entry archive

February 4, 2007

Global Warming and Discount Rates--Posner

The latest report of the Intergovernmental Panel on Climate Change, issued on Friday, confirms the scientific consensus that the emission of carbon dioxide and other greenhouse gases, as a result of the combustion of fossil fuels such as oil and gas, and other human activities (such as deforestation by burning), is having significant and on the whole negative effects by causing global temperatures and sea levels to rise. See http//ipcc-wg1.ucar.edu/wg1/docs/WG1AR4_SPM_PlenaryApproved.pdf. I discussed global warming in my book Catastrophe: Risk and Response (2004), I considered the evidence that global warming was a serious problem for which man-made emissions were the principal cause altogether convincing--and since then more evidence has accumulated and the voices of the dissenters are growing weaker. The global-warming skeptics are beginning to sound like the people who for so many years, in the face of compelling evidence, denied that cigarette smoking had serious adverse effects on health.

What has changed since I wrote my book is that not only is the evidence that our activities (primarily the production of energy) are causing serious harm even more convincing, but also that the scientists are increasingly pessimistic. It is now thought likely that by the end of the century global temperatures will have risen by an average of 7 degrees Fahrenheit and that the sea level will have risen by almost 2 feet. Besides inundation of low-lying land areas, desertification of tropical farms, and migration of tropical diseases north, global warming is expected to produce ever more violent weather patterns--typhoons, cyclones, floods, and so forth.

There is much uncertainty in climate science, and climate scientists concede that their predictions may be off--but they may be off in either direction. Far worse consequences are possible than those thought highly likely by the authors of the report, including a temperature increase of 12 rather than 7 degrees Fahrenheit, higher sea levels that could force the migration inland of tens of millions of people (or more), the deflection of the path of the Gulf Stream, causing Europe's climate to become Siberian, and abrupt, catastrophic sea-level rises due to the sliding of the Antarctic ice shelf into the ocean. Not only has the consensus among scientists concerning the harmful anthropogenic (human-caused) character of global warming grown, but the scientific consensus is increasingly pessimistic: recent evidence indicates that the global-warming problem is more serious than scientists thought just a few years ago.

My own view, argued in the book, is that the risk of abrupt global warming--a catastrophe that could strike us at any time, with unknown though presumably low probability--is sufficiently costly in expected-cost terms (that is, multiplying the cost of the catastrophe by its probability) to warrant taking costly measures today to reduce emissions of carbon dioxide and other greenhouse gases. Both the scientists and the policymakers, however, are mainly focused on the long-term costs of global warming--costs that will unfold over the remainder of this century. That focus makes the choice of the discount rate important, and potentially decisive.

A discount rate is an interest rate used to equate a future cost or value to a present cost or value. As a simple illustration (and ignoring complications such as risk aversion), if the interest rate is 5 percent, the present value of $1.05 to be received in a year is $1, because if you are given $1 today you can invest it and have $1.05 in a year. That is financial discounting. But discounting is important even when financial considerations are not the only ones involved in a choice. If you have a very strong preference for spending money now rather than a year from now, you might prefer $1 today to $1.50 a year from now.

These approaches don't work well when the question is how much we should spend today to avert costs that global warming will impose in the year 2107. Suppose we estimated that those costs would be $1 trillion. Then at a discount rate of 5 percent, the present-value equivalent of the costs is only $7.6 billion, for that is the amount that, invested at 5 percent, would grow to $1 trillion in 100 years. At 10 percent, the present value shrinks to $73 million.

So it is possible to argue that, rather than spending a substantial amount of money today to try to prevent losses from global warming in the future, we should be setting aside a modest amount of money every year--$73 million this year to deal with global warming in 2007, the same amount next year to deal with global warming in 2008, and so on. Of course we would also want to spend money to prevent the lesser losses from global warming that we anticipate in earlier years. For example, suppose we estimate that the loss in the year 2057 will be $100 billion. Then at the same 10 percent interest rate, we would want to spend $852 million this year.

Thus two effects are being balanced in computing the present equivalent of future losses from global warming--the larger loss in the more distant future, and the greater shrinkage of the larger loss, because of its remoteness from today, by the operation of discounting. The latter effect will often dominate, as in the examples, but of course this depends critically on the choice of discount rate. At an interest rate of 3 percent, a $1 trillion loss in 2007 has a present value not of $73 million or $7.6 billion, but of $52 billion. However, when either of the latter two figures is added to figures representing the present value of losses in intermediate years, the sum will be formidable.

A very high discount rate, implying that optimal current expenditures to avert the future consequences of global warming are slight, could be defended on the ground that the march of science is likely to deliver us from the consequences of global warming long before the end of the century. Clean fuels for automobiles as well as for electrical plants (where already there is a clean substitute for oil or coal--nuclear power, though it is more expensive) will be developed, or carbon dioxide emissions from electrical plants will be piped underground, or artificial bacteria will be developed that "eat" atmospheric carbon dioxide. These are not certainties but they are likely, and so they provide a good argument for using a high discount rate, such as 10 percent--and perhaps for considering no losses after 2107, on the theory that the problem of global warming is almost certain to be completely solved by then.

Nevertheless there are at least three arguments for incurring hefty current expenditures on trying to reduce carbon dioxide emissions in the near term. The first is that global warming is already imposing costs, and these will probably increase steadily in the years ahead. Discounting does not much affect those costs. They may well be great enough to warrant remedial action now.

The second argument for incurring heavy expenditures today to reduce global warming is that there is a small risk of abrupt, catastrophic global warming at any time, and a small risk of a huge catastrophe can compute as a very large expected cost. "Any time" could of course be well into the future, and so there is still a role for discounting, but it is minimized when the focus is on imminent dangers.

The third argument is that reducing our consumption of energy by a heavy energy tax would confer national security benefits by reducing our dependence on imported oil. Our costly involvement in the Middle East is due in significant part to our economic interest in maintaining the flow of oil from there. It is true that because our own oil is costly to extract, a heavy energy tax would not cause much if any substitution of domestic for foreign oil. But that is fine; our oil would remain in the ground, available for consumption if we decide to take measures abroad, such as withdrawing from Iraq, that might reduce our oil imports.

Heavy U.S. energy taxes would induce greater expenditures by industry on developing clean fuels and techniques for carbon sequestration; might persuade other big emitters like China and India to follow suit; and by reducing emissions of carbon dioxide slow the increase in the atmospheric concentration of the gas. Drastic reductions might actually reduce that concentration, because carbon dioxide does eventually leach out of the atmosphere, though at a slower rate than it is built up by emissions.

Posted by Richard Posner at 3:31 PM | Comments (99) | TrackBack (1)

Trackback Pings

TrackBack URL for this entry:
http://www.becker-posner-blog.com/mt/mt-tb.cgi/1481

Listed below are links to weblogs that reference Global Warming and Discount Rates--Posner:

all inclusive mexico trips from all inclusive mexico trips
In a statement from the Department of Tourism, Local Contest Coordinator Ms. Vanessa Webbe, said that Ms. Ram and her chaperon (her parents Mr and Mrs Parikan Ram would receive an all expense paid trip to attend the opening ceremony of the FCCA Caribbe... [Read More]

Tracked on June 12, 2008 7:03 AM

Comments

I suspect that scientists themselves are actually more worried by the risk of a catastrophe, but think there is more hope of persuading politicians on the basis of the things that they can predict will happen with high probability. Given the difficulty of convincing people of the existence of global warming itself, who can blame them?

Posted by Alex at February 4, 2007 4:03 PM | direct link

The cultivation and burning of fossil fuels for energy; and the attendant effects, are argued to be the primary cause of the phenemenon called global warming.

There is significant science supporting this analysis.

However, there are also many scientists who feel they would be abandoning their scientific training, which includes the cultivation of doubt and fealty to the methods (calculus-based physics, peer review) of their profession if they simply committed themselves to such a position. It is still a significant risk.


There is much science supporting global warming, but there are also many, many people who have a financial, political, and ideaological interest in this debate.

I suspect this is what has many scientists frightened.

Posted by Chris N at February 4, 2007 4:22 PM | direct link

First, we should notify Greg Mankiw that Judge Posner has joined the Pigou Society.

Do I detect some confusion in Judge Posner's contribution between maximizing present value using an appropriate discount rate when probabilities are rather well known and their sigma is small, and what decision rule to use when there is a great deal of uncertainty about catastrophic losses, and we do not know what the probabilities are or they have a very large sigma?

If we are worried about a catastrophic outcome with an unknown probability, should we use the expected value decision rule at all? Wouldn't it be better to be pessimistic and use the decision rule that minimizes the maximum loss--"minimax", or use the decision rule that minimizes regret?

