeev Sabhlok March 11, 2014 at 1:47 am

Sorry, these are all problematic on the basic ground that they have assumed CO2 to be a problem. It is, instead, a net benefit to society and life on earth. Without this fundamental issue being resolved, economists’ “solutions” are more likely to harm than help. My ‘booket’ The Net Benefit of CO2 can be downloaded here: http://sanjeev.sabhlokcity.com/Misc/The-net-benefit-of-CO2.doc

dearieme March 11, 2014 at 6:32 am

Quite so. The best bet, though, for the intellectual neanderthals who believe in “You are going to roast in hell and it’s all your own fault” is fusion. Fusion is only forty years away! How do I know? Because it’s been forty years away ever since I started reading New Scientist in about 1960.

T March 11, 2014 at 2:38 pm

Snark aside, in the fusion community we’re actually now building a reactor scale experiment, ITER, (scheduled for completion in 2020 though that looks unlikely) which, if successful, would pretty clearly demonstrate that fusion is viable. At the current pace of research we would likely be able to start designing and building reactors in the 2030′s. For some time now we’ve been ready to start tackling the technological and engineering challenges associated with a reactor, which requires building a reactor-scale experiment, which is expensive compared to most countries fusion research budgets. So most of the delays in fusion research in the past few decades have just been due to getting the money together to build the next generation experiment (see this excellent article: http://www.newyorker.com/reporting/2014/03/03/140303fa_fact_khatchadourian?currentPage=all) – the steady decline in US funding for fusion, and the US pulling out of ITER at one point, have really slowed things down.

Tyler described it about right, as a gamble. As someone working in the field I would say its almost inevitable that we will one day get power from fusion (if it’s needed), but it’s still hard to predict when. It’s almost certainly a worthwhile investment though because solving the technological and engineering solutions needed have plenty of uses outside of fusion anyways.

And, more money would definitely help. Fortunately China and South Korea are starting to heavily invest in this research.

TallDave March 11, 2014 at 3:26 pm

No, fusion is definitely a terrible investment at these levels. AEC estimated decades ago that we have 1,000 – 250,000 years’ worth of fissionables.

And therein lies the problem. Most fusion schemes cannot compete with fission — even the most advanced Powerpoint tokamaks have a plant power density an order of magnitude worse, which means they will be an order of magnitude more expensive.

ITER and NIF should be flatlined, they have no plausible path to economic usefulness. Less-funded technologies like Polywells or field-reversed configurations might someday be commercially viable, but the big flashy useless fusion programs are currently sucking up >90% of the money. LENR is producing some results that are getting harder to ignore. There are a half-dozen other even more esoteric fusion technologies I haven’t even mentioned. Probably none of the above will ever produce a single watt of commercial power, but the current funding structure doesn’t make much sense.

T March 11, 2014 at 5:10 pm

I don’t disagree with you that fission could do the job with technology we already know works. Fusion wouldn’t be necessary any time soon if we started massively deploying fission reactors, but I’m assuming that isn’t going to happen.

Polywells or other electrostatic confinement methods seem to be impossible, see this paper: http://scitation.aip.org/content/aip/journal/pop/2/10/10.1063/1.871080 (unless there is some good counter-argument, which I’m unaware of).

NIF exists mostly to do ‘stockpile stewardship’ research for the Department of Defence – they sell it as a possible reactor concept but this seems significantly more challenging than even magnetic confinement fusion.

T March 11, 2014 at 5:15 pm

I would also add that any other D-T based fusion concept is at some point going to have to deal with the extremely messy issues ITER is largely built to deal with (Tritium breeding, can we find any materials that can withstand the power exhaust and survive for ~30 years, can we build a reactor which doesn’t lose its structural integrity due to the intense neutron fluxes). Any of the other innovative magnetic confinement concepts (which I agree are worth funding, but currently don’t require much money since they are far, far less mature than the leading concepts such as the Tokamak or Stellarator) would eventually have to solve these issues as well and they would all likely eventually lead to big, expensive experiments even if they are radically successful.

TallDave March 11, 2014 at 10:50 pm

FRCs and Polywells expect to do p-B11. Granted, their aneutronicity is both somewhat unknowable (side reactions in the thermal tail can’t be totally eliminated) and not all that useful (the 1/100,000 radiation production really only buys you a bit less shielding) but they won’t have to deal with a lot of the issues ITER faces, such as neutron flux on reactor surfaces. I believe the Navy is currently funding p-B11 Polywell tests today.

You’re missing the larger point though — if they require tens of billions of dollars to achieve Q>1, they probably have no future. Polywells, for instance, should have 62,500x the power production of ITER at similar conditions, thus the 100MW prototype only costs a couple hundred million. Of course, the most likely scenario is they run into the same scaling problems that have plagued toks, but if that happens they’ve at least eliminated a real possibility rather than spending 100x as much on something that we already know won’t have commercial value.

Tokamaks and other MCF devices are only “mature” in the sense we know for certain they don’t work very well — i.e., we’ve spent tens of billions and there’s still no clear path to commercialization.

TallDave March 11, 2014 at 11:01 pm

re the Nevins paper — This is something that’s been kicked around in IEC circles for some time. Luis Chacon showed pretty clearly that Nevin’s (and Rider’s) critique is only true given certain assumptions, such as the shape of the potential well. Curved wells give very different results than flat wells, which is somewhat counterintuitive. Net power is possible, at least in theory.

L. Chac�n, D. C. Barnes, D. A. Knoll, G. H. Miley, “Energy gain calculations in Penning fusion systems using a bounce-averaged Fokker-Planck model,” accepted in Phys. Plasmas (2000).

Age Of Doubt March 11, 2014 at 7:24 am

After this winter, convincing people of the the risks of a 0.5 degree increase is an extremely difficult sell. It’s beginning to look like the ozone-layer and acid rain scares of the previous century. As some of the panelists allude to, every developed country could go green tomorrow, but that’s not going to stop the developing world from continuing to dump CO2. The West would suffer all of the pain, with minimal benefit.

Suffer Fools Not Kindly March 11, 2014 at 7:49 am

Great! May I suggest a lovely property in the Maldives or coastal Louisiana (http://www.theatlanticcities.com/technology/2014/03/louisianas-coastline-disappearing-too-quickly-mappers-keep/8544/) or North Carolina so you can take in the great benefit of CO2 and climate change more effectively? Or perhaps Bengladesh? Should be lovely there! Or India, where thankfully you should have some really wonderful summers with attendant good crops as I’ve heard it’s too cold there in the summer at this point.

Love how the climate change boo birds and ostriches grabbed the first three slots here. Combining Tyler’s with the others point you get the depressing result: we are likely going to needlessly (excpet to Exxon) make our future much, much more interesting than it should be.

dan1111 March 11, 2014 at 8:08 am

What this amounts to is an appeal to recent weather as proof of global warming, which is total bunk. It doesn’t prove anything. Just like a cold winter doesn’t prove warming false.

The stories about land disappearing into the sea are particularly egregious. They often combine warnings about a rising sea level with stories that have nothing to do with that. The sea level has risen a few inches in a hundred years, a rise that has been going on since the last ice age and is not responsible for short-term catastrophic shore damage.

In this case, the land in Louisiana is disappearing due to erosion. This is caused by weather and engineering works. Changes in weather could be caused by global warming, but no one has actually shown that. It is just assumed in the article, without evidence.

At least this article doesn’t explicitly claim rising sea levels are to blame, unlike numerous NY Times articles. For example: http://www.nytimes.com/2013/08/25/us/where-sand-is-gold-the-coffers-are-running-dry-in-florida.html?_r=0

dearieme March 11, 2014 at 9:24 am

Yep, never in history has low-lying land been flooded. It’s unprecedented I tell you!

Brian Donohue March 11, 2014 at 1:30 pm

Good point. We need to get away from non-renewables and start burning renewable wood pellets, like the progressive geniuses in the UK.

TallDave March 11, 2014 at 3:30 pm

What’s weird is that not only were floods in the past far, far worse, some of our coastal cities have actually grown out into the water. Check out a map of 1800s NY or Boston.

Floccina March 12, 2014 at 10:28 am

Might I suggest that you buy land in Maine close to the ocean but 20 feet above sea level in hopes that it will one day be much more valuable ocean front property in climate warm enough to enjoy?

Vangel March 11, 2014 at 10:54 am

I could not agree more. First of all, there is little evidence of a major impact on temperatures due to an increase in CO2 in the atmosphere. Second, there is no evidence that warmer temperatures are harmful to the biosphere of this planet, particularly when we note that life first evolved when temperatures were much warmer and CO2 concentrations were much greater. I expected much more from Tyler and Alex.

Phill March 11, 2014 at 11:50 am

How are otherwise educated people still going on about climate change denial?

Why are libertarians so predisposed to deny climate change? I’m starting to file this alongside “intelligent design advocates”. To deny climate change today puts you in the same intellectual range as the curators behind the Creation Museum.

Wake up and smell the increasing insurance premiums in coastal areas.

Brian Donohue March 11, 2014 at 1:11 pm

Thinking people accept AGW. This is the starting gate. It tells us nothing, by itself, about how bad it will be, let alone what should be done about it.

Lumping ‘climate science’ in with evolution tells me you may not have a firm grasp on either.

Phill March 11, 2014 at 4:45 pm

>It tells us nothing, by itself, about how bad it will be, let alone what should be done about it.

At this stage, higher concentrations of atmospheric CO2 leading to more heat being retained in the atmosphere is uncontroversial.

More heat being retained in the atmosphere leading to unpredictable, more extreme weather is also fairly uncontroversial.

The case for evolution is deductively simpler, but I’m not a climatologist and I imagine you’re not an evolutionary anthropologist. As a result, we’re judging the merits of both ideas based on their respective institutional backing by differing bodies of academic. We can debate the specifics of the epistemology – how confident *am I* that atoms are real things? I’ve never seen them – but whatever process led you to conclude that evolution is a true thing must ipso facto also lead you conclude “AGW is a true thing and while just how destructive it is going to be is still undetermined all estimates point to huge disruptions in human quality of life”.

I would be OK if we were arguing over whether it’s worth investing 0.1% of GDP or 5% of GDP; to still be hand wringing over whether it’s actually happening feels a lot like arranging the deck chairs on the Titanic.

Jay March 11, 2014 at 1:58 pm

Because “denial” is often lumped in with not agreeing to their brand of devastating economic policies in the name of “fixing” said problem.

Lee A. Arnold March 11, 2014 at 10:17 pm

Except the idea that they would be “devastating” is nonsense.

Jay March 13, 2014 at 11:46 am

…and the other side disagrees. Even if you think the costs are minimal, they’re still non-zero or we would have already done them. There’s also the rub of getting China to agree to anything..

Lee A. Arnold March 13, 2014 at 12:27 pm

No, this won’t do. There is no evidence that climate mitigation policies will not be cost-effective. That is just misleading blackboard economics, without all the variables. China is not really an issue.

Nathan W March 13, 2014 at 9:51 am

Yes, CO2 is useful.

Must everything be seen through rose-coloured glasses? Morphine is also useful, yet most sensible people look to both sides of a story. Rational planning looks at both costs and benefits. We need C02. But doubling or tripling its level in the atmosphere in 100, 200 or 300 years leaves us with comparatively little time to adjust.

We have a challenge here. It starts with the FACT, easily proven by laboratory demonstration, that CO2 plain and simply IS a greenhouse gas.

Ray Lopez on why Alex wins the soundbite war March 11, 2014 at 2:00 am

AlexT wins from just the soundbite above, but the others are very close behind (Summers wills silver, TC wins bronze, and Lundberg is last since he only mentioned a tech solution but without mentioning intellectual property). That is because only AlexT mentioned a subsidy for green energy, a form of intellectual property (like a patent) by way of a “prize” for a green breakthrough.

The others are correct that a indirect form of intellectual property, namely greenhouse gas taxes, will help spur research in green tech, but we need a more direct form of subsidy as well, which Alex mentions. The other two medalists mention phasing out subsidies (including road subsidies for cars) for fossil fuels, which is a plus. Elimination of these subsidies btw will penalize the USA more than other countries, since it is spread out.

Further, it’s clear anthropogenic global warming is real; what is debatable are the effects: trivial or not?

Vangel March 11, 2014 at 11:01 am

“Further, it’s clear anthropogenic global warming is real; what is debatable are the effects: trivial or not?”

The trouble is that warming is not ‘real’ for many of us. The direct measurements show that the US was actually hotter in the 1930s, which is why most state high temperatures came in the 1930s. The same is true for most other countries. It is also clear by now that the Medieval Warm Period was at least 0.5C warmer than today for most areas of the globe and the Holocene Thermal Maximum was even greater than that. So whether the ‘global warming’ is real depends on what your starting point is. If you choose the 1970s then we are warmer. If you choose the Little Ice Age as your starting point then we are also warmer. But if we pick other start points in the last century or in the last 10,000 years we find a cooling trend. This means that the issue is a bit more complex than the sound bites suggest.

Nathan W March 13, 2014 at 9:55 am

CO2, plain and simple fact, is a greenhouse gas.

Climate is complex, and there are many feedback processes which have not yet been fully sequenced into models which match spotty historical data with recently observed data.

CO2 is a greenhouse gas. Earth will be warmer when there is more C02 in the atmosphere, unless getting a little warmer kickstarts a negative feedback process with self-reinforcing trends (such as a weaker gulf current via reduced salt concentration, explained by the FACT that salt gradients are a major driver of movement between deep and shallow water in oceans, a requisite FACT when looking to understand more complex aspects of climate change).

Nathan W March 13, 2014 at 9:55 am

Trust, me, I don’t use the word FACT lightly.

