what’s most troubling about “SuperFreakonomics” isn’t the authors’ many blunders; it’s the whole spirit of the enterprise. Though climate change is a grave problem, Levitt and Dubner treat it mainly as an opportunity to show how clever they are. Leaving aside the question of whether geoengineering, as it is known in scientific circles, is even possible—have you ever tried sending an eighteen-mile-long hose into the stratosphere?—their analysis is terrifyingly cavalier. A world whose atmosphere is loaded with carbon dioxide, on the one hand, and sulfur dioxide, on the other, would be a fundamentally different place from the earth as we know it. Among the many likely consequences of shooting SO2 above the clouds would be new regional weather patterns (after major volcanic eruptions, Asia and Africa have a nasty tendency to experience drought), ozone depletion, and increased acid rain.

Kolbert’s closing words are, however, a little unfair.

To be skeptical of climate models and credulous about things like carbon-eating trees and cloudmaking machinery and hoses that shoot sulfur into the sky is to replace a faith in science with a belief in science fiction. This is the turn that “SuperFreakonomics” takes, even as its authors repeatedly extoll their hard-headedness. All of which goes to show that, while some forms of horseshit are no longer a problem, others will always be with us.

Not unfair to Levitt and Dubner, mind you, but to science fiction. After all, two science fiction authors, Frederik Pohl and Cyril Kornbluth, had their number down way back in 1953 with The Space Merchants (Pohl, amazingly, is still alive and active).

The Conservationists were fair game, those wild eyed zealots who pretended modern civilization was in some way “plundering” our planet. Preposterous stuff. Science is always a step ahead of the failure of natural resources. After all, when real meat got scarce, we had soyaburgers ready. When oil ran low, technology developed the pedicab.

First, as I mentioned briefly, while everyone at this workshop and many others were working on ways to reduce, manage and understand uncertainty, there is also a large and (at least until recently) very well-funded group working, to create and disseminate uncertainty, ignorance and confusion, with sufficient success that much of the political right in Australia and nearly all in the US have been (with their own complicity) deluded into thinking the problem is illusory.

Second, it’s a straightforward implication of standard economic analysis that the more uncertainty is the rate of climate change the stronger is the optimal policy response. That’s because, in the economic jargon, the damage function is convex. To explain this, think about the central IPCC projection of a 3.5 degrees increase in global mean temperature, which would imply significant but moderate economic damage (maybe a long-run loss of 5-10 per cent of GDP, depending on how you value ecosystem effects). In the most optimistic case, that might be totally wrong – there might be no warming and no damage. But precisely because this is a central projection it implies an equal probability that the warming will be 7 degrees, which would be utterly catastrophic. So, a calculation that takes account of uncertainty implies greater expected losses from inaction and therefore a stronger case for action. This is partly offset by the fact that we will learn more over time, so an optimal plan may involve an initial period where the reduction in emissions is slower, but there is an investment in capacity to reduce emissions quickly if the news is bad. This is why its important to get an emissions trading scheme in place, with details that can be adjusted later, rather than to argue too much about getting the short term parts of the policy exactly right.

A third point, raised by Michael Hanemann is that the global average conceals a lot of seasonal and regional variation. He suggested IIRC that on current estimates, a 3.5 degree global average increase corresponds to an 8 degree increase in winter temperatures in Southern California, with huge implications for water supplies derived from snowfall.

Anyway, back to my main point. The huge scientific uncertainty about the cost of inaction has obscured a surprisingly strong economic consensus about the economic cost of stabilising global CO2 concentrations at the levels currently being debated by national governments, that is, in the range 450-550 ppm. The typical estimate of costs is 2 per cent of global income, plus or minus 2 per cent. There are no credible estimates above 5 per cent, and I don’t think any serious economist believes in a value below zero (that is, a claim that we could eliminate most CO2 emissions using only ‘no regrets’ policies).

For anyone who, like me, is confident that the expected costs of doing nothing about emissions, relative to stabilisation, are well above 5 per cent of global income that makes the basic choice an easy one. Any agreement that comes out of Copenhagen or its successors will be better than no agreement.

