Reynolds, Tol, Lomborg: The Case for Ignoring Climate Change

Fri, 2009-08-21 14:30Jim Hoggan
Jim Hoggan's picture

Reynolds, Tol, Lomborg: The Case for Ignoring Climate Change

The most successful Libertarian politician in Canadian history, Globe and Mail columnist Neil Reynolds, has joined the campaign to do nothing about climate change, basing his argument (A Net-Benefit Greenhouse Gas Plan - Less is Really More) not on the work of anyone who actually studies climate science, but rather on two economists with a track record of trying to discourage action.

Most famous of these is Bjorn Lomborg, the Disingenuous Environmentalist and director of a Danish think tank that specialilzes in understating the costs of climate change and overestimating the costs of taking preventative action.

In the run-up to the United Nations meeting scheduled for his hometown in December, Lomborg’s Copenhagen Concensus Center has commissioned 21 reports “to examine the costs and
benefits of different solutions to global warming.” The most recent result, a paper by the economist Richard Tol (inset), gives a good indication of how agenda-driven and, in some regards, surprisingly unprofessional, those papers might be.

Tol’s contribution, entitled “An Analysis of Mitigation as a Response to Climate Change,”  purports to consider the costs or benefits (!) of climate change, balanced by the costs and benefits of particular actions. Tol builds a narrow case, on an extremely limited number of assumptions, and then cobbles together a financial model to assess five potential policy approaches. Then he lets the model churn through the numbers, delivering a result that he presents as somehow relevant - even as scientific.

The economists of the world might be emarrassed by his machinations, given his obvious effort to set up assumptions that will deliver the result most likely to please his Copenhagen Concensus Center funders. For example, when Tol tackles “Estimates of the welfare loss due to climate change,” he pulls together a series of studies (including one of his own), that arer anything but random. Rather, he appears to have gathered up all the lowest estimates, including five from the respected but famously conservative Yale economist William Nordhaus. Missing from the list, however, is the Stern Review on the Economics of Climate Change, the best-known and probably most ambitious analysis, conducted by the former chief economist of the World Bank, Nicholas Stern. (Although, if you read Tol’s footnotes, you will find that Stern’s work was diluted into one of the other reviews - thereby acknowledged as legitimate but strategically averaged down before being fed into Tol’s calculations).

Tol is sometimes forthright about the fallibility of his work. He says, “The effects of climate change that have been quantified and monetized include the impacts on agriculture and forestry, water resources, coastal zones, energy consumption, air quality, and human health. Obviously, this list is incomplete.”

“Obviously.” How, for instance, can we summarily dismiss the risk that ocean acidification caused by too much CO2 in the atmosphere might trigger a global collapse in both coral and in all ocean creatures that rely on creating their own shells for survival?

But Tol goes on to sniff at his own shortcomings: “Many of the omissions seem likely to be relatively small in the context of those items that have been quantified.”

“Relatively small?” Who is Tol to pass off this comment as if it is reliable and based on a serious reading of the science. The people who have actual expertise in this field are telling us that humans, having pushed the carbon dioxide content of the atmosphere over 300 parts per million for the first time in more than 650,000 years, have endangered the steady state that has allowed human life to thrive. The best of those scientists say we should be wrestling CO2 back from its current level of more than 380 ppm to a safer 350. European leaders are aiming to contain the increase below 450 ppm - and Tol is recommending  that we do as little as possible as a way of saving money on the journey to a level of between 550 and 650 ppm - a point at which real climate scientists say the world would be subject to catastrophic consequences.

In his Globe and Mail column touting Tol, Reynolds also clings to this unsubstatiated tendency to minimize, saying this: “Noting that one-half of all probable environmental damage has already occurred (and won’t be reversed), Prof. Tol estimates that a further doubling of greenhouse gases would inflict ‘relatively small’ further damage.”

This is a fine, first-year-economist-style bit of logic. An alert firefighter might similarly judge that a house, already 50-per-cent destroyed, is not worth the risk or effort of saving. But said firefighter would have housing options. The human race is less fortunate in this instance.

Bjorn Lomborg keeps trying to present himself as someone with a legitimate concern for the environment. And yet all his arguments - and all those he subsidizes and promotes - seem similarly contrived to say that we should ignore our responsibility to act in the environment’s favor. At some point - and preferably before the Copenhagen negotiators make the mistake of taking him seriously - we must hope that he and his acolytes will be dismissed as climate science frauds.

Previous Comments

This reminds me of a quote from Star Wars where Han Solo said “What good is money if you’re not around to use it?” This lunacy has got to stop or else we are all doomed.

Economists (as Sir Nicholas Stern has done) have to start thinking in the long-term. They have to realize that if we don’t undertake steps that will be painful in the short-term, then there will be a lot more pain to come in the long-term. “Short-term pain for long-term gain” is the motto, I believe. Even with this recession, it has to be done or else we risk a long-term depression as a result primarily of environmental factors.

Time to buck up and get started. Now!