I would be willing to trade off a good deal of future economic growth against the expenditure now of large sums to minimize the possibilities of the maximum catastrophes in the future, and to avoid at all costs that future(last?) generations will be full of regret that we did not act now with a maximum response when catastrophe could have been avoided.

I think the advanced countries now have a level of consumption that does not need to be increased, and that even with some redistribution, consumption levels in the world that do not yet meet standards can be increased without lowering the standard of living in advanced countries below a historically high level. To put it bluntly, I am nauseated at the level of conspicuous consumption I see all about me here in the U.S.

I am no scientist, but I would welcome a discussion by the mathematicians and management science experts about what decision rules are available for the highly uncertain situation we face with global warming, and what the advantages, disadvantages and current research expenditure and investment implications are of the various rules. I doubt that maximizing expected value, as Professor Becker and to some extent Judge Posner seem to be doing, is the decision rule we should be using.

Posted by William Rhoads at February 4, 2007 5:04 PM | direct link

If we're worried about protecting against the small risk of abrupt, catastrophic global warming that could happen at any time, there are a near infinite number of low probability, high cost events against which we might also need protect ourselves. How much are we spending to develop systems to protect us against rogue comets or meteorites? Perhaps slightly lower probability than an abrupt catastrophic climate change, but certainly potentially more catastrophic. That one, I'm actually slightly worried about. But, we can move further down the list of lower probability but higher cost events. How much should we be spending against the possibility of a Great Collapsing Hrung disaster? We can always envision costs so high that even very low probability events should be guarded against.

Do you really think that moral suasion would induce China to follow America's example in setting very high carbon tax rates? Consider an alternative option: set a very large, tax-funded, prize for any scientist developing workable alternative energy or carbon sequestration systems, then provide the technology for free to developing countries.

Posted by Eric Crampton at February 4, 2007 7:05 PM | direct link

Global warming would produce quite a few good things too, perhaps enough to more than offset the bad. Agriculture would be more productive and growing seasons much longer; vast areas of the earth that are now wastelands would be useful and habitable, such as northern Canada and Siberia; winter heating costs would drop; and most economic activities would be completely unaffected, because they don't depend on the climate. These need to be taken into account as well. Furthermore, the evidence for man-made global warming isn't as tight as Judge Posner would have it: the climate has always been changing, and many periods within human history have been warmer than now; humans were adding very little CO2 to the atmosphere then.

And finally, my suspicions of the motives behind those who support massive government intervention to "do something" about global warming are encapsulated in the remark of a previous commenter: "To put it bluntly, I am nauseated at the level of conspicuous consumption I see all about me here in the U.S." Socialists everywhere, like the commenter, will love the new global warming regime.

Posted by Dennis Mangan at February 4, 2007 9:02 PM | direct link

Surely a fourth argument for using a lower discount rate (or a different approach altogether) is the potentially irreversible nature of the change; if I understand the scientists' warnings, in 2017 it may not be possible to achieve at any cost the climate stabilization that is still within reach -- though expensive -- today.

Posted by Amanda at February 4, 2007 9:24 PM | direct link

Another factor is the point at which the runaway greenhouse effect is triggered. That is, at a certain point, the amount of warming is enough to substantially increase the amount of water vapor in the atmosphere--a far more effective greenhouse gas. This is to say that at some point, we won't be able to do anything and the atmosphere will "runaway" and we will look like the planet venus (crushing atmosphere, 900F at the surface, etc.).

Unfortunately, we don't know at what point the point of no return is for the runaway greenhouse effect. Obviously, this changes these cost calculations considerably. What should we spend now to avoid a point of no return that we can't yet scientifically predict when or under what conditions it is triggered? Obviously, if we're past that point, we might better spend our resources calculating and then preparing for when we need to be off this rock.

Posted by joe at February 5, 2007 1:47 AM | direct link

Doesn't the "short horizon" of the political world, i.e., politicians thinking in terms of the next election as to opposed to the next hundred years, militate against long range responses to this purported problem?

Posted by robert at February 5, 2007 1:06 PM | direct link

It's -1 deg.F outside and the windchill is running at -15 below. Who says the world is warming up? :( It is well known that the planets temperatures have run higher in the past and colder as well. Perhaps what is going on is a natural warming cycle taking place, and being slightly accelerated by greenhouse gas emissions from human production.

The figuring out of discount rates is one method calculating future costs, but the efforts should be spent on optimizing the productive process. Such that, in any process; raw materials, utilities, energy, and labor are utilized in the process and on the other side out comes, wastes and product. Product has positive value, wastes negative value. Any business that wishes to maximize its profit, trys to minimize its waste streams by minimizing them or recycling them back into the process as raw materials, utilities, or energy. No waste, no negative values and increased profit. Green house gas emissions are just one such waste stream that affects the process's bottom line.

Perhaps business will wise up and understand that Process R&D does have a place in its Business Plan. Until then, as the public, all we can do is hope for the best for ourselves and our future generations. Not too mention, solving global warming.

Posted by N.E.Hatfield at February 5, 2007 2:39 PM | direct link

Static solutions like Carbon Credits won't do anything but line the pockets of corrupt UN eurocrats [recall the Oil for Food scandal].

If the science is accurate [which I don't beleive] the solution is nuclear energy and green-tech investement that encourages India & China to sign on

Posted by Fen at February 5, 2007 2:49 PM | direct link

I'm not so sure about fossel fuels being the primary culprit here. There are 1.3 billion cows on this planet, and every year each cow produces about 90kg of methane. Methane is about 24 times worse than CO2 in sealing the heat in the air. According to a recent report by the UN's Food and Agriculture Organisation, agriculture produces 18 per cent of the world's greenhouse gases, as measured in CO2 equivalent - more than is produced by the entire human transport industry.

Then there is power production, responsible for about 24 per cent of global emissions. Perhaps the state should be contriving measures to ensure houses are properly insulated, or developing more nuclear energy, which seems to be less damaging in terms of emissions than various alternatives (though there remains the question of disposing of nuclear waste).

Alternatively, the developed world could do something to stop Third World countries from burning the forests, which produces 18 per cent of CO2.

I can't help feeling that we're missing the point by ascribing the whole phenomena to CO2 emissions, which are but a minor part of the equation.

Posted by Political umpire at February 5, 2007 2:50 PM | direct link

"It is now thought likely that by the end of the century global temperatures will have risen by an average of 7 degrees Fahrenheit and that the sea level will have risen by almost 2 feet."

This is so badly mis-stated as to be outright misleading. The _worst case_ scenarios proposed by the IPCC are 7 degrees F with a 17in rise in sea levels.. this is down from the 2001 IPCC worst case estimate of 10.5 degrees F and 36in rise in sea levels.

THOSE ARE WORST CASE ESTIMATES. It is simply false to portray the worst case estimates as that which is 'likely'. One would assume the median of the estimate would be the most likely.

Posted by Mark Buehner at February 5, 2007 2:56 PM | direct link

You may want to check your dates; a number of them read 200x when 210x seems intended.

Posted by Kevin Murphy at February 5, 2007 2:58 PM | direct link

Whenever I look at a politicized debate, I try to measure the credibility of both sides. My main measure is the accuracy of predictions. By that measure, the people who claimed there was no global warming seem less credible than those who claim there is global warming. But the people who claim that the proximate cause of global warming is human activity are not, at this point, as credible to me. I'd just like to see some predictions borne out that separate human causes from 'end of little-ice-age' causes.

Posted by Andrew Berman at February 5, 2007 3:02 PM | direct link

1/3rd of US emmissions are caused by petroleum fueled power plants. We could convert those entirely to nuclear in 10-15 years easily and cut our emmissions by an order of magnitude more than Kyoto calls for. I judge anyone's seriousness on global warming by how staunching they are demanding nuclear power. If global warming is indeed the global crisis to the human race that the activists claim, the comparatively minor risks of nuclear power are laughable.

Posted by Mark Buehner at February 5, 2007 3:03 PM | direct link

As much as I respect your views and opinions within your own field, you are dead wrong on the level of general acceptence of anthropogenic global warming within the scientific community. The 'consensus' is a fraud based on Naomi Oreskes very flawed 2004 'Science' article (Google [Oreskes Peiser] for the details. The basic science is wrong: the data points for temperature are derived from the changing widths of bristlecone pine tree rings, which are not so much temperature dependent as moisture dependent. Mann et al.'s 'hockey stick' totally misrepresents the world climate from 1000 AD onward (Caesar's era was warm enough to grow wine grapes in Britain; around 200 AD the climate cooled below present temperatures and the Huns had to flee their homeland, heading west, and took out the weakened Roman empire; around 650 AD the world warmed up again by 2 or more4 degrees centigrade, the Normans were growing wine grapes in the York area after 1066; six weeks after Easter in 1315 the world cold down about 4 degrees and the Little Ice Age began. We started coming out of the little ice age in the 19th century. If a 'science' cannot postdict a well known history, it is garbage.

