Archive for January 26th, 2009

Hard Realities: Why Understating the Cost of Dealing With Climate Change Hurts

Sharon January 26th, 2009

Despite our taste for doing so, the world can never be divided into two kinds of people.  Still, were one to try and divvy up climate change activists, one way to do it might be to divide up those who admit that addressing climate change is going to be painful and those who are inclined to minimize the difficulties, perhaps even claim that in our mitigation strategies lies the beginning of a new economy.

Among those who stand on the “this is going to hurt and it is best we prepare people for it” side of the aisle are Bill McKibben, who has discussed the costs of climate change in recent articles in _Foreign Policy_ and _Yale Environment 360_, George Monbiot, whose superb _Heat_ describes his concern that our calls to insufficient action actually reflect our desire to fail, and thus not be forced into austerity, and James Hansen, who has described the methods that must be implicated in the next few years as “draconian.”  Longtime readers will recognize that I fall firmly in this category as well – in fact, one of my proudest achievements was the inclusion of language I wrote (profuse thank to Albert Bates for arranging its inclusion) in a document on climate change presented to Kofi Annan calling for a reconsideration of climate activist’s reluctance to call for sacrifice. 

On the other side of this divide stand, well, I think most major climate activists.  I do not think I am misrepresenting the field to say that the majority opinion is that climate change can probably be addressed without too high a cost, and that hopes are running high among many people that new green jobs will mitigate the current economic crisis.  I certainly don’t blame such writers for their hope, but I think they overstate.  For example, Grist contributor Anna Fahey has argued that the fact that a recent poll puts climate change down as number 20 out of 20 of national concerns really isn’t that bad, because

“The fact is, solutions that will address the top two concerns — the economy and jobs — as well as several other top 10 concerns — energy, terrorism, helping the poor — are all wrapped up in the best solutions for combating climate change.

The fossil-fuel roller coaster has long whiplashed family budgets, and our economy remains shackled to its adrenaline-boosting unpredictability. Any economic recovery we muster in coming months will sputter if we fail to reduce our fossil-fuel dependence. As soon as the economy rebounds, oil prices are sure to shoot up again, negating the economic gains that we’ve made. “

There is some real truth there – but there’s a big missing elephant in this room.  The problem is that if the people don’t actually care about climate change, they are likely to seek solutions, say, to rising oil prices that make the climate situation worse.  For example, in the Northeast, where I live, there’s been a dramatic increase in the number of households burning coal for heat, in response to rising heating oil prices and availability issues.  In order to choose spending thousands on insulation, rather than a thousand dollars on a coal stove, a household will have to actually care about climate change – and convey that concern to their representatives in such a way as to provided economic incentives to choose the more expensive option.  It is not clear to me that the best ways to keep people comfortable in their homes or to get us new jobs are always ones that lead towards the radical shifts in carbon usage that are needed – and my concern is that as long as the message remains “we won’t ask too much of you” people will indeed expect not to be asked.

In this sense, my own feeling is that those who understate the costs of mitigating climate change actually do more harm than good.  I don’t blame them for their preference for the politically palatable – I would prefer that too.  But I would argue that there are two problems – the first is that a more politically palatable strategy is infeasible, particularly given the current economic situation, and that it risks branding climate activists as liars later on, when the bills come due. 

A good example of those who dispute the “this is gonna hurt” strategy is Sierra Club executive director Carl Pope’s recent missive “Moving the US Off Carbon with Less Pain, More Gain.”  He writes,

“But if, as Bill McKibben has said elsewhere, there is no silver bullet for climate change, just lots of silver buckshot, then insisting that sacrifice is the key has the effect of distracting us from the reality that it will take many answers to solve the problem. Often, advocates of inaction or tokenism say the reason we must do too little is that the price of doing more is too extreme. It is not strategically helpful to reinforce this notion.