Alexei Sadeski March 11, 2014 at 12:00 pm

TC wins the soundbyte war:

“The most likely scenario is that we will find out just how bad the climate change problem is slated to be.”

prior_approval March 11, 2014 at 2:01 am

Such appealing modesty on the part of Prof. Cowen, Holbert C. Harris Chair of Economics at George Mason University, and chairman and general director of the Mercatus Center. At least Prof. Tabarrok is proud of his chair, though puzzlingly, linking to that chair’s sponsor’s bio is beyond the pale in this comment section.

‘Neither the developed nor the developing world will accept large reductions in their standard of living.’

And the graveyards are full of indispensable men. It isn’t really a question of what we will accept, it is a question of what we will get. For example, it is fair to say, right now, that most people in Egypt, Syria, and Libya have experienced a significant drop in their standard of living – without any choice but to accept it.

dan1111 March 11, 2014 at 4:12 am

Adopting much more expensive green technologies to replace fossil fuels, at a level that would actually affect predicted global warming, would require a massive voluntary reduction in standard of living. It is a question of what people will accept, in that sense.

Lee A. Arnold March 11, 2014 at 10:18 pm

It requires no reduction in living standards at all. You can print the money.

Dan Hanson March 13, 2014 at 6:31 am

And therefore the real costs of production, the opportunity cost of diverting real hard assets just magically go away, do they?

Printing money is perhaps a specific solution to a specific problem. It is not a wealth printing machine. It does not let you escape the inevitable fact that scarce resources are being diverted.

I hear this printing money argument more and more from people on the left. The people that used to mock conservatives for believing in the Laffer Curve now think you can create wealth in printing presses and use it to avoid making hard choices. Amazing.

Lee A. Arnold March 13, 2014 at 10:21 am

No, the real costs of production and the the diversion of real hard assets do not magically go away. But that is not necessarily an issue.

Lee A. Arnold March 13, 2014 at 10:34 am

By the way, the Right now appears very happy to live with the fact, or to forget the fact, that the Fed printed $7-10 trillion dollars over the last 6 years simply to preserve the asset structure of the financial system. Much of which went into the private purchase of Treasuries and thus the banks will make a profit on the free money, out of taxpayers’ pockets, just as soon as interest rate go up. I don’t really care — the money system had to be saved, the alternative was worse. And I am neither right nor left, so that is your first fail. But arguing that climate mitigation policies will reduce living standards or divert hard assets at the beginning of the 21st century (with high unemployment, growing inequality, and kids not finding the financing to start college or a business) is another one of the Dumbest Ideas Ever, and you should be ashamed of yourself.

Nathan W March 13, 2014 at 9:58 am

We will have to develop them sooner or later. Economic theory suggests that it would be more efficient to spread these efforts over time, in particular because it is easier to dedicate 1 million minds to energy research every year over 100 years than it is to achieve similar results by applying 100 million minds to the same research over the space of 1 year.

The fact that green energy is not yet cheaper than fossil fuel is a sign that further research is needed, and should not be interpreted as a sign that it is time to stick our heads in the sand.

Ask this mean how it worked out: http://izreal.eu/2014/01/31/plastering-not-all-sand-is-created-equal/
Ask this bird how it worked out: http://www.mugpunting.net/2011/06/head-in-sand.html

Sticking your head in the sand is not a highly effective strategy when searching for mutually beneficial solutions to long term problems.

AIG March 11, 2014 at 2:14 am

Before we get into “solutions” for a potential problem, we first have to figure out how to quantify the problem, and figure out if one even exists, So without taking any sides on the debate on global warming, these question still need to be conclusively answered:

1) Is GW caused by CO2 emissions? I.e., does a negative externality exist in the first place? Not sure this has been answered conclusively yet (and its not for economists to answer).

2) If such a negative externality exists, what is the cost it is imposing? I.e., can we quantify it? Because if the hypothetical discounted cost 100 years into the future is…$10 billion…is it worth spending $100 billion to fix it? Seems to me this is a critical question to ask.

3) To levy a tax to counteract the negative effects of this potential externality, one needs to know what the optimal level of CO2 production ought to be, based on its effects. I.e, we’re back to needing to answer 1) and 2) to get to 3.

4) Can we expect the political environment to produce an effcient tax, given that it knows 1, 2 and 3, or can we expect it to utilize the tax for other purposes, as happens for example with the various taxes on transportation. Or worst, can such a tax become akin to an excise tax?

5) Can we assume that the shortcomings of “green” technologies are due to a lack of funding? I.e., is funding the bottleneck here, or is it the technology curve itself? Comparing to the X prize or the Lunar X prize is not entirely accurate since those technologies already exist, and we have known how to do that for decades. This is not the case for problems which have “bottlenecks” in their technological infancy. I.e,, you can throw all the money in the world at getting cold fusion, but you’re still not going to get it.

Seems to me the single most important question, however, is question #2. Seems to me, at the moment, most of the discussion around 2 is driven by “emotion” and ideological beliefs, rather than any actual facts.

Ray Lopez March 11, 2014 at 3:39 am

@AIG – your points rebutted

1) Yes, AG=AGW, with at at least 67% accuracy, and probably 95% accuracy. But since this is a big question, ordinarily you would need 99.9% accuracy. But the Precautionary Principle says we can’t wait that long, since by then we’re all toast (there is a small chance we get runaway GW). Another analogy: I’m in favor of meteor/asteroid/bolide hunting and mitigation, and even fund a private firm in California to do this ( B612 Foundation), even though the science says there’s a very very small chance of another extinction event due to an outer space body impacting earth (i.e., the Precautionary Principle at work)

2) see (1). It’s too late once you can quantify it. Sort of like the Ozone Hole. What are the costs of no ozone in the upper atmosphere? After all, like Interior Secretary chief James G. Watt of Reagan era once said, you can just wear sunblock and sunglasses, right?

3) see (2)

4) Nothing wrong with carbon taxes becoming an excise tax, it will help, albeit in a regressive way, to pay off the government debt

5) Fund it and it will be built. If you throw enough money at a problem, it will be solved. See, NY Yankees. Cold fusion btw is making a comeback.

dan1111 March 11, 2014 at 4:26 am

You could appeal to the precautionary principle to justify any response to any problem that has the slightest likelihood of coming true. The reason this fails is that the response to any one particular problem does not happen in a vacuum. There are many, many potential problems and only limited resources. Thus you have to decide which problems are the biggest; or, more precisely, what use of resources will most efficiently alleviate problems.

In my opinion, expensive measures to combat global warming are a very poor use of resources. I have my doubts about the science, but I am willing to admit there is a chance that damaging warming is coming. However, I see very little chance of carbon reduction measures being successful. Convincing the developing world to use expensive clean energy is just not going to happen. Even Europe is willing to do far less than it would really take. Unless the whole world suddenly gets on board a whole lot more, resources spent in this direction will be a massive waste. Meanwhile, there are huge problems like disease, poverty, and starvation that the same resources could address. These are certain to be problems, and there is a much better probability of getting positive results out of resources spent.

Slocum March 11, 2014 at 7:18 am

The ‘precautionary principle’ cuts in many directions. For example, it also says that you can’t impose cap and trade or carbon taxes because there is a small chance that it will trigger a runaway process that leads to global economic catastrophe (say, imposition of carbon tariffs escalating into a global trade war , leading to a 21st century re-run of the great depression). Or, more reasonably, that we can’t have a concerted push toward green energy because there is a significant chance of retarding global growth enough to condemn the ‘bottom billion’ to remain in extreme poverty indefinitely. People who tend to employ the precautionary principle seem to have a rather selective sense of what kinds of low-probability disaster scenarios should drive policy and which should not even come to mind.

Ray Lopez March 11, 2014 at 7:34 am

@ dan1111- peak oil is a problem, and green tech will help solve it. government debt is a problem, and green taxes will solve it. So even if AGW (man made GW) is wrong, you solved two problems by adopting green tech and carbon taxes. “disease, poverty and starvation” — does not exist. No I’m serious. You can get an African pissed off at you if you suggest otherwise. You must get over the “We are the world – Aid to Africa” mindset–that was so 1980s. Here in the Philippines, I know poverty, and I can tell you what you think of as poverty does not exist. This post would go on a couple of pages to prove my point, but just try traveling outside the USA for a while. AGW *is* the “huge problem” that you speak about.

@ Slocum – the trade war did NOT cause the Great Depression. A Midwest economist wrote a book proving that fallacy is wrong. I read this book, and agreed with it. For one thing, the average weighed by volume tariff rate increase with Smoot-Harley was small, even if you accept free trade of goods in 1930s economies made a big difference (they did not–even today the USA imports about 15% of GDP–not that much). You also make the same mistake as dan1111 about poverty: again, it does not exist. The African in the bush is doing OK. The ones in slums in Manila and elsewhere are doing OK. Come visit here and I’ll show you poverty. The kids are alright.

As for green “top down” solutions: even a libertarian like myself will agree they sometimes work. Case in point: here in Manila (I moved to Manila recently, from a small town outside of Manila) they have banned plastic bags. Result: much fewer plastic bags. Case closed. There are some inconveniences (you must bring a cloth bag) but they are minor. Also, I have recently gotten an expensive water purifier and now I don’t buy bottled water. More savings to the environment by way of fewer plastic bottles. Green tech is the next growth industry for a pressing problem: too many humans on the planet.

dan1111 March 11, 2014 at 7:55 am

All of my life I have been searching for someone who has the moral authority and omniscience that can only come from living in the Philippines. I knew that if I found such a person, all of my questions would be answered, and life would finally make sense. Thank you Ray, for finally being that person.

chuck martel March 11, 2014 at 11:20 am

It’s interesting that the global weather change debate goes on and on with the absence of any reliable evidence on its causation or remedy, but then, maybe that’s why it does go on. On the other hand, the shrinking of the birth rate over much of the globe, an indisputable fact, is virtually ignored except by a few marginal voices like Mark Steyn and David Goldman. If present demographic trends continue Mother Earth won’t have to worry about contracting a fever.

Larry Siegel March 12, 2014 at 2:47 am

>the shrinking of the birth rate over much of the globe, an indisputable fact, is virtually ignored except by a few marginal voices like Mark Steyn and David Goldman

…and me. Here’s an undated version of my article, “Fewer, Richer, Greener,” in the Financial Analysts Journal:
http://larrysiegeldotorg.files.wordpress.com/2012/01/fewer-richer-greener_siegel_2012_03_021.pdf

…and Ben Wattenberg, whose book title, “Fewer,” inspired mine. And, of course, Lomborg. And many others.

Larry Siegel March 12, 2014 at 2:48 am

Sorry, I meant “ungated.” Damned autocorrect.

Erik Køie March 11, 2014 at 11:45 am

Precaution Principle is a good starting point, but I think you fail to take into account the fact that we do have an emergency brake or failsafe we can use in case of catastrophic climate change, namely climate engineering. Now, climate engineering is not to be undertaken lightly, and it is not a long term fix, but it is a pause button of sorts that could be deployed at a time desperate enough for the global society to accept real, hard sacrifices.

As for now, I don’t believe it’s possible to get enough people in enough contries to sacrifice for a global agreement that will actually be enough. Our only hope is for technology to come to the rescue.

TallDave March 11, 2014 at 4:18 pm

But by the same token, the problem of future catastrophic cooling is much more worrisome as it is much more likely to end human civilization — and we are in the midst of a very temporary interglacial. Therefore the precautionary principle suggests we should maximize economic growth so as to be best positioned to deal with whatever the future brings.

We’ll see if Rossi or Defkalion have anything commercially useful. I am still optimistic in the long term, though I suspect no one has a solid LENR theory yet.

AIG March 11, 2014 at 4:37 pm

Re #1: You mean “67% certainty”? That’s rather awful, actually. Where are you getting these “confidence levels” from, BTW?

Regarding the “precautionary principle”. That STILL requires the knowledge of a probability, and knowledge of the potential harm. Neither of these are actually…known…or can be known. This is not a scientific argument, and certainly not one to create massive government policies. After all. the Great JC might come back tomorrow and there would be no 100 years from now, so the “precautionary principle” would reverse.

All sorts of things can be made up if you don’t have to worry about probabilities and costs.

Phill March 11, 2014 at 12:05 pm

1) Is GW caused by CO2 emissions?

This has been done to death. Yes. That is the consensus amongst people whose job it is to study this stuff full time – http://www.slate.com/blogs/bad_astronomy/2014/01/14/climate_change_another_study_shows_they_don_t_publish_actual_papers.html

>In 2012, National Science Board member James Lawrence Powell investigated peer-reviewed literature published about climate change and found that out of 13,950 articles, 13,926 supported the reality of global warming.

2) If such a negative externality exists, what is the cost it is imposing?

This has also been studied.

>According to the Review, without action, the overall costs of climate change will be equivalent to losing at least 5% of global gross domestic product (GDP) each year, now and forever. Including a wider range of risks and impacts could increase this to 20% of GDP or more, also indefinitely.

http://en.wikipedia.org/wiki/Stern_Review

You can quibble over the specifics, but that’s a rather catastrophic potential effect.

3) To levy a tax to counteract the negative effects of this potential externality, one needs to know what the optimal level of CO2 production ought to be

Existing climate models have provided guidance for setting ceilings of CO2 emissions given certain warming ranges. See, Kyoto accords – which were signed in 1997.

4) Can we expect the political environment to produce an effcient tax, given that it knows 1, 2 and 3

With such dedicated skeptical resistance amongst the conservative intelligentsia, I grow more depressed every day.

5) Can we assume that the shortcomings of “green” technologies are due to a lack of funding?

Lack of incentives, and existing fossil fuel incentives. We may be approaching peak oil, but we’re a long, long way from running out of coal. Complex issue of course.

>Seems to me the single most important question, however, is question #2. Seems to me, at the moment, most of the discussion around 2 is driven by “emotion” and ideological beliefs, rather than any actual facts.

