Bishop Hill Stourton on global warming
Dec 22, 2009 Climate I caught most of Edward Stourton's history of global warming on Radio 4 this morning. This seems to represent something of a shift for the BBC, moving from outright cheerleading and propaganising to something slightly more balanced. Stourton even managed to include some sceptical views (Pat Michaels and Myron Ebell) without sneering or otherwise belittling them. He also managed not to mention the Hockey Stick as far as I could tell, and one wonders whether this was significant or not.
The shocker was that he covered the Stern Report without informing the listener that Stern reinvented the subject of economics in order to get to the answer he did. Let us say charitably that this is probably a case of embarrassing incompetence on Stourton's part rather than anything more sinister. Still, it is hard to credit that an organisation with the resources of the BBC could make such an oversight.
Meanwhile, no reporting of Rajendra Pachauri's conflicts of interest (latest revelations here) from our national broadcaster. I guess there are limits to how far the BBC is willing to go.
Reader Comments (39)
I suspect the BBC are hoping that no one will notice that they're inching away from their original position.
They only report on news when it's already been covered elsewhere as far as I can tell - makes it nice and safe to simply say "The Daily Whatever said..."
I look forward to the day when they return to PSB rather than advocacy [and I won't be betting on it :( ]
Part 2 (of 3) of Defining The Decade is repeated on Radio 4 at 9:30pm tonight. It lasts 45 minutes.
Bishop
Could you expand on how Sir Nicholas "reinvented the subject of economics in order to get the answer he did"?
Yes, he argued that instead of discounting future costs by long-term interest rates as is normal in these sorts of assessments, that a lower rate should be used. It was only by doing this that he was able to make the case for the action he wanted.
IIRC, Richard Tol, an environmental economist, said he would have failed any student who presented him with such an argument.
The scandal of the media coverage of Stern is that this is never reported.
Bishop Hill
As I think you have observed from time to time, Tim Worstall argues that even using Stern's calculations which, as you say, are based on an unusual (to say the least) choice of interest rates we'd be as well off forgetting about trying to directly intervene in the climate and keep generating wealth so we can ameliorate the possible effects of climate change. This would be the correct application of the precautionary principle: we know we can generate the wealth: we don't know either that AGW is true or, if it is, how or if crippling the West's economies will affect climate.
I heard the first half of it and was surprised that there was at least an attempt at balance. Yes, some good sceptical views were heard. However, Stourton said that the hot summer of 2003 won over many of the sceptics that something 'climatic' was happening. He also said that, though it was difficult to estimate, something like 30,000 deaths were attributable to the heatwave. Of course, one hot summer in Europe isn't evidence of either global warming or 'climate change'. And those who deny the Medieval Warm Period do so by saying it was localized to the North Atlantic area rather than globally, so it is difficult to see how the warmistas could claim one hot European summer as evidence of climate change (never mind anthropogenic climate change). The 30,000 deaths sounds like a gross exaggeration, but it is also a half truth verging on a lie when mortality due to cold is not mentioned. A warming earth is far more benign than a cooling one.
I am wondering if the CRU's Peer reviews were all carried out by the noble Lord Stern.
Bishop
Thanks for your reply. Stern's choice of an essentially zero discount in no way constitutes a "reinvention" of economics. Economists such as Ramsey back in the 1920s were similarly advocating a zero discount rate. Sure, Tol and Nordhaus take the view that the discount rate should greater than zero, but as philosopher Simon Caney argues in a recent paper on discounting*, such views carry little philosophical weight.
*'Climate Change and the Future: Time, Wealth and Risk', Journal of Social Philosophy vol.40 no.2 (2009), pp.163-186
available at
http://www3.interscience.wiley.com/cgi-bin/fulltext/122440738/PDFSTART
Richie is right here .....Stern didn't reinvent, although he certainly went to an extreme interpretation.
We're pretty used to the idea that human beings are not entirely rational in choosing between short term and long term goals....so called hyperbolic discounting. So the use of entirely market interest rates to make decisions about something 200 years in the future might not make sense. This is already done in a number of cases....The Treasury (before Stern!) advocates market interest rates out to some number of years and then reduced rates thereafter.
Stern of course went with near zero, which is his extreme.
There are other problems though with using these reduced rates: as Sir Partha Dasgupta pointed out, if we have a zero discount rate for events in the far future then our current savings rate should be around 97.5 %...for the effect on future wealth of less consumption now and more investment should also be discounted at that zero rate.
I have a feeling that it's this sort of thing that makes Tol award a failing grade.