A slightly trickier question is: what is the best target? I don’t have a good answer to this, but, given the politics of the process I don’t need one. The nature of such negotiations, with every country looking to shift as much of the cost as possible to others, ensures that there is almost no likelihood of getting an agreement that is too strong. In the present case, we can put some numbers on this. On the same kind of reasoning as I gave above, it seems clear enough that a 450 ppm target would be beneficial relative to a 550 ppm target. And, given the commitments and offers already on the table, the likelihood of anything stronger than 450 ppm is close to zero.

So, despite all the uncertainties, the policy position I would like to see Australia take to Copenhagen is clear enough. Aim for an agreement on a 450 ppm target, with emissions cuts on track for this until 2020 and with the capacity to revise later when we have more information. With all its imperfections, the currently proposed ETS (including a 25 per cent cut in emissions as part of a global agreement) is consistent with this position and therefore should be supported unless and until something better can be put in its place.

But looking at the issue again today, I’m finding lots of claims that this “grid parity” will be achieved in the next few years, and even one company, First Solar, that claims to be already at grid parity with a 12 MW plant in Nevada completed last year. Obviously, Nevada is a particularly favorable location, and there is plenty of room for judgement in cost estimates. Still, looking at a lot of different reports, it seems clear that, with a carbon price of say $50/tonne (about 5 cents/kwh for black coal and 7 cents/kwh for brown coal), solar will be cost-competitive with coal for most places in Australia without any need for fundamental technical improvements.

The big question is whether the industry can ramp up from its current small scale (about 5 GW capacity produced last year) to meet global demands for growth and replace a significant part of the existing 4TW of mainly fossil-based capacity, with even more needed if we are to have big growth in electric vehicles. There’s no obvious constraint in the long run, since silicon is abundant and ubiquitous. But the price of the high-purity silicon crystals used in solar cells skyrocketed as demand rose in recent years (it used to be available cheaply as an offcut from the semiconductor industry, but solar demand has outstripped this source). Prices have fallen with the onset of the financial crisis, but will presumably rise again if demand recovers.

However, in the long run, and with no absolute resource constraints, costs should fall further as all elements of the manufacturing chain scale up. And over 20 years or so, with continued growth of 20-30 per cent a year, the necessary scale would be achieved If so (and assuming contributions from other renewable sources) the transition to a post-carbon economy could be faster and cheaper than most existing estimates suggest.

All this seems a bit too good to be true, so please feel free to point out problems I haven’t noticed.

As Brad Plumer explains here, the regulations will transform the Congressional debate over bills to introduce a national cap-and-trade system. In the absence of EPA regulations, and assuming continuation of current practices regarding the filibuster, the Republicans in the Senate could block any action as long as they could muster 41 votes (and of course, ratification of a treaty like Kyoto requires 66 out of 100 votes). But now the effect of a filibuster will be to leave the EPA to deal with the issue by regulation, which might include establishment of emissions trading schemes, as well as technological mandates to adopt best practice technology. Almost certainly, some Senate Republicans will prefer a deal where they get to protect some favored interests to a system of regulation over which they have no say.

The only other possibility for the Repubs, flagged by leading delusionist Senator Inhofe would be to pass legislation overriding the EPA determination. But Inhofe seems to have been drinking too deeply at the well of delusion, or else to be engaging in feelgood gestures – the likelihood of getting a Congressional majority for such an action is close to zero.

The EPA move is obviously a major step forward, and means that all governments in the developed world are now committed to reducing CO2 emissions (regardless of how much some would like to backslide on their commitments). The big question now is whether international negotiations can produce an agreement to stabilise the global climate or whether it will be politics as usual, with everyone trying to offer as little as possible.

At this stage, the omens don’t look that good. On the other hand, if you compare the situation now to that of, say, five years ago, when Bush and (in Australia) Howard were blocking any action at all, and climate section “sceptics” were still widely regarded[1] as serious participants in scientific debate, there has been a lot of progress.

fn1. Of course, they are still widely regarded that way in some quarters, but only by people who can’t be regarded as serious participants in debate of any kind.

