REVIEWING THE STERN REVIEW
By Andrew R.B. Ferguson
In the OPT Journal of April 2002, concerns about climate change were stated
in a short paper, Ice Age, Glacial and Interglacial. The sources of reference
were John Houghton's Global Warming, the Complete Briefing (1997) and Earth
Story by Simon Lamb and David Sington (1998). The essential point being made
was that humans have been on Earth only during a period when there have been
glacial periods (when the polar ice creeps towards the equator) and interglacials
(when it recedes) - with these cycles lasting about 120,000 years. But on a
wider time perspective, human history has existed only in a period of a continuous
'ice age;' that is in the sense of there having always been polar ice caps while
humans have been around. In 2002, it was clear that human carbon emissions had
already raised atmospheric carbon dioxide above the level of the last interglacial,
meaning that there was a distinct possibility that the human race would push
the Earth back into what the article termed a 'water age' - the sort of age
the dinosaurs lived in. What speed the effects of climate change would manifest
themselves was by no means evident at that time at. The amount of evidence for
rapid climate change has been growing at a rate that very few would have predicted
only four years ago. In 2002 even the Intergovernmental Panel on Climate Change
would not give a clear indication of what was an 'unsafe' level of global warming
gases.
However, the imminence of the dangers have become more apparent, and Nicholas
Stern, former chief economist of the World Bank, was asked by the UK government
to report on the economic costs of climate change. The result was the 570 page
Stern Report, published in October 2006. I can claim to have read only the 27
page introductory review, but perhaps that suffices for my present purposes,
for I am mainly asking whether the Stern Report has a similar failing to Al
Gore's film An Inconvenient Truth. While admiring that film in some respects,
I have already written about that failing. The failing consists of omitting
to properly address five other inconvenient truths. I won't attempt here to
prove the truth of all six 'inconvenient truths', since that has occupied many
issues of the OPT Journal. But by way of brief rehearsal, these are the six
inconvenient truths:
The six inconvenient truths
1. Climate change due to greenhouse gases needs to be taken very seriously indeed.
2. There is immense difficulty in finding a way to replace the energy provided
by fossil fuels. The consensus view of ecologists is that without them, a world
population of only about 2 billion could be supported in comfort.
3. An improbable 60% cut in emissions by the USA and Europe, by 2050, would
be cancelled out by a probable 130% increase by China, India and Indonesia (after
which per capita emissions in the latter group would still be below those of
the former).
4. Allowing only balanced migration into developed countries is one very important
aspect of holding down carbon emissions.
5. Globalization is a powerful driver of carbon emissions so needs to be abandoned.
6. To continue - as economists and the commercial world would have us do -with
ever continuing growth is just about certain to be fatal. Overdeveloped nations
need to 'undevelop', and populations need to shrink, with 2 billion as the eventual
aim.
The Stern Report recommendations
The Stern Report makes as good a job as Al Gore of getting over the message
that climate change has such disastrous consequences that every effort needs
to be made taken to effect mitigation. Item 1 is thus dealt with very well.
Also the report is sound in some respects about what needs to be done to reduce
carbon emissions, for instance there is no doubt it is correct in saying (p.
xvi): "Carbon capture and storage is essential to maintain the role of
coal in providing secure and reliable energy for many economies." There
is much else that is good sense regarding item 1, but we need not dwell on that.
Regarding item 2, the extent of the difficulty of finding replacements for fossil
fuels is not dealt with in the report. Perhaps this is not surprising, as the
fundamental nature of the problem is not widely understood even in the academic
community.
The report tends to be misleading with regard to item 3. For instance it says
(p. xxxiii): Securing broad-based and sustained co-operation requires an equitable
distribution of effort across both developed and developing countries. There
is no single formula that captures all dimensions of equity, but calculations
based on income, historic responsibility and per capita emissions all point
to rich countries taking responsibility for emissions reductions of 60-80% from
1990 levels by 2050.
So far so good, but it does not go on to point out that, by the same tokens
of equity, the undeveloped nations should be allowed to increase to the level
to which the developed world has reached after achieving the mooted 60% reduction.
Yet as item 3 states, if America and Europe decreased their emissions by 60%,
this is likely to be cancelled out by increases in China, India and Indonesia,
which would be fully justifiable in that they would only have achieved about
the same per capita level as the developed world. In other words, a 60% reduction
by the developed world would most likely lead to little change in overall emissions
from the rate today.
With regard to item 4, the report notes the probability of large migrations
occurring, but fails to notice the consequence, in carbon terms, of large numbers
of people from undeveloped nations coming into developed nations. For instance,
the 3 million annual increase in population in the United States is largely
a result of such movements, and makes the United States a 'rogue nation', in
that it is continually increasing its already excessive emissions in step with
its population growth.
With regard to item 5, the report seems to take the same line as most governments,
namely that globalization is an unstoppable force which it is useless to oppose
(or alternatively that it is something to be welcomed).
With regard to item 6, it is clear that the thought of anything but continued
economic growth hardly crosses Stern's mind. He is no Thomas Malthus, John Stuart
Mill or Maynard Keynes. Thus item 6 is not dealt with.
Conclusions
The report could be welcomed for the stress it places on the need to reduce
carbon emissions, but it is also dangerous, in that it implies that the task
is easier than it is, mainly by failing to deal with the items 2 to 6. They
too need to be addressed to get a rounded picture of the world's predicament.
The dangers of the report being misinterpreted are very great. For instance,
Anatole Kaletsky, associate editor of the Times newspaper, wrote thus on 2nd
November:
To appeal for more ambitious policies on global warming, therefore, is not to
demand self-sacrifice and austerity; but on the contrary, to create conditions
for higher living standards, more consumption and faster economic growth. This
is by far the most important message of the Stern report.