BTW, just for jollies, here's a recent Richard Tol paper. The EU is already doing too much about climate change.....
http://www.voxeu.org/index.php?q=node/4245
Tim
Enjoyed your post but a minor quibble with your description of Stern's position as an "extreme interpretation". I would instead argue that holding the pure rate of time preference to be essentially zero between generations is a long standing and philosophically respectable position.
Simon Caney, a philosopher, starts his tract with "It is widely recognized that the Earth’s climate is undergoing profound changes. The most authoritative analysis is that produced by the Intergovernmental
Panel on Climate Change (IPCC). In its most recent report, the Fourth Assessment
Report, the IPCC confirmed that the Earth’s climate is getting warmer and
is projected to continue to do so. The report employs six different scenarios."
Having got that wrong, why should anyone take Caney's argument that the views of Tol and Nordhaus should carry little philosophical weight. RichieRich is backing the wrong horse and is soon to disappear up the equine orifice. If you commence a journey with the map upside down and reversed, then a safe arrival at the correct destination is unlikely.
As Richard North noted re Gatwick Airport, the lack of preparedness there, could be due to the false signals given by the Met Office to the airport authorities about global warming – thus lulling them into a false sense of security about the need to equip properly and develop appropriate systems? With the Met Office only recently forecasting a mild winter, is it surprising that the airlines and airports have been caught out?
http://eureferendum.blogspot.com/2009/12/false-signals.html
There is nothing profound about our existing climate when compared to time periods longer than the last 150 years. I do not understand why people are incapable of understanding that temperatures should increase after the conclusion of a little ice age. There is no "excess" warming if you understand climate on longer time scales.
Since everyone (?) assumes this to be an interglacial period, then all the climate models ought to predict the return of an Ice Age in the next few hundred years or so. Do they?
I heard the program. For a good deal of the program, Stourton linked AGW skepticism to fundamentalist Christianity and creationism. Such a link will tend to discredit AGW skepticism among most R4 listeners. On the economic policy, he linked skepticism to Libertarianism. Again, though perhaps less completely, this would tend to discredit the idea with a lot of R4 listeners. At no point did he invoke any economists who criticize Stern's reasoning, though it would not have been hard to find a few prominent ones. Critique of the scientific basis of AGW alarmism was limited to a quote from Pat Michaels saying that there are very few actual climatologists who are catastrophists.
Wow! The more I read about these twist and turns, the more the word "conspiracy" comes to mind. I hesitate to use that word for fear of sounding unintelligent, naive or sensational, but I do believe the word "conspiracy' is a good description.
I haven't listened to the whole thing yet but I did catch Sir David King, the govt's chief scientific adviser, saying that we have three possible responses to climate change: we can mitigate it, we can adapt to it or we can do nothing. Perhaps you need to be the govt's chief scientific adviser to understand the third option. Or perhaps it's a false trichotomy.
"so it is difficult to see how the warmistas could claim one hot European summer as evidence of climate change (never mind anthropogenic climate change)" -ScientistforTruth
Surely you jest. If it's cold in 2005 it's because of "local variations". If it's hot in 2010 it's evidence of global warming. Or if it's cold in 2010 it'll be evidence of climate change. And the science is "settled" unless it turns out to be "worse than we thought" in which case suddenly it isn't!
Oh yes and the widely-documented Medieval Warm Period is a local phenomenon but one tree on a hillside in Russia can detect global climate...
Ice age ended by cavemen lighting campfires. This has been scientifically proven
and all other theories debunked by Al Gore a.k.a. Bullwinkle
Cavemen start Global Warming!
I Igor produce Obama Birth Certificate at www.igormaro.org
Compare Obama Care vs Igor Care at Obama Care vs Igor Care
I listened to this as well. I'm holding my judgement until the other episodes have broadcast. This one I listened to this morning didn't seem to me to be very balanced, to be honest.
I thought it was more balanced than I expected, and even if it didn't directly criticise Stern, there was a subtle implication that he was taking a creative interpretation to achieve the result he did. I was upset by many of the quotations which were used and went un-corrected. Saying that Katrina was a big help for the campaign, then mentioning that we don't know how much climate was to blame is still not very balanced. The primary message seemed to be one of 'arn't the Americans stupid for not believing', but there was a reasonable amount of background on the campaigning use of the science. Not sure if it marks a change in emphasis by the BBC, or if it is just a pretence to be able to refer back to in the future - look, we did raise serious questions back then.
Bruce: "For a good deal of the program, Stourton linked AGW skepticism to fundamentalist Christianity and creationism. Such a link will tend to discredit AGW skepticism among most R4 listeners."
