Developing a consistent message

PwC was among the businesses who signed the World Bank’s call to governments and business leaders to support putting a price on carbon.

A prominent firm of accountants, September 2014

A tax cut on North Sea firms would rescue the UK's oil and gas sector and safeguard future revenues for the Treasury, PwC has claimed. 

The same firm of accountants, 18 months later

Stochastic Stern

You know all that money we have been spending on developing economic models of the effects of climate change? Well apparently it has mostly been wasted. At least that's the case according to Lord Stern, whose article in the sociology journal Nature says that we should be moving onto something more reliable.

Because the IAMs omit so many of the big risks, SCC estimates are often way too low. As a first step, the consequences being assessed should include the damages to human well-being and loss of life beyond simply reduced economic output. And the very large uncertainty, usually involving downward bias, in SCC estimates should always be made explicit...

A comprehensive review of the problems of using IAMs in climate economics called for the research community to develop a “third wave” of models. The authors identify various types of model that might offer advances. Two are: dynamic stochastic computable general equilibrium (DSGE) models, and agent-based models (ABMs).

It's also interesting to see stochastic modelling being touted in a week when climatologists have been outraged by a suggestion that such an approach might be useful in their own field. 

Monbiot's audit trail

What is that old saying about repeating a lie often enough? George Monbiot is having a bit of rant in the Guardian today on the subject of (alleged) fossil fuels subsidies. It's the usual nonsense that redefines everything that greens are against as a "subsidy".

In his support, our George cites the IMF:

Already, according to the International Monetary Fund, more money is spent, directly and indirectly, on subsidising fossil fuels than on funding health services. 

If you follow the trail through his link you end up at the IMF's website and a working paper by Coady et al. However, before you read it, it's hard not to notice the disclaimer, in bold, which reads:

This Working Paper should not be reported as representing the views of the IMF.

Misconceptions and mislabellings

So, some minor brouhaha this morning over Roger Harrabin's piece about Richard Tol this morning. In it, Richard is quoted as follows:

Prof Richard Tol predicts the downsides of warming will outweigh the advantages with a global warming of 1.1C - which has nearly been reached already.

This is contrasted with Matt Ridley, quoted as follows:

Matt Ridley, the influential Conservative science writer, said he believed the world would probably benefit from a temperature rise of up to 2C.

And if you refer to the transcript, which Roger has helpfully made available at Joe Smith's Climate Creativity site (!) you can read this:

Click to read more ...

For discussion

Industrial scale evil can usually be traced to (a) perverse incentives and/or (b) use of low discount rates.

Discuss.

The carneyage of Mystic Mark

It is said that once people start laughing at you, you are completely finished. I think Mark Carney may have reached that point:

The scene is the governor’s office at the Bank of England. Mark Carney is talking to an aide.

Governor, about your forthcoming speech to the chambers of commerce.

Yes

It seems to be about alien life forms.

You’ve seen the news from Mars?

I have, but this speech is supposed to be about labour flexibility and the downside risks to productivity.

You don’t see the downside risks from extremophile bacteria in the briny water on Mars?

Not in the short to medium term, Governor.

Read the whole thing...

Kelly on Stern

Mike Kelly has a long piece in Standpoint magazine looking at Lord Stern's magnum opus and some of the big questions of the climate debate:

Those building the biblical Tower of Babel, intending to reach heaven, did not know where heaven was and hence when the project would be finished, or at what cost. Those setting out to solve the climate change problem now are in the same position. If we were to spend 10 or even 100 trillion dollars mitigating carbon dioxide emissions, what would happen to the climate? If we can’t evaluate whether reversing climate change would be value for money, why should we bother, when we can clearly identify many and better investments for such huge resources? The forthcoming Paris meeting on climate change will be setting out to build a modern Tower of Babel.

Well worth a read.

Why the poor should pay higher rate tax

In the crazy world of the environmentalist, the following logic holds:

Oil companies are subject to a supertax on top of corporation tax.

Oil companies operating West of Shetland do not have to pay this supertax.

Therefore oil companies operating West of Shetland are subsidised.

Therefore we should apply the supertax to all oil companies.

One can apply this logic elsewhere:

Rich people pay income tax at 40%.

Poor people pay income tax at 25%.

Therefore poor people are subsidised.

Therefore we should tax poor people at 40%.

I'm not sure our environmentalist friends have thought this through.

More than media

This interview with Hans Rosling is rather wonderful in the way that the great man batters away until realisation dawns on the interviewer that the bubble he inhabits reflects only a small part of reality.

Quotes of the day

Today's words of wisdom come from Ruth Dixon's review of Lord Stern's latest opus.

