Archive for the ‘Cato’ Category

Jim Manzi/Cato: Climate progressives?

August 31st, 2008 No comments

Jim Manzi has just posted the close-out essay in the online forum (at Cato Unbound) that the Cato Institute has devoted recently to the issues of climate change risks and policy.  I alerted readers to the Cato effort and provide comments here, here and here.

My thoughts on Manzi`s final essay?  Briefly, while there`s much here to warm the cockles of any climate hysteric, misanthropic enviro-fascist or their dupes and co-religionists throughout the business and policy world [snark, to those not familiar with me or LvMI], I`m disappointed that Manzi has not tried to seriously explore libertarian approaches – involving serious de-regulation and tax changes – to climate change.

But let me let Jim Manzi speak for himself (emphasis added):

“I’d also like to thank Joseph Romm, Indur Goklany, Michael Shellenberger and Ted Nordhaus for their extensive efforts in considering and responding to my essay and subsequent comments.  It’s always inspiring to me to see people who’ve devoted so much time, work, and intellect to analyzing hard problems.

“Mr. Romm and I, in particular, have disagreed quite directly about the likely impacts of carbon dioxide emissions, and I’ll just refer interested readers to the series of detailed exchanges between us ….  I’d like to try to establish what I think is common ground between us.  I think that vigorous, but respectful and fact-based, disagreement is almost always a precondition for practical progress on complicated issues, but that ultimately some consensus needs to be achieved to get anything done.

“It seems to me that all contributors believe that anthropogenic global warming is real and poses a serious risk.  We all agree that an R&D program of the type that I have proposed is a component of a solution, and I hope that we all can get behind this idea.  I think that we would all support adaptation to weather problems that may arise as a wise investment of resources.  Most adaptation measures have the advantage that, in comparison with R&D or mitigation efforts, they can be executed in fairly short order and only in response to problems as they become manifest, and hence would likely have very attractive cost-benefit ratios.  Finally, I think that we would all agree that the ongoing efforts to analyze physical and economic trade-offs involved in various proposals through the IPCC and similar bodies are valuable and should be supported.   (In fact, I would like to see such processes incorporate case-by-case analyses of the kinds of incremental R&D/technology-deployment ideas that Messrs. Shellenberger and Nordhaus have proposed).  Improved science, along with increased structure and rigor in the debate of its implications, should enable further progress.”


Categories: AGW, Cato, climate change, government, Jim Manzi Tags:

More on Manzi/Cato on climate

August 22nd, 2008 4 comments

A few days ago I concluded that Jim Manzi’s lead essay in Cato Unbound’s new climate issue exhibited rather weak “libertariarian sinews”.

Allow me to note a few additional remarks on Manzi`s arguments.

1.  It’s clear from Manzi’s essay that (i) he is actually quite concerned about the risks posed by anticipated climate change, even while he dismisses the “scare stories” and the “precautionary principle” and (ii) he believes that the risks warrant even greater investments by government in climate science and carbon sequestration/geo-engineering efforts. 

While I commend Manzi for addressing at close to face value the IPCC’s warnings (even while climate science does not provide a firm basis for precise temperature or climate change prognostications) and the advice offered by economists such as William Nordhaus and Martin Weitzman, it is puzzling that he does not see in climate change concerns the opportunity for a positive agenda of deregulation and tax reform that would liberate our economy and help to spur changes in capital investments.

2.  Manzi has underplayed both the possible degree of climate change under “business as usual”/non-aggressive policy scenarios and the absolute and relative magnitude of the concomitant risks and costs.

Manzi notes that the “current IPCC consensus forecast is that, under fairly reasonable assumptions for world population and economic growth, global temperatures will rise by about 3 °C by the year 2100.” Note that this implies a an AVERAGE global temperature increase of 5.4 °F, with even greater temperature increases in the US and elsewhere the further one gets away from the equator. The IPCC does not make “forecasts”, but has analyzed and released a number of projections based on various scenarios, most of which assume aggressive actions to deploy clean energy technologies.

