Category — Climate policy

Editor’s Note: Jim Manzi is a Senior Fellow at the Manhattan Institute, and blogs at both National Review’s The Corner and at The American Scene.

It is amusing to watch advocates of rapid, aggressive carbon dioxide emissions reduction, when confronted with the plain facts of the consensus scientific projections for climate change and its associated damages, move from “science says we must do this or die” to “well, actually, the science is pretty uncertain, so it’s possible that we might die,” and then proceed to some restatement of Pascal’s Wager.

Friedman’s Throw

Tom Friedman’s recent New York Times column is a perfect illustration of this logic.  I’ll quote him at length, before demonstrating that his emission-cuts-as-insurance analogy breaks down once you plug in actual numbers:

This is not complicated. We know that our planet is enveloped in a blanket of greenhouse gases that keep the Earth at a comfortable temperature. As we pump more carbon-dioxide and other greenhouse gases into that blanket from cars, buildings, agriculture, forests and industry, more heat gets trapped.

What we don’t know, because the climate system is so complex, is what other factors might over time compensate for that man-driven warming, or how rapidly temperatures might rise, melt more ice and raise sea levels. It’s all a game of odds. We’ve never been here before. We just know two things: one, the CO2 we put into the atmosphere stays there for many years, so it is “irreversible” in real-time (barring some feat of geo-engineering); and two, that CO2 buildup has the potential to unleash “catastrophic” warming.

When I see a problem that has even a 1 percent probability of occurring and is “irreversible” and potentially “catastrophic,” I buy insurance. That is what taking climate change seriously is all about.

Computing the Odds

The United Nations Intergovernmental Panel on Climate Change (IPCC) is the leading bookie for this game.  The current IPCC consensus forecast is that, under fairly reasonable assumptions for world population and economic growth, global temperatures will rise by about 3°C by the year 2100 (Table SPM.3). Also according to the IPCC, a 4°C increase in temperatures would cause total estimated economic losses of 1–5 percent of global GDP (page 17). By implication, if we were at 3°C of warming at the end of this century, we would be well into the 22^nd century before we reached a 4°C rise, with this associated level of cost. [Read more →]

When you fly overnight from Johannesburg to Europe the lights become thin just north of Lusaka, Zambia, a few more in Zambia’s Copper Belt and then nothing (and I mean nothing) until the North African coastline. For most of this 11-12 hour flight there are no artificial lights below. From the Sahara on south, but excluding South Africa, a region that is home to more than 400 million people consumes less electricity than New York City.

The World At Night (courtesy of Bert Christensen. Click to enlarge.)

• And yet this area includes major oil producers:
  Nigeria produces 2.1 million b/d oil and consumes 19 billion kWh/y
  Angola produces 2.0 million b/d oil and consumes 3.2 billion kWh/y
  Equatorial Guinea produces 0.36 million b/d and consumes 26 million kWh/y
  Other sub-Saharan Africa oil producers supply more than 1 million b/d to world markets.
  New York City produces 0 b/d oil and consumes 75 billion kWh/y

Apparently some are bothered by the prospect that Africa could light up.

We Don’t Want What You Have (Wanna Bet?)

Many of those who would save the earth from the scourge of modern energy want us to believe that it is no big deal that as many as 1.5 billion people, more than three fourths of the population of the world’s poorest countries, lack any access to modern energy. They still use wood and charcoal for cooking, and sometimes a bit of kerosine for lighting. For most of these people the only realistic way to gain access to modern energy is to leave the village or town and move to the city. [Read more →]

But even if the IPCC’s iconic statement were correct, it still would not be cause for alarm….The potential (and only the potential) for alarm enters with the issue of climate sensitivity—which refers to the change that a doubling of CO2 will produce in [global mean temperatures]. –Richard Lindzen, Wall Street Journal, November 30, 2009

Defenders of the IPCC position on climate science have adopted different strategies in dealing with the scandal of the CRU emails and computer code.  Some authoritative voices, notably Judy Curry, have engaged in dialog with skeptics and have reassured PhD students that the “tribalism” revealed in the CRU emails has no place in science.

On the other hand, another very common reaction has been to mock the “deniers” for taking certain phrases out of context. This circle-the-wagons strategy tries to convince the public that the CRU episode has absolutely no bearing on the actual science, and that at worst it reveals petty personality flaws. This spin is epitomized in sarcastic pieces which take on the voice of the “deniers” and claim that the laws of physics are all a socialist hoax too.

