Bjorn Lomborg has a history of getting under environmentalists’ skin. His most recent op-ed in the Wall Street Journal, in which he labels Obama a climate alarmist based on a few sentences from his inaugural address, is likely to provoke more anger from the left. Lomborg makes a reasonable point about subsidies to the renewables industry, but we disagree with his portrayal of climate science and lament his omission of our favorite policy response (can you guess what it is?).
Lomborg makes two main points. First, he argues that global warming has not yet had serious negative consequences. Then he changes gears and proposes that we should address climate change through adaptation and energy R&D, and not through renewables subsidies.
Let’s tackle the policy issues first. Lomborg says that “the scary examples” in Obama’s speech “suggested that he is contemplating poor policies that don’t point to any real, let alone smart, solutions.” The “poor policies” that he fears are expanded subsidies to the wind and solar industries. His category of “real, smart” solutions includes creating incentives for climate adaptation, for example by revising building codes and reforming federal flood insurance. It also includes increased investment in clean energy R&D.
We are all for building code changes, insurance reforms, and much higher energy R&D funding. Each of these policy initiatives responds to a clear market failure (asymmetric information, moral hazard, and non-appropriable spillovers from innovation, respectively). We also agree that the economic justification for subsidies to existing renewable technologies is not so clear (perhaps industry-wide learning that can’t be fully captured by individual firms?).
But there is a glaring omission from Lomborg’s list. We hope that the scary examples are a signal that Obama is serious about a federal cap-and-trade program or carbon tax. These are the only policies that directly address the most important market failure in this area: the negative externality associated with energy consumption. It’s hard to think of a more “real, smart” policy approach than that.
Secondly, it’s unfair for Lomborg to label President Obama as an alarmist for using increases in fires, droughts, and storms as examples of the consequences of climate change. The full quote from the inauguration is this: “Some may still deny the overwhelming judgment of science, but none can avoid the devastating impact of raging fires and crippling drought and more powerful storms.” Nowhere does Obama suggest that any specific recent examples of fire, drought, or storms are a direct result of climate change, nor that the observed pattern and frequency of these events in recent history is evidence of climate change.
So Lomborg’s attack on the “climate change has already caused major problems” straw man is irrelevant. Perhaps he is right that we have not yet observed some of the potential impacts of climate change. We don’t know; we’re not climate scientists. But even we know that the consensus among climate scientists is that future, larger increases in global temperature are likely to be very harmful. The IPCC Fourth Assessment Report and the IPCC Special Report on Managing the Risks of Extreme Events and Disasters represent the consensus of thousands of scientists and other experts. They list wildfire risk, decreasing water availability, and increased damage from floods and storms among many other examples of impacts associated with climate change—so how is it alarmist for Obama to do the same?
– Walter and Judd
PhD students in the Agricultural and Resource Economics department at UC Berkeley, and graduate student researchers at the Energy Institute at Haas.