As fellow contributor Joe Romm (undergrad and Ph.D. in physics at MIT, Senior Fellow at the Center for American Progress, where he writes and maintains the Climate Progress blog, and author of “Hell and High Water: Global Warming–the Solution and the Politics–and What We Should Do” ) argues, Manzi has seriously understated the risks of much higher temperatures by 2100 that the IPCC has noted.  Joe Romm notes that, in fact, the growth of actual global carbon emissions since 2000 has exceeded the IPCC’s most extreme A1F1 scenario, and argues that 

“the latest IPCC report finds that, absent a sharp reversal of BAU trends, we are headed toward atmospheric levels of carbon dioxide far exceeding 1,000 parts per million by 2100. IPCC’s “best estimate” for temperature increase is 5.5°C (10°F), which means that over much of the inland United States, temperatures would be about 15°F higher.” (emphasis in original)

Further, even using a very optimistic projection, Manzi has also seriously understated the impact and costs that the IPCC suggests may be felt in the US. Manzi, assuming that global temperatures rise “only” by 3 °C increase by 2100, refers to an IPCC summary that states that such a temperature increase would cause total estimated economic losses in the low end of a range of 1–5 percent of global GDP (and later uses an estimate of 3% of GDP). This ignores not only the much higher costs that will be faced if warming is even greater, but also ignores:

(1) that as global GDP is expected to substantially grow, the absolute magnitude of the annual GDP loss may be very large, indeed,

(2) that measures of “economic” losses include adaptation costs as a part of GDP but do not cover non-market damages, the risk of potential extreme weather, socially contingent effects, or the potential for longer-term catastrophic events and

(3) that the greatest negative effects of climate change are expected to be felt in developing countries that have a relatively insignificant share of GDP.

3.  Manzi notes that even with the low-ball assumptions, mainstream economists like Yale’s William Nordhaus have long argued on a standard cost-benefit analysis basis that the gains from implementing an escalating carbon tax would outweigh the costs (Nordhaus has for many years been at the low end of the benefits to be gained), but even so Manzi argues that “the real world of geostrategic competition and domestic politics” one leads him to greatly discount the basis for a policy the difficulties with implementing a carbon tax or similar policy.

But it looks like Manzi has put his thumb on the scale again. Manzi asserts that in order to have an effective GHG mitigation policy, we would have to agree to, and enforce, “for hundreds of years” a “global, harmonized tax on all significant uses of carbon and other greenhouse gases in any material form” that “would run directly contrary to the narrow self-interest of most people currently alive on the planet” and that “all the side deals that would be required to get this done would create enough economic drag to more than offset the benefit.” Manzi also points to the ineffectiveness of the Kyoto Protocol, the apparent unwillingness of developing nations to agree to GHG restrictions and the penchant for politicians for loading down climate change legislation with special deals as reasons to think that a globally-coordinated climate policy is not worth while.

But while these are serious concerns, it is relatively easy to counter that:

– the Kyoto Protocol is no failure, but that the Europeans have been waiting for the US to agree to similar action rather than blindly biting any bullet unilaterally;

– it is clear that China, India, Brazil and other developing countries are seriously concerned about climate change, but their initial participation is not needed for the developed nations to commence a meaningful mitigation deal, and there are trade and other levers (including a desire for cleaner energy technologies) to eventually bring them on boar;

– Manzi later acknowledges this in his own plan for an agreement among developed nations to invest in technology that can then be shared with developing ones;and

– effective climate policy can be initiated and implemented domestically without external coordination, such as power market deregulation, allowing immediate depreciation of capital investments, and replacement of income taxes with resource taxes.

Further, it’s clear that Manzi`s assertion that climate policies “run directly contrary to the narrow self-interest of most people currently alive on the planet” is simply an unfounded and unjustifiable conclusion.