This is one of the most common arguments FOR AGW in the U.S. Skeptics are immediately labeled anti-science religious zealots who believe Jesus will save us from any planetary damage we inflict. Occasionally, on the internet forums, it is possible to find a warmist who will argue the science, but it's rare. It is virtually impossible to find a story about Robert Spencer (who I believe offers some interesting theories on warming) that doesn't mention that he believes in intelligent design. The 'religion as a dis-qualifier' argument is tiresome, but what it really shows is the dearth of sound arguments for AGW.
The 'religion as dis-qualifier'-argument is rather interesting, because Ian Plimer, who wrote against creationism, compared AGWers with creationists, and didn't find much of a difference between them.
Its in his book 'Heaven and Earth'.
@RJ: I believe you are referring to Roy (not Robert) Spencer:
Roy Spencer
MikeE,
Right you are. Honest, I only visited the Jihad Watch website once.
I agree with RichieRich and Tim Worstall that the zero rate of pure time preference is neither weird nor original. Waht was strange about the Stern report was the juxtaposition of this assumption - a pure value judgement- with another value judgement assuming effectively a low value for society's value for giving extra consumption to poor people. The combination of assumptions meant it was good value to take from poor people now to give to much richer people 200 years hence. This is what Partha Dasgupta really didn't like.
I'm not sure there's any link between AGW scepticism and Christian fundamentalism any more. The UK monthly newspaper, Evangelical Times (Jan 2010), for example, which is strongly anti-evolution, has a misguided article about climate change in which it declares "...everyone wants to know whether UN actions will really prevent an impending ecological disaster. When we see uncharacteristic weather patterns, such as the 2003 heat wave in Europe or recent serious flooding in Cumbria, one has to admit that climate change of some sort is happening". Of course, that is scientific claptrap. Occasional severe weather events will always occur.
The programme by Stourton picked up on Hurricane Katrina and how this changed people's thinking. But it is the same unscientific reasoning. Severe hurricanes like Katrina make landfall every year - in fact the frequency of severe hurricanes is decreasing. What was different about Katrina was that it was a direct hit on a city at or below sea level with levees that could not withstand a direct hit by a hurricane. It was a disaster waiting to happen - just as major earthquakes in SF and LA are, and Vesuvius was to Pompei.
Yeah, the hurricane thing annoyed me a bit. People don't have an intuitive grasp of how frequent such events are so it's easy to suggest that hurricanes are getting more frequent, and get away with it.
I can't see the connections between Christianity and AGW. Sir John Houghton is christian and I've come across a few other prominent AGW scientists who are too. But then so is Christy, I believe.
Zero discount rate might be a respectable philosophic position. But it's a very extreme economic one.
The difference comes from what people are trying to do. Philosophy contains an awful lot of "people ought to". Economics is much more concerned with "people do".
We can assert that there ought to be a zero discount rate. We can draw up all sorts of reasons, morality, equity and so on, about why this should be so. Philosophy.
If we go and look at what people do (revealed preferences!) then they don't have a zero discount rate. The economist is trying to evaluate these costs and benefits in the future as people actually do value them. Economics.
A lot of the problems in applied economics come from when you try to graft philosophic positions onto economic calculations. People "should" value a more caring and equitable society. But do they? People "should" be happy with the current level of wealth and get off raping Gaia. But do they?
That's why Stern's zero discount rate is extreme from an economic point of view. Not because you can't defend it on philosophic grounds, but because real people simply don't act that way. Thus we shouldn't be using descriptions of unreal people as a guide to the behaviour of real people.
The Stern Review did not reinvernt economics. It is just very sloppy, in fact so sloppy that it would not have passed as a Master's thesis.
Stern managed to focus the discussion about the Stern Review on the discount rate used. The issue is not that Stern argues for a particular discount rate. That is his right as a a citizen of a democratic country. The issue is that he used a single discount rate (without performing a sensitivity analysis) and that he used a discount rate that differs from the discount rate typically used by his own, democratically-elected government. And all without alerting the reader. Stern's use of the discount rate is a clear case of manipulation.
The sloppiness of the Stern Review is perhaps best illustrated with its assessment of an optimal climate policy. (By the way, the Stern Review concludes that the previously formulated long-term target of the UK government is exactly right.) Stern's "optimum" does not meet the first-order conditions. In the optimum, marginal costs should equal marginal benefits. Stern recommends that greenhouse gas concentrations be stabilized at 550 ppm CO2eq, but at that point his (faulty) estimates of marginal costs do not equal his (faulty) estimates of the marginal benefits.
