In a recent poll it was found that over half of all Australians had no idea what carbon trading is. The poll discovered that 17 per cent of Australians said they had never heard of emissions trading schemes. And 93 per cent said they knew little or nothing about what economic changes would be needed to cut carbon pollution.
Interestingly, in spite of this ignorance, 72 per cent said they supported a carbon reduction scheme. Of course it is not just the layman that is confused. The scientific community is divided over a number of questions concerning climate change and global warming. How much warming, if any, is in fact taking place? More importantly, how much is due to human activity? And what solutions, if any, should be implemented, if there is in fact a problem? And what exactly will be the costs of those solutions?
Several recent articles explore some of these issues. One writer, James Kerian, asks whether some scientists today are guilty of “yellow science”. He is referring to what is known as yellow journalism, which ignores standard reporting procedures, runs with unverified sources, and goes in for sensationalism. Kerian says science is in danger of heading in this direction. He explains,
“Scientists, like journalists, are called upon to plumb the depths of the unknown and to fairly and objectively report their findings to their own professional community as well as the general public. Scientists, like the journalists of yesteryear, have specific methods for ensuring that the public trust placed in them is not abused. The most fundamental of these methods is the well-known, if not so creatively named, scientific method. The essence of the scientific method is the formulation of hypotheses (ideas) and the using of these hypotheses to make predictions that can be experimentally tested. In the words of Sir Thomas Eddington in ‘The Philosophy of Physical Science,’ ‘Every item of physical knowledge must therefore be an assertion of what has been or would be the result of carrying out a specified observational procedure’.”
He continues, “Nevertheless, over the past several decades an increasing number of scientists have shed the restraints imposed by the scientific method and begun to proclaim the truth of man-made global warming. This is a hypothesis that remains untested, makes no predictions that can be tested in the near future, and cannot offer a numerical explanation for the limited evidence to which it clings. No equations have been shown to explain the relationship between fossil-fuel emission and global temperature. The only predictions that have been made are apocalyptic, so the hypothesis has to be accepted before it can be tested.”
“The only evidence that can be said to support this so-called scientific consensus is the supposed correlation of historical global temperatures with historical carbon-dioxide content in the atmosphere. Even if we do not question the accuracy of our estimates of global temperatures into previous centuries, and even if we ignore the falling global temperatures over the past decade as fossil-fuel emissions have continued to increase, an honest scientist would still have to admit that the hypothesis of man-made global warming hardly rises to the level of ‘an assertion of what has been or would be the result of carrying out a specified observational procedure.’ Global warming may or may not be ‘the greatest scam in history,’ as it was recently called by John Coleman, a prominent meteorologist and the founder of the Weather Channel. Certainly, however, under the scientific method it does not rise to the level of an ‘item of physical knowledge’.”
If matters of science and technology are confusing to most people when discussing climate change, so too are matters of economics, and the financial consequences of following yellow science. Economist Henry Ergas asks some hard questions that need to be asked, questions of cost/benefit analysis.
The notion of an emissions reduction budget, he explains, is “the idea that there is a fixed quantum of emissions reduction we should achieve by a given date, with the result that if we reduce a bit less in one area, we will have to reduce by more elsewhere. Reducing Australia’s greenhouse emissions is not a goal in its own right; it is merely a way of trying to deal with the risks of potentially harmful climate change. How much we should devote to that goal depends on the costs and benefits involved. If the costs increase relative to the benefits, only the fanatic redoubles his efforts.”
He continues, “The fallacy involved is manifest in the debate about how trade exposed, emissions-intensive activities should be dealt with. It has become increasingly evident that if Australia, acting unilaterally, imposes a carbon tax on these activities, global emissions will not be reduced. Rather, they will simply shift to other countries, decreasing our welfare (as we have a comparative advantage in those activities) and welfare worldwide. As a result, without an international framework that would prevent emissions flight, putting a carbon tax on trade exposed, emissions-intensive activities serves no useful purpose.”
Fanatics, he says, will arbitrarily pick some target and work toward it, regardless of the costs. But a reasonable person will adjust “the target to reflect the greater cost of achieving it”. For example, “the economic cost of achieving any given emissions reduction target increases more than proportionately with the severity of the reduction being sought: doubling the target inflicts more than twice the cost. As a result, increasing the extent of the reduction sought from those activities that are least footloose makes the cost of any overall reduction all the greater. These added costs then are compounded by an increased distortion in resource allocation between the activities that are exempt and the now more heavily taxed ones that are not.”
He continues, “There is an additional, deeper reason the fanatic’s response is perverse. The problem of emissions flight merely highlights the absence of an effective and comprehensive regime for reducing greenhouse gas emissions. In the absence of such a regime, abatement in Australia, no matter how great, will have no direct impact on the risk of harmful climate change. The only reason for undertaking that abatement is the possibility that it will assist such a regime to come into place. However, whether abatement in Australia would have a ‘demonstration effect’ internationally, and if so to what extent, is highly uncertain. Even if such an effect did exist, there is little reason to think the effect will be much greater if we pursue abatement at home with greater intensity.”
Ergas concludes, “The case for abatement beyond a very modest level, consistent with a low carbon tax, therefore seems economically untenable. Moreover, anything that makes the marginal costs of abating now higher, or the community’s willingness to bear those costs now lower, should induce us to reduce our overall abatement effort rather than sticking by some inherently arbitrary target. Consequently, a heavy burden of proof should be placed on those who advocate ambitious fixed targets to be pursued with the ferocity of latter-day Savonarolas. Reducing emissions is not an act in a morality play but a decision that has to be made by trading off benefits and sacrifices. Moreover, the community must be given a full opportunity to assess those benefits and sacrifices and decide whether they are worth bearing.”
Climate change is an important issue. But questions of science and economics need to be carefully considered before rushing headlong into radical and costly directions. The science of climate change needs to be carefully established, and then the costs and benefits of any proposed solutions need to be thoroughly examined.