The assumption that the costs of climate recovery will be prohibitively high simply does not stand up to scrutiny. A study by McKinsey & Company last year documented large opportunities to reduce U.S. emissions by 2030 that could be achieved with a negative cost — meaning that these represent investment opportunities that would increase the productivity of the overall U.S. economy. Less speculatively, experts at the University of California-Berkeley recently documented that more than 1.5 million jobs were created in California by relatively aggressive clean energy policies adopted by the state between 1972 and 2006. And other studies show that in the long run, energy costs are lower under a high efficiency and renewable energy scenario.” I would never presume to speak for Bill McKibben, but my own guess is that the reason that he presents sacrifice as key is that “sacrifice” is not in itself a BB, a bullet or a wedge, but something different – a national relationship to our collective actions, some hard, some not, one that opens up the range of available possibilities.  Were I making the case, my inclination would be to observe that we are more likely to succeed with more ammo to fire against climate change (can I just say that I really hate the BB-Bullet discussion – is there no other terminology we can get to here?) rather than less – a call to sacrifice offers us a range of options not available without that compelling rationale – without, we have fewer BBs to shoot.But is sacrifice really even necessary?  Pope mentions studies that suggest that we might actually make money on the climate, and the possibility of job growth.  But let’s take a closer look here at the studies he cites.  It might first be noted that the McKinsey report mentioned was sponsored by such ecological luminaries as Shell and PG&E – this does not in itself devalue the research, but it does suggest that the research was undertaken by those who would probably like to find necessary energy cuts economically profitable.  But more importantly the essay shows comparatively low cost abatements for limiting emissions to 550 ppm, moderate cost for limiting them to 450ppm (among them Carbon Capture and Storage, often falsely described as “clean” coal –  which does not exist and probably never will – so is irrelevant to any discussion), and then leaves open “higher cost abatements” for stopping at 400ppm.  Moreover, it presumes a fairly stable economic situation – neither of which assumptions deal with the reality.

Much of the problem lies in shifting assessments of what we have to do – analysis based on older climate estimates of 450 ppm by mid-century simply don’t match up to the new science.  For example, see Gar Lipow’s timely discussion of how fast we have to cut emissions radically.  Generally speaking, those who claim that climate change can be arrested without signficant economic costs are those who still accept the IPCC assumptions about climate sensitivity, many of which were proved false before or shortly after its release.  Williams, I think does a superb job of demonstrating the big gap in our understanding – at this point, we don’t know what precise rate or by what date we need to reduce emissions.  But it seems likely that Pope’s analysis, while better than the IPCC’s, is still understating the scale of emissions reduction.  He says,

“Confronted with the urgent need to reduce our economy’s greenhouse gas emissions 20 percent to 35 percent in the next 12 years, and 80 percent to 95 percent by mid-century, it is difficult to imagine this shift not requiring massive sacrifice.”

The “mid-century” figure is almost certainly far too far in the future.  Lester Brown of the Worldwatch Institute suggests we have to be down 80% in 11 years.  Most other cutting edge analysis suggest at the latest by 2030.  Nearly all analysts find that the costs of mitigation rise rapidly when we have to do it faster and make deeper cuts. 

The other relevant point, and one that seems to be grasped by few climate activists is this.  In 2006, 80% by 2050 seemed quite radical.  In just 2 years we’ve learned that climate sensitivity is, as Carbon Equity puts it, ”double” what was thought in 2006.  Meanwhile, in two years we’ve seen a dramatic reduction in arctic ice, in the ability of the ocean to absorb carbon and we’ve begun to see signs of substantial increases in methane release – all things that the IPCC had predicted might happen at the end of the century. 

Which means that given the pace at which the acceptable carbon levels are being pushed back, it would be foolhardy not to leave room in our analyses for the reality that the earth’s response to carbon already emitted may push back acceptable levels of carbon still further.  That means, we may have to move even faster than we think.  I realize this is not pleasant to consider, but we have no choice but to allow some leeway.  Pope’s analysis assumes lower targets than the emerging scientific consensus, he assumes a longer period to make the shifts, and most importantly, he leaves no room for further revisions, even though events of the last few years suggest that they are likely to be needed. 

The other difficulty with Pope’s analysis, and with many other climate activists’ assessment that we can count on this to be easy is that their analyses seem to take a given a stable economic situation.  Generally speaking, brief mention is made of the economic downturn, the assumption is that life will shortly return to Business As Usual.  The problem with this assumption is that it leaves out other contributing factors, and views climate change in isolation.  I think it is not accident that among those activists who endorse a call for sacrifice, every single one is on record as believing in peak oil.  Hansen, McKibben, Monbiot – all seem to fully grasp peak oil *and* the fact that peak oil is most likely to manifest itself as an economic difficulty.

 Indeed, I’ve argued that our current financial crisis is, in fact, an expression of both climate change and peak oil, indirectly.  In my essay ”Peeling the Onion: What’s Behind the Financial Mess” I argue that the food crisis, which is both an energy crisis (much of the rise in food prices was driven by the rich world’s misguided rush to biofuels) and to a lesser extent a climate crisis (climate instability has also been a contributing factor in the rising cost of food) drove millions of new consumers in the Global South back into poverty, forcing them to spend more and more of their income on food, and thus cut the flow of growth in the world overall. 