On the right side of the ideological spectrum, the issue has become a kind of shibboleth for Correct Thinkers and is the easiest way to display your mood affiliation.

Lots of people have studied all these points in depth, and it is not nearly as open to interpretation as you seem to believe.

Brian Donohue March 11, 2014 at 1:25 pm
TallDave March 11, 2014 at 4:30 pm

1. Wrong, there are over peer-reviewed 1300 papers questioning climate change. http://www.populartechnology.net/2009/10/peer-reviewed-papers-supporting.html

2. “Potential.” History suggests warming will be net beneficial.

3. “Models.”
http://www.drroyspencer.com/2013/06/still-epic-fail-73-climate-models-vs-measurements-running-5-year-means/
http://wattsupwiththat.com/2014/01/09/the-ipcc-discards-its-models/#more-100843

4. With such dedicated propagandists cloaking themselves in the mantle of science…

5. Right, because the hundreds of billions already thrown into this hole didn’t provide enough incentive.

Phill March 11, 2014 at 5:07 pm

>1. Wrong, there are over peer-reviewed 1300 papers questioning climate change.

Compare their methodology then. Also, how many total papers were pro climate change? What’s the actual proportion?

>2. “Potential.” History suggests warming will be net beneficial.

And people right now are suggesting it would involve permanent droughts and a reduction in arable land. There were lots of problems in the middle ages above and beyond a brief cooling.

>3. “Models”

Some people disagree. They are a small minority of people involved. If the people who disagreed offered a compelling alternate explanatory narrative for the data… more people would believe them because that’s largely how the scientific establishment works. Arguing against this point is equivalent to saying scientists never throw out old ideas and only ever stick to the politically expedient.

TallDave March 11, 2014 at 6:20 pm

1) Yes, please do. Note every study is linked at the source. No consensus, obviously. And a perfect meta-demonstration of just how awful some “climate science” can be.

2) “Suggesting…could” Compare cooling periods to warming periods historically. There’s no question warming is better. Cold is deadly.

3) Data doesn’t argue.

AIG March 11, 2014 at 4:31 pm

Re. #1) A Slate article isn’t going to cut it. There are serious scientific discussions pointing to no evidence or weak evidence. An appeal to authority isn’t an answer.

Re. #2) A politically-motivated “risk assessment” which is impossible to validate, isn’t convincing either. There are thousands of “risk assessments” done by governments and special interest groups, 95% of which fail rather badly at assessing risk. This is a far too complicated question to answer conclusively, but if you can’t, you don’t have an argument of how MUCH should be spend.

Re #3: Existing climate models are rather poor at predicting climate. This much seems to be accepted even by those who rely heavily on climate models. So using a poor method to predict the optimal level for a tax, seems very inviting for all sorts of potential problems.

Re. #4: The problem of the political system isn’t necessarily coming from conservatives (who are actually arguing “do nothing”). The bigger problem is those who argue “do something”, without knowing what, why, or how much. The possibility of it turning into an entrenched political interest like ethanol subsidies, seems more disturbing to me here and now, than 0.5 deg hypothesized temp change 100 years into the future.

Re. #5: Didn’t really address my concern. There are some things that no amount of incentives and attention is going to resolve. If we invested $5 trillion today in Warp technology, we still wouldn’t be able to create it.

TallDave March 11, 2014 at 4:41 pm

Good points, just thought I’d add –

#2 — Yes, see Tetlock on this. Expert predictions have a terrible track record. Experts are great at regurgitating relevant facts, not so good at predicting the future.

#3 — The UK Met incorrectly predicted on the warm side 14 of 15 times. The odds of that happening by chance are around 2000:1.

#5 — A guy named Woodward might disagree!

Phill March 11, 2014 at 5:00 pm

1) He lists awfully good evidence. He cites _several_ meta reviews of the literature. I’m providing sources! and you’re not.

It really isn’t an appeal to authority, go check it out. There are, in fact, some people who question the science. The vast majority of people however say it’s solid. This, to day, is uncontroversial and we may as well start wondering about whether a truly intelligent creator might not have also faked the fossil record.

2) Just because you disagree with the conclusion doesn’t mean it’s “politically motivated”. By this standard of evidence, it is impossible for any government to prove anything. Do you know who Nicholas Stern is?

After teaching for a decade at the LSE, and then serving as “the World Bank Chief Economist from 2000 to 2003, Stern was recruited by Gordon Brown, then Chancellor of the Exchequer, to work for the British government where, in 2003, he became second permanent secretary at H.M. Treasury, initially with responsibility for public finances, and head of the Government Economic Service.”

That’s about as status quo as it gets. Is it politically motivated because it was ordered by Gordon Brown?

This is just one example. The Stern Review isn’t the only risk assessment guide on the topic.

>this is a far too complicated question to answer conclusively, but if you can’t, you don’t have an argument of how MUCH should be spend

This is flat out asinine. You can try to reason about how to bear to risk appropriately – you will never know anything with certainty.

3) Existing climate models are rather poor at predicting climate.

Just because I can’t tell you how much it’s going to rain next week doesn’t mean the greater incidence of hurricanes through your neighborhood isn’t going to affect your quality of life.

4) You’re even off by orders of magnitude in the worst case scenario! No wonder you can afford to be blasé. It’s 2-6 degrees over the next 50-100 years. It sounds small, but I’m far more concerned about permanently entrenched droughts and rising water coastlines.

5) Fortunately, reducing carbon emissions is more viable than creating a warp engine.

TallDave March 11, 2014 at 9:11 pm

Seriously? Hurricanes are at an all-time low.

Grover Cleveland had 26 hurricanes in the late 1800s — you know, when GISS claims it was much colder (though the raw data is less emphatic). Obama’s had three.

Lee A. Arnold March 11, 2014 at 11:21 pm

Actually the research on the recent hurricane lows seeks to fit them into the framework of the concomitant evolution of tropical and North Pacific interannual and interdecadal climate modes which appear to have linkages to anthropogenic climate change.

AIG March 12, 2014 at 2:46 am

#1) How much evidence showing the opposite, or no effect, does it take to disprove a theory? I think it only takes 1. So regardless of the number of papers showing the effect, the question is not conclusively answered by the scientific community. For the simple reason that it is…unanswerable.

#2 ) Again, an appeal to authority. It does’t matter who he is, or isn’t. Nothing in that report can be verified through any existing economics tools. One, however, has a track record of government-sponsored “risk assessments” which fail rather spectacularly. People operate on heuristics…and I see a pattern here.

Yes, nothing can be know with certainty. Which is why one can never rely on “risk assessments” when making a decision. Perhaps if we had 50 independent risk assessments, and even then, each individual one would be meaningless on its own. But even then, we still need to reply on our judgment call. It’s not hard to make a judgment call on a “risk assessment” coming from the British government. It’s very easy, in fact.

#3) You can’t tell me that there will be “greater incidence of hurricanes”, because you can’t even figure out what the PAST INCIDENCE of hurricanes has been. How can you tell me something is “increasing”, if you don’t even know with sufficient confidence what it was in the past? This is precisely the point. We started measuring weather with any degree of confidence until about 150 years ago. Our instruments have changed widely since then (which introduces even more uncertainty on previous data). And now we’re trying to extrapolate thousands of years into the past, and hundreds of years into the future…and pretend like we’re doing science.

It takes balls of steel to make such an argument in pretty well defined mechanical environments, even, never-mind in a field where climatologists know very little about the underlying mechanisms at work.

#4) Based on what evidence? Again, if you’re going to pretend to make scientific claims, you need scientific, verifiable, evidence. Which no one has any. Because no one actually can provide any. Because we don’t understand the mechanisms at work.

#5) Good luck with that.

Phill March 12, 2014 at 10:25 am

> How much evidence showing the opposite, or no effect, does it take to disprove a theory? I think it only takes 1.

Science… doesn’t really work that way. That works in a very narrow range of deductive fields, but once you’re dealing with inductive, empirical events, contradictory data or interpretations are common. Discovering that the results your paper brought forward are not repeatable is really common.

> Yes, nothing can be know with certainty. Which is why one can never rely on “risk assessments” when making a decision. […] It’s not hard to make a judgment call on a “risk assessment” coming from the British government. It’s very easy, in fact

This is literally insane.

You can’t be convinced because you don’t understand the mechanics on which the scientific community operates. You’re just making up rules as you go along.

Lee A. Arnold March 12, 2014 at 4:36 am

AIG: “Before we get into “solutions” for a potential problem, we first have to figure out how to quantify the problem…”

Actually, that is wrong in the case of complex systems, which are composed of N-compartments and cannot be precisely predicted, due to something analogous to N-body computational intractability. The best answers we are going to get will be statistical, with long catastrophic tails, and an intuitive sense of when the system is going haywire.

Nathan W March 13, 2014 at 10:03 am

CO2 is a greenhouse gas.

Experiment:

Take several tubes. Ensure that they have otherwise similar ratios of components of air, with the exception of CO2 and 250ppm, 500ppm, 750 ppm, 1500 ppm, 4500 ppm. Then, send light, and watch how various parts of the electromagnetic spectrum (wave lengths) can be measured.

This experiment will tell you everything you need to know about it being easy to understand that CO2 is, as a matter of FACT, a greenhouse gas, even though this piece of information is not sufficient to tell us everything else we need to know about various positive and negative feedbacks involved in ongoing climate change processes.

If you do not understand what I am saying, please review your high school knowledge on electromagnetic radiation (including the particle versus wave debate applied to photons) and your knowledge of diffraction via optics in high school level physics.

Just an Australian March 11, 2014 at 2:47 am

#2 is the rub, as AIG says – but the fact that it is impossible to quantify until it’s retrospective is the problem, and why urgent action is required – because it’s not the kind of problem that leads to rational solutions such as tax. Instead, irrational solutions will come to the fore, and these tend towards blood rather than money

wiki March 11, 2014 at 3:45 am

But the rub is symmetric. If we overshoot our responses we might actually retard a solution thus making the crisis worse at high cost (for example if economic growth is slowed so that there’s less green technological change than would otherwise occur). It is only a guess that green technologies can be efficiently induced by governmental subsidy given the political constraints on rational prizes. After all no one would have guessed that the US would do better than Europe in meeting the Kyoto emissions standards because of natural gas and fracking. Given much higher carbon taxes in Europe and much greater green subsidies, we would have expected the Euros to come up with viable alternatives. So far, progress in wind and solar has been pathetically slow and filled with rent-seeking abuse.

AIG March 12, 2014 at 2:51 am

Exactly. So if the argument is that “more subsidies to green tech will lead to them becoming competitive”, the question still remains:

How MUCH more subsidies are needed to make them competitive? Apparently, the billions over the several…decades…still haven’t paid off. So, how MUCH should we spend?

And isn’t there a cost-benefit calculation to be done there too? If CO2, hypothetically, imposes $100 billion worth of “damage” to future generations, 100 years from now, should we spend $200 billion “green tech” to avoid it? Of course not.

And then, there’s the actual technical details. Are “green techs” actually…green? Certainly the existing systems aren’t actually CO2 neutral.

Nathan W March 13, 2014 at 10:07 am

Good questions, imo

Chip March 11, 2014 at 5:47 am

1) is there a net cost to warming?
2) are the models that predict warming accurate?
3) has the money spent had any effect?
4) considering the pace of technological change should we spend money we don’t have now or wait till 2030 when the tech is available?

The answers to all of these is no. And yet supposedly intelligent people plow on with calls to spend trillions.

As someone who has followed this issue closely for over a decade – starting as a ‘believer’ and later becoming skeptical – I am simply amazed that AGW still has traction.

TallDave March 11, 2014 at 3:56 pm

The really astounding thing in this debate is that there was never any evidence climate could be predicted in the relevant ranges.

In the 1970s, people MIT were openly scoffing at the idea of forecasting climate into the distant future, calling it “necromancy.” The main difference today seems to be a lack of critical thinking and humility.

Nathan W March 13, 2014 at 10:08 am

p < 0.01

What does that mean?

Lee A. Arnold March 11, 2014 at 10:09 pm

Considering the possibility of return to the Dansgaard-Oeschger cycles, you might want to learn some of the evidence.

TallDave March 11, 2014 at 10:39 pm

The evidence strongly suggests the models have no predictive power.

Lee A. Arnold March 11, 2014 at 10:43 pm

“The evidence strongly suggests the models have no predictive power.”

That is false.

Anyway, the Dansgaard-Oeschger cycles are not models.

TallDave March 11, 2014 at 11:08 pm

Which model predicted a 17-year pause?

http://www.drroyspencer.com/2013/06/still-epic-fail-73-climate-models-vs-measurements-running-5-year-means/

If we want to “Consider the possibility of return to the Dansgaard-Oeschger cycles” we need a model that tells us how likely they are.

Lee A. Arnold March 12, 2014 at 12:05 am

This is just boring. It is within the margin of error. Spencer is not your best move, here. According to Wikipedia, “Spencer is a signatory to An Evangelical Declaration on Global Warming, which states that “Earth and its ecosystems – created by God’s intelligent design and infinite power and sustained by His faithful providence – are robust, resilient, self-regulating, and self-correcting”. Nothing wrong to me with religious belief, but that statement is misleading nonsense, since “self-correcting” may include wiping whole species, including humans, off the surface of the planet. I think we can do a little better than that.