When I pressed him over this, the paraphrased reply was that Newton and Leibnitz are so passe.
Tim
Here's Caney's response to your revealed preference argument. This is from an earlier paper "Human rights, climate change, and discounting", Environmental Politics,17:4,536-555.
@RichieRich
Caney is right, of course, that what people do is not what people ought to do.
However, overriding people's expressed preferences implies that someone will need to be appointed who is learned and wise enough to tell people what they should be doing. That is, Caney's argument is just the same as Plato's: We need a philospher-queen to rule us.
In the absence of an obvious candidate for that role (the Dalai Lama, Sarah Palin, Desmond Tutu, Gordon Brown, Sayyid Ali Khamenei?), I'd go with the democratic alternative of using the expressed preferences of the average Jack and Jill.
@ Richard Tol
Caney deals with the your Philosopher Queen worries is some considerable detail (pp545-8). The following quotes give a flavour.
@RichieRich
All true. But Caney does not answer the question: If not the preferences of the people, then whose preferences? The Ayatollah Khomeini, who was a great scholar and a wise man, did answer that question: Mine!
The problem with a low pure rate of time preference is that it would not only apply to climate change, but to all intertemporal decision problems: education, pensions, R&D, road safety, and so on.
If you follow Caney and Stern, then you should drastically cut consumption. If Dasgupta is right, then Stern's assumptions imply that we should save 99% of our income, instead of 20%. That is, we would slash consumption to 1 in 80 from what it is today.
Is that fair?
It certainly would not get you re-elected.
@ Richard Tol
Surely the answer is that, for better or worse, we must rely on the moral judgement of our elected government. You said in an earlier post that you favoured a democratic solution and it would seem that the three main parties all buy into Stern's view of discount rates. Isn't Caney's key point that economists cannot rightly claim that theirs is a superior because non-moral view. If everyone has a moral view and we are ruled by our elected government, then surely it's their moral view that counts.
Sorry, not familiar with Dasgupta's argument so can't comment on that.
@RichieRich
Sure. The democratic process in Europe points to stringent emission cuts. If you believe my numbers, EU climate policy is based on a 1% pure time preference: http://www.voxeu.org/index.php?q=node/4245 If that is what the electorate wants (to be confirmed in the next elections), then so be it.
The claim that the economic viewpoint is a-moral is just nonsense. If one takes the pure rate of time preference of the median voter, then one adopts the moral position of one person, one vote. If one takes the pure rate of time preferences as expressed in the capital markets, then one adopts the moral position of one dollar, one vote.
Dasgupta's piece is in the National Economic and Social Review, the journal of the National Institute for Economic and Social Research (NIESR). It's his critique of Stern, published in early 2007.
@ richard tol
Thanks for the ref to Dasgupta ref to your work too. I'll check them out.
My previous comment re non-moral arguments was simply harking back to what Caney took to be the Philosopher Kings argument, namely that "it is inappropriate for an economic analysis to rely on the ethical judgements of the analyst". In my view, Caney effectively rebuts this argument. You appear to agree with his rebuttal and with the claim that for better or worse we must rely on the moral judgements of our elected governments. To that extent we appear to agree???
Christmas preparations mean I probably can't contribute further today, but thanks for the exchange.
@RichieRich
We seem to agree.
The pure rate of time preference is not the same as the social discount rate. The usual idea - see for example a paper by Ulph and Pearce (curiously enough an East Anglia discussion paper)
http://www.uea.ac.uk/env/cserge/pub/wp/gec/gec_1995_01.pdf
is that the social consumption discount rate also depends on the marginal (social) utility of consumption and the long run growth rate of the economy. This captures the idea that future people may be richer than us and therefore an extra unit of consumption for us now is worth more than the same increment to someone in 200 years time who can be expected to be richer than us because of the economic growth that will occur. In addition we might want to add in something to account for the possibility that there will be no one alive in, say, a million years time, so there would be no point in our saving to look after them. Pearce and Ulph argue that the resulting rate is between 2 and 4 per cent.
Note that this is the rate at which future consumption should be discounted, not necessarily the rate that should be used in cost-benefit analysis. The reason for the difference is that the project being analysed may crowd out investment instead of consumption and this needs to be allowed for if we just look at project returns and not project effects on consumption.
What was odd about Stern was the choice of values for the marginal utility of income as much as the pure rate of time preference. As I said above it had the consequence of requiring poor people now to save to raise incomes of richer people in the future - hence the absurdly high savings rates it implied, as noted by Dasgupta.