Climate Economists: Good and Bad
Excerpt from David Ray Griffin, Unprecedented: Can Civilization Survive the CO2 Crisis? (Clarity Press, 2015)
Since the 1970s, when he essentially founded the economics of climate change, William Nordhaus had been considered its preeminent authority. According to a fellow economist, the optimal economic policy had for decades been simply "what Bill Nordhaus said." This view had been unquestioned, said a 2013 article, "until 2006, when the British government published a new review of climate change, led by Sir Nicholas H. Stern."
Stern, a professor at the London School of Economics, had served as the Chief Economist of the World Bank. The review that he led was published as The Economics of Climate Change: The Stern Review, usually called simply the Stern Review. This publication , which gave the world a radically different view of the economics of climate change, led to a new era in the field -- a transition from the Nordhaus era to the Stern era.
"In the era before the Stern Review," say Frank Ackerman and Elizabeth Stanton, "economic models of climate change were typically framed as cost-benefit analyses." This framing has been preeminently exemplified by Nordhaus. Although he called global warming "the major environmental challenge of the modern age," he did not express a sense of urgency about it. In his 2008 book, he said: "Neither extreme - either do nothing or stop global warming in its tracks - is a sensible course of action." The central question, Nordhaus said, was: "How to balance costs and benefits."
One especially startling statement came in a discussion about the sea-level rise that would be caused by the melting of the Greenland and Antarctic ice sheets: "Although it is difficult to envision the ecological and societal consequences of the melting of these ice sheets," Nordhaus said , "this situation is clearly highly undesirable and should be avoided unless prevention is ruinously expensive." It is startling to suggest that, if we find avoiding the melting of these ice sheets "ruinously expensive," we should just let them melt.
Nordhaus's 2013 book expressed a somewhat greater sense of urgency. Nevertheless, he continued to focus on cost-benefit balance, saying that "good policies must lie somewhere between wrecking the economy and wrecking the world."