These defenses are self-evidently absurd to anyone who has read the actual CRU emails in question. The public’s faith in the sacrosanct “peer-review process” will be understandably shaken when they read just how this “consensus” was enforced. Furthermore, the real debate was not between ultra-skeptics who say “global warming is a hoax” versus professional climate scientists who say “anthropogenic climate change is real.” [Read more →]

My ‘Left’ friends are mad at me now that the climate debate/ discussion has shifted, at least temporarily, from Save the World to Why Did We Fail? Here is what a former Enron executive (his name will remain confidential) emailed me a few days ago:

Rob- shame on you. The [Breakthrough Institute] article [Apocalypse Fatigue: Losing the Public on Climate Change] names only 3 reasons why the U.S. will not address climate mitigation: far off threat, greed, and telling them what they don’t want to hear. It ignores the real reason: the constant effort from people like yourself to undermine the case for action with its ancillary affect of dividing the country and paralyzing the system.

Then the sarcasm comes in:

I am not being facetious: you should pat yourself on that back for helping create an atmosphere that will prevent any meaningful action on the false threat of climate change from happening in this country. It is a proud moment and credit to your hard work. I tip my hat.

Now, there are a lot of people who would love to take credit for helping to derail any piece of all pain-no gain legislation. But Waxman-Markey probably would not pass the House today if a re-vote were taken, and even some Democratic Senators know that being Democrat includes not needlessly increasing energy prices for their constituents.

Still, I took some offense at this email and wrote back in all seriousness:

I am surprised …. I thought you were having second doubts about the increasingly false alarm of high-sensitivity warming. And to me the lessons of Enron include the fake green stuff we were doing–and the fake stuff that [our old colleague Jim] Rogers [of Duke Energy] is doing at the expense of his customers and broader society.

[Texas A&M Distinguished Professor of Atmospheric Sciences and Oceanography] Jerry North told me just last week that he is more convinced than ever that the warming is at the very bottom of the IPCC range, which some top climate economists say makes CO2 a positive externality, not a negative one. We have peer-reviewed articles on how feedback effects are not the big amplifiers that the models (must) assume. [Read more →]

Two years ago, in Scenes from the Climate Inquisition, my colleague Steve Hayward and I observed that climate alarmists were growing ever more incendiary in their criticism of people who disagree with them. And these disagreements were not simply about the science, but about the favored policy choices of leftist environmentalists, many of whom had no training in public policy or economics.  As we wrote:

Anyone who does not sign up 100 percent behind the catastrophic scenario is deemed a “climate change denier.” Distinguished climatologist Ellen Goodman spelled out the implication in her widely syndicated newspaper column last week: “Let’s just say that global warming deniers are now on a par with Holocaust deniers.” One environmental writer suggested last fall that there should someday be Nuremberg Trials–or at the very least a South African-style Truth and Reconciliation Commission–for climate skeptics who have blocked the planet’s salvation.

Former Vice President Al Gore has proposed that the media stop covering climate skeptics, and Britain’s environment minister said that, just as the media should give no platform to terrorists, so they should exclude climate change skeptics from the airwaves and the news pages. Heidi Cullen, star of the Weather Channel, made headlines with a recent call for weather-broadcasters with impure climate opinions to be “decertified” by the American Meteorological Society. Just this week politicians in Oregon and Delaware stepped up calls for the dismissal of their state’s official climatologists, George Taylor and David Legates, solely on the grounds of their public dissent from climate orthodoxy. And as we were completing this article, a letter arrived from senators Bernard Sanders, Pat Leahy, Dianne Feinstein, and John Kerry expressing “very serious concerns” about our alleged “attempt to undermine science.” Show-trial hearing to follow? Stay tuned.

Desperation is the chief cause for this campaign of intimidation. The Kyoto accords are failing to curtail greenhouse gas emissions in a serious way, and although it is convenient to blame Bush, anyone who follows the Kyoto evasions of the Europeans knows better. The Chinese will soon eclipse the United States as world’s largest greenhouse gas emitter, depriving the gas-rationers of one of their favorite sticks for beating up Americans.”

At the time, we naively hoped that there would be a moderation of such language, as some saner voices were beginning to push back against the whole slander-denier complex.

Alas, the venom-spitting of the the climatistas is increasing in direct proportion to the probability of failure in enacting their world-girdling eco-theocracy. And the leader of the pack, Joseph Romm of Climate Progress (Center for American Progress), turns out to be one of the least civil human beings to tread the planet. [Read more →]

Last week, at the first Senate Environment and Public Works Committee hearing on S. 1733, the Kerry-Boxer “Clean Energy Jobs and American Power Act,” Department of Energy Secretary Steven Chu explained the economic rationale for adopting a Kyoto-style cap-and-trade program.