Lee A. Arnold March 12, 2014 at 12:25 am

By the way, the whole idea that we “need a model”, meaning presumably a quantitative predictive model, before we do something, is COMPLETELY AND UTTERLY RIDICULOUS. It depends on what it is. If we are dealing with a complex system, that means it’s an N-compartment model, and that puts us up against the limitations of N-body computation. You are up against the foundations of mathematics. (Never mind finding the right variables, and measuring, testing, and modifying, which also become difficult when not impossible). So we will get statistics, and long tails of catastrophes, and lots of arguments from people who cannot think in terms of whole systems. This is the mental poison of modern science. Don’t get me wrong — science is great. But expecting everything to be predictable is an epistemological mistake, and in this era it is coming to be of the gravest consequence. So we will also have to go along with inductive observations about systems: they always oscillate, they usually oscillate more when you force them, and you don’t want to force something when the last time it happened, agricultural civilization could not have survived the consequences. We don’t even keep 2 years supply of food reserves, for gods sake.

Lee A. Arnold March 12, 2014 at 4:39 am

And all the rest of the arguments in this thread are hard-money nonsense. It is a mass delusion. We have enough money to do whatever we think we need.

TallDave March 12, 2014 at 9:50 am

The IPCC MOE now includes scenarios with almost zero warming. So depending on your model, it’s either been falsified or it doesn’t predict warming.

Lee A. Arnold March 12, 2014 at 10:52 am

More hare-brained hair-splitting? This is your response?

Nathan W March 13, 2014 at 10:12 am

I heard, one time, of a man who was shot in the head and later saved.

Perhaps there exists some statistics that 1% of people who are shot in the head later benefit from a surgical process whereby they live.

So, next time I have a gun pointed at my head, all I need to do is explain my logic that, untill I have incontrovertible evidence that shooting someone in the head is 100% proven to be associated with mortality (p < 0.0001), that I will continue to act as though there is no gun to my head.

An extreme example. But this is approximately the amount of respect I have for AGW deniers.

sbh March 11, 2014 at 5:55 am

Funding for R&D sounds all well and good, but is that really the major problem right now with developing greener technologies?

Maybe it seems that I hear more about the failures, especially related to the stimulus spending, but is it possible government money is actually hindering the longer run development and adoption of greener technologies because the markets are so distorted, like with solar panels?

Z March 11, 2014 at 9:16 am

When I was a kid in the 1970′s, schools were telling us about the coming ice age. All that pollution we were putting in the air was blotting out the sun. The answer was solar. I still remember sitting in an assembly watching a presentation on how solar energy was going to replace everything by the time we were in college. The value of preaching this stuff to kids never made sense to me then, but it beat diagramming sentences.

Well, here I am approaching my dotage and we don’t have solar powered flying cars or even solar powered refrigerator bulbs. At least not ones that cost less than a mortgage payment. The other day I spent $40 for a light bulb I was told I could include in my will. It can’t hold a candle to the incandescent (pun intended) it replaced, that only cost a quarter. I may put it in my will, but only as one last poke at those I leave behind.

My advice to the young: If you see a green technology advocate, beat him. He will know why.

Phill March 11, 2014 at 11:55 am

You mean we’ve made *no progress*. In fact, you’ve never changed your mind given new evidence, or studied an issue in length and came to the conclusion that your prior beliefs were ill informed?

You’ve witnessed *zero* technological environment improvements in the past forty years? Have you seen zero products start as luxury goods then slowly filter out to the mass market?

Z March 11, 2014 at 12:26 pm

Where in my post does the phrase “no progress” appear?

Nathan W March 13, 2014 at 10:16 am

And what did they do then?

They got rid of S02 and other particulate. Our air is cleaner. We are healthier for it, and so are ecosystems around the world. More importantly from my perspective, American soot no longer threatens Canadian wildlife (or lungs) to the extent it did in the 1970s.

S02 markets provide(d) evidence that the most obvious solutions to C02 can and have worked in the past, and American environmentalists are largely to thank for demonstrating that a concerted politically oriented movements can move from the margins to the mainstream in ways which create real world results which benefit everyone (except for a few shareholders who lost money in the process of reducing SO2 emissions).

Dan Hanson March 13, 2014 at 4:42 am

Ethanol subsidies. They were the first ‘green’ policy that deviated significant money to an alternative energy source. They have been a total disaster. They have diverted funds away from other green technologies, driven up the cost of food, and have become little more than a payoff to large rent-seekers. And worst of all may actually be making the problem worse.

And here’s something else to consider before developing any policy – just like the arrow of time, there is an arrow of money into such programs, and it generally only goes one way. For example, it’s now widely known that ethanol is a very poor choice for a ‘green’ fuel, but the subsidies are now nearly un-killable because they have resulted in a complete restructuring of agri-business. Eliminating them now should be done, but it will be very painful so it probably won’t be.

Look at the wool and mohair subsidy – what it was intended for, and how long it lasted.

Another example is Germany’s subsidies for solar power, which are not working out very well but is likely un-killable.

So the risk of doing the wrong thing is much higher with government than with the private sector, because the private sector is self-correcting. Its entire model of innovation involves a stochastic search where failure is actually a feature because we learn from it. In government, failure is simply a brake.

Nathan W March 13, 2014 at 10:18 am

I think it is safe to say that environmentalists do not support ethanol subsidies. Generally speaking, and as opposed to popular opinion, most environmentalists care about people even more than the environment. They would rather use corn to feed people than to feed your gas tank on an extended Sunday drive.

Corn farmers like ethanol subsidies. Environmentalists don’t.

Dan Hanson March 14, 2014 at 12:16 pm

They don’t like them now, because now the unintended consequences have become clear so they are distancing themselves from the subsidies. But the subsidies were very much liked by the environmental movement when they were first proposed. Ethanol was supposed to be the first ‘green’ fuel.

ummm March 11, 2014 at 6:21 am

Some could argue it’s rational to ignore global warming because we’re not going to live long enough to experience effects . This is even assuming anything happen, or that global warming is preventable, or that man made global warming exists, or that it’s bad enough to case the potential loss of life

delatopia March 11, 2014 at 11:13 am

Jesus, what kind of planet do you plan on leaving your kids and grandkids? One where the Great Plains looks like the Sahara? How sad.

chuck martel March 11, 2014 at 11:26 am

A previous generation left us interstate highways with billboards everywhere and now we can’t do a thing about it. Another previous generation left us the Federal Reserve Bank, agricultural subsidies and the personal income tax, also permanent fixtures. How about letting future generations solve their own problems? Or are they going to be dumber than we are?

Brandon March 11, 2014 at 2:19 pm

Infrastructure, billboards, and particular laws in one country are the same sort of problem as the entire globe being several degrees warmer?

TallDave March 11, 2014 at 4:23 pm

The largest desert on Earth is under miles of ice.

Michael March 11, 2014 at 7:20 am

So when are we going to have a panel of climatologists discuss macroeconomics?

Jim Nazium March 11, 2014 at 9:24 am

Winner.

dan1111 March 11, 2014 at 9:30 am

Yes, only climate scientists are qualified to talk about the effect of the massive changes in the economy that they are proposing.

Norman Pfyster March 11, 2014 at 9:32 am

They aren’t discussing climate per se. They are assumng warming due to carbon emissions, and discussing paths forward.

Nathan W March 13, 2014 at 10:24 am

Some of the main problems have to do with levels of aggregation in data.

Economists tend to classify data in ways which are not particularly useful for climate modelling. In the last 20 years, however, we have seen data go from 5-100 km squares to squares at hundreds-2.5 km square.

But when data is essentially missing from much of the world, whether in relation to the economy or the environment, much of what comes is guesswork. I could dig back to some literature reviews from grad school, but the basic idea is that climatologists are not very interested in working within the ideological confines of “modern” study of the macroeconomy, while macroeconomists struggle to find climatologists who see the relevant of producing data in the levels/forms of aggregation that can be matched to economic data.

Nathan W March 13, 2014 at 10:26 am

Result? Economists play climate science even more childishly than climatologists play money science.

Martin March 11, 2014 at 8:18 am

Couldn’t the find a single economist with expertise on the topic? And serisouly, how does Lomborg keep managing to get into such panels?

jdm March 11, 2014 at 9:46 am

Yes, the presence of Lomborg on the panel is an embarrassment, as is that of Summers.

The Ashok Rao comments are a propos in this regard. He notes that economists’ models predict a 50% decline in GDP with a 20 (!!!!) degree Celsius (36 degree F) increase in global temperature. There is nothing more that needs to be said about the worth of economists input on this topic.

Economists should, as Rao suggests, shut their collective mouths on this topic, throw out their absurd models, and apply themselves to figuring out the most economically effective ways to get the world off of fossil fuels by 2050. And the reality is that we should try everything: massive investments in R&D, elimination of fossil fuel subsidies, and a carbon tax.

I particularly like Jim Hansen’s idea for a carbon tax and rebate: rebate the full amount of tax collected to all citizens pro-rata. The WTO allows countries with a carbon tax to impose tariffs based on the carbon content of imports from countries without such a tax. This should be done to encourage other countries to impose a similar tax. Hanesn’s idea has two additional benefits. One is that it is revenue neutral. A second is that it would be politically popular, just as Alaska’s natural resource rebate is popular in that country.

dan1111 March 11, 2014 at 10:04 am

Is there not a disconnect between dismissing economists as non-experts on environmental issues, then saying we should listen to Jim Hansen’s ideas on tax policy? Or saying that economists should shut up and just implement the economic plan proposed by climate scientists?

If you are concerned that people are meddling in fields outside their expertise, note that this started with climate scientists going beyond just reporting their climate work to propose major policy changes with huge economic implications. The economists can hardly be faulted for responding.

jdm March 11, 2014 at 10:59 am

1. Hansen’s ideas on taxation are hardly heretical. Eminent economists ranging across the political spectrum, from Frank to Mankiw, are in favor of a well designed carbon tax. I think Mankiw even keeps a list, the Pigou Club, of supporters of such a tax.

2. Many economists don’t take climate risks seriously enough. Alex was worried about the discovery of some giant extinct virus the other day in the thawing Siberian permafrost (actually, I’m not sure if he was genuinely worried, or if this was tongue in cheek). But if you read the climate literature (written by climate scientists) carefully, this kind of fear should be very far down the list compared with the very real risk of a climate catastrophe.

dan1111 March 11, 2014 at 11:40 am

To me, your appeal to the authority of climate scientists on the one hand, while outright rejecting the entire discipline of economics on the other hand, seems purely arbitrary.

Why should I accept climatologists’ work at face value, and yet reject economists’ work as a joke?

The best answer I can come up with is that climate scientists are “real” scientists, while economists are not. Their work is more solid, and thus they have greater authority. However, this does not really hold up to scrutiny. The problem is, the climate science that is driving this debate is no more hard science than economics is. All of the claims about future catastrophe are based on predictive models of a complex system–surprisingly similar to the kind of modelling that economists do. This work is not “hard science” based on the scientific method. It is not falsifiable (except in the very long term). It is based on many, many assumptions–not only of the way different components in the climate system interact, but also in what effect climate changes will have on humans and the environment.

To the extent that science has an authority, it comes from the rigor of the process. Results are proven empirically and reproducible, so that one doesn’t have to trust the scientist–indeed, much of scientific process is specifically designed to root out bias, which shows that even within science it is understood to be improper to appeal to the authority of the person doing the work. The scientific method teaches you not to even trust yourself when it comes to results, never mind other people. This process has been applied many times, sometimes getting wrong results, sometimes even with fraud taking place, but due to its self-correcting nature, a body of trustworthy knowledge has been built up. Climate science (at least when it comes to modelling the future) does not have this. What we are left with is being asked to just trust a bunch of people because they are “scientists”. Why should we?

Scientists have been wrong before. Scientific consensus has been wrong before–it tends to form around the best available hypothesis at the time. Which is not necessary a process that leads to truth when the hypothesis is a non-falsifiable one about future events. Also, it is not at all clear that there is a consensus about the extend and consequences of warming, even if there is one about the fact of warming.

jdm March 11, 2014 at 12:20 pm

You are attributing to me views that I do not hold. I don’t think economists’ work is in aggregate a joke. I respect the results of well founded economic research. I think economists can contribute a lot, especially in coming up with the most cost effective ways to eliminate our dependence on fossil fuels.

Also, I am not saying that you should listen to climate scientist simply because they are climate scientists. What I am saying is that when you have complete scientific consensus in a complicated scientific discipline, with specialists across a wide range of sub-fields all agreeing on the basic facts, you should take that very seriously indeed, especially, as in the case of climate change, where the risks are very high and where the public and the the media is woefully misinformed. It’s also simply not the case that predictions of future catastrophe depend on predictive models of complex systems. That is one line of evidence. But there is also for example a huge amount of empirical work on paleoclimate data which indicates that the climate is quite sensitive to small changes in forcing. And doubling the amount of CO2 in the atmosphere is not a small forcing.

I agree with you on the value of the scientific method (I did my PhD in theoretical physics so maybe I’m biased). And I also agree that the climate is enormously complex. But I strongly disagree that the basic picture painted by climate scientists – that we are running a huge uncontrolled experiment on the earth’s climate, with the almost certain repercussions of rising sea levels, ocean acidification, drastically changing weather patterns, and massive extinctions – is somehow not credible. There is no competing body of scientific knowledge which paints a different picture and there is an enormous degree of consensus in the climate science community. Given that, I think we have to take the results of climate science seriously, and unfortunately, as a society (economists included) we aren’t doing that (e.g. Tyler when says “we’ll just have to see what happens”).

dan1111 March 11, 2014 at 1:31 pm

@jdm, what is the scientific consensus on how much warming there is going to be in the next 100 years? What is the scientific consensus on how many people will die as a result? I do not believe there is a consensus on such issues, and the magnitude is precisely what matters for what our response should be. To what extent is a consensus around “this is going to be really bad” (with widely varying opinions of what that means) a real scientific consensus? Or is it just groupthink coupled with the all-too-human tendency to think one’s own work is really important?

