Climate change, economics, and journalists

Like many people, I too can't but wonder where the global climate change will take us, and have blogged, and "oped"ed about it too.  

Eric Pooley writes that as much as scientists are in agreement about most aspects of climate change, most economists are also in agreement about one thing: it is cheaper to act than not to act.  He writes:  

First, there is a broad consensus that the cost of climate inaction would greatly exceed the cost of climate action—it's cheaper to act than not to act. Reducing greenhouse gas emissions by moving to alternative energy sources and capturing carbon from coal-fired power plants will cost less in the long run than dealing with the effect of rising sea levels, drought, famine, wildfire, pestilence, and millions of climate refugees. (There are some outliers who disagree with this—Danish statistician Bjorn Lomborgcomes to mind—and some respected economists, like William Nordhaus, who argue that future, richer generations will be able to more easily shoulder the cost burden than we can.) But influential mainstream economists from Paul Volcker to Robert Stavins to Lord Nicholas Stern to Larry Summers all agree that action is cheaper than inaction, even if they disagree on much else (Stavins can't stand Stern's methodology; Summers prefers a carbon tax to cap-and-trade). Stavins, director of Harvard's Environmental Economics Program, phrased it this way in a recent paper: "There is general consensus among economists and policy analysts that a market-based policy instrument targeting CO₂emissions ... should be a central element of any domestic climate policy."

The second area of consensus concerns the short-term cost of climate action—the question of how expensive it will be to preserve a climate that is hospitable to humans. The Environmental Defense Fund pointed to this consensus last year when it published a study of five nonpartisan academic and governmental economic forecasts and concluded that "the median projected impact of climate policy on U.S. GDP is less than one-half of one percent for the period 2010-2030, and under three-quarters of one percent through the middle of the century." (That's a lot of money—U.S. GDP in 2007 was $13.8 trillion—but Stavins has estimated the cumulative cost of all U.S. environmental regulation to date at 1 percent of GDP, and it has not been an insupportable burden.) Stavins' climate-cost calculations come in a bit higher than those in the EDF study, ranging from less than 0.5 percent to 1 percent of U.S. GDP; he describes these as "significant but affordable impacts" that are "consistent with findings from other studies." The Stern Review on the Economics of Climate Change, an influential but controversial 2006 report for the British government, concluded that climate action would cost 1 percent of global GDP (though Stern now warns that our failure to act is raising the price tag) and that inaction could reduce global GDP by up to 20 percent.

So, one might then wonder why we don't hear much about the consensus among economists.  Pooley faults journalists for this, and partly the economists themselves.  He notes that even when economists agree on the larger picture, they tend to disagree a lot, which then leads journalists to think that economists are split on this, and they then resort to reporting "both sides" of the story ....

But, all these don't worry me at all.  

I lose sleep thinking that my future and yours are in the hands of bozos, er, politicians in this country and all over the world.  Here is an example (not from climate change discussions, but from the current economic crisis).  Megan McArdle writes:

I sat here in front of my television and laughed at Maxine Waters, because her apparently random ramblings are a true spectacle.  One laughs because one can't cry.  But this woman is sitting on the House Financial Services Committee.  She is supposed to help craft the bills that govern our financial system.  And she clearly doesn't have the first shred of an inkling of a clue of how said financial system works.  Her questions had the air of someone who couldn't quite wrap her mind around the complexities of the E-Z Reader consumer activist pamphlets from which she had presumably cribbed them.

That's not really funny.  This is the crack talent that's supposed to reform the banking system into something more robust?