All of mankind shares the atmosphere, as an open-access but indispensable commons. We are approaching the point that the costs and risks of inaction (or rather, the costs of continuing free use without responsibility for costs/risks shifted to others) merit the costs of shifting to a system of shared rules (and other investments) with respect to its management – the efforts in which people and firms of many nations are voluntarily engaging in this regard are themselves evidence that even narrow self-interest justifies coordination with our neighbors (even as gamesmanship remains).

4.  Manzi next, rightly, considers the “inherently unquantifiable possibility that our probability distribution itself is wrong,” so that “the case for a carbon tax or a cap-and-trade emissions rationing system is really that it would be a hedge against the risk that actual damages from warming would be much, much worse than current risk-adjusted projections indicate,” with the primary purpose of such a tax or rationing system being “not to encourage conservation per se, but rather to induce the development of new technologies that can de-link economic growth from damaging accumulations of atmospheric carbon dioxide”.

Oddly, though, Manzi simply concludes, with no analysis, that any carbon pricing program would be “insanely expensive” and yet even then “would very likely not be high enough to successfully incentivize the creation of the desired technologies.” One would like to know on what basis he concludes that markets do not respond to incremental changes in prices – so that the governments of developed nations ought to directly make certain climate change technology investments (or incentivize them via prizes, etc.)

5.  It is also odd that Manzi then turns immediately from the dismissal of a gradualist pricing approach to a focus on “rapid, aggressive emissions abatement” that would only be justified if “the outer edge of the probability distribution of our predictions for global-warming impacts is enormously conservative, and disaster looms if we don’t change our ways radically and this instant,” in which case Manzi agrees that “we really should start shutting down power plants and confiscating cars tomorrow morning.”

Manzi seems to be as alarmist as many enviros, and to have even less faith in the market than they do.

Manzi then briefly addresses – and conflates with the table-pounding of Al Gore and others – the more sophisticated argument (advanced by Harvard’s Marty Weitzman) that “the risk that actual damages from warming would be much, much worse than current risk-adjusted projections indicate” is quite large. Says Manzi, “any rationale for rapid emissions abatement that confronts the facts in evidence is really a more or less sophisticated restatement of the precautionary principle: the somewhat grandiosely named idea that the downside possibilities are so bad that we should pay almost any price to avoid almost any chance of their occurrence.” 

Manzi believes that worrying too much about climate change is “to get lost in the hothouse world of single-issue advocates, and become myopic about risk,” while ignoring “lots of other unquantifiable threats of at least comparable realism and severity”. Well, I beg to disagree. While we can certainly deal with more than one risk at a time, why is it that conservatives like throwing trillions at “defense” and can focus on bird flu, but need to write off climate change? Could it have anything to do with what industries are in favor with Republicans and the White House?

Climate change differs from the other risks Manzi raises in that it is a risk that our own activities generate (not an “external” threat) – and one that we can manage by focussing on who is generating risk and asking them to bear some of the cost. Like the others, though, action is in some ways a collective choice problem, but unlike blowing trillions unilaterally on “defense”, climate change is a risk that other developed nations have shown they are willing to co-invest in heading off.

So why is continuing to be the spoiler in our national self-interest? Manzi provides the answer with a strawman:

“The loss of economic and technological development that would be required to eliminate literally all theorized climate change risk would cripple our ability to deal with virtually every other foreseeable and unforeseeable risk.”

Those who are concerned about climate change have long concluded that we are already facing ongoing climate change, with further unavoidable change in the pipeline, so simply nobody is talking about “eliminate[ing] literally all theorized climate change risk”.

6.  Finally, Manzi trots out his own proposal, after against dismissing any carbon pricing policies (and ignoring all others, like deregulation) with un-established suppositions:

“IF there is a real, though unquantifiably small, possibility of catastrophic climate change, and IF we would ideally want some technological hedges as insurance against this unlikely scenario, and IF raising the price of carbon to induce private economic actors to develop the technologies would be an enormously more expensive means of accomplishing this than would be advisable, then what, if anything, should we do about the danger?”

