Three Questions on Climate Change?

This, then, is the first question: how likely are the catastrophes against which we should be paying an “insurance premium”? We do not know the answer because there is little that serious scientists feel comfortable saying about the likelihood of truly disastrous events, such as feedback effects turning the planet into another Venus, as some distinguished scientists argue is possible. We urgently need research to tell us the likelihood of disastrous outcomes.

The second crucial uncertainty is that we do not know what future generations will regard as disastrous outcomes. Views change: 200 years ago many people thought slavery was reasonable, and 100 years ago women were commonly assumed inferior. Tastes about the environment can change surprisingly fast – it seems hard to believe now that the US government came within an ace of flooding the Grand Canyon to produce hydropower as recently as 1966, before being thwarted by so-called “extremists”. (Not that the lesson has been noticed - perhaps in 40 years time the Chinese people will be stunned that their government flooded the Three Gorges.) When I was young, vegetarianism seemed restricted to eccentrics, but today many of my students regard my meat eating as unethical, and there is increasing awareness of the similarity between us and other animals.

So do we know, for example, how our great-grandchildren will feel about the likely extinction of several million of the world’s species? Maybe they will feel that, despite their fabulous wealth, and despite being awash with mobile phones and super-high-resolution TVs, they have actually experienced a catastrophe.

The third critical question is the ethical one: how much should we care about the future? Nick Stern and his allies evaluate costs and benefits using real interest rates that discount the future very little except for the effects of economic growth. Many of his critics use interest rates at least 2 % higher which, compounded over a hundred years, values the welfare of our great-grandchildren less than one-seventh as much as Stern does.

-Why economists don't know all the answers about climate change