And I do think the modelling of this is highly uncertain. Economists have many past economic events to study and understand, too, but this doesn’t give them the ability to accurately model what is going to happen a year or a decade from now. How are climate models any different?

Your comment above was essentially a call to ignore the input of all economists on climate change: “There is nothing more that needs to be said about the worth of economists input on this topic.” “Economists should…shut their collective mouths.” This is what I was referring to; sorry if it sounded like I thought you were rejecting economics more broadly.

jdm March 11, 2014 at 2:16 pm

My statement on economists was too harsh. It wrote it in irritation, after reading the tepid policy recommendations of Summers et al. There are obviously good economists working in this area. Unfortunately, we hear less from them than from people like Lomborg.

I agree with you that are many difficult questions which can’t be precisely answered – even in principle. It’s impossible to predict how many people will die in year x if we follow course y. But I strongly disagree with you about the proper policy response when faced with this kind of uncertainty. Climate scientists are completely united in raising the alarm that humanity is taking actions which are drastically changing the climate in ways that are irrevocable – we can’t go back. They point out many serious specific risks, to agriculture, to water supplies (lack of snowcaps), to rising sea levels. They point out, based on paleoclimate evidence, that there may be dramatic non-linear feedbacks which could quickly throw the climate into a state which humanity has never experienced and is ill-adapted to civilization. It seems foolhardy, if we care at all for posterity, to pooh pooh all this evidence and advocate business as usual, especially as there are many sensible proposals (more nuclear power, a carbon tax) which could go a long way toward alleviating these risks at minimal cost.

TallDave March 11, 2014 at 3:39 pm

What I am saying is that when you have complete scientific consensus in a complicated scientific discipline, with specialists across a wide range of sub-fields all agreeing on the basic facts

This is the climate science version of three-card monte, conflating the “basic facts” that everyone agrees on (there is a recent warming trend, CO2 causes some amount of warming) with highly speculative claims on which there is very little agreement (warming will be catastrophic, we understand feedbacks well enough to say they are large and positive, models can reliably predict climate within a degree 100 years into the future).

TallDave March 11, 2014 at 4:09 pm

It seems foolhardy, if we care at all for posterity, to pooh pooh all this evidence

Sigh, the eternal confusion of evidence with speculation.

If you’re really worried about the future of humanity, you should be demanding we double down on economic growth — that’s how we got today’s world in which floods no longer kill millions and hurricanes rarely kill thousands.

Only economic growth will permit humanity to mitigate future disasters. Too warm? Build a fleet of space mirrors. Too cold? Reposition them. Asteroid on the way? Use their collective energy to push it off course. If the global median per capita income in 2100 is $100K, the available options will be staggering.

Nathan W March 13, 2014 at 10:29 am

Any risk of releasing viruses from before the time that we can realistically have active antibodies anywhere in the population is frightening.

So frightening that I don’t even want to think about it.

But I hope the people who are responsible for thinking about it are thinking about it.

Martin March 11, 2014 at 10:21 am

jdm,

damage function in IAMs are ad hoc. Nobody ever suggested to use IAMs to calculate damages for such high temperature changes, e.g. Nordhaus very much included. The issue here is how IAMs capture catastrophic risk (specifically, in the context of a fat-tailed climate sensitivity, see Weitzman’s “Dismal Theorem”). But the simple criticism of a “prediction” (look that word up) of IAMs concerning such huge variations is a bit silly.

I don’t see how the presence of Summers is an “embarrassment”, though I admit I am always flabbergasted how Lombord manages to get on such panels. But yes, there are quite a few economists specialising in this field, and they range from not really concerned (e.g. Tol) to really, really concerned (e.g. Ackerman). Probably non of them was available?

jdm March 11, 2014 at 11:19 am

OK, so “prediction” is not the right word. It’s more accurate to say that “The bottom line here is that the damage functions in most IAMs are completely made up, with no theoretical or empirical foundation.” (Robert Pindyck of the Massachusetts Institute of Technology, FT article quoted by Rao). Now I feel better, especially when I also read ‘So-called integrated assessment models of climate change come “close to assuming directly that the impacts and costs will be modest, and close to excluding the possibility of catastrophic outcomes”’ (Nicholas Stern, same article).

So basically, economists use models to “calculate” (estimate? predict?guess?) damages from climate change using “completely made up” damage functions and which explicitly exclude a serious treatment of tail risks. Great.

I don’t doubt that there are serious economists who are very, very worried about climate change and who are not blinkered by the conventional approaches of their discipline. Stern is one. And I agree with you, it would be great to hear symposiums where genuine experts in the field were invited to talk.

Martin March 11, 2014 at 11:43 am

jdm,

I let a comment at Rao’s.

Anyway, this is all known long before Pindyck collected these points. And selective quoting of the literature to pad a POV that you probably did already hold before is hardly a good way to assess the best information in the literature.

Specifically, a Taylor approximation is also “completely made up”, in a way. Basically, IAMs take a convex damage function (quadratic-polynomial in DICE) and calibrate it to damage estimates teased out of variations as they occur naturally or already due to climate change. To use this for huge deviations is indeed nonsensical, which is why nobody is suggesting to do so. To take it as an estimate for small deviations seems reasonable. That it’s “made up” is true, but hardly important if you think about it. Also, this has nothing to do with the assessment of risk and uncertainty per se, though one might think of pushing these into the damage function.

Stern used an IAM to assess costs, btw (PAGE2002). Stern is wrong with the catastropohic outcomes (and indeed, Chris Hope, the developper of the very model Stern used has been protesting that Stern is simply no up-to-date on PAGE), you might be interested in reading Tol’s overview from 2013.

jdm March 11, 2014 at 12:39 pm

I always find it a odd how people assume things about other people based on reading a few paragraphs of something they wrote. First you instruct me to look up the work “prediction”, and now you suggest that my “POV” on economic models of climate change damages was made up on the spot after reading Rao! I actually came very close to switching fields (from theoretical physics) and going into climate science several decades ago. I choose a different course (making automated ‘predictions’ using machine learning techniques of short term asset price changes for a prop trading firm I founded), but I have followed both the scientific literature and to a lesser extent the economic literature on the subject since then so my “POV” on the kind of models many economists use to study the effects of climate has been fairly set for quite some time. What you describe is basically perturbation theory. But it is highly likely that if we can’t drastically reduce our carbon emissions in very short order, the effects of climate change will not be perturbative, making the economic models based on these assumptions worthless.

Martin March 11, 2014 at 12:42 pm

If you say so…

jdm March 11, 2014 at 12:59 pm

That makes three comments, and three ad hominem remarks.

Martin March 11, 2014 at 1:20 pm

jdm,

I did not intend any “ad hominem” attack.

You first pointed to that “IAMs tell complete crap for a 20 °C temperature rise” meme, of which I am not exactly sure what it is to demonstrate. This shows a fundamental lack of understanding how these damage estimates work (by Pindyck, and it was pointed out). It is about as silly as saying that a Taylor approximation is completely off if you are distant enough from the point around which it was developed. So, I hope this specific alleged weakness of IAMs can ditched.

On the other side, it is simply not true that risk and uncertainty are ignored. I pointed you to Tol’s literature overview, and to a specific discussion between Weitzman and Nordhaus concerning this very issue (and they did talk about the convexity of the damage function, if you feel that it should be all in there). You might think that all this is not captured well enough. But you didn’t. You tell me that what I describe is basically “perurbation theory” and then dismiss it as adequte. Showing that you did not bother to look up how risk and uncertainty are actually assessed. Period.

Chris Hope is on twitter and has a blog. He is usually more than happy to answer how PAGE tries to capture catastrophic risk. Nordhaus has recently published a book called “The Climate Casino Risk, Uncertainty, and Economics for a Warming World”, which sounds as if it had something to say about risk and uncertainty, too. Tol is on twitter and usually answers, though he is a rather difficult character.

All this, I think is important. As is its criticism. What is not important wre your – or my – personal impressions on the topic.

jdm March 11, 2014 at 2:00 pm

You told me to look up the word ‘prediction’ which seemed to imply that I didn’t understand it (somewhat ironic, as I make my living off of making predictions in a with very large data sets in a low signal to noise environment, and when in physics made several unimportant but non-trivial predictions which turned out to be correct). Then you said my ‘POV’ was probably based on something I just read in a blog. Then you said “if you say so”. All of which sounds rather ad hominem or perhaps patronizing, but no matter, I found this discussion valuable. Nordhaus’s book has been on my “to read” list since I read the mostly positive review of it in the October issue of Nature and I have just pulled the trigger and ordered it based on this discussion. I haven’t had time to check out your Tol reference and Hope reference, but intend to do so – thanks for the references.

Nathan W March 13, 2014 at 10:31 am

Mathematical aesthetics rather than real world data often drive damage functions in economics.

That problem needs to be fixed. We would do better speaking with an actuary than an economist if we want to work towards effective modelling of damage functions, imo.

TallDave March 11, 2014 at 3:51 pm

He notes that economists’ models predict a 50% decline in GDP with a 20 (!!!!) degree Celsius (36 degree F) increase in global temperature. There is nothing more that needs to be said about the worth of economists input on this topic.

The whole exercise is ridiculously speculative, but a permanent 50% fall in GDP seems reasonably apocalyptic. WW II and TGD would be blips by comparison.

DaveL March 11, 2014 at 9:03 am

Fairly astonishing that so many smart people manage to completely ignore nuclear power (except for a minor mention of fusion research). Nuclear provides significant energy already, is “green,” and manages to be both these things while using reactor technology mostly developed in the 1950s. In the interim new fission power technologies (some of them “inherently safe”) have been proposed and even tested, but research money is scarce and government regulation and NIMBYism have blocked any further progress.

We are in the position of someone with an infection who will do anything to combat it except take an antibiotic.

jdm March 11, 2014 at 9:30 am

Indeed. There are only a handful of cases in which countries have successfully reduced their per capita carbon emissions by a significant amount over a sustained period of many years and in each case it was mostly due to a big investment in nuclear. France and Sweden are the two examples that come to mind. It is highly highly ironic that this clean and safe technology has been sidelined by irrational fears and by misguided environmental concerns. Nuclear construction is expensive, but that is largely because of a paranoid regulatory environment, dictated by a paranoid and scientifically ignorant public (on full display here in the MR comments, with many people doubting what has been scientifically understood for decades), which imposes absurdly high safety hurdles at every level. Third and fourth generation nuclear designs are inherently much safer than even the very safe reactors we have now which are based on 1950s designs. Thorium fluoride reactors could for example power the world for millenia without making any material that would be usable for a warhead and with an extremely minimal amount of nuclear waste.

Finch March 11, 2014 at 9:59 am

+1

The strongest evidence of people’s true belief that future global warming is not going to be particularly bad is the failure to embrace fission. The developed nations can have cheap, clean energy within a couple of years of choosing to do so. We don’t because we’re not really worried about it and we’d prefer to signal our concern for others than actually solve any problem that might exist.

As far as I can tell, it’s pretty well established that there has been some warming over the past century and some of that is due to the actions of humanity. Scientists are much less certain of the future path of warming, and it looks like the consensus estimate, to the extent that there was such a thing, is turning out to be too high. But much remains unknown. And it is common to propose approaches to combating global warming that would be much worse than the consequences of just enduring the warming. I don’t feel like these beliefs make me particularly radical, and certainly not a denier, whatever that means. Nuclear power is my litmus test. People who say “we need to start building new nuclear power plants now” are serious in their beliefs (they might still be wrong) and people who aver on nuclear power don’t actually believe what they’re saying about warming, they just want to be part of the club out there yelling.

Z March 11, 2014 at 10:11 am

This is similar to my view. There are a lot of ways to judge a proposal. If the person making it is lying or shouting at anyone with a question, it is prudent to be skeptical. There’s a reason no one is worried about gravity deniers. When the AGW advocates rule out all solutions but their own, which they readily admit is not a solution, my BS detector starts to overheat.

jtf March 11, 2014 at 10:58 am

Meh, I certainly agree with you about nuclear power and I consider myself one of those serious about AGW, but I’d disagree that nuclear power is an effective litmus test. The only way to reconcile an irrational fear of radiation and radioactivity in general with AGW is to oppose nuclear energy. Simultaneously opposing nuclear energy while beating the climate change drum, claiming that all energy needs can be met by renewables, is the delusional but seemingly rational position that results from not being able to run the analysis yourself and following people with genuinely flawed thought on the subject. I mean, people still believe and cite Aleksei Yablokov’s discredited, addled rants about Chernobyl as serious science.

The better explanation is that the subset of people who are genuinely equipped to understand all the issues is very small, the subset of people who have put in the time an effort to understand at least one area of the intersection between energy, climate, and the economy is smaller still, and the subset of people with expertise in all three are vanishingly tiny. The vast majority of people out there are believers and followers rather than people with the ability to analyze and solve problems, and of those few with the ability few are willing to devote the time for proper study (which is measured in years of dedicated work). We must acknowledge that most people are taking this from people they trust rather than actually having the knowledge to speak about this intelligently.

Finch March 11, 2014 at 11:23 am

I’m not sure your first paragraph is internally consistent. You say that people who worry about global warming and oppose nuclear power do so because they are poorly informed and merely affiliating with “experts” that for various reason they find attractive. How exactly does that undermine nuclear power as a litmus test? I’d say it strongly supports the idea.

William Newman March 11, 2014 at 12:33 pm

Lots of people associated with the catastrophic AGW bandwagon and the policy coalition are capable of noticing that most of the nuclear downside scenarios that stir the crowd to rapturous ecstasy at green revival meetings are not plausibly worse than, say, reenacting all those Cold War H-bomb tests every few years. And while stopping those was good, their downside was several orders of magnitude smaller than CAGW advocates’ worries.