Apparently, Manzi has introduced these suppositions to tone down the much firmer and more extensive proposals he has made and justified elsewhere:

“There is, however, massive uncertainty (rather than mere risk) in our ability to predict the impacts of AGW, and recognizing this reality should lead us to take at least two actions: (1) improve the science to better-specify these extreme risks, and (2) hedge this uncertainty by making “insurance-type” investments today that would provide protection if an extreme AGW scenario ends up happening.”

Manzi`s proposals? To avoid the “failed game of industrial policy” by creating a climate change DARPA with a “a very high-IQ staff” to make many small (but collectively substantial) investments related to “detecting or ameliorating the effects of global warming” that “serve a public rather than a private need” (viz., that provide “no obvious potential source of profit to investors if successful”). Manzi thinks investments of the following types are merited: “improved global climate prediction capability, visionary biotechnology to capture and recycle carbon dioxide emissions, or geo-engineering projects to change the albedo of the earth’s surface or atmosphere”. Does Manzi not see that carbon pricing, if structured to allow offsets, would encourage private investments in all of these areas?

Ironically, Manzi concludes that “attempt[ing] to use the government to control the evolution of the energy sector of the economy” is not a “prudent reaction” to risk, but “the opposite: an impractical, panicky reaction unworthy of a serious government”.

Well, Jim, nice try, and thanks for your impractical, imprudent and panicky reaction.

Cato … takes climate change seriously, and devotes latest online issue to it

August 19th, 2008 No comments

The Cato Institute has dedicated its entire current monthly issue of Cato Unbound, its online forum, to discussing policy responses to ongoing climate change. 

The issue, entitled “Keeping Our Cool: What to Do about Global Warming“, contains four relatively balanced essays from a wide range of authors and perspectives.  Here are excerpts from their lead in:

“While virtually no one doubts the reality of climate change, assessing its extent and crafting a prudent and proportional response raises problems of its own. …

“Which approaches offer the best value in terms of protecting property and natural resources, while generating the fewest risks and side effects of their own? In short: How much would we or should we pay today for a future without global warming?

“The problem grows more difficult when we realize that proposed global warming solutions have often been victims of the domestic political process — rightly or wrongly — or else have been unacceptable to developing nations. …

“To discuss the way forward on this complex and truly global issue, we have invited Jim Manzi, statistician and Chief Executive Officer of Applied Predictive Technologies, whose proposals to conservatives on the issue have generated significant discussion. In response to his essay, we have invited environmental expert and frequent Cato Institute author Indur Goklany; climate scientist Joseph J. Romm, a Senior Fellow at the Center for American Progress; and Michael Shellenberger and Ted Nordhaus, the co-founders of The Breakthrough Institute, a think tank whose mission includes encouraging an ‘equitable and accelerated transition to the clean energy economy.'”

Unfortunately, Cato has no online blog.  Feel free to leave comments here; I will also try to post my thoughts on the essays.

Categories: adaptation, AGW, Cato, climate change, mitigation Tags:

Climate change AND the Forest Service’s perfect budgetary firestorm

August 4th, 2008 No comments

On a Mises blog thread last year, I noted:

controlled burns might of course be useful in some places, especially along the WUI (wildland-urban interface), but Randal O`Toole at Cato has done a good job showing that generally fuel accumulation is not a major factor in the increasing number and severity of fires, but climate change, and the fuels build-up argument has been one that suits the forest service`s budget desires

On that post I cited and linked to a very interesting essay by O’Toole:  The Perfect Firestorm; Bringing Forest Service Wildfire Costs under Control (Cato, April 30, 2007); allow me to post here for the interested reader a few excerpts that I consider most pertinent:

Blessed and cursed by a Congress that gives it a virtual if not literal blank check for fire protection, the Forest Service’s fire spending is out of control. … The Forest Service’s program—which consists of spending close to $300 million per year treating hazardous fuels and as much as $2 billion a year preparing for and suppressing fires—will not restore the national forests to health or end catastrophic fire in most of those forests. In many forests it may do more harm than good.

