[A]ccording to the IPCC the expected economic costs of global warming under the plausible scenarios for future economic growth are likely to be about 3 percent of GDP more than 100 years from now...
Resources for the Future, a moderately left-of-center, well-respected environmental organization, collated a set of widely-cited projections for the costs of such emission mitigation schemes for the world as a whole. Its list of “least cost” estimates... average a little over 6 percent of global GDP by 2100 (with a very wide range of estimates). That is, we would start paying a cost today that would rise to about 6 percent of world output by 2100 in order to only partially avoid a problem that would have expected costs of about 3 percent of world output sometime later than 2100.
Manzi then addresses the most common response to this argument-- namely that it is not the most likely outcome that we need to worry about, but instead that we need insurance against the far more unlikely, but catastrophic possibilities:
Competent analysts don’t assume only the most likely case, but build probability distributions for levels of warming and associated economic impacts (e.g., there is a 5 percent chance of 4.5 °C warming, a 10 percent chance of 4.0 °C warming, and so on). The economic calculations that comprise, for example, the analysis by William Nordhaus that I referenced earlier are executed in just this manner...
In very short form, Weitzman’s central claim is that the probability distribution of potential losses from global warming is “fat-tailed,” or includes high enough odds of very large amounts of warming (20°C or more) to justify taking expensive action now to avoid these low probability/high severity risks. The big problem with his argument, of course, is that the IPCC has already developed probability distributions for potential warming that include no measurable probability for warming anywhere near this level for any considered scenario.
In a second article, Bradford Plumer responds, primarily by moving the goalposts:
I see a couple problems with this argument. The first is that Manzi is clinging way too tightly to the IPCC report. Yes, the IPCC puts out the best summary of scientific knowledge about our climate system. I rely on it all the time. But the 2007 report is also dated. Climate science is a rapidly moving field, and more recent research has suggested that things may be bleaker than was projected three years ago.
This is simply intellectually dishonest, as Mr Plumer was openly scornful of the argument back in 2007, when the IPCC report was state of the art.
Second, it's a bit too simplistic to use a single global GDP figure when talking about the effects of climate change. True, a 3 percent drop in global GDP may not sound so bad. We'll all be much richer in 2100, we can take a hit. But that top-line figure can obscure some serious distributional issues. Climate change, after all, is expected to hit developing countries much harder than wealthier ones. And as Nate Silver once noted, you could completely wipe out the poorest 81 nations in the world, with a total population of 2.8 billion, and the blow to global GDP would "only" be about 5 percent
Point taken. But, while poor countries will be disproportionally hit, they won't be taking the entirety of the cost. Even still, we could still take Bjorn Lomborg's advice, and simply give these the poor countries the money they lost, and we'd still be ahead.
But to me, none of this is the most interesting part of this exchange. Plumer concludes his article with the almost parenthetical comment "But even so, there's nothing inherently expensive about climate policy. In the end, a carbon tax is just a tax. We tax lots of things in this day and age, and all of those taxes put some amount of drag on the economy." Contrast that attitude on taxes and regulation to the original article, back to Manzi:
In the real world of domestic politics and geostrategic competition, it is not realistic to expect that we would ever have an optimally designed, implemented, and enforced global system, and the side deals made to put in place even an imperfect system would likely have costs that would dwarf 0.2 percent of global economic consumption. Look at what was required to not pass the Waxman-Markey cap-and-trade program, in a wealthy and reasonably democratic country, to get some idea of the kind of deals that would have to be cut. And then you’d have to enforce it throughout developing economies for literally centuries.
Here is where the real action is. Neither side really differs by very much on the science-- instead there is an implicit argument about the effectiveness of tax regulation. Plumer sidesteps the question of if a global carbon tax scheme is even possible, much less enforceable. He claims that environmental regulations are often cheaper then expected, conveniently ignoring the cases where it isn't, and oblivious to the cases where regulations meant to reduce emissions actually increase them:
“It’s an absolute government boondoggle,” Sutton said. “These companies were not using fossil fuels. They only started because they needed it for the tax credit to work. So there’s a negative to the environment, not a positive.”
And so, ultimately, the debate falls onto familiar ideological lines. It is not a debate of what the science says. Instead, it is another instance of conservatives fretting endlessly about the Law of Unintended Consequences while progressives put on their rose-colored glasses when it comes to the effectiveness of government intervention.