Another economist who knows the price of everything and the value of nothing.

Considering the title for this article and the picture, I kind of imagined it would be some kind of pro-anarchy - let the world destroy itself sort of thing. Alas, it’s just some boring economists trying to guess what the future holds. Crazed anarchists would have been so much more interesting.

There are several reasons that these “climate change damage models” underestimate the real damage of rising CO2..

Jim already mentioned one..
Their models are far from complete;

Another is an unreasonably high discount rate..

But most important, these damage models categorically underestimate risk..Because the worst case scenarios of climate change are usually not quantified they just ignore them..

Ofcourse ignorance does not make the risks of climate change go away..In fact the worst case scenarios of climate change imply a meltdown that would make the financial meltdown feel like a cakewalk..

I tried explain this to Tol in my thesis in 1995 but he clearly did not get it..I find it sad people like Tol seem to fall in love with their own model and as a result ignore the reality of climate change risk.

Here is an interesting recent article that explains it again..

Climate Risks: Lessons
From The Financial Crisis
By Robin Hahnel
5 April, 2009
CommonDreams.org

…………….
Economic models that claim that the costs of preventing climate change are not worth the benefits of avoided damages are ignoring the possibilities of black swans and maximizing the expected value of climate policy. If an action almost always produces small negative payoffs and only yields a large positive payoff once in a blue moon, maximizing expected value leads us to reject this course of action. Yet, if people behaved this way in the real world, no one would buy insurance. Profits in the insurance industry hinge on the willingness of buyers to pay more in annual premiums than the expected payout in the event of a blue moon. Insurance is profitable because almost all of us, fearful of incurring a black swan we cannot afford, buy insurance policies with a negative expected value for the buyer and only a positive expected value for the seller. Yet most of us do not think it is foolish to purchase life insurance or fire insurance for our homes. Why then, would we think it is foolish to insure the planet against catastrophic climate risks whose costs are literally incalculable?

Ironically, there is every reason to believe the benefits of avoiding even mild climate change would outweigh the costs of avoidance. A few unwarranted assumptions buried in mountains of technical details - such as ignoring whole categories of damages from even mild climate change and undervaluing benefits of avoidance by choosing a high rate of time discount - are responsible for giving the opposite impression. But even if avoiding mild climate change were not cost effective, and even if cataclysmic climate change was less probable than scientists warn, the appropriate risk model - paying reasonable premiums for insurance against black swans we cannot afford - would still recommend the precautionary policy of paying the necessary costs to avoid climate change.

The likelihood of cataclysmic climate change under business as usual emissions scenarios is far greater than the likelihood of a once in a hundred years financial crisis - to borrow the words of a chastened Alan Greenspan. Even Greenspan now admits that this small probability warrants precautionary regulations on the financial industry given the magnitude of the damages that such an event unleashes. Since both the probability of a climatic black swan and the magnitude of the damages are far greater, the rational choice is to pay our precautionary premiums to insure ourselves against climate change. Arguments that the expected value of our insurance policy may be negative are beside the point. There are times to maximize expected value and there are times to buy insurance. Now, as we are deciding how to respond to climate change, is surely a time to buy a life insurance policy for our planet. Haven’t we learned our lesson yet?
…. http://www.countercurrents.org/hahnel150409.htm

Jim:

Tol at least *is* an economist (even if he seems to be wrong, but economists disagree often).

As per:
http://www.desmogblog.com/bjorn-lomborg-and-long-con

I can find no evidence that Lomborg should be called an economist (or statistician, or even a political scientist), all of whom would normally build a peer-reviewed publication record…

Have I missed something? Why would Lomborg be called an economist?

Game theorist, I think, is most correct. That’s what his PhD is in. And certainly, you can’t beat the guy for gamesmanship.

“Tol goes on to sniff at his own shortcomings: “Many of the omissions seem likely to be relatively small in the context of those items that have been quantified.” […] “Relatively small?” Who is Tol to pass off this comment as if it is reliable and based on a serious reading of the science. […] [James Hansen] says we should be wrestling CO2 back from its current level of more than 380 ppm to a safer 350.”

Hansen is not a specialist in social sciences. Unlike Tol, he has no particular expertise in valuing the damages of climate change. For example, what impact would Hansen’s idea of leaving coal in the ground have on poverty reduction in China and India?

Well, since coal slurries have resulted in spikes in cancer rates among the Chinese population, a reduction of coal mining would be less of a burden on their health care system. Also, the slurries have rendered the land less suitable to agricultural production, which is toxic to any nation of China’s size, as less food will be produced.

I also resent your berating of Hansen and your attempt at delegitimizing him. He is probably the most well-versed climate scientist in the United States in terms of the whole issue. I’d put my money on Hansen any day.

Most people don’t care about the climate change and most of them are ignoring climate change..
It bring negative impacts, so this world will be worse and worse..

reborn baby girl

[x]

The Sussex University economist has aligned himself with climate denial and his tweets are highly entertaining - shame this book is so damn conventional.

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