Significant structural changes in the Forest Service are essential to control fire costs. … 

The Forest Service distorts its own research and other scientific information about fire ecology to justify huge budgets for hazardous fuels reduction and fire suppression. As the next section of this paper will show, the claim that a century of fire suppression has left most western forests highly vulnerable to fire is greatly exaggerated, which means that much of the billions of dollars that the Forest Service is spending today on fire is unjustified. …

If protecting homes and other structures is the goal, only a few million acres need treatment, most of which are nonfederal land.

If fuels are not the huge problem the Forest Service claims, then what is the explanation for recent large fires and record fire seasons? A recent article in Science concluded that the reason was drought, not fuels. The authors studied fire data since 1970 and found that the greatest increases in fires have been in fire regimes III, IV, and V, “where land-use histories have relatively little effect on fire risks.” Instead of fuels, they found a strong correlation between drought and fire. “Thus, although land-use history is an important factor for wildfire risks in specific forest types (such as some ponderosa pine and mixed conifer forests), the broad-scale increase in wildfire frequency across the western United States has been driven primarily by sensitivity of fire regimes to recent changes in climate over a relatively large area.”43  Similar correlations between drought and fire have been found going back to 1931.44

Another explanation for the large fires in recent years can be found in the changes in firefighting strategies aimed at improving firefighter safety. To fight large fires, incident commanders often backburn tens of thousands of acres in an effort to create large firebreaks that wildfires cannot cross. One study of the Biscuit fire, the largest fire in Oregon history, estimated that 30 percent of the acres were burned by backburns, not the natural fire.45

All of this research—some of it done by Forest Service scientists—indicates that Forest Service leaders have greatly exaggerated the excess-fuels problem. By concentrating on this issue, they have deftly persuaded Congress to increase funding for hazardous fuel reduction in national forests from less than $8 million in 1992 to nearly $300 million in 2007. Meanwhile, because of the perceived threat of hazardous fuels, Congress has increased funding for presuppression (which the Forest Service now calls preparation) from less than $180 million per year in the early 1990s to more than $650 million per year since 2004.

(emphasis added)

FN43: 43. A. L. Westerling et al., “Warming and Earlier Spring Increase Western U.S. Forest Wildfire Activity,”
Science 313 (August 18, 2006): 943,  [This is the report that I discussed in this previous post.]

More work by O’Toole (who is also associated with The Thoreau Institute) and other libertarians on wildfires is here:

More on the climate change connection to Western wildfires is in this previous post.

Categories: AGW, Cato, climate change, forests, O'Toole, USFS, wildfires Tags:

More carbon tax advocacy, this time from Jerry Taylor/Cato, in a piece criticizing Pickens’ plan

July 30th, 2008 3 comments

Jerry Taylor, a senior fellow at the Cato Institute, published a pithy criticism in last week’s Financial Post of T. Boone Pickens’ plan to get wind subsidies and other favors from Congress;  said Taylor:  “Virtually every claim made by T. Boone Pickens to justify the lavish subsidies he is seeking for his wind energy investments is flat wrong.”

Jerry also had a few interesting things to say about about carbon taxes:

Fourth, if reducing our carbon footprint is the goal, then the most direct and efficient means of reducing that footprint is to impose a tax on carbon emissions and then leave it to the market to sort out how to most efficiently order affairs under those new prices. Maybe it will mean windmills and CNG [compressed natural gas], but maybe not. Perhaps it will mean more nuclear power, new hydrogen-powered fuel cells, “clean” coal, the emergence of cellulosic ethanol, battery-powered cars or hybrids — or a continuation of the existing energy base but less consumption as a consequence.

(emphasis added)

I agree with Jerry, but note that Jerry he has not explicitly accepted that reducing our carbon footprint SHOULD be a goal.  Rather, he has simply concluded that, should such a goal be adopted,  that carbon taxes are the best policy tool.  And that might be as much as we can expect, from the time being, from a long-time advocate of limited government such as Jerry.

Jerry Taylor joins Ron Bailey (Reason), George Will, AEI and a long list of others in favoring carbon taxes over any other AGW-directed policies.