'Global Warming' is more a religion than a science. If we have anything to worry about, I suspect it is global cooling caused by a decline in sun spot activity, something that is worrying the solar physicists. The Russian scientfic community, which went through Stalin's purges and has less tolerance for bandwaggonism and faddism, fears we will be dropping back into the little ice age by the end of this decade. I recommend the blogs climateaudit.org and motls.blogspot.com and worldclimatereport.com for detailed information.

Posted by John H. Costello at February 5, 2007 3:04 PM | direct link

Judge Posner: I respectfully suggest; there are none so blind as those who won't see. And in that vein ask; Who have you read/studied and when, that are not believers as you are in AGW and its apocalypse?

Seriously (as above), if you would like the names and citations to some highly respected, highly qualified scientists who do not hold your views (entirely) I'd be delighted to send them.

I enjoy your site/posts, especially because they are so lucid - a potential brought to your legal training no doubt.

Posted by Joe Halbach,Sr at February 5, 2007 3:10 PM | direct link

So Posner is convinced? Many are not--including some rather significant names in climatology. The recent IPCC summary was (once again) a tendentious, highly politicized document that does not accurately reflect the science it purports to synopsize. It's also worth recalling that prior to Copernicus the overwhelming consensus was that the sun revolved around the earth.

Posted by PD Quig at February 5, 2007 3:12 PM | direct link

"The global-warming skeptics are beginning to sound like the people who for so many years,"...

who doubts global-warming? or cooling for that matter.

it is anthropogenic warming and co2's role in it that people want to question. when i see people say 'global-warming skeptics' i know they are people who seek to squlech the discussion.

they are like temple priests screaming 'heretic'.

Posted by bubarooni at February 5, 2007 3:18 PM | direct link

When you tell me how many cars, power plants and cows there are on Mars (where the polar ice caps are melting), I will believe that we can stop global warming. Until then, the current craze seems to be merely a cover for various and sundry people to remove still more of our freedom. I have come to expect much more thorough analysis than this from Judge Posner.

Posted by watchman at February 5, 2007 3:20 PM | direct link

If we are going to do something, I want to be assured I am not merely being forced to don a hairshirt for the enjoyment of the scolding classes.

Posted by Dr. Ellen at February 5, 2007 3:20 PM | direct link

I remain unconvinced that there is anything more than the normal climate cycle at work here. Efforts to supress debate make me even more convinced that this is far from settled.

What we have is bad data, cherry picked, to support a theory. Evidence proving the earth was warmer in the past, pre Industrial age, is ignored. Evidence that non-anthropogenic causes are responsible for part/most of the current warming are dismissed. Skeptics are branded as heretics. Aspersions are cast on the honesty of non-believers, but those who claim there is a problem that will require trillions of dollars to fix (if it is not already too late) are pure as the driven snow.

Posted by MarkD at February 5, 2007 3:23 PM | direct link

"The benefits of such an approach are concrete and realizable, while at this stage, the benefits of deindustrialization are speculative and likely unattainable."

It's even worse than that. Many commentators who worry loudly about the potentially catastrophic consequences of climate change seem completely oblivious to the fairly obvious and almost inevitable catastrophes that would result from a global economic slowdown, such as revolution, civil war and genocidal levels of violences across the developing world. And anyone who thinks the world's "advanced" societies can avoid severe political and social turmoil in the face of arbitrarily frozen or even declining standards of living are kidding themselves.

And barring the development of cost-competitive alternative energy technology, serious efforts to curtail CO2 emission WILL trigger a major global recession, while simultaneously raising the price of every single manufactured good and agricultural product...i.e....the very things on which poor people spend the bulk of their incomes. Good luck with that approach, but I think its going to prove extremely difficult to explain to an Indonesian or Mexican mother that she has to forgo purchasing food, school textbooks or clean drinking water so that we can keep global see levels from rising 2cm/annum instead of 1.4cm/annum.

But then, it's human nature to be more frightened by exotic things that can hurt us a lot, such as shark attacks or catastrophic climate change, than about the familiar things most likely to do us harm, such as automobile accidents and political instability.

Posted by C.gray at February 5, 2007 3:30 PM | direct link

"Whenever I look at a politicized debate, I try to measure the credibility of both sides"

Agreed. Thats why I distrust the Global Warming crowd:

1) Hyperbole and exageration.

2) Omitting key data [little Ice Age] and using disaprate data sets [as in the hockey stick]

3) Argument by assertion [ie "the debate is closed"]

4) Appeals to Conformity ["all SMART people believe x"].

Seriously, if their cause is just, then why must they deceive?

Posted by Fen at February 5, 2007 3:30 PM | direct link

If chicken Little is indeed correct and the sky is falling, then there is only one long term solution: We gotta kill off about 90% of the human beings on this planet and enforce some sort of cheat-proof population control. Every other "solution" is short-term and merely postpones the inevitable catastrophe.
As for myself, I think we should be looking around for the Fox.

Posted by Pixelkiller at February 5, 2007 3:33 PM | direct link

Judge, there is no scientific consensus that global warming has thus far had any net negative effects, or that it will (depending on the degree to which it occurs). You are doing a disservice to yourself and the community by making this false assertion.

Posted by michael steigmann at February 5, 2007 3:43 PM | direct link

Considering the fact that humans contribute only 0.32% of all CO2, it is hard to believe that reducing our portion of CO2 to even 0.10% will have any effect.

Posted by MistrX at February 5, 2007 4:01 PM | direct link

The sun cause global warming.

There can be only one solution.

We have to nuke the sun.

Gotta nuke something..

Posted by Drew at February 5, 2007 4:16 PM | direct link

Global warming has only recently entered the consciousness of the public at large. Yet a small scientific elite, operating under politicized sponsorship, has declared the matter settled and any dissenters on the take, stupid, or (with apologies to George Orwell) A Denier. So now we have an economist and a lawyer, who cite no evidence of having studied the matter themselves, telling me that any attempt to examine the evidence for myself is equivalent to denying that cigarettes cause cancer. Do I have to provide a notarized copy of my math PhD. to be able to raise my hand from the back of the class? The Internet never forgets, and if the Cassandras prove to be wrong, I hope those of us who prefer to think for ourselves make sure they don't either.

Posted by John F. at February 5, 2007 4:19 PM | direct link

I've been asking a question to those who believe that global warming is caused by human activity: What caused the several global warming events throughout earth's history?

I've yet to have anyone even attempt to answer it.

Posted by The Raging Patriot at February 5, 2007 4:23 PM | direct link

Dennis Mangan has it exactly right. Before even thinking about countermeasures we should have some reason for thinking that global warming is, net, a bad thing. Too many people, perhaps including our host, have skipped that step.

Posted by Walter S. at February 5, 2007 4:24 PM | direct link

"For example, suppose we estimate that the loss in the year 2057 will be $100 billion. Then at the same 10 percent interest rate, we would want to spend $852 million this year."

Maybe we would want to spend 852 million this year, but ONLY if we were sure that it would achieve the desired result of reducing the loss in 2057 by 100 billion.
All "solutions" proposed by the greens - such as Kyoto, or a carbon tax - will solve nothing, and will achieve nothing. This is why we aren't willing to spend those 852 million (or such).

Posted by Jacob at February 5, 2007 4:26 PM | direct link

My, it is certainly interested in seeing all the comments. I wonder how many of the comment writers have even read the IPCC report?

What those not trained in science often fail to appreciate is that both data and predictions come with errors associated but not necessarily mentioned in every paragraph or every chart of a scientific summary.

Then when the lay-reader does find out that there are exceptions to theories, and errors in data, the response is all to often to call into question the whole scientific undertaking.

I propose that is what we are seeing in several of the comments above mine. Too many dissenters want to throw the baby out with the bathwater just because there is still much (scientific) work to be done.

What Mr. Posner has written is about accepting that since we have limited knowledge we will have various, differing, opinions about what the discount rates (in this case wrt climate change and its anthropogenicity) ought to be, were we to try and monetize what climate change means to us.

Dealing with climate change is a classic low probability (for any given year), high risk problem. Being able to deal with that type of issue (versus a high probability, low risk) is critical in making sound policies.

Posted by InJapan at February 5, 2007 4:29 PM | direct link

might persuade other big emitters like China and India to follow suit



To me, this is the real problem. Out of control underground coal fires in China now emit as much CO2 as all the cars and trucks in the US.