Whether you accept that analysis or not, it is certainly no accident that rising energy prices eventually helped push an fragile bubble into collapse – and quite honestly, there’s little reason to believe that future high energy prices, when they return, won’t also cause another economic crisis (assuming we actually get out of this one), or extend the current one.  In fact, I’ve argued that in the US, most of our truly serious economic crises have lasted a decade or more which suggests that there is a tolerable chance that whatever strategies we will use to deal with climate change must be compatible with a vastly poorer society, with its eyes fixed on its economic difficulties.  Is this inevitable?  No, but just as we need to take into account the possibility that climate sensitivity will be further revised downward in accordance to new realities, it would be imprudent to base any policy on an assumption of wealth for which there is no clear evidence.

In a Global Depression, which is what we seem to be facing at present, the realities of long term economic returns and cost benefits are radically different than all the prior estimates have been based upon.  As far as I know, there is no major economic analysis of the consequences of climate change mitigation in a negative growth Depression.  All of our economic analysis has so far assumed growth, the ability to borrow, and most importantly, a population of reasonable affluence.   The gap in our understanding this lack of research creates is vast.  The reality is that things have changed, and we forgot to allow for those changes.  This is understandable, but the rhetoric of climate change must change now, to reflect the new realities.  Yes, our president is calling for year over year trillion dollar deficits, and some of that money will probably be poured into green development – indeed, it absolutely should be.

But more and more of that money will be needed to simply mitigate economic suffering – states will need it to keep the plows and buses running and basic policing going, unemployment funds will need to be replenished.  Pope’s observation that green growth led to the creation of 1.5 million jobs in California from 1972 to 2006 ignores the fact that that was a 34 year span (I was born in 1972) – that adds up to a job creation rate of about 250K a year – and we lost more than twice that in jobs last month.   Again, do not mistake me – my goal here is not to dismiss the value of investing in environmentally friendly infrastructure, it is to talk about things as they actually are, in the hopes that we might not abandon the project of mitigating climate change altogether.

 In a declining economic situation, where much of our action must be undertaken in a period where people are struggling economically and where their eyes are primarily fixed upon their suffering, climate change risks being driven off the agenda altogether by the economy.  If the current Depression goes on – and there seems no realistic end in sight, and more and more economists are assuring us that there is no quick fix - we will have to cut our emissions hugely while people are also enduring involuntary economic pain.  We may also have to cut those emissions while enduring the early effects of peak oil, which may further cut into the resources we have to adapt.

It seems likely that the next decade, which James Hansen calls “critical” will be one of collective suffering, and a major shift in economic realities.  Even Pope admits that there will be some hardship.  Those who deny the reality of climate change are already claiming starting to claim that misguided attempts to deal with climate change are already the cause of our suffering – and that will only increase, no matter what carbon cost strategy we adopt.  The climate deniers are already trying to seize the public narrative – and as people get poorer they will be more likely to accept the idea that their poverty is in part caused by our strategies for dealing with climate change – or even to agree with those who believe climate change isn’t a real problem.  We have seen over the last decade and more just how powerful the anti-scientific but rhetorically brilliant climate denier lobby.

Pope’s strategy, which is to reassure people that they will end up better off is doomed to failure.  The reason is that whether climate change has anything to do with it or not, the odds are good that during much of the period in question, people won’t be better off – and they are not foolish enough to accept being told that something is for their benefit when they do not see benefits.  This strategy is likely to enable the denier narrative that says that climate science is false – because they will point out that we promised something we could not and did not deliver.  And we will have.

On the other hand, the rhetoric of sacrifice is potentially powerful here.  Historically speaking, in the US, in Britain, in many nations we’ve seen a willingness to endure privation if we felt we were part of a greater national project, if our sacrifices were needed.  And this is where climate change, overlain upon the economic crisis, offers us a chance to pull together.  That is, poverty due to economic crisis has no inspiring qualities.  But sacrifice for the cause of building a better future for one’s posterity – that has possibilities.  In that narrative, one can ask people to forgo the coal stove, can ask them to bear with cooler temperatures, not just because they can no longer afford to heat their houses as they have been, but as part of a Global and national project that ensures the well-being of the future.  That is, the call to sacrifice makes possible a range of actions impossible without it, and enables an overarching narrative that makes even involuntary sacrifice part of a heroic story.  It is, I think, impossible to underestimate how important the sense of personal heroism can be to shaping one’s understanding of events.

Moreover, I think the public will forgive hardship in ways they will not forgive lies.  Do not mistake me, I think Pope is telling the truth as he sees it, and so are optimistic climate activists.  But there is a solid chance that what he’s saying will become a lie, and be perverted into one by the denier right.  Only by taking command of the story we are being told can we acknowledge necessity and bring (if we must speak in the language of ammunition) as many BBs to the battle as possible.