His argument, in a nutshell, goes like this:

1. Reducing emissions globally will require a massive investment in “clean technologies” — an estimated $2.1 trillion in wind turbines and $1.5 trillion in solar voltaic panels by 2030. These investments will create many green jobs.
2. “The only question is — which countries will invent, manufacture, and export these clean technologies and which will become dependent on foreign products.”
3. The United States is falling behind. “The world’s largest turbine manufacturing company is headquartered in Denmark. 99 percent of the batteries that power America’s hybrid cars are made in Japan. We manufactured more than 40 percent of the world’s solar cells as recently as the mid-1990s; today we produce just 7 percent.”
4. To seize the opportunity of clean tech and keep from falling farther behind, “we must enact comprehensive climate legislation,” the most important element of which is a “cap on carbon emissions that ratchets down over time. That critical step will drive investment decisions towards clean energy.”

There is so much silliness packed into Chu’s testimony that it’s hard to know where to begin. [Read more →]

One of the ugliest battles in the blogosphere climate wars has involved the newly released Superfreakonomics, sequel to the best-selling Freakonomics. In the new book’s final chapter (available here in pdf), economist Steven Levitt and journalist Stephen Dubner set out to challenge the view that massively restricting carbon emissions is the only hope for averting planetwide catastrophe.

In this post I will link to some of the major commentary on the book so far, and then focus on U.C. Berkeley economist Brad DeLong’s specific claims that Levitt and Dubner’s arguments in support of geoengineering are somehow “bad economics.” As we’ll see, Levitt and Dubner might be wrong, but if so they are wrong because of the numbers. DeLong is painting their views as self-evidently absurd, but that’s only because he himself is overlooking a basic economic point.

The Background

Not surprisingly, the climate scientists and economists who are most vocal about the need for drastic emissions cutbacks were furious when the book’s contents began circulating. Joe Romm got the ball rolling with this fiery post; his ally in such matters, Paul Krugman, soon followed suit. Dubner defended himself and co-author Levitt against Romm’s accusations of intentional distortion in this post, and one of the primary sources for the chapter, physicist (and all-around guru) Nathan Myhrvold, defended himself from Romm’s accusations of ignorance here.

In the present post, [Read more →]

On October 16, 2009, the Houston Chronicle ran an Outlook piece by Dr. Ronald Sass– a fellow in global climate change at the Baker Institute and Professor of Natural Sciences emeritus at Rice University–complaining that Texas governor Rick Perry was getting his ideas about climate change from unreliable sources. Apparently, that Governor Perry is not hopping on the climate alarmism/policy activism bandwagon has Dr. Sass a bit concerned. Make no mistake about a political agenda of the giver of this advice that goes far beyond natural science issues.

Dr. Sass argues that the latest findings of the Intergovernmental Panel on Climate Change (IPCC) should be the end all and be all of the physical science debate. But he is behind the times. The IPCC report is several years old, and the latest theory and empirical data is pointing in more benign directions than at the height of the climate alarm in the late 1990s. Perhaps the governor’s stance isn’t as off-base as Sass would like his Chronicle’s readers to believe.

Some Good Points

Dr. Sass does make some good points about the science, but he attributes too much import to the implications of setting the Governor straight on them.

For instance, Dr. Sass, points out, and rightly so, that human activities—primarily the burning of fossil fuels for energy—have contributed to the build-up of the atmospheric concentration of carbon dioxide and an enhancement of the earth’s natural greenhouse effect. If Governor Perry is being advised otherwise, he is getting bad advice. 

And Dr. Sass is correct that an enhanced greenhouse effect will lead, in general, to a modified, and warmer, climate. Again, if the governor is getting advised differently,  he is being misinformed.

The Rest of the Story

However, from here Sass goes astray. 

It is not true that just because humans are modifying the climate that this will lead to a bad outcome and thus we should undertake immediate efforts to stop this (which is what Sass would like the Governor to do). [Read more →]

Today, the Senate Environment and Public Works Committee will hold the first of three hearings on S. 1733, the Clean Energy Jobs and American Power Act,” also known as Kerry-Boxer, after its co-sponsors Senators John Kerry (D-MA) and Barbara Boxer (D-CA). Kerry-Boxer is the Senate companion bill to H.R. 2454, the American Clean Energy and Security Act (ACESA), also known as Waxman-Markey, after its co-sponsors Reps. Henry Waxman (D-CA) and Ed Markey (D-MA).