What if we spend a lot of money and get OUR act cleaned up, but they don't? This is a variation of the Prisoner's Dilemma and we're playing with parners known to uncooperative.



I think we should spend largely on this problem, but not so large that it hurts our economy. Technology is going to be the answer here, whether it's alternative energy sources or better batteries or increased efficiency or whatever. We'll only have the money to develop that technology if our economy is strong enough to afford it.



My guess is that we WILL spend the money, but that it will be a pyrrhic victory because other countries (Mexico, China, etc) aren't going to be willing or able to do their part.



I think we should be concentrating more on how we're going to deal with a warmer world than fooling around with some stupid debate about who or what we can blame. Climate is going to change, no matter what. It always has. We need to learn to deal with it, not point fingers.

Posted by Rob at February 5, 2007 4:38 PM | direct link

Richard, it's just not compelling argumentation when geezers in their last decade start making the case for "arguments for incurring hefty current expenditures." Pour yourself a scotch and watch some of that reality tv the kids have been talking about.

Posted by happyfeet at February 5, 2007 4:44 PM | direct link

Before we start recklessly taking action to lower the temperature of the Earth, we should stop and consider that the KNOWN consequences of global cooling are far, far more devastating than even the most lurid fantasies spun by GW alarmists.

Even if fast global cooling is a relatively low risk, the consequences (the massive crop failures and loss of arable land to glaciation alone would almost immediately end modern civilization and reduce human population to mere millions) are so severe we might well be best served to warm the globe as much as possible, especially given that we know that without human intervention the Earth will eventually enter another ice age.

Posted by TallDave at February 5, 2007 4:53 PM | direct link

TallDave has just illustrated how you can make a cogent, compelling argument without coarsening public discourse.

Posted by happyfeet at February 5, 2007 4:55 PM | direct link

There is a large glacier-covered island called Greenland that's part of the North American continent. Anyone care to guess why it's called "Greenland?"

It seems that the herd of brilliant scientists that favor human-caused climate change are completely ignoring the Medieval warm period. You know, when Leif Eriksson and Erik the Red melted the glaciers by driving their SUV's over from Iceland to go off-roading....

Posted by apb at February 5, 2007 4:57 PM | direct link

People are idiots. We will spend a ton of money on this - all in the wrong way.

For example: Anyone who thinks that New Orleans should (continue to) be rebuilt obviously doesn't believe the global warming reports.

The solution isn't to "fix" global warming - even if we could (I'm in the "it's getting warmer but people have very little to do with it" crowd) without unintended consequences. The solution is to adapt to it - then it doesn't matter what is causing it.

Posted by mrsizer at February 5, 2007 4:57 PM | direct link

Current estimates are that sea levels are rising at the astounding rate of 3.3 mm a year. Almost 50% higher than the last estimate.

At that rate if it continues sea levels will rise about 1 foot in 100 years.

We are doomed.

I wonder if Dr. Becker has run the numbers? Or looked at geological history. Or inspected the models (you can't, the codes are private and unreleased - nothing like science done in the open to give a feller confidence).

As some one elsewhere pointed out: suppose there are 100 multaplicative factors in the climate equation each known to 99% accuracy. The chances of a right answer is about 1 in 3. Now repeat the multiplications using your last answer. How long does it take to get pure garbage? Not very long.

If the accuracy of the inputs and factors is 98% then the worst case first iteration gives about 5% chance of the right answer.

Now some of the factors will offset each other and other things will help. But there are other problems. For instance is the effect of water vapor positive, negative, or neutral? And if positive or negative by how much?

The sun is a variable star. Is that variation included in the models? How anout orbital and inclination variations of the Earth? Milankovitch Cycles anyone?

Posted by M. Simon at February 5, 2007 4:58 PM | direct link

The scientists and "good well-meaning people of the world" have not been able to solve famine and hunger, genocide, disease and AIDS, cancer, utopian equality or the generally unpredictable harshness of mother nature herself. Thus, they won't be able to solve this problem either, man made or not. Yet, we will misspend hundreds of trillions of dollars over the next 50 years trying to do so. Nature will take her course, and humans need to accept the harsh realities of that, as did the dinosaurs. The greatest human weakness is to believe that we are somehow above and immune to the random catastrophies that the great universe can dish out.

Btw, how much did it cost to determine that Pluto is no longer a planet? Please.

Posted by pragma at February 5, 2007 4:59 PM | direct link

My snark aside, TallDave is probably on to something.

What if the "climate change" that evereyone is pushing turns out to be mere moderation? Aside from projection of a degree C increase, is the increase only in the cold areas of the planet? Wouldn't this then reduce the volatility between cold and hot, actually moderating the weather?

As we saw from the hurricane bust of 2006, the atlantic ocean had actually cooled - is that a side effect of melting glacial ice?

Posted by apb at February 5, 2007 5:08 PM | direct link

"The third argument is that reducing our consumption of energy by a heavy energy tax would confer national security benefits by reducing our dependence on imported oil."

For the Love of God, that's not the way supply and demand works. A heavy energy tax, by reducing demand, would lower the clearing cost of energy. Because the low-cost producer is Saudi Arabia, a heavy carbon tax would actually INCREASE our dependence of foreign oil.

If Posner does not understand what happens when the demand curve shifts left, how credible is he on understanding time value of money?

Posted by bristlecone at February 5, 2007 5:08 PM | direct link

Overblown,

That's how to summarize the ICPPs Summary for POlictmakers, just released. I say that because it reuses the Mann, Bradly, et, al., Hockey Stick - which the NAS head of statistics Edward Wegman called "unscientific" last summer.

In an AP story, NCARs Kevin Trenberth (in Boulder) warned of eventually one millions deaths - preusmable per year. But we leave two million to dies from malaria each year, and it's largely preventable with DDT. But are we exorcised about THIS tragedy? No, only if Gaia is sacraficed (ie, changed! Somethign humans have always done.

Thus, the anthropogenic climate warming hysteria is about religion of saving the earth - not bettering people. In fact, the only thing CGMs (climate modelling) have gotten empirically right is increased high latitude warming. Not the lower troposhpere uncoupling, not the non-warming satellites show in the southern hempisphere.

I'm repelled by the phony alarmism. Big Science is corrupt!

Posted by Orson at February 5, 2007 5:16 PM | direct link

Can someone point me in the direction of any "science" that explains global warming? I have a technical background and would like to learn something. All I can find is most scientists agree that... I would like to see what they are basing the conclusions on. Without looking at anything it seems to me that global warming is a simple energy balance. We are taking stored chemical energy and converting it to heat. I would like to see if the global warming science takes that into account. My initial thought is that global warming is caused by producing more heat, not CO2, but that has to be too simple.

Posted by Bernie at February 5, 2007 5:20 PM | direct link

The point made about Mars is certainly an obvious one. There is an positive correlation coefficient for Earth temperatures and solar activity, but not one for man made greenhouse gasses and Earth temperatures. Man made global warming is an elaborate theory without statistics to back it up. The models when backcast are worse than random numbers. Anyone out there that can tell me the weather for Chicago 10 days from now? Nope, absolutely no one.

As for cigarettes, you can clearly state that smoking is linked to several diseases, but you can't say they cause those diseases. While the statistics are overwhelming that smoking is bad for you, and a rational person attempting to maximize health would not smoke, a mechanism needs to be defined to use the word "cause". The mechanism has never been discovered. That is the historic argument between tobacco companies and public health officials/ politicians/trial attorneys. Statistics, while valuable, alone don't constitute science. Historic statistics suggest the stock market will go up this year based on the results of the Super Bowl. This is due to an anomoly, not any underlying mechanism.

For a very entertaining lecture on adjusting single variables to complex systems please see http://www.michaelcrichton.com/speeches/complexity/complexity.html

Posted by Cliff at February 5, 2007 5:28 PM | direct link

"The scientists and "good well-meaning people of the world" have not been able to solve famine and hunger, genocide, disease and AIDS, cancer, utopian equality or the generally unpredictable harshness of mother nature herself."

I'm pretty sure we could solve plenty of problems if we listened to the right people. Solutions are out there, usually prevented by small and powerful interest groups. Scientists have created plenty of good things, and they may be right about this. We can debate about the report all we want [although I doubt we're qualified to] but let's not label scientists as inept and incapable.

Posted by Haris at February 5, 2007 5:30 PM | direct link

"Btw, how much did it cost to determine that Pluto is no longer a planet? Please."

Surprisingly little. In the grand scheme of things, the total budget for Astronomy, and especially Astronomical Conferences of the type that reclassified Pluto, is miniscule. The results, on the other hand, are about as useful as those of the IPCC.