Stern is...selective in his choice of data. He frequently ignores mainstream scientific evidence (such as that found in the authoritative reports of the Intergovernmental Panel on Climate Change (IPCC)) in favour of outlying estimates.

The type of small-scale solar PV [Stern] describes is a good way to supply electricity for lights, phone and internet access to remote communities, but it is fanciful to suppose that such systems can provide enough power for cooking.

Even in his own words, Stern makes clear that he does not view objectivity as an overriding concern.

Read the whole thing.

The ever-changing story of Stern

Lord Stern ponders what positions he might adopt after lunchLord Stern has mounted his high horse, ready to slay the dragon of opposition to anything he deems a good idea at the time.

The problem is that Lord Stern's views seem fluid to say the least. Back in 2009 he was telling the world that rich nations would have to forgo growth in order to stop climate change.

Now he is telling us that portraying economic growth and climate change action as being in conflict is "diversionary" and a "misunderstanding of economic development".

The question readers want answered is "Does Lord Stern ever actually mean anything he says?".

(H/T Richard Tol)

Update on Aug 27, 2015 by Bishop Hill

Josh points out that the Guardian, rather hilariously, even has the evidence on the same page as Stern's new article!

Cost of global warming wildly exaggerated

Enthusiasts for a carbon tax tend to lick their lips at the sheer size of the numbers that have been conjured up out of the economic models. They see a door opening to massive economic changes, with societal change on the horizon too.

Today the door has been pushed back somewhat, with a new paper in Energy Economics by a multinational team of authors led by Zuzana Irsova of Charles University in Prague (there is a preprint here). She and her colleagues have been looking into published estimates of the social cost of carbon and find good evidence of a strong publication bias. You can probably guess which direction the bias is in:

Click to read more ...

Integrity and scholarship at the LSE

Bob Ward and the Grantham Institute are jumping up and down this morning about a new paper the Institute has published. It's fair to say the conclusions of author Fergus Green, as reported in the Grantham Institute press release are striking:

Countries will benefit economically from almost all of the actions needed to limit global warming to no more than 2°C above pre-industrial levels, according to a paper published today (PDF) (13 July 2015) by the Grantham Research Institute on Climate Change and the Environment and ESRC Centre for Climate Change Economics and Policy at London School of Economics and Political Science.

The paper suggests that individual countries have large incentives to make ambitious reductions in greenhouse gas emissions and to agree to strong collective action at the United Nations climate change conference in Paris in December.

Remarkable stuff, I'm sure you will agree, overturning much of what we thought we knew about the economics of global warming mitigation. It's even more surprising when you learn that Mr Green is not an economist at all, but a post-graduate student who was until recently a lawyer at a firm in Australia.

Click to read more ...

Venting and venting

Robert Wilson is nothing if not grumpy, and his grumpiness can lead him occasionally to a kind of foolishness that he might have avoided if he had taken a deep breath before clicking on the publish button.

Today's post is a case in point. Entitled  Dear climate change deniers, please spare me your faux concern for the poor it is something of a rant at "right wing climate change deniers/skeptics/lukewarmers" (he forgot "eeevil" and "big-oil-funded"). According to Wilson, BH readers and people like that are actually cold, callous, heartless bad people who are unconcerned about our fellow human beings unless they are, like us, bloated plutocrats. What seems to have pushed him over the edge was a tweet from Junkscience's Stephen Milloy, which had a poverty-stricken Indian lady asking "Who exactly is 'the Pope' and why doesn't he want me to have electricity?". It does look rather as if Wilson's ire has been prompted more by the fact that these are difficult questions for global warming adherents to answer rather than anything else. Certainly it's a crashing logical fallacy to respond as Wilson does:

Click to read more ...

Rhubarb to save us from global warming

Ambrose Evans Pritchard's latest effort in the Telegraph is very long but rather amusing in the way that it repeats every utterance of the greens without question.

An astonishing report - blandly titled "How Large Are Global Energy Subsidies" - alleges that the fossil nexus enjoys hidden support worth 6.5pc of world GDP.

This will amount to $5.7 trillion in 2015, mostly due to environmental costs and damage to health, and mostly stemming from coal. The World Health Organisation - also on cue - has sharply revised up its estimates of early deaths from fine particulates and sulphur dioxide from coal plants.

Right on cue indeed! One wonders whether the possibility that he was merely a conduit for a political PR campaign ever crossed AEP's mind. Then again, as you read all the garbage he has introduced into his article, you have to wonder if it is not a role that he is wholeheartedly embracing. Elon Musk! Four degrees! Rhubarb powered batteries! It's mindblowing.