The Economist
April 1, 1995
Stay cool
ENVIRONMENTALISTS are dismayed. Their efforts to scare the world over global warming seem not to have worked. Three years ago, in Rio, governments agreed to hold down their output of ``greenhouse'' gases, such as carbon dioxide, that are thought to be raising the earth's average temperature. But when this week's Berlin conference (see page 67) asks what progress has been made since Rio, the answer will be: virtually none. Rich countries are unlikely to meet the Rio target of reducing output of greenhouse gases to 1990 levels by 2000. Even if they do, growing emissions from coal-burning poor countries will more than offset their success. Few poor countries are even considering restraining their output of greenhouse gases. And thus, say the greens, will a short-sighted world stroll insouciantly towards a calamitous future of storms, floods and drought.
Well, maybe. It would certainly be a pity if the world's governments retreated from the promises made at Rio, for that would bode ill for any attempts to deal collectively with global environmental problems. Nonetheless, penguins and people can afford to relax for many years yet. For all the green clamour, it is far too early to be panicked into Draconian actions to avert global warming; especially when most actions would pose a bigger threat to human wellbeing than does global warming.
Two clouds, and a hot prediction
Consider, first, the uncertainty of scientists about the extent of global warming. Despite recent advances (see pages 109-111), science still understands little about the world's climate, a system that depends on a huge range of variables, with causation flowing in every direction. Most scientists agree that, provided other variables remain the same, big increases in carbon dioxide will boost temperatures. But the extent of the boost is widely disputed. And nobody can predict whether other variables will remain the same. Some scientists reckon that rather than just growing gradually warmer, the climate may become subject to sudden lurches. That makes it even harder for countries to prepare for climate change. The Intergovernmental Panel on Climate Change, the body of scientists studying global warming, reckons that a doubling of carbon in the atmosphere could lead to a temperature rise of anywhere between 1.5AEC and 4.5AEC.
There is also much uncertainty about the costs of global warming. Some areas of the world would benefit from a warmer climate. Cold wastelands, for example, might become fertile farmland. Other areas would suffer. If global warming raised the sea level, valuable inhabited land (eg, in Bangladesh, the Nile delta and the Maldive Islands) would be submerged. Estimates of the overall economic impact of global warming depend on weighing these costs_the dislocations of ways of life based on the present climate_against potential benefits, ie, the opportunities for growth in places where the climate improves. Few expect the benefits to carry the day, especially if the temperature rises quickly.
Economists have, however, pointed out that even substantial net costs can and should be tolerated if the alternatives are worse. Even a pessimistic prediction that climate change could knock 20% off world income in a hundred years' time would imply merely that the world economy expands a little more slowly than otherwise. To set this in perspective, consider another extrapolation: the world economy could, if recent growth continues, be over 300% bigger in 2095 than today_and so that much better able to bear the costs of coping with climate change.
One of the few certainties about global warming is that the costs of severely curbing emissions of greenhouse gases now would be huge. The world relies on carbon-based fuels for 90% of its energy needs. A quick, enforced switch to non-polluting alternatives would savagely cut people's living standards. In developing countries reliant on fossil-fuelled economic growth to lift them out of poverty, the pain would be acute. Why should people make such a sacrifice for a problem whose extent and cost are so uncertain? There are more pressing environmental concerns such as urban smog, the spread of disease and inadequate sanitation in poor countries. Unlike global warming, these cause enormous suffering for millions of people now. And it would cost less to alleviate or even eliminate them than to reduce sharply the world's output of greenhouse gases.
This does not mean that world governments should do nothing about the possibility, however remote, of climatic catastrophe. Many policies that would reduce greenhouse emissions are desirable on their own terms. For example, most state subsidies for energy industries should be scrapped on grounds of economic efficiency. That would lead to less coal being burned (the coal industry is often heavily subsidised) and to higher electricity prices, encouraging conservation. Proper road pricing should be introduced to reduce congestion in cities. Policies designed to deal with one environmental problem may not necessarily help with others, however. Scrubbing sulphur dioxide out of power-station emissions curtails acid rain, but it may enhance warming; sulphur compounds in the atmosphere cool the earth.
Besides encouraging energy efficiency, governments should also continue to finance research into the science of climate change, and into how to reduce the costs of non-polluting fuels. Such actions could pay dividends if more drastic measures to counter global warming ever became necessary. Even the occasional jamboree such as Berlin's may be justified, so long as it does not foster panic: the wheels of global co-operation should be kept oiled in case climate change turns nasty. Other than that, however, patience should be the watchword. Within a couple of decades, scientists should have a firmer grip on the influences on climate. By then the costs of altering the world's economic structure are likely to be lower: although prices of most non-polluting fuels, such as solar power, are still higher than fossil fuels, the gap is narrowing. And if climate change turned out to mean no more than a slow but steady rise in temperatures, the costs of adapting as warming occurs (such as building higher sea walls) might still prove lower than the costs of prevention.
Greens will no doubt continue to paint their scary pictures of the future. What, they will ask, if climate change were to entail a sudden lurch that led to half the world starving to death in 50 years' time? The best answer is that anything can happen in half a century: even an invasion by aliens, say. On present evidence, though, any huge catastrophe looks highly improbable. There is still time to bask in the sun.