Posted by Jason at February 5, 2007 5:36 PM | direct link

Bernie: Since you are a technical person I'd agree that "looking at something" would be a good idea as the longest journey, does indeed, begin with that first tentative step. As for your initial, intuitive? concern of the heat put into the system from the use of heat producing technology, I think you'll find it negligible, and would suggest your first step might be that of typing "earth green house effect" into google or yahoo. Oh! and seeing Gore's film could add quite a bit for a short evening's effort. Good luck! Jack

"Without looking at anything it seems to me that global warming is a simple energy balance. We are taking stored chemical energy and converting it to heat."

Posted by Jack at February 5, 2007 5:40 PM | direct link

Bernie -

Here's an interesting site I stumbled across - a handy chart shows temperature variation vs. CO2 levels over the past 600 million years. The temp is most interesting - we're at a minimum right now, and the minimums seem to spike neatly in a 145 million-year cycle; the 600-million year history shows relatively quick transitions from max->min->max, with minimum and maximum boundaries at 12C and 22C respectively...

Posted by apb at February 5, 2007 5:45 PM | direct link

Bernie -

The site would be:

http://www.clearlight.com/~mhieb/WVFossils/Carboniferous_climate.html

Posted by apb at February 5, 2007 5:48 PM | direct link

APB asks:

"Anyone care to guess why it's called "Greenland?"

... It was a real estate hustle much as a new subdivision today might be named something "shores" despite its actual geography.

....... you'll recall that after a few warm years the "Greenland" hustlees starved and were perhaps prevented from leaving by ice shelfs or optimistically hoping for the return of warmer years. Interestingly the local natives survived by dining on the fresh water seals disdained by European newcomers. (Our own founders too seemed a finicky lot for having nearly starved at the base of Cape COD, with easy access to its rich fisheries and where lobsters and crab could be had from the clam-laden beaches.)

Posted by Jack at February 5, 2007 6:00 PM | direct link

Bernie,

Solar output fluctuates +/- .2% over a period of days.

One fluctuation is equal to all the man made energy consumed in a year.

Posted by M. Simon at February 5, 2007 6:02 PM | direct link

OK, now I'm convinced: WE ARE DOOMED!

When Nixon "lost" Cronkite the Vietnam War was lost; now that we've "lost" Posner, the fight against the global warming alarmists has been lost.

Or not. Thank Goodness he's only a legal wizard and not a genius meteorologist or something.

Estimating, tracking and projecting climate change is a really important task, but blindly assuming that CO2 gases are the primary determinant of climate change is just nuts.

Any one of the following "forcings" are likely to be exerting more impact on the global climate than CO2 levels: cosmic rays + the solar winds that carry them along, cloud formation and magma circulation. But the measurement is so inaccurate at present that quantifying the relative impact(s) is hopeless. Orbital changes (Milankovitch cycles) we understand, but not the other stuff.

A great question for hard-core believers in human generated global warming is, "so where'd the hockey stick chart go?"

Posted by Anarchus at February 5, 2007 6:03 PM | direct link

Haris,

If it weren't for a secret cabal of manipulators we would be living in paradise.

If we can idendify and eliminate the cabal we could see big improvements in the world.

You got any candidates for elimination?

Posted by M. Simon at February 5, 2007 6:05 PM | direct link

Anarchus at February 5, 2007 06:03 PM ,

A great question for hard-core believers in human generated global warming is, "so where'd the hockey stick chart go?"

A good question for them also is where is the Medieval Warming and Little Ice Age. It doesn't show up in their charts.

What the hockey stick proves is that with the right kind of filter you can get almost any signal you want out of the noise.

Posted by M. Simon at February 5, 2007 6:11 PM | direct link

Bernie-
Here is a good three part article from the New Yorker awhile back.

http://www.wesjones.com/climate1.htm

Posted by Mike at February 5, 2007 6:14 PM | direct link

A BTU is defined as the amount of heat required to raise the temperature of one pound of water by one degree Fahrenheit. Total energy use is 421 quadrillion British thermal units (Btu) in 2003. This hardly seems negligible. This is heat added above what is provided by the sun because it is converted from stored chemical energy. The production of heat from burning fossil fuels produces CO2 as a byproduct, it makes sense that the teperature rise Correlates to CO2 levels, but the cause of both is the burning of fuel. I am still reading though, thank you for the hints so far.

Posted by Bernie at February 5, 2007 6:14 PM | direct link

It seems to me the analysis misses the critical issue, viz., whether any expenditure is likely to reduce global warming. contrary to the premises of the first 'graph, the issue is not whether warming is occurring, but rather to what extent man's influence exacerbates the warming everyone can see. Many (most? almost all?)models seem to suggest that even really large and immediate changes in CO2 emissions likely will have little effect. discount rates make sense in this context only to the extent they reflect spending that actually deals with the problem, as opposed to mere wishful thinking.

-mca

Posted by mcallen3 at February 5, 2007 6:47 PM | direct link

Regardless of the truth that global warming is happening, the debate is plauged to the core by two ideaologies. One, environmentalism, whose objective is the maximisation of environmental health. Two, socialism, who’s adherents see in environmentalism an excuse for the suppression of capitalism. The two ideaologies are united by anti-consumerism.

This idealogical basis is betrayed in a number of ways. One is an intolerance of dissent. Another is the failure to focus on suppression of consumption rather than technologies which promise ever higher consumption alongside reduced emmissions. Another is the willingness of climatologists to advocate for policy action when policy response is squarely an economic and political problem and one climate scientists are qualified only to inform but not decide.

Most important is the near total failure to recognise the limitations and ineffectiveness of governments to make commitments and keep them. Posner only has so much space to write, but in multiple posts I have not seen him recognise or incorporate into his analysis the significant shortcomings of public institutions.

I personally accept the argument that global warming is happening and that human activity is probably responsible but am not convinced governments are capable of any response in which benefits remotely approach costs. Governments have been close to uniformly ineffective in dealing with other global problems. Global warming will be used as an excuse to nationalise or high regulate energy and transport industries with only minor effects on emissions at the cost of great inefficiency.

Posted by ben at February 5, 2007 7:09 PM | direct link

Oops, should have put, "Another is the focus on suppression of consumption rather than..."

Posted by ben at February 5, 2007 7:14 PM | direct link

I've enjoyed everyone's comments very much and once again thank you for contributing to Important Discussions, but only posted to nominate Happyfeet for the greatest comment ever made on any blog. Ever.

Posted by guy in the veal calf office at February 5, 2007 7:20 PM | direct link

One thing that needs to be mentioned is that, assuming global warming is real and that it's man-made, a very cheap solution is available: seeding small parts of the ocean with iron. This causes plankton blooms which will suck CO2 out of the atmosphere like nobody's business. The late oceanographer John Martin said, "Give me a ship full of iron, and I'll give you an ice age." Of course, the fact that the solution is so cheap and easy will make it anathema to the world's bureaucrats.

Posted by Dennis Mangan at February 5, 2007 7:22 PM | direct link

A recent "Nova" program looked at scientists' efforts to change the climate of Mars so that it could support life. The multiple levels of insanity of this idea aside, the idea is to produce...global warming. On Mars. What is the chief way they think they can do that? Create lots of water vapor. Water vapor? Yeah, because you see water vapor is a "greenhouse gas," which has much greater greenhouse properties than CO2 (according to the show...I have no idea.)

So, I'm thinking to myself, huh. Isn't one of our great hopes for salvation from the carbon fuels mess supposed to be hydrogen fuel cells that are perfectly clean and only produce, uh...water vapor? And if water vapor is a "much greater greenhouse gas than CO2," and if CO2 constitutes only about 1 percent of our atmosphere...then how much of the atmosphere is water vapor? And isn't that maybe a lot more of an issue than CO2?

Oh, but I forgot. "The debate is over," according to Al Gore, Barbara Boxer and other noted climatological authorities. Westerners, especially Americans, who already cause all of the evil in the world, are now causing catastrophic global warming by driving too many SUVs. So the problem HAS to be CO2. Sorry I brought it up.

Posted by Victor Erimita at February 5, 2007 7:45 PM | direct link

Seeding the ocean with iron to reduce CO2, and presumably, global temperatures?

See, this is what scares the hell out of me when it comes to the warm-mongers - they're going to come up with a "solution" to something that may not exist, or may be beneficial if it does, and end up kick-starting an Ice Age that will destroy civilzation in a way that warming never could.

The commenter above said it best - who decides what the global thermostat should be set at? Hands off.