For those worried about the economic impacts of these bills, I bring unwelcome news: their bite is worse than their bark. Escalator clauses common to both bills, ignored in most previous analyses, are the setup for dramatic increases in regulatory stringency well beyond the bills’ explicit emission reduction targets. Similarly, “findings” presenting the “scientific” rationale for cap-and-trade are not mere rhetorical fluff but precedents for litigation targeting emission sources considerably smaller than those explicitly identified as “covered entities.”

The Economic Debate So Far

Much of the economic debate on Waxman-Markey and Kerry-Lieberman has been about the likely impacts of the specific emission-reduction targets proposed in these bills. The Heritage Foundation, National Black Chamber of Commerce, and American Council on Capital Formation/National Association of Manufacturers project substantial GPD and job losses. In contrast, the Environmental Protection Agency and Congressional Budget Office project much smaller costs.

EPA says Waxman-Markey would cost the average household only $140 annually. CBO puts the figure at about $175. Citing these estimates, proponents say cap-and-trade is cheap, costing only a postage stamp per person per day.

Heritage Foundation scholar Dr. David Kreutzer points out that EPA improperly used a technique called “discounting” to make the costs of cap-and-trade seem tiny: $140 is what a household would have to invest today, with compound interest, to pay the costs of Waxman-Markey in 2050. But according to EPA’s own numbers, in 2050 the cost to a family of four would be $2,700.

Kreutzer and his colleagues also note that the CBO analysis does not estimate the GDP loss from higher energy prices, only the cost of the energy ration coupons, 85% of which are to be distributed free-of-charge in the initial years of the program.

A Breakthrough Institute analysis suggests that Waxman-Markey may cost pennies on the dollar because the bill’s “offset” provisions could allow “covered entities” to increase their emissions at business-as-usual rates through 2030. An offset is a credit earned for investments in projects — either in developing countries or in U.S. economic sectors outside the cap, such as agriculture and forestry — that reduce, avoid, or sequester emissions. The bill allows capped sources to utilize up to 2 billion tons’ worth of domestic and international offset credits each year in lieu of reducing their own emissions. If the offsets option is “fully utilized,” says Breakthrough, “Emissions in sectors of the economy supposedly ‘capped’ by ACESA could continue to grow at BAU rates until as late as 2037.”

This assessment is not a realistic projection of what is likely to happen. [Read more →]

Editor Note: Robert Murphy’s peer-reviewed article in The Independent Review, “Rolling the DICE: William Nordhaus’ Dubious Case for a Carbon Tax”, is available online [.pdf].

When I first began working for the Institute for Energy Research, my preliminary research indicated that William Nordhaus (now a co-author of Paul Samuelson’s famous economics textbook) was a great representative of the mainstream case for a Pigovian carbon tax. I have gone on to study his case, presented in articles and a book, in great detail. What I have found is an eager willingness to spot “market failure” coupled with a naive faith in government “solutions.” The full article deals with these big picture issues, but this post will dwell on the narrow technical results–using Nordhaus’s own numbers–that should give average economists pause when it comes to the typical recommendation of a carbon tax to “internalize the externality” of greenhouse gas emissions.

Most Damages Come From Ill-Specified “Catastrophic” Outcomes. In Nordhaus’s DICE model [Dynamic Integrated Model of Climate and the Economy], he relies on a simplified model of the global climate system and economy, calibrated to the latest numbers put out by the IPCC and other groups. The model can then simulate the climate damage impacts of a marginal ton of emissions on human welfare, allowing Nordhaus to derive the “optimal carbon tax.”

When I delved into the numbers behind Nordhaus’s damage function–which related a given increase in global temperatures to a percentage loss of global GDP–I was quite surprised. The DICE model (at least as of the time I wrote the paper) assumed that a warming of 2.5C would yield a loss of 1.5% of global GDP, averaged across various sectors. For example, the agricultural sector (worldwide) would contribute to a 0.13% reduction in global GDP, the toll on coastal regions would yield another 0.32% of GDP in damages, and so forth.

The single biggest contributor, however, was a 1.02% GDP loss attributed to a “catastrophic impact.” (See Table 2 on page 209 of my paper, hyperlinked above.) So to repeat, Nordhaus’s optimal carbon tax was based on a damage function that said 2.5C of warming would yield 1.50% GDP losses, and 1.02% was due to a “catastrophic impact.”

Now this in itself is a bit disturbing, since the lion’s share of Nordaus’s recommended tax is coming from the nebulous “catastrophic impact” category. In other words, it would be one thing if careful, sectoral studies assessed the likely impact from various amounts of warming, and then Nordhaus rounded up the final number because of the “kicker” of ill-defined catastrophic impacts. But that’s not what happened–fully 68% of Nordhaus’s damage function (calibrated at the 2.5C warming level) results from this one category of impacts. [Read more →]