There *are* risks of nuclear power which are not laughably inadequate to justify CAGW-but-no-nukes belief. For example, it’s natural to worry that various kinds of nuclear technology proliferation would lead to an increased risk of nuclear war. Even non-nuclear WW3 is indeed enough of a disaster for numerate people to balance it against an actual sincere belief that CAGW risks are real, not just a useful political fiction. (And nuclear WW3 is a dumptruck of icing on the cake.) But as per unsung more-recent Haidt (and contra widely-reported earlier Haidt) in http://www.yourmorals.org/blog/2010/02/in-search-of-liberal-purity/ red meat for the the anti-nuke crowd is not thoughtful armed security tradeoffs, but emoting about the vile befouling of the purity of Mother Earth by the intrinsically sinister operation of technology,

(Also us-vs.-them doublethink seems to rival actual ritual purity in importance, which shouldn’t come as a complete surprise to anyone who has much knowledge of groups of humans. How bad is it for a given power technology to kill a bird, e.g.? It seems that the befowling coefficient varies enormously depending on whether it’s a green wind tech or a brown oil tech. Such demonization of the other for problems which are closely analogous to behavior which is tolerated or celebrated in the in-group has sometimes been reported in other groups of humans.)

Finch March 11, 2014 at 2:45 pm

It occurred to me that you might be quibbling with my use of the word “serious” insofar as people who have no idea what they are talking about may still believe quite sincerely that global warming is a massive problem and nuclear power is not an effective solution to the problem. I did not mean to count such people as serious. By serious, I meant solemn or thoughtful and not earnest.

ThomasH March 11, 2014 at 11:22 am

Ashok Rao is wrong that a carbon tax “works” only if the revenues are used to ameliorate the damage of carbon dioxide emissions. Taxes on carbon dioxide emission/subsidies for carbon dioxide sequestration work across the board encouraging innovation in less carbon dioxide emitting /more carbon dioxide sequestrating technologies, and encouraging less carbon dioxide emitting/more carbon dioxide sequestrating activities and discouraging more carbon dioxide emitting/less carbon dioxide sequestrating activities. Climate change ameliorating investments should be funded according to their cost benefit analyses regardless of whether in the aggregate their cost is greater or less than carbon tax revenues.

A further note, as a former World Bank employee for 28 years I never flew first class and seldom flew business class.

ThomasH March 11, 2014 at 11:26 am

Of course carbon taxes would change the financial incentives for nuclear power (and all other technologies) in such a way as to promote the research and overcome the NIMBYism as DaveL rightly points out is needed..

Nathan W March 13, 2014 at 10:35 am

Solving a long term problem of unknown consequences with a technology which leaves behind long term problems of unknown consequences.

I’m not anti-nuclear, but imo it’s not hard to understand why the people who should be most in favour are also most against.

The cure could be worse than the medicine. People who are concerned about antibiotic resistance similarly avoid antibiotics except in times of greatest need.

Z March 11, 2014 at 9:06 am

As an AGW insouciant, I’m in favor of whatever puts money in my pocket. I’m against anything that takes money from my pocket. I’m ambivalent about that which has no impact on my pocket. My chief complaint with both Warmists and Deniers is they never stop to consider what’s best for me.

Nathan W March 13, 2014 at 10:37 am

I want to take money from your pocket and put into into “green” research. I want you to kick, scream, cry and everything else you can peacefully do to stop it. Then, when the government turns around and does its job of thinking beyond the current second, I expect you to comply.

You live in a democracy. It has already done many things to make your life better, often by taking money from other people’s pockets to invest in better future outcomes.

Economist March 11, 2014 at 9:27 am

Ashok Rao naïveté is adorable. If academic economists were valuable the market would have already hired them.

Brian March 11, 2014 at 10:31 am

So these are “economists.”

The only thing I can equate the profession to is the high priest in Apocalypto that lived a lavish life and cut off poor peoples heads – knowing it won’t bring rain – but wanting to keep themselves in an esteemed profession.

Looking you people up online, I can see that Tyler Cowen is quite corpulent. There is a serious mis-allocation of resources for somebody that contributes so little to get so fat. In fact, he seems like an aristocratic bon vivant that waxes poetic on the books he is reading and ethnic restaurants he likes to visit.

Amazingly, this obese “economist” is now talking about putting a tax on the fuel source that is close to 90% of the electric grid for West Virginia, Kentucky, Ohio, Indiana, and other poor states. Electricity is a key pillar that keeps our poor states in the 1st world, and some obese “economist” from Washington is giving Easterners “scholarly cover” to tax us on our fuel.

I’d suggest a tax on the fat and slovenly before a tax on the poorest of us that actually produce things of tangible value.

msgkings March 11, 2014 at 12:41 pm

Well, Brian, you’ll find that a tax on the fat and slovenly would probably hit a lot of your poor folk buddies in WV, KY, OH, IN, and other poor states. Just sayin’.

Nathan W March 13, 2014 at 10:39 am

Let’s tax school books instead.

ThomasH March 11, 2014 at 11:18 am

Ashok Rao is wrong that a carbon tax “works” only if the revenues are used to ameliorate the damage of carbon dioxide emissions. Taxes on carbon dioxide emission/subsidies for carbon dioxide sequestration work across the board encouraging innovation in less carbon dioxide emitting /more carbon dioxide sequestrating technologies, and encouraging less carbon dioxide emitting/more carbon dioxide sequestrating activities and discouraging more carbon dioxide emitting/less carbon dioxide sequestrating activities. Climate change ameliorating investments should be funded according to their cost benefit analyses regardless of whether in the aggregate their cost is greater or less than carbon tax revenues.

A further note, as a former World Bank employee for 28 years I never flew first class and seldom flew business class.

Ashok Rao March 11, 2014 at 1:32 pm

You are right. A carbon tax would work, period. I was commenting on whether it would correct for the externality and that requires a more careful use of revenues.

A tax that corrects for externalities is effectively a requirement to purchase a carbon offset – but those offsets only work if they are used towards some “green” endeavor. A carbon offset would not work if it was used to finance soup kitchens in Harlem.

Nathan W March 13, 2014 at 10:41 am

That’s a technical question which can be theoretically modelled. At which level of taxation would applying the sum of (carbon) taxes collected towards damage alleviation perfectly offset those damages?

The modelling whizzes could put together something beautiful in minutes, but the words say (ask) the same thing.

Nathan W March 13, 2014 at 10:45 am

The carbon offset could only finance soup kitchens in Harlem if you could demonstrate that soup kitchens reduce greenhouse gases relative to a baseline scenario.

For example, 10,000 additional soup kitchen meals versus 10,000 meals cooked at home, count for efficiency of cooking 10,000 meals as opposed to 1 meal 10,000 times over, estimate greenhouse gas saving, then pitch your plan to the soup kitchens to who buys it.

Personally, I think there are better ways to improve energy efficiency than institutional meal provisions.

The money would go where the carbon offset is cheapest. That’s the point of allowing companies to trade rather than some heavy handed planner trying to dictate who has to reduce emissions by how much. Let the market find the cheapest way to reduce emissions via a cap and trade system.

CMOT March 11, 2014 at 11:53 am

Alex Tabarrok
“… A carbon tax will induce innovation as people demand a way to avoid the tax.”

Got any actual evidence to support this?

For more than 40 years Europe and Japan have had taxes that raise the prices of fossil and electric energy far above the level of any “carbon tax” that would be acceptable in the US.

The sum total of innovation they’ve produced is mild hybrid autos in Japan. That’s it for trillions in taxes.

Carbon taxes can’t change fundamental chemsitry or physics. They will only prduce innovation among rentiers.

chuck martel March 11, 2014 at 11:57 am

US tariffs on sugar, which dramatically increase the cost of imports, have led to the development of newer sweeteners and the resurgence of old ones. Bees of incredible size are now being bred to produce much greater quantities of honey, all because of US agriculture policy.

CMOT March 11, 2014 at 2:10 pm

High Fructose Corn Syrup is probably not the poster child for innovation that you think it is.

Jay March 11, 2014 at 4:01 pm

Why? The developer’s primary objective wasn’t to create a healthier sugar, it was to get around the sugar tariff. In that regard, wasn’t the innovation successful at what i set out to accomplish?

Nathan W March 13, 2014 at 10:48 am

They could have instead taxed your underwear, or your groceries, or higher taxes on luxury items.

You seem to imagine that the money they taxed was stolen from the economy and hidden away in a deep, dark hole, and that any monies spent were on the type where executives continuously wipe their asses with hundred dollar bills.

In reality, governments need to tax something, and the money they spend actually does something useful sometimes. Those tax giveaways to auto makers are part of an aggregate tax package faced by the industry. Your argument is fallacious.

chuck martel March 11, 2014 at 11:53 am

“On the 9th of April, while encamped awaiting the council, which was to be held the following day, a terrible snow-storm occurred, lasing all day until late in the evening. It was our good fortune to be in camp rather than on the march; had it been otherwise, we could not well have escaped without loss of life from the severe cold and blinding snow. The cavalry horses suffered seriously, and were only preserved by doubling their ration of oats, while to prevent their being frozen during the intensely cold night which followed, the guards were instructed to keep passing the picket lines a whip, and to keep the horses moving constantly. The snow was eight inches in depth. The council, which was to take place the next day, had to be postponed until the return of good weather.”

April 9, 1867, near the present-day Larned, Kansas. Custer, George Armstrong, “My Life on the Plains”, Univ. of Nebraska Press, 1969, pg. 37.

Maybe if this was an example of the normal climate at that time we would prefer it to the more benevolent weather we now enjoy. Or perhaps it really means nothing at all.

Yancey Ward March 11, 2014 at 12:36 pm

Nothing is going to be done until fossil fuel production reaches its physical/economic plateau. If climate change is really a big deal, humanity will just have to adapt to it.

Lee A. Arnold March 11, 2014 at 12:55 pm

Climate change may be increasing the frequency and severity of hot days in the growing season, and most food crops are up against their productivity limits. If an increase in aver. temp. increases the number of hot day spikes, we may see global crop failure, for a year or two — occurring only a few decades from now. Thus, panic and mayhem across world civilization. We might get some extra time, if the polar vortex shift serves to increase continental glaciation a bit, thus increase albedo. It won’t quite tip us into a little ice age, as happened after the medieval warming maximum, but at least it may cool things down, for a short while. Buying only a little more time unfortunately. Our biggest intellectual problem is that economists have led us down the primrose path into believing that complex systems can be made computationally tractable, and that quantification matters, though of course economists couldn’t even predict the financial crisis, and argue instead over utter nonsense like the size of gov’t budgets, and still almost entirely avoid a central, primary concern: the subject of policy capture by industry. After all, it’s their bread and butter! Luckily most of them are fat and slow, so they’ll be easy to catch and cook, once cannibalism sets in. Thanks, economists! Learn this instead: Climate wobbles: https://www.youtube.com/watch?v=SIvcQTXdjTg

TallDave March 11, 2014 at 4:01 pm

Our biggest intellectual problem is that climate scientists have led us down the primrose path into believing that complex systems can be made computationally tractable.

FTFY.

If an increase in aver. temp. increases the number of hot day spikes

According the climate scientists, it’s been getting hotter and hotter since the 1870s. Would you care to see a graph of global food production over that time? I can probably even find one showing a (spurious, mind you!) correlation to CO2.

Lee A. Arnold March 11, 2014 at 8:57 pm

Food production and crop plant productivity are two different things.

TallDave March 11, 2014 at 9:13 pm

Would you like to compare crop productivity? Hint: the U.S. has less arable land in production today than 100 years ago, but we produce a LOT more food.

Lee A. Arnold March 11, 2014 at 9:22 pm

This just gets stupider. Because crop productivity has increased, doesn’t mean that it continues increasing.

TallDave March 11, 2014 at 10:36 pm

Yes, ignoring the entire history of modern agriculture is pretty stupid. It makes much more sense to just assume, for no apparent reason, that the massive growth in yields over the past century will be reversed by a few degrees temperature change in areas that experience a hundred degrees of annual variance.

Lee A. Arnold March 11, 2014 at 10:45 pm

Gee, I thought it would have made more sense to listen to agricultural scientists who say that most crops are up against their hot day limitations.

TallDave March 11, 2014 at 11:14 pm

If you’re going to appeal to the predictive power of experts, you should again read Tetlock. Agricultural scientists in the 1960s predicted we’d all be starving by the year 2000.

Sorry, there is no evidence for your claim, and massive evidence against it.

Lee A. Arnold March 12, 2014 at 12:10 am

This is terminally inept. Complex systems only admit of inductive argument, and all the evidence and logic increasingly suggest that agriculture is going to be the first and gravest danger in climate change. Steer clear away from dunciads like the comments sections at wattsup.

TallDave March 12, 2014 at 9:55 am

I agree, your argument is terminally inept. Because obviously crops can’t be moved to higher latitudes. And tropical food production and crop plant productivity haven’t been falling. You don’t need inductive reasoning when there’s piles of evidence to deduce with.

Another big problem you appear to be ignorant of is that “hot days” peaked in.. the 1930s.

http://wattsupwiththat.files.wordpress.com/2014/03/clip_image006.png

Since you just careen from one ridiculous assertion to another I’m not paying attention any longer.

Lee A. Arnold March 12, 2014 at 10:55 am

Crops can be moved to higher latitudes, but not in the SAME YEAR that crops fail. Maybe not even in the next year. And not shy of massive government activity. It is better for you to avoid the argument, because you are in way over your head.

Lee A. Arnold March 12, 2014 at 1:56 pm

Also, the idea that because something happened in the 1930′s, it isn’t a problem now, is just stupid. What if the 1930′s were a prior oscillation in a complex systems attractor that is returning again, only now with additional CO2 in the atmosphere? Do you know what happened in the 1930′s? The Dust Bowl. Have you costed an water system to resupply the entire western half of North America? Or is it just stuff you want to believe?