In one sense, the blogosphere has reached a near-universal consensus on climate change. Everyone who follows the issue at all closely agrees that there is no real debate. Instead, it’s generally agreed, we have a situation where (1) a large body of people devoted to serious scientific research is confronted by (2) pushers of silly Internet talking points who are ideologically motivated, financially driven or just plain delusional . The only disagreement is which group is which. Is group (1):

• The Australian Academy of Science, all other similar organisations and the vast majority of active climate scientists;

or is it

• The 650 “sceptical scientists” identified by Marc Morano (aide to US Senator Inhofe) including such Australian luminaries as David Evans, Louis Hissink, Warwick Hughes and Jennifer Marohasy (Morano’s list includes numerous genuine scientists whose views he has misrepresented but he’s right to include all those I’ve mentioned )

Broadly speaking, for anyone from politically left or centrist blogs the first answer is correct, and for anyone from the political right, the second answer is correct. As far as the mainstream media is concerned, Fox News, the Australian and some other outlets know where they stand.

But for establishment outlets like the Washington Post, the idea that either (nearly) all scientists or (nearly) all right-of-centre politicans and commentators are liars/hacks/self-deluded is rather hard to accept. So we get episodes like this one. (via Tim Lambert)

Thus, anyone who took a genuinely sceptical attitude to the evidence could safely predict that 1 January 2000 would pass without any more serious incidents than usual, even for the many countries and businesses that had ignored the problem. The retrospective evaluations of the policy were even more embarrassingly skimpy. I analysed some of the factors involved in this paper in the Australian Journal of Public Administration.

A really interesting point here is the fact that, in the leadup to 1 January 2000, self-described global warming sceptics, for the most part, went along with the crowd. If any of them rallied to the support of those of us who called for a “fix on failure” approach, I didn’t notice it. Of course, I’m open to correction here. I’d be very interested if anyone could point to a piece published before 2000 taking a sceptical line both Y2K and AGW.

… a study at Rotterdam’s Erasmus University showed that boys whose mothers had been exposed to PCBs grew up wanting to play with dolls and tea sets rather than with traditionally male toys.

The Australian Treasury has just released estimates of the cost of an measures to reduce greenhouse gas emissions, most importantly an emissions trading scheme. Of course, there have been quite a few exercises of this kind, but what’s striking about this one is that it looks at a much wider (and more realistic, if we want to save the planet) range of options, going all the way to a 90 per cent reduction in emissions relative to 2000 levels, achieved by 2050.

Treasury estimates that, under this scenario, GNP per person in Australia will average $78 000 in 2050 compared to $50 000 at present. By contrast in the reference scenario which has an 88 per cent increase in emissions, 2050 GNP is estimated at $83 000, or about 6 per cent higher (I don’t think this takes account of environmental and other damage costs avoided through climate mitigation, which will much more than offset the cost of mitigation in the long run).

When I get a bit of time, I’ll report more on the details and assumptions. But the quibbles coming from predictable rentseekers, and their tame consultants, look like just that, quibbles. It’s striking how many supposed advocates of the free market think we’ll all be rooned unless we continue to subsidise industry (and households) by allowing them to dump their garbage into the atmosphere free of charge.

Treasury’s estimates are, not surprisingly, quite consistent with the arguments I’ve made for a long time. That’s because any competent economist doing the analysis must come up with estimates of a comparable order of magnitude. If you want to make the case that saving the planet requires reducing living standards, or even a big reduction in the rate of growth of living standards, you need either to invent a whole new economics or wave your hands vigorously enough to conceal the fact that you don’t have any economic analysis to support you.

Shorter Weisbach-Sunstein: If ethical considerations suggest that the most appropriate discount rate is 1.4 per cent, but the market rate of return is 5.5 per cent, it’s best to use the 5.5 per cent rate in evaluating climate change policies.

As a hypothetical statement this is broadly correct. Weisbach and Sunstein illustrate the point by considering someone choosing between an investment yielding a 10 per cent increase in value over 2 years and the alternative of putting money in the bank at 6 per cent, which is clearly superior.

The problems arise for the reader who tries to plug in real numbers. According to today’s New York Times the rate of interest on 10-year Treasury bonds is 3.84 per cent. Assuming (optimistically) that the Fed manages to hold inflation at 2.5 per cent over the next years, that’s a real rate of 1.34 per cent, almost exactly equal the rate quoted as justified on ethical grounds.