Posted by Dave S. at February 5, 2007 7:54 PM | direct link

Interesting point about Greenland, Jack -

I have little knowledge of the details of moving TO Greenland - I'd assume "hustle" would be a great term if someone had ownership of the local land, and sold it to the new arrivals.

How would you characterize the difference in behavior of those locals (i.e. either starved, or found a new way to survive), who had 10th-century resources and capabilities vs. the modern-age folks (facing, eh, (certain?) warming, a loss of ice, longer growing seasons, eh?), who only have 20th century capabilities of energy generation, plant genetics, water reclamation....blah, blah.

And the panic is? If you check out the site I listed above (please shoot holes in the data or methodologies...) it appears ol' Earth has its own temp-limiting system that has adequately handled (at 65 million years ago) a planet-wide extinction event caused by asteroid impact.

If the asteroid impact estimates are correct, there were billions of tons of matter ejected into the atmosphere - the old nuclear winter scenario in spades. Yet, the result was a re-regulated temperature system ... it appears there was a mminor rise in CO2 at roughly that time (to roughly twicw what it is now), but if there's cause and effect for temperature, it's opposite what is being pushed now.

Did dust cause a 10C temperature drop lasting 50+ million years? How did the planet temp bottom at 12C (matching all prior minimums).

Just another inquiring mind...

Posted by apb at February 5, 2007 7:59 PM | direct link

Bernie at February 5, 2007 06:14 PM ,

You put all that energy into one pound of water and its temperature will be 421 quadrillion degrees (Big Bang territory).

You put that much energy into the oceans and the temperature rise will be unmeasureable.

You are getting your orders of magnitude mixed up. A not uncommon mistake for those uncomfortable with numbers.

If every cell in your body was worth one cent. You would be fabulously rich. They are not and neither are you fabulously rich.

Posted by M. Simon at February 5, 2007 8:39 PM | direct link

Bernie at February 5, 2007 06:14 PM,

Let me explain it nice and simple. The 421 quads of heat generated by man in a year is within the range of a few days fluctuation of solar output.

i.e. not significant.

Posted by M. Simon at February 5, 2007 8:42 PM | direct link

What do we need to do to protect ourselves from OTHER possible abrupt catastrofic events? How about Abrupt Cooling? How about Abrupt Pandemic of a Spanish Flue scale? What about Abrupt Increase in Volcanic Activity? Terrorist atacks - should we mandate nuclear shelters in every yard?

No, really, out of all the things that are just possible - why choose only one to prepare for? Let's just invest 90% of the GDP in all the preparations. It will not be too much... given how low the GDP will get as soon as we start.

Posted by Anonymous at February 5, 2007 9:16 PM | direct link

Putting aside whether anthropogenic climate forcing (human caused global warming) is a major factor in current temperature trends, there is a useful question to raise. Are we at the optimum temperature for the planet? If we are not, it would make sense to create a global thermostat to put us there no matter the reality of the causes of present climate change. The positive impact on our economy over the next century would likely be enormous and the ability to counteract global warming by reducing the solar output that strikes earth as well as increasing it if this is called for would be a nice bonus.

Catastrophe would be averted, and we would maximize the utility we get from our climate dependent economic activities. What could be better? But you will not find such geoengineering solutions on the "to do" list of the global warming alarmists. I have had the discussion and there is an instinctive revulsion to it among the true believers. It is not rational but it is there. Just raise the subject and be prepared for a highly emotional response.

Fortunately, the largest cost of such a thermostat seems to be the price of lifting material into orbit and there are several encouraging developments that indicate that lift costs are likely to crater over the next century. From private space flight companies to railgun launching systems to space elevators, we're likely going to be able to control temperature before any sort of catastrophe hits so long as we don't let the luddites into government.

Mt. Pinatubo erupted in 1991 and dropped global temperatures 0.5C almost immediately. This is the speed at which a shade system can act. Reducing effective solar output gets us cold and quick. Doing it in orbit is a lot cleaner than provoking Mt. Pinatubo style eruptions. The money necessary to do the materials research and develop a space elevator, for instance, is likely a couple of orders of magnitude smaller than what will be necessary in the currently popular "Kyoto treaty" style.

In short, the conflict over the cause of warming is a false conflict. Embrace geoengineering and the utility of a thermostat becomes obvious and beyond maximizing planetary utility it also shuts down global warming as a problem no matter what its cause.

Posted by TM Lutas at February 5, 2007 10:51 PM | direct link

Here in Texas, TU is trying to build 12 coal plants now, before pesky restrictions. After the NEJM report on polluton and cardiovascular disease last Thursday, I'd rather see us go nuclear (tthough I have just read abstracts so far). I think we are hung up here by state politics of disposal at the Yuma mountains. It doesn't look like we have a federal system when it comes to nuclar waste disposal.

Posted by michael at February 5, 2007 11:07 PM | direct link

It's not the waste disposal as much as a complex web of regulatory, legal and environmental risks forestalling construction of new nuclear plants . . . . . . . . there are a small number of possible brownfield nuclear plants in the preliminary planning stages today, but given the extremely high cost of engineering and constructing a new plant (even sited on extra space at an existing facility), it's doubtful that any of those possible plants will be built without major changes in the political/legal/regulatory environment.

Posted by Anarchus at February 6, 2007 11:29 AM | direct link

M. Simon at February 5, 2007 08:39 PM, wrote:

"You put all that energy into one pound of water and its temperature will be 421 quadrillion degrees (Big Bang territory).

You put that much energy into the oceans and the temperature rise will be unmeasureable."

Yes but you are not putting that much energy into the oceans. You are putting it into the air and water around major urban centres where coincidently you are also measuring the Earth's "temperature".

Posted by Jeff Norman at February 6, 2007 12:59 PM | direct link

I urge you to consider this op-ed piece by a climatologist.

http://www.canadafreepress.com/2007/global-warming020507.htm

Now the arguments about global warming remind me of the arguments during the 1950's on the necessity for centralized planning if less developed countries are ever going to grow. Myrdal stated that all experts agree that comprehensive planning is needed in order for development to occur. Of course, Peter Bauer was right and Myrdal (as well as other development economists) were wrong about the need for planning.
Finally, have you ever seen anyone use a Dickey Fuller test to see if the hypothesis that world temperatures follow a random walk can be rejected?
I knew one person who said that he did. But the response of the so-called scientific journals was that the test had to be wrong, because it failed to reject the random walk hypothesis, since everyone knew there was global warming. Truth is not determined by a popularity contest. Just ask the people who argued that we were entering a new ice age just about 35 years ago. They are the same scientists who are saying we now have global warming. Be that as it may, they all want socialism anyway.

Posted by James Cover at February 6, 2007 1:33 PM | direct link

To all the nay-sayers, I place more credence in the comments of the Royal Society, than I do in bloggers. Which states, that there is at least a 90% chance that the warming is directly due to human activity. Being a betting man, those are pretty good odds. Just out of curiosity, how many of you are familiar with the fundamental principles of Thermodynamics, the first law, second law, reversible and irreversible process, heat, work and the system? These ought to be the grounds of any cogent discussion of the problem. ;)

Posted by N.E.Hatfield at February 6, 2007 1:47 PM | direct link

If we're doing a cost benefit analysis, is lowering the CO2 levels the best way to counteract global warming?

Didn't the eruption of Mt St Helens and the ensuing ash lower global temperatures for half a decade?

Would it be less economically painful to recreate that (via explosives, etc.) than to cripple the economies of deloped and developing nations?

"Heavy U.S. energy taxes would..." Stop transcontinental shipping, or cause inflation of a level to match the taxes, depressing the economy.

Heavy U.S. energy taxes would ... bankrupt numerous transportation industries who do not have the margins or demand to pay their current costs, plus these taxes.

Heavy U.S. energy taxes would ... cause many energy intensive industries to move overseas, losing U.S. involvement, and avoiding any influence by the U.S. (and not moving to an ecologically concerned nation) making the global footprint worse, not better.

I'd say all of these are more likely than your prediction of what "Heavy U.S. energy taxes would" do...

So, make the environment worse, cripple the U.S. economy, end major transportation industries, and cause skyrocketing inflation rates. But it won't be "our fault" that the environment gets worse. This is your best idea?

Unimpressive.

Posted by Gekkobear at February 6, 2007 2:47 PM | direct link

Here is a description of how the Stern report's famous 20% of GDP was derived (from http://www.opinionjournal.com/extra/?id=110009182)

"On the face of it, Mr. Stern actually accepts Mr. Nordhaus's figure: Even including risks of catastrophe and non-market costs, he agrees that an increase of four degrees Celsius will cost about 3% of GDP. But he assumes that we will continue to pump out carbon far into the 22nd century--a rather unlikely scenario given the falling cost of alternative fuels, and especially if some of his predictions become clear to us toward the end of this century. Thus he estimates that the higher temperatures of eight degrees Celsius in the 2180s will be very damaging, costing 11% to 14% of GDP.