Also, the intensity of hot days is by all reports on the increase. Stay away from wattsup — they don’t read their own citations and it is corroding your brain.

Nathan W March 13, 2014 at 10:54 am

If a climate scientist tries to tell you that they think they have already succeeded in making climate computationally tractable, and that their work is done, I recommend that we either start proceedings for a Nobel Prize nomination or that we never, ever, ever listen to anything that “scientist” has to say about climate.

Climate is complex. No one knows it better than a climate scientist.

You may be aware of the fact that, since the 1870s, the use of chemical fertilizers has become common. Also, we use better seeds. Also, the rats and bacterias don’t destroy as much crops.

We are better at farming than we used to be.

At we reach technical limits in production potential, factors such as a few too many hot days or a few too many cold days can start to have genuine impacts on the theoretical limits to yield. For example, much of Africa relies on maize, yet maize reaches optimal production at temperatures UNDER that already experienced on the continent (citation needed).

Dan Hanson March 13, 2014 at 6:24 am

“Our biggest intellectual problem is that economists have led us down the primrose path into believing that complex systems can be made computationally tractable”

And what do you think the climate system is?

Lee A. Arnold March 13, 2014 at 10:16 am

The climate is a complex system too, and thus will not be precisely predictable, either. The statistical predictions will tend to be much better than than in economics, however, for the simple reason that climate deals in physics and chemistry, whereas economics contains humans, thus creativity and unpredictable emergence of new ideas. In reality there may be NO big downside to climate mitigation. Economists couldn’t see the financial crisis coming, then screamed about multipliers and Ricardian equivalence to prevent adequate fiscal stimulus, while many kids couldn’t find the money to start college. Basically, most economists don’t know what is going on.

DaveL March 11, 2014 at 2:00 pm

Nuclear power is not a panacea. It is also not cheap. Current technology plants are ruinously expensive to build (even ignoring regulatory and NIMBY hurdles). Next-generation plants should be much cheaper but they still aren’t cheap. Don’t jump from the belief that only “solar, wind, and biomass” can fix our problems to the belief that “only nuclear” can fix them. Energy provision and use is disparate and complex.

Oil, coal and natural gas make up 82% of energy consumption in the US. Nuclear can in principal replace most carbon-based electricity generation (coal and oil and natural gas), but in practice there are places geography makes it hard.

Still, before nuclear can replace gasoline, we need better electric powered cars and trucks. It is not likely to replace jet fuel. In many areas home heating would have to be changed to use electricity (more expensive than oil or gas). So, we are talking huge capital costs: building plants, replacing a lot of infrastructure, and so on. This won’t happen quickly.

I see wind and solar, both of which are relatively green once built, as contributing. The same people who tout green energy are also at the forefront of trying to remove hydroelectric dams all over the country, but they are right they hydro isn’t really that great from an ecological perspective. Research into carbon capture and other “scrubbing” technologies could eventually make continuing to burn some fossil fuels be closer to carbon neutral. So far though, these technologies are at best at the demonstration stage. Fusion has only been approached with experiments that, scaled up to the size of a working power plant, would make fission reactors seem to be essentially free to build.

None of this is going to be cheap, but it will be much, much cheaper than building sea walls to protect dozens to hundreds of coastal cities, or relocating the inhabitants of Bangladesh, or moving all of our farms north into Canada.

@Lee A. Arnold: The polar vortex shift bringing excessive cold is a local phenomenon unlikely build glaciers anywhere.

mulp March 11, 2014 at 7:53 pm

“None of this is going to be cheap”

Right, paying tens of millions of workers is a big cost.

But hey, if you pay those workers a trillion dollars, those expensive workers are going to spend a trillion dollars. And that trillion dollars they spend will pay the cost of labor required to build all the sustainable energy productive capital assets.

What I find fascinating is how modern free lunch economists see workers as liabilities and look for ways to kill jobs and rid the economy of workers.

Burning natural capital is little different than my going into your house to break up your furniture, paying you a royalty, and then selling the wood to other for firewood. After all, burning your furniture requires less work than planting trees and tending them until they can be cut down, and then splitting the wood and stacking it for drying, and only then selling it as firewood, Your furniture is already cut and dried so burning your furniture is labor saving. Burning fossil fuels is labor saving compared to farming the sun and wind with solar and wind farms which require tens of millions of workers to build and replace that farm equipment as it depreciates.

Clearly workers need to eliminated. The ideal economy is the economy with capitalists selling to consumers without profit killing requirement that the capitalists pay workers. American Exceptionalism is God giving capitalist capital to burn.

Nathan W March 13, 2014 at 10:56 am

I thought all that money disappeared into a deep dark hole and we never saw it again.

You mean those researchers actually take that money and go do research, and green energy producers actually pay people to produce real energy?

This is revolutionary. We may need to revisit some basic assumptions on the types of outcomes that we may expect when governments tax people, and more importantly, what happens when those tax dollars are allocated to some area of activity.

Lee A. Arnold March 11, 2014 at 9:20 pm

“The polar vortex shift bringing excessive cold is a local phenomenon unlikely build glaciers anywhere.”

Oh for God’s sake. Except maybe in Greenland at the end of the medieval warming period. The question is, how does glaciation extend anywhere? The answer is, snow doesn’t melt. A few more extreme winters with extra precipitation on the U.S. northeastern seaboard would start the ball rolling. The ground outside of Toronto is already frozen down so far that it may not thaw out completely until the middle of next summer. If a warming trend brings a cooling trend in rapid alternation, we could return to the Dansgaard-Oeschger cycles that occurred between 18,000 and 80,000 years ago, when climate sometimes bounced 8 to 15 degrees Celsius over a few decades. If you think agriculture for 11 billion people is possible under such a scenario, explain how.

DaveL March 12, 2014 at 8:15 am

Even if your speculations are correct, they will not change the underlying trend, which is more CO2 and more warming. However, I doubt they are. Given this polar vertex excursion is partly exacerbated by the current El Nina, which is expected to wind down, your scenario of a glacial advance in Canada seems unlikely. Not to mention that other parts of the northern hemisphere have had an unreasonably warm winter (Alaska, for example).

Check back in August or so and see if Canada is still frozen.

Lee A. Arnold March 12, 2014 at 1:49 pm

Stop this snarky linear thinking that, because one area has a warm winter, glaciation cannot advance in another area. El Niños and La Niñas may be climate related. The question was, how did we get from the medieval warming period to the little ice age? We know those happened. What is your theory? You don’t know? Was it ENSO? We don’t know. Did ENSO’s start on the day you first heard about them? Probably not.

Nathan W March 13, 2014 at 10:59 am

We all have a very strong interest in having very intelligent people worry about these things, so we will see the signs if/when the next time it comes.

Glaciers beget more glaciers because more light is reflected.

Sine glaciers are currently melting, the opposite logic applies. This is perhaps the most obvious reason to worry that some global warming leads to more global warming, simply because fewer glaciers are around and earth absorbs more heat and reflects less heat.

Lee A. Arnold March 13, 2014 at 12:15 pm

Nathan, We may be seeing the signs now. I READ all the very intelligent people. I think I am among the first to point out to these very intelligent people that agriculture could be at much greater risk, much sooner, than they themselves thought. They have been getting the message.

Agricultural civilization developed entirely within a long period of almost STABLE climate. If we experience extreme variation INSTEAD OF mild warming increase, we could get a spiking year or two when crops fail, worldwide. Current varieties are near their thermal max. The global temperature may go back to the previous trend in the years AFTERWARD, but meanwhile we will have panic and war. You CANNOT replant crops in the same year that they fail. And there are no food reserves to last a year or two.

We may be seeing the signs now. The increase in intensity of extremes may be the clue. Consider what we KNOW: the Medieval Warming Period gave way to the Little Ice Age, the 1910′s led to the 1930′s, the 1960′s led to the 1980′s. But the whole thing is, as you know, ratcheting upward. So I am not arguing that an ice age is imminent, so we don’t have to worry! Quite the reverse! I am arguing that we are risking falling into another KNOWN condition of climate, which is extreme variation over short periods of time, WITHIN our general trend upward. The Dansgaard-Oeschger cycles are KNOWN to have caused climate variability of 8 to 15 degrees C. in periods as short as a few decades. From hotter than now, to colder than now — in very rapid oscillation. We do not want this. We don’t know why this happened, and we may not know why, even if it starts again. And, if we are adding extra energy flux to the planetary system ON TOP OF the possibility of oscillatory states like this (and that is what CO2 does, it increases the energy flux), we don’t KNOW what that leads to either. And it might start to occur within a fairly short period of time. There will be NO useful prediction of this, despite what some of the other commentators here and elsewhere demand — basically, we should ignore anybody who doesn’t understand that complex systems pose severe limitations on prediction. If, in 10 or 20 years, we have a year’s sudden drop in agricultural output, there will be violent mayhem, because there are no food reserves. Nations should AT LEAST start keeping food reserves!

TallDave March 11, 2014 at 3:19 pm

These are all terrible ideas. There has never been any evidence that climate can be reliably forecast, the warming models are all failing, even the IPCC’s own estimates (which continue to trend down, the bottom of the 95% interval is now nearly zero and will probably include negative numbers in the next report) suggest that warming will be mild enough to be net beneficial based on historical evidence — way too much is being made of speculative “impact studies” and not nearly enough actual historical evidence is being studied (confirmation bias is harder to find among facts).

1. Summers makes the least sense. Phasing out fossil fuels would have little impact in the next 50 years even in the useless IPCC estimates and is horrifyingly expensive.

2. Lomborg is only slightly better. There is no magic green energy tech and there probably never will be. Subsidizing failure leads to more failure.

3. Tabarrok at least finds some innovative ways to address the problems in 2, but has the same basic problem.

4. Tyler’s final sentence is extremely accurate.

mulp March 11, 2014 at 7:34 pm

“…horrifyingly expensive.”

Yep, paying people to work is totally unacceptable.

That why it is critical to pillage and plunder the natural capital of the land to kill jobs and cut costs by making millions of people unemployed.

But if the people own land and agree to royalty payment from fossil fuel pillagers, they won’t need to work because they will get paid for selling off the value of their land. And as long as the land doesn’t become worthless wasteland before they die, they will never need to work to consume more than they produce. Ideally, they buy the land with a nodoc nija no interest or principle 30 year mortgage so they can create wealth and live off the capital gains, until the mortgage comes due when they die. Then their estate gets the government bailout of bankruptcy.

The very idea that leftist are demanding that labor be employed to built capital assets like wind and solar and then paying for the operating costs, depreciation, and a fair ROIC is just way too socialist. Only be creative destruction of capital assets and liquidating them can wealth be created. You can never create wealth with labor used to build and maintain capital assets.

You can never have a successful economy if you are required to pay workers.

The ideal economy is the one without the liability of paying workers. Eliminate workers and taxes, and the profits will drive fantastic rowth in production, and the increased supply of goods and robot services will drive consumer demand. When your profits go up, that means your stock goes up, and that means you are wealthier, and that creates consumers to buy what your corporation,

The wealth effect creates consumers to make you wealthier.

Who needs workers??

TallDave March 11, 2014 at 9:14 pm

Sorry, I stopped reading at your first nonsensical sentence.

Nathan W March 13, 2014 at 11:01 am

I think he says start with an end to subsidies.

I can think of plenty of things more deserving of subsidies than the production and consumption of fossil fuels.

Let me start with a list of one: Universal primary school.

Primary school is more deserving of subsidies than production and consumption of fossil fuels.

Anyone care to take up the debate?

Dallas Weaver March 11, 2014 at 3:41 pm

Without even considering the value or significance of CO2 reductions, we could easily cooperate on a revenue-neutral tax shift from a known job-killing tax, such as payroll tax, to another less job killing “carbon tax” on oil, coal, and gas at the source. Yes, the carbon tax will impact jobs. However, energy sector jobs are more automated and less elastic with demand changes than the average job to payroll taxes.

The difference in elasticity would make a revenue neutral tax shift from payroll taxes to carbon taxes a net economic and job creating stimulus. Doing something about climate change would be a byproduct, so how much risk and cost is associated with global warming is irrelevant. The decision can be based upon economic stimulus effects alone.

The difficulty in trying to legislatively control CO2 emissions arises from the fact that it involves a billion daily individual decisions: will I car pool? move closer to work? buy an LED? etc., not a few politicians sitting around plotting on how to reward their supporters and punish their enemies. A tax shift to a carbon tax will impact the billion decisions a day. Politicians rewarding their friends will only impact a few decisions and have little real impact beyond creating economic distortions.

mulp March 11, 2014 at 5:23 pm

I bet you think that the labor saving burning of fossil fuels creates jobs which is the reason burning fossil fuels is cheaper – the price of burning fossil fuels does not need to pay for as much labor as sustainable energy that must be priced to pay for massively more jobs than burning fossil fuels.

A carbon tax would be job creating because it would make burning fossil fuels so much more expensive than hiring workers to build tax dodging solar and wind harvesting capital assets.

The ideal carbon tax is the tax that generates zero revenue. Perhaps $1000 per ton. 50 times higher than any existing carbon tax, five time higher than the $200 modeled by economists for the California energy policy alternatives.

Rather than seeking to kill jobs by reducing West Virginia to wasteland by blowing tops off mountains and filling valleys reducing the productive forests to wasteland, a $1000 per ton carbon tax would allow only mining to produce coke to make capital assets like steel and cement, and those only if methods using solar can’t be found, say solar tower of power heating molten salts that circulate and heat the limestone to convert it into cement, or into electricity to electromelt iron and iron ore with charcoal from wood derived anodes to reduce the iron ore. Those WV woodlands would be a source of charcoal to meet the industrial demand for carbon needed for reduction of metals like iron, aluminum, and calcium. But all that would require immense amounts of labor to build the capital and to harvest and process the wood into charcoal.