So to restate Weisbach and Sunstein with real numbers:If ethical considerations suggest that the most appropriate discount rate is 1.4 per cent, but the market rate of return is 1.3 per cent, it doesn’t matter which one you choose.

To be fair to Weisbach and Sunstein, all they are doing here is offering an uncritical restatement of the way the position is stated by people like Nordhaus, who should know better. Nordhaus, like nearly everyone else in the high discount rate camp, takes it for granted that the “market rate return” means something like “the average rate of return to capital”, even though this average is dominated by the risk premium for equity, which in turn is driven, in standard models, by the correlation between returns to equity and aggregate consumption. There are two big problems here
(i) The equity premium ‘puzzle’, that the risk premium for equity is much larger than standard theory says it should be. The same theory is used by Stern to estimate the appropriate discount rate This is why, if you use the average rate of return to capital, you get the gap Weisbach and Sunstein are talking about.
(ii) Second, even if the risk premium for equity is an appropriate market measure of the risk involved in public investments with return distributions similar to those of private investments, there’s no reason to think investments in climate change have these characteristics and plenty of reasons to think the opposite.

On reflection, I don’t think fairness requires this concession. The point that it’s the bond rate and not the average rate of return to capital that should be used in discount climate change mitigation ins’t new. William Cline was pushing it 15 years ago and it’s had a thorough airing in the debate over the Stern Review (I started early on in both blog pieces and journal articles and Stern made the same point in his Ely lecture, to which I can’t find a good link right now). It’s possible to make counterarguments, but Weisbach and Sunstein don’t even recognise there’s a problem here.

Coming back to the hypothetical, if the market rate of return is far above that suggested by economic analysis as socially optimal, the policy implication is that action is needed to increase savings and investment, so that the market rate and the socially optimal rate move closer together. Depending on your policy predilections, you might look for tax distortions to remove, externalities to internalise or failures of strong rationality assumption, requiring additional public savings and investment. There’s a big literature on all this, but I must admit reading it tends to increase rather than reduce the level of perplexity.

Finally, as I observed a while back, I’ve only paid attention to Sunstein only occasionally and over the last couple of years, and I’ve always been a bit puzzled by him. Despite his big reputation as a liberal thinker, everything I’ve seen from him has been both rightwing and weakly argued. Kathy G, with the benefit of a much closer acquaintance, has the same view, only more so.

[fn1]. This “builds on the success of the AEI-Brookings Joint Center which leads me to the discovery that this center is no longer in operation. Given the long descent of AEI into the worst kind of propaganda outfit, that’s not before time.

• First, I’m a bit surprised to find libertarians on the wrong side of this debate. Global climate change is one of the few instances where lots of environmentalists (not all, by any means) are supporting a property-rights based solution (tradeable emissions permits), despite starting from a position (in the leadup to Kyoto) of almost uniform opposition to anything that didn’t rely primarily on direct and detailed regulation. it seems as if the ideological opponents are upset because the government-created nature of the property rights in question will be self-evident, rather than obscured by a century or two of history.

• I’m struck by the reliance of most libertarian critics, such as Indur Goklany, who debates Adler here, on consequentialist benefit-cost arguments in favor of climate inaction. As Adler says, it seems odd to find libertarians saying that it’s OK, for example, to completely wipe out the property of Pacific Island nations, on the basis that there will be a net social benefit for the world as a whole from doing so.

• If emission permit trading is rejected on ideological grounds (I can’t exactly figure out what these are, but I’m not well equipped to arbitrate on ideological disputes among libertarians) it doesn’t seem as if any the other solutions commonly proposed by the FME camp are applicable. Take for example the Coasian favorite of tort action. For a global congestion problem, this would require everyone in the world to sue everyone else, presumably in some newly created world court (Goklany disputes this, saying, in effect “let he who is without sin cast the first stone”, a principle that renders any sort of response to pollution impossible)

• This has led lots of libertarians, and others on the right, to write as if the mainstream scientific view on global warming renders libertarianism untenable, or, more succinctly[1] “global warming equals socialism”. If only it were so easy! Even it the scientific evidence weren’t overwhelming, it’s surely a big problem for a political viewpoint if its viability depends upon assumptions about cloud feedbacks. As I’ve said, I don’t think any such concession is necessary. A successful response to global warming is vitally important, but it doesn’t imply (or, I should note, preclude) radical changes to the existing social order.

fn1. This is from a conservative, not a libertarian, but the same sentiment is evident among many libertarians.