The Stern review then analyzes what the cost would be if everyone in the present and the future paid equally. Suddenly the cost estimate is not 0% now and 3% in 2100--but 11% of GDP right now and forever. If this seems like a trick, it is certainly underscored by the fact that the Stern review picks an extremely low discount rate, which makes the cost look much more ominous now.

But even 11% is not the last word. Mr. Stern suggests that there is a risk that the cost of global warming will be higher than the top end of the U.N. climate panel's estimates, inventing, in effect, a "worst-case scenario" even worse than any others on the table. Therefore, the estimated damage to GDP jumps to 15% from 11%. Moreover, Mr. Stern admonishes that poor people count for less in the economic calculus, so he then inflates 15% to 20%.

This figure, 20%, was the number that rocketed around the world, although it is simply a much-massaged reworking of the standard 3% GDP cost in 2100--a figure accepted among most economists to be a reasonable estimate."

If this is a fair summary of the derivation of the famous 20%, then Stern has essentially made up the headline figure now being deployed as a call to action. If the economic case for policy response to global warming could be grounded in rational analysis, Stern would have presented it. Apparently, it can't.

This says nothing about Posner's analysis, but I would be extremely wary of being on the same side as Stern.

Posted by ben at February 6, 2007 9:42 PM | direct link

The correct link to the IPCC report is below. The colon was left out of the original.

http://ipcc-wg1.ucar.edu/wg1/docs/WG1AR4_SPM_PlenaryApproved.pdf

Posted by Nelson Pratt at February 6, 2007 10:31 PM | direct link

I wonder what you think of the proposal by Gregory Benford, a professor of physics and astronomy at UC Irvine, and a science fiction author, to put a giant Fresnel lens at the L1 point between the Earth and the sun (where there is presently a satellite).

The idea is that this lens can act neutrally with regard to observing the sun, but still filter one or two percent of the sunlight falling upon the earth. Lest we fear that this is catatrophic for plants, apparently new evidene suggests that in a "global dimming" period between the 1950s and 1980s something similar happened to ground-level sunlight due to unknown factors -- perhaps cloud cover -- and as far as I know no one even noticed an effect on agriculture. It is thought this incident may have somewhat masked the perception of global warming, though of course the sunlight at least reached the atmosphere. Under Benford's proposal, by blocking this incident sunlight we might be able to buy ourselves additional decades or centuries.

Posted by James W at February 7, 2007 11:01 AM | direct link

It is crazy not to impose a carbon tax at the end-user position. That is how pigovian taxes work after all. If you tax the oil companies it will hurt their pocketbooks but it won't change behavior, and it may not effect hte price of gasoline.

Posted by Nanette Cohen at February 7, 2007 7:52 PM | direct link

Victor "grist for the mill"

"great hopes for salvation from the carbon fuels mess supposed to be hydrogen fuel cells that are perfectly clean and only produce, uh...water vapor? And if water vapor is a "much greater greenhouse gas than CO2,"

........ perhaps too many "worries". The hopes for fuel cells are that they could double, perhaps even triple the useful energy from natural gas, and are "clean" because hydrogen is stripped from the hydro-carbons. The other source may be the use of "excess" electricity from wind farms to create hydrogen and oxygen by electrolysis.

....... gas and diesel are hydro-carbons as well, and while burning at half the efficiency the carbons create CO2 and the even nastier CO, while the hydro part creates H2O.

........ but! I don't think we have to worry much about the water vapors as they soon join our evaporation-cloud-rain-evaporation cycle. You can imagine how much water is constantly being recycled from the oceans that cover 2/3rds of our planet and from the plants, trees and steaming rain forests?

Man can screw up a locality though, and irrigating the many golf courses of Palm Springs has made that climate cloudier, but the clouds aren't likely to make it over the next mountain range.

Posted by Jack at February 7, 2007 11:00 PM | direct link

James W. sez:
"by blocking this incident sunlight (with a Fresnel lens) we might be able to buy ourselves additional decades or centuries."

........ Once we wake up and boot the "oilies" and their lobbyists out of Congress and the White (Black??) House why not just use the solar here?

Item: Japan with a third our population is installing a million solar roof panels per year, while the US has yet to top one million and uncountable "subdivisions" have covenants against installing them.

Item: "Thin film" solar has, and is dropping the price dramatically and in CA where they are encouraged the cost, when it's part of new construction is negligible.

Item: Take a look at the new Tesla Motors sports car; it's sexy, luxurious and will blow off most of the Corvettes, and has a 200 plus mile range, and it's a $6,000 option to have enough solar installed on your garage to provide its fuel. Detroit? No they've recalled their EV1 "flop?" and are "considering" hybrids, ....Silicon Valley.

How about saving the money to launch the "sunglasses" and instead use the lenses and reflectors to heat water for turbines in our great deserts?

But! we still need more transportation energy, right? How about burning more ethanol but from a sensible source? Ethanol works in Brazil because sugar cane is eight times better than corn, but we don't have very much areas suitable for growing cane. Guess who does? And how they've been treated under NAFTA:

With the North American Free Trade Agreement, NAFTA, the (Mexican) industry hoped to export their sugar excess to the United States, and thus acquire additional revenue that would be used to pay for the harvest, repay part of the loans, and invest in modernizing the existing infrastructure. Unfortunately, the US has not fulfilled NAFTA's agreement on sugar and thus, the mills are left with tons of sugar in their warehouses without buyer: they cannot sell them at home, because of the saturization of the domestic market nor in the US. The loss is unquantifiable and the industry will need more than a restructurization to bring it out of 90-year crisis. The government has been left with a great challenge: restructure the industry while providing for those 2.5 million people that depend on the industry for their monthly income.

.......... ah yes! so we are ruining their Ag biz and complaining of "them" coming here when they tire of starving on $4/day and spending/wasting millions on a "fence" while spending many BILLIONS more trying to turn corn into ethanol. Why not spend similar amounts paying Mexico to produce ethanol with sugar cane? Eight times better than corn and at Mexican wages? Should be LOTS of affordable ethanol and many good paying jobs for Mexicans.

Are we too busy thumping our chests and chanting "We're the best" to notice we're shorter on brains, honesty and creativity than on energy?

Posted by Jack at February 7, 2007 11:28 PM | direct link

I've grown completely skeptical of all the scary stories told by a 'consensus of experts'. All my life I've heard scary stories from 'experts'. I remember Paul Ehrlich's The Population Bomb . After reading it and believing it, a lot of people made some permanently bad decisions, such as having abortions or deciding to never have children. And they're saddened to find they made a sacrifice for no good reason. Ehrlich predicted the human population would keep growing until billions will die in famines, all before 1985. He was perfectly wrong. Ehrlich made the mistake of assuming a growth curve could be extrapolated endlessly and when the growth curve approaches an asymptote . . . it's the end of the world.

It looks like the alleged climate scientists are making the exact same mistake. Only they're doing it deliberately with manipulated data sets fed into secret computer models. I'm surprised to see competent economists support this kind of mistake.

Global warming is another cult religion just like Marxism or Lysenkoism. It's fascinating to see the zealots denouncing the non-believers and declare them to be enemies of the people. Next they'll accuse the non-believers of being 'double-plus ungood'

Posted by Skeptic at February 8, 2007 8:06 AM | direct link

Can we all just agree to stop pulling scientific "facts" out of our
@$$ please? With so much research and discoveries for each side of the argument, we should all just agree that there is no common scientific consensus at the moment. But that still does not justify plowing along with no regard to our planet. If we are still not sure about the direct effects of CO2 on Earth, then maybe we should start restraining ourselves until we know more to safely continue raping the planet.
And as far as discount rates, even though somehow we have come up with a way to put a monetary value on human life, (please, no arguments on abortion here), can we really start to discount it with rates. If anything, we should realize the human aspect of it all, and not discount lives, but rather inflate the prices of them.

Posted by Jon at February 9, 2007 7:56 AM | direct link

See, this is what scares the hell out of me when it comes to the warm-mongers - they're going to come up with a "solution" to something that may not exist, or may be beneficial if it does, and end up kick-starting an Ice Age that will destroy civilzation in a way that warming never could.

I think you're missing the point. People suggesting such things as creating plankton blooms to absorb CO2 aren't generally believers in an upcoming global warming disaster.