Blowing tops off mountains to get to the coal to burn it is job killing pillage and plunder that destroys productive capital assets.

And the payroll tax creates jobs by making sure that the kids of workers don’t become homeless beggars if the worker dies, but instead maintain consumption which creates jobs. And it ensures that older workers also continue consuming and thus creates jobs. And without the payroll tax, workers would be forced by the suffering of friends and family by death and old age to stop consuming and instead saving huge portions of what they earn, like in China. In China the culture puts it in banks where is chases assets, inflating their prices. In the rest of Asia, the culture drives buying gold and silver for dowries and savings which simply end up unproductively around the necks and wrists of women,

We have seen tax cut after tax cut after tax cut since 2000, all to supposedly create jobs and create wealth and to result in better investments than government.

Jobs are much lower now after all the tax cuts.

The gas tax is much lower in real terms than in 1994 20 years ago, but the private sector has not invested in a better alternative to the roads and bridges, which have been decaying for decades since taxes have been attacked as job killing. Where have all the jobs that would have been created by higher gas taxes to build up the road and highway assets gone in the private sector?

With tax burdens much lower than in the 90s, why isn’t the rate of employment and the share of the economy of labor much higher??

Perhaps pollution, lower taxes, drill baby drill, letting roads, bridges, dams, levies, water and sewer all decay, leads to lower job creation rates, or more importantly to job killing.

The reason people hate pollution regulations is it forces labor to be hired to reduce the pollution or clean up the pollution.

Killing the EPA and Clean Air and Water Acts cuts costs by killing jobs.

Nathan W March 13, 2014 at 11:02 am

I prefer carbon taxes to payroll taxes.

It gives me more freedom in deciding how to avoid those taxes. Previously, the best way to avoid taxation was to stop working. Now, the best way to avoid taxation is to reduce wasteful uses of fossil fuels.

The Anti-Gnostic March 11, 2014 at 5:03 pm

Importing millions of Third World peoples into the developed world is completely incompatible with reducing humanity’s CO2 emissions. It’s also incompatible with environmental stewardship generally in the developed world, but the Left has been tiptoeing away from traditional environmentalism for some time now.

Todd Kreider March 11, 2014 at 9:05 pm

As a guy with a degree in physics and a PhD in economics, I can’t believe some of these comments (and no, I’m not a macro or climate change expert, but I try to look at the evidence including the insane models out to 2100, which assume no technological change.)

The one post that really nails it is from Chip. I’ll copy it here:

“1) is there a net cost to warming? 2) are the models that predict warming accurate? 3) has the money spent had any effect? 4) considering the pace of technological change should we spend money we don’t have now or wait till 2030 when the tech is available? The answers to all of these is no. And yet supposedly intelligent people plow on with calls to spend trillions. As someone who has followed this issue closely for over a decade – starting as a ‘believer’ and later becoming skeptical – I am simply amazed that AGW still has traction. ”
(Chip)

Lee A. Arnold March 11, 2014 at 10:14 pm

Considering you have a PhD in economics, it is curious that you endorse this shoddy comment: “should we spend money we don’t have now or wait till 2030 when the tech is available?” Because we can print the money, and nobody know what tech will or will not be available in 2030, and printing the money now may help make it available by then.

Todd Kreider March 12, 2014 at 2:13 am

I may have misunderstood that comment among his others. We can afford to spend the money now since we do have a rough idea that 2030 will be much more productive than today. This is obvious to any one but Cowen stuck in the 20th century.

Lee A. Arnold March 12, 2014 at 4:20 am

You may have misunderstood another. He asked, “Is there a net cost to warming?” and answered, “No.” But that is ridiculous. First, a complete calculation is impossible. Second, it ignores any possibility of catastrophe.

Chip March 12, 2014 at 4:58 am

Shall we spend money converting all of LA’s power sources to solar now, or shall we do it when the cost/performance ratio of solar hits a certain level predicted by current trends.

Is this really that difficult to understand? How many people rushed out to map their genome when it was $100,000, as opposed to waiting – knowing that it would eventually hit less than $1000 as it is today?

As for net benefits to warming, this has been studied to death. Throughout human history we have retreated as a species during cold eras and flourished during warm. More specifically, the current trend of warming is expected to be a net benefit to GDP until about 2080.

The real shocker is that cost/benefit isn’t even on the table when AGW policies are enacted.

Why? Because bright lights like yourself are shrieking about “possible catastrophes.”

Even as extreme weather events are decreasing and there is no serious literature on catastrophic warming.

And that’s all the time I have to waste on an incurious mind.

Lee A. Arnold March 12, 2014 at 2:08 pm

Spend the money now. It gets more people working, creates more wealth. Make the systems retrofittable so you can put in higher performance panels later. Problem solved.

Your problem is that you think that precise cost-benefit analyses are required. In complex systems, they may not even be possible. Secondly, cost-benefit is necessary to companies on a budget. Society as a whole is a very different creature. We can print the money if we need it.

Extreme weather events are NOT decreasing in intensity. Some categories are increasing.

“Net benefits to warming” is nonsense. You can’t do those calculations to any useful degree because it is an N-compartment system. The real questions is whether our civilization can survive extremes that we KNOW to have occurred before agricultural civilization developed.

It is nice that you know the word “incurious”, though.

Nathan W March 13, 2014 at 11:04 am

What does your degree in physics tell you about climate science, beyond the ability to easily understand that some gases can trap more heat inside an atmosphere than others?

TallDave March 11, 2014 at 9:18 pm

Real theories make predictions. If AGW proponents really believe their models are 95% reliable, let them establish exchanges which pay skeptics 10:1 when they’re wrong. Since that would give them tidy 2:1 odds, they should love the idea.

Lee A. Arnold March 11, 2014 at 10:11 pm

So the theory of evolution is not a real theory?

TallDave March 11, 2014 at 10:31 pm

Evolution doesn’t make predictions?

Todd Kreider March 12, 2014 at 2:17 am

This is of course , correct. But they will run and hide , maybe saying “betting is illegal!”

Bunch of pussies.

Nathan W March 13, 2014 at 11:06 am

How about we make recourse to democratic debate, and leave the deniers to stick their heads in the sand while we press forward on taxing wasteful use of finite resources and stimulation of renewable energy technologies.

Nathan W March 13, 2014 at 11:07 am

Seriously though, I’m trying to stretch my mind to think of a viable mechanism to serve the function you propose.

Any ideas?

Lee A. Arnold March 11, 2014 at 10:33 pm

What is a horse going to look like in 10,000 years? Where is the prediction market?

TallDave March 11, 2014 at 10:37 pm

Where’s the global horse lobby asking for triliions of dollars in horse-related taxes?

Lee A. Arnold March 11, 2014 at 10:48 pm

Oh, so the taxes just disappear from the economy? Or they must cause less-productive activity, just because you say so? The whole Reaganoid libertarian shtick fails both logic and evidence, so don’t bother.

TallDave March 11, 2014 at 11:10 pm

If you’re going to comment on an econ blog, you probably shouldn’t deny the existence of incentive effects.

I give up. That’s enough internet for me.

Lee A. Arnold March 11, 2014 at 11:24 pm

Nonsense. Incentive effects upon whom, for what?

Nathan W March 13, 2014 at 11:08 am

10,000 years is a blink of an eye from an evolutionary perspective.

Probably it will have a sore back because we’re breeding for larger and faster horses without any regard to what would have been useful in nature.

Duracomm March 11, 2014 at 11:09 pm

The problem with mulp’s and ray lopez’s desire to spend money to fight global warming is the vast environmental damage policies designed to fight global warming end up causing.

The environment can’t stand much more help of the type mulp and ray lopez like.


Palm oil: the biofuel of the future driving an ecological disaster now

But the European Union’s aim of cutting greenhouse gas emissions by 20% by 2020, partly by demanding that 10% of vehicles be fuelled by biofuels, will see a fresh surge in palm oil demand that could doom the rainforests.

That is likely to kill off the “flagship species” of wildlife such as the Asian elephant, the Sumatran tiger and the orang-utan of Borneo which are already under enormous pressure from habitat loss. Plantation owners regard the orang-utan as pests because it eats the young palm oil plants and hunt them down ruthlessly.

Researchers from the Dutch pressure group Wetlands International found that as much as half the space created for new palm oil plantations was cleared by draining and burning peat-land, sending huge amounts of carbon dioxide into the atmosphere.

prior_approval March 12, 2014 at 2:37 pm

At least provide EU information that is less than 7 years old –

‘Under the Directive 2009/28/EC on the promotion of the use of energy from renewable sources this share rises to a minimum 10% in every Member State in 2020. Regarding the expand of biofuels use in the EU, the Directive aims to ensure the use of sustainable biofuels only, which generate a clear and net GHG saving without negative impact on biodiversity and land use.’ http://ec.europa.eu/energy/renewables/biofuels/biofuels_en.htm

Duracomm March 13, 2014 at 9:02 am

It is the height of gullibility to blindly accept the assurance of a political body that their new policies won’t cause another environmental disaster like their previous policies did.

That is what prior_approval demonstrates by arguing that an EU policy promise not to cause another environmental disaster assures EU policies won’t cause another environmental disaster.

Given the amount of time prior_approval spends on this site it is interesting that he has still not picked up on the concept of unintended consequences.

Nathan W March 13, 2014 at 11:09 am

OK. Now we know. Next idea.

I.e., do not let one failed idea stop you from trying to think up more good ideas. That would mark an end to thought and progress in one fell swoop.

AIG March 12, 2014 at 2:27 am

Here’s another economist that might be quotes on this topic:

“Would you bet your paychek on a weather forecast for tomorrow? If not, then why should this country bet billions on global warming predictions.”

Thomas Sowell

Ultimately, this is the question. Why should anyone pay for a problem that can’t be quantified, can’t even be detected, can’t assign causality, can’t figure out probabilities…can’t even be reliably proven to exist as a problem?

All this “lets tax it and give the money to green energy research” is about as pie in the sky as, well, just about everything that has been done in the past 20 years in the name of preventing the seas from rising.

DaveL March 12, 2014 at 8:22 am

I wouldn’t bet my paycheck on tomorrow’s forecast (although weather forecasting is getting good enough that it’s not nearly as much of a longshot bet as it was even a few years ago).

I would bet my paycheck on climate: it’s going to be cold in winter and hot in summer. Global warming models are about extrapolating what we know to predict climate. They don’t claim they can predict tomorrow’s weather.

The problem is being quantified (atmospheric CO2 is rising, is detected (warming of the Arctic, sea-level rise, heat records set all over the place), has a known cause (CO2 and other greenhouse gases), and gives a probability range every time there is a publication. That adds up to showing there is a problem.

Lee A. Arnold March 12, 2014 at 2:14 pm

““Would you bet your paychek on a weather forecast for tomorrow? If not, then why should this country bet billions on global warming predictions.”

This is a false analogy. More of the hard-money nonsense.

Nathan W March 13, 2014 at 11:13 am

If you talk to people who have a great stake in such questions, farmers, you would find that farmers regularly have to bet major amounts of money on the basis of probability distributions of outcomes.

Sensible farmers buy crop insurance if they can, because the math is hard, the models uncertain, and like all humans they have an aversion to ‘excessive’ risk.

How can we “buy” “crop insurance”. Invest in green tech and start thinking of how to deal with the migration and production-related fallouts of climate change.

Worst case scenario of “buying” into this “insurance plan”? We enjoy only limited gains in green technologies and have spent more effort debating classic and eternally important questions regarding who is allowed to go where when why now?

Floccina March 12, 2014 at 9:47 am

You need a carbon tax and a payout to those who net remove CO2 from the air then you could reach equilibrium. But, Could rationally ignorant voters ever get the politicians to properly implement such a scheme, not until AGW brings temperatures to a level where negative effects are obvious. So sit back and enjoy milder winters for now.

Another possibility would be geoengineering measures to cool the planet.

I am not worried though because I think that removing co2 from the air or cooling the planet will not be very expensive.

So don’t worry be happy.

Todd Kreider March 12, 2014 at 4:46 pm

Actually, there is at least one bet out there. In 2004, Richard Lindzen was willing to take bets that the average global temperatures will be cooler in 2024. I think one climatologist took his offer and bet $1,000 against him.

Pat MacAuley March 12, 2014 at 5:48 pm

Reading these four statements makes me proud to be an economist (for a change). All four of them understand the futility of the current track of trying to reach international agreement to curtail carbon emmissions by fiat or taxes. Lomborg states the best stategy clearly — invest massively in R&D to reduce the cost of non-carbon energy so that it is cheaper than fossil fuels. Professors Cowen and Tabarrok seem basically in agreement with Lomborg on this point, as does Summers in his roundabout way.

There will be two follow-up panels of experts from Wall Street and the hard scientists. I suspect that the economists will have the best answer.

Nathan W March 13, 2014 at 11:17 am

If it’s not politically viable, then all the optimality in the world will get you nowhere.

The best plan is one that will happen (if necessary), not the one that would be best if we could only get people to listen.

Voters are not half as good at billiards as chapter 2/3 of intro to micro would have us believe.

Pat MacAuley March 13, 2014 at 7:29 pm

It would seem to me that the economists’ approach is the most politically viable because it is cheapest and it doesn’t have negative impact on economic growth. The scientists should like it because it would funnel tens of billions into R&D. If the scientists and Wall Street can’t come up with a better strategy, then what else can we try? As Lomborg notes, the Rio-Kyoto-Copenhagen approach will yield little more than hot air.

TallDave March 15, 2014 at 12:44 am

Solyndra today, Solyndra tomorrow, Solyndra forever!

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