Through all this sound and fury, some progress was made. No one even attempted to defend the claim that the use of DDT against malaria had been banned, or the outrageous lies of Steven Milloy (still employed by Fox News and CEI, despite his exposure as a tobacco industry shill) who blames Rachel Carson for every malaria death since 1972. It even turned out that the much-denounced decision of South Africa to abandon DDT use (reversed when malaria cases increased because of resistance to the pyrethroids used as alternatives) was not primarily due to environmentalist pressure. As Bate noted in his reply, the main factor behind the decision was the unpleasant look and small of DDT sprayed on hut walls, which often led to repainting or replastering. A minor, but still striking point, is that DDT continued to be used for public health purposes in the US (against plague-bearing fleas) even after the 1972 ban on general use of the chemical, and is still available for these purposes if needed.

Update:Absolutely the last word Via Ed Darrell a quiet victory for friends of Rachel Carson with the abandonment by Senator Tom Coburn of a block on the naming, in her honor, of the post office in her birthplace. It appears that the campaign of denigration against Carson (and, by implication, the environmental movement as a whole) has become untenable.

To sum up the position. DDT has never been banned (either de jure or de facto) in antimalarial use and remains available for that purpose.
Although there have undoubtedly been occasions when DDT’s bad reputation (caused by the failure of the first DDT-based eradication campaign as well as the environmental effects first publicised by Rachel Carson) led to its being underused, the current danger is the opposite – that pro-DDT campaigners will push for its use when alternative pesticides, or other approaches such as bednets, would work better.

Coming back to the question of the origins of the pro-DDT campaign, nothing in the debate has shaken our position that the tobacco industry, through bodies like Milloy’s TASSC and Bate’s ESEF, sought to divert the focus of WHO and other bodies from work to reduce smoking, and used a variety of strategies, including spurious claims about DDT and malaria, to promote this end. In this respect, I’ll take the advice of Jonathan Adler at Volokh who suggests that the work of ESEF “can and should be evaluated on its own terms”. So, I’ll hand over the mike to Lorraine Mooney, medical demographer for ESEF and later for Africa Fighting Malaria.

In a Wall Street Journal piece entitled “World Bank and WHO Gang Up On Big Tobacco“, Mooney writes of Gro Harlem Brundtland

she has two main focuses: saving innocent children from malaria and saving naughty grownups from tobacco. As regards malaria, it is about time; in Africa, a child dies every minute from this devastating disease. As for tobacco, we can see where this campaign is headed from the call Dr. Brundtland made last week for cigarettes to be available on prescription only, like nicotine patches.

This study is an important contribution to our understanding of the emerging parallel universe which has almost completely absorbed the formerly Earth-based Republican party[1] and its networking of supporting thinktanks, media outlets and blogs. It helps to explain the otherwise surprising fact that higher levels of education make Republicans more, not less, ignorant and deluded. With their beliefs on scientific, economic and political issues derived from the Great Library of Tlön, every book they read, talk show they listen to and blog they browse actively reduces their knowledge of the real world. [2].

fn1. Represented most notably on Earth by Abraham Lincoln, but on Tlön by Jefferson Davis.
fn2. If any Tlön based readers have access to this blog, please apply your polarity reverser. Educated Tlön Democrats are more likely to hold the deluded notions that their planet is roughly spherical, billions of years old and subject to significant climatic effects from human action. Tlön social democrats are even likely to believe that income inequality is increasing and that the market-based health system of Uqbar is less then perfect.

The contrast between these two locations is confirmed to some extent by Walk Score. Our old house was a lowly 23 while our current house gets a 68.

I have offered to present a talk to a large conference audience in Adelaide, and intended to do it by videoconference, following several successful (and cheap!) presentations to seminar-size groups. But the conference of organizers have been quoted a cost of thousands of dollars to present the videoconference session. There are some obvious cheap alternatives like a pre-record, but I’d like to avoid these if possible. Does anyone have any suggestions as to how I could deliver a videoconference presentation, at reasonable cost to a large audience in a venue that isn’t specifically set up for this?