Instead, the point is "if it's really as catastrophic and as urgent as you say and we really need to do whatever we can, even if it otherwise hurts us, to stop it, then why not do this?" It helps distinguish those who really are trying to analyze future costs and expected values, and those who are just using it to further a back-to-nature ideology.

Stopping global warming with nuclear power uses the same principle, since the same ideology is opposed to nuclear power.

Posted by Ken Arromdee at February 9, 2007 2:44 PM | direct link

If ‘Global Climate Change’ doesn’t really exist, interested parties would surely invent it.

Posted by Bill at February 10, 2007 1:26 AM | direct link

Scientists were right to insist on evidence of smoking causing adverse health effects, because correlation does not imply causality. For smoking, the evidence was strong because (1) direct experiments (blowing smoke at rats) showed it, (2) it was dominant over competing explanations or noise. Neither of those cases apply for AGW, where the evidence is far from compelling. Instead of supplying evidence, we have repeated attempts by authors like Posner and Ellen Goodman to squelch honest debate. The evidence presented wouldn't pass the laugh test for settling any scientific question where politicians and what amounts to religious feelings were not involved.

Furthermore, by various accounts such as Lord Monckton's, Posner is simply wrong that the evidence is ever more convincing, and that the scientists are increasingly pessimistic. My own assessment is that, between the facts that the earth has not warmed significantly in the last 5 years, that the hockey stick has been substantially debunked, that competing theories such as cosmic rays have made substantial progress, that there still is no explanation for satellite measurements of the tropical troposphere, etc., that the case has gotten substantially worse. I would respectfully urge Posner to read the Fraser Institute's Independent Summary for Policy Makers
http://www.fraserinstitute.ca/admin/books/files/Independent Summary.pdf
and then state whether he still thinks this is a decided question. I believe he does not really intend to sink to the level of Ellen Goodman and that he is probably as capable of assessing the state of evidence, provided he tries, as most of the bureaucrats who were responsible for the recent summary for policy makers.

Posted by Eric Baum at February 10, 2007 2:18 PM | direct link

Eric, Ok. Let's assume for the sake of argument that warming is not the problem. Did you know that the oceans of the planet function as the primary carbon sink? What happens when you dissolve CO2 in water? The pH falls. Viola! Now we've got acidification of the marine environment and all aquatic life forms have developed over the eons to surviving in very narrow pH ranges. What happens when the pH falls below this narrow range? Massive die off. Similiar problems occur with flora and fauna due to Acid Rain. With the increase of CO2 and sulphur (a contaminant of most fossil fuels) in emissions due to the use of fossil fuels to power the rapidly expanding world wide industrial base. The planet is quickly approaching a critical point where life itself is threatened.

The problem may not be warming, but there are other things that are clearly affecting the bio-chemistry of the environment that has direct negative effects. Like the ostrich should we stick our heads in the sand when danger is approaching? Btw, we haven't begin to fully understand the true impacts of planetary thermodynamics where all energy sources that are not converted to power and into work becomes heat that is not rejected from the system. Hence raising the temperature of the system i.e. Global Warming.

Would it not be better to er on the side of safety and health instead of acting like the ostrich?

Posted by n.e.hat at February 10, 2007 5:48 PM | direct link

n.e. hat, I was aware of the PH issue, which is mentioned in the Fraser review. My post concerned the science, not whether there are any potential problems. If warming is not the problem, why are we subjected to nonstop propaganda, not to mention abuse from the likes of Posner? If the global warming alarmists cry wolf re: warming, maybe the real problems won't be dealt with.


Aside from the fact that the predictions of warming are very uncertain, the next question is what could be done to deal with the CO2. Kyoto, aside from being hellishly expensive, would do almost nothing useful. More serious efforts would cost a significant fraction of gross world product, like 1/3 according to a UN panel, and are not likely to be undertaken without more serious evidence than seen to date. Meanwhile, according to Mockton, the Chinese are bringing a new coal burning power plant on line every 5 days until at least 2012, overwhelming any efforts we might make. The global warming alarmists don't seem eager to trumpet that.


My guess is, rather than die, ocean life will evolve.

Posted by Eric Baum at February 10, 2007 6:36 PM | direct link

I’m no expert; but the air-water interface is two-dimensional and the ocean is miles deep. It seems a stretch that small changes in CO2 atmospherics would do too much to carbonic acid levels and ocean pH. Especially in comparison with real influences like dissolved minerals like lime. If somebody wants to arrange me a government grant to look further into it; I’ll kick you back 10 points.

Posted by Bill at February 10, 2007 7:59 PM | direct link

If ‘Global Climate Change’ doesn’t really exist, "interested parties would surely invent it."

On the flip side, if the Global Warming does exist, interested parties surely would deny it.

Posted by Haris at February 10, 2007 8:56 PM | direct link

Skeptic sez:

"Ehrlich made the mistake of assuming a growth curve could be extrapolated endlessly and when the growth curve approaches an asymptote . . . it's the end of the world.

It looks like the alleged climate scientists are making the exact same mistake."

.......... Erhlich being "wrong" was in large part due to human intervention. Some, as China and India due to central government policy and others to changing economics and other social policy.

1 billion 2 billion 3 billion 4 billion 5 billion 6 billion
Year 1802 1928 1961 1974 1987 1999
Years till next billion 126 33 13 13 12

The world's population has increased by 50% (from 4 billion to 6 billion since 1974 about when Erhlich's book was published. Note the 12-13 years to add another billion? Perhaps that rate of increase will drop but, if not, the doubling time is 50 years, for a total of 12 billion.

Was Erhlich "wrong" or just off on his timing?

According to the "warmers" we've picked up most of a degree in the 20th century, but they predict another degree in the next 40 years. I wonder how many people they figure will be tooling around in gashogs, bidding heavily on post-peak fossil fuels and spewing emissions at twice the current rate or more?

As most of the population growth is not in the US, I wonder if the US will be able to continue to get away with using/wasting one quarter of the world's energy production? Or how it will go over as we bid up the price of corn to feed our gashogs, while our neighbors in Mexico can't afford corn for their tortillas?

My guess is that shortages will manifest in ways other than simply being out of fuel or out of food. For example, clearly it confuses the nukie issues in NK and Iran that both need nuclear power.

Posted by Jack at February 10, 2007 8:59 PM | direct link

Eric, Evolve like the dinosaurs huh? Don't forget the sulphur, it converts to sulphurous acid in the presence of water vapor. The sink is only so big, and how many fossil fuel plants, mines, mills, factories, transport units, etc., they all generate their own emissions; are being brought on line? Not just in China, but the entire world? And do we know where the critcal tipping point is? The issue, was and is, the destablizing of the biosphere's biochemistry upon which all life depends. This is not a maybe, but a fact.

Posted by n.e.hat at February 10, 2007 9:26 PM | direct link

Absent government directives, our collective standard of living is significantly more resorce efficient than it was even ten years ago. For example, I site here next to my petroleum-based albums that have been replaced by MP3s. Resource efficiency is accelerating and if capitalism can stay around, this trend will continue. More efficient use of resources through the free market should be Plan A in avoiding environmental catastrophe, as disorderly as it sounds. Instead, rent seeking and redistribution of wealth dominate the agenda.

Posted by The Dirty Mac at February 10, 2007 11:28 PM | direct link

And what a coincidence it is that after the careful modeling of data and testing of hypotheses, the consensus solutions would just happen to be payments to rent seekers and redistribution of wealth. Never woulda guessed it.

Posted by The Dirty Mac at February 10, 2007 11:38 PM | direct link

Dirty Mac sez:

"our collective standard of living is significantly more resorce efficient than it was even ten years ago."

.......... and it's a good point. But, I think CA is the only state whose energy consumption is nearly flat despite population growth. The other "market driven" states have gone in for larger and larger gashogs, longer commutes, and larger homes that aren't very efficient at all.

..... BTW... The CAFE standards of the Carter era really DID make more resource efficient cars...... but, after a while it was ALL used up on longer commutes, and then the SUV craze hit. Have you heard "soccer moms" speak of how much more fashionable their SUV is over their former mini-van? Anyway, back in the 70's Scoop Jackson made an impassioned speech about the national security risks of being 30% dependent upon foreign energy, today that number is over 60%.

But then? perhaps offshoring more of our heavy industry might help, eh? Did you know all of the 52 inch pipe for the proposed Alaska-Midwest gasline will come from Japan?

Posted by Jack at February 11, 2007 1:20 AM | direct link

Posted by Anonymous at June 27, 2009 1:39 AM | direct link

Very nice site! cheap viagra

Posted by Anonymous at July 1, 2009 3:15 AM | direct link

Very nice site!

Posted by Anonymous at July 1, 2009 3:15 AM | direct link

Post a comment


Remember me?