Denying the Climate Catastrophe: 9. A Low-Cost Insurance Policy
This is Chapter 9 (the final chapter) of an ongoing series. Other parts of the series are here:
- Introduction
- Greenhouse Gas Theory
- Feedbacks
- A) Actual Temperature Data; B) Problems with the Surface Temperature Record
- Attribution of Past Warming: A) Arguments for it being Man-Made; B) Natural Attribution
- Climate Models vs. Actual Temperatures
- Are We Already Seeing Climate Change
- The Lukewarmer Middle Ground
- A Low-Cost Insurance Policy (this article)
While I have shown over the previous chapters that there is good reason to be skeptical of a future man-made climate catastrophe (at least from CO2), I am appalled at all the absolutely stupid, counter-productive things the government has implemented in the name of climate change, all of which have costly distorting effects on the economy while doing extremely little to affect man-made greenhouse gas production. For example:
- Corn ethanol mandates and subsidies, which study after study have shown to have zero net effect on CO2 emissions, and which likely still exist only because the first Presidential primary is in Iowa. Even Koch Industries, who is one of the largest beneficiaries of this corporate welfare, has called for their abolition
- Electric car subsidies, 90% of which go to the wealthy to help subsidize their virtue signalling, and which require morefossil fuels to power than an unsubsidized Prius or even than a SUV.
- Wind subsidies, which are promoting the stupidist form for power ever, whose unpredictabilty means fossil fuel plants still have to be kept running on hot backup and whose blades are the single largest threat to endangered bird species.
- Bad government technology bets like the massive public subsidies of failed Solyndra
Even when government programs do likely have an impact of CO2, they are seldom managed intelligently. For example, the government subsidizes solar panel installations, presumably to reduce their cost to consumers, but then imposes duties on imported panels to raise their price (indicating that the program has become more of a crony subsidy for US solar panel makers, which is typical of the life-cycle of these types of government interventions). Obama's coal power plan, also known as his war on coal, will certainly reduce some CO2 from electricity generation but at a very high cost to consumers and industries. Steps like this are taken without any idea of whether this is the lowest cost approach to reducing CO2 production -- likely it is not given the arbitrary aspects of the program.
For years I have opposed steps like a Federal carbon tax or cap and trade system because I believe (and still believe) them to be unnecessary given the modest amount of man-made warming I expect over the next century. I would expect to see about one degree C of man-made warming between now and 2100, and believe most of the cries that "we are already seeing catastrophic climate changes" are in fact panics driven by normal natural variation (most supposed trends, say in hurricanes or tornadoes or heat waves, can't actually be found when one looks at the official data).
But I am exhausted with all the stupid, costly, crony legislation that passes in the name of climate change action. I am convinced there is a better approach that will have more impact on man-made CO2 and simultaneously will benefit the economy vs. our current starting point. So here goes:
The Plan
Point 1: Impose a Federal carbon tax on fuel.
I am open to a range of actual tax amounts, as long as point 2 below is also part of the plan. Something that prices CO2 between $25 and $45 a ton seems to match the mainstream estimates out there of the social costs of CO2. I think methane is a rounding error, but one could make an adjustment to the natural gas tax numbers to take into account methane leakage in the production chain. I am even open to make the tax=0 on biofuels given these fuels are recycling carbon from the atmosphere.
A Pigovian tax on carbon in fuels is going to be the most efficient possible way to reduce CO2 production. What is the best way to reduce CO2 -- by substituting gas for coal? by more conservation? by solar, or wind? with biofuels? With a carbon tax, we don't have to figure it out. Different approaches will be tested in the marketplace. Cap and trade could theoretically do the same thing, but while this worked well in some niche markets (like SO2 emissions), it has not worked at all in European markets for CO2. There has just been too many opportunities for cronyism, too much weird accounting for things like offsets that is hard to do well, and too much temptation to pick winners and losers.
Point 2: Offset 100% of carbon tax proceeds against the payroll tax
Yes, there are likely many politicians, given their incentives, that would love a big new pool of money they could use to send largess, from more health care spending to more aircraft carriers, to their favored constituent groups. But we simply are not going to get Conservatives (and libertarians) on board for a net tax increase, particularly one to address an issue they may not agree is an issue at all. So our plan will use carbon tax revenues to reduce other Federal taxes.
I think the best choice would be to reduce the payroll tax. Why? First, the carbon tax will necessarily be regressive (as are most consumption taxes) and the most regressive other major Federal tax we have are payroll taxes. Offsetting income taxes would likely be a non-starter on the Left, as no matter how one structures the tax reduction the rich would get most of it since they pay most of the income taxes.
There is another benefit of reducing the payroll tax -- it would mean that we are replacing a consumption tax on labor with a consumption tax on fuel. It is always dangerous to make gut-feel assessments of complex systems like the economy, but my sense is that this swap might even have net benefits for the economy -- ie we might want to do it even if there was no such thing as greenhouse gas warming. In theory, labor and fuel are economically equivalent in that they are both production raw materials. But in practice, they are treated entirely differently by the public. Few people care about the full productive employment of our underground fuel reserves, but nearly everybody cares about the full productive employment of our labor force. After all, for most people, the primary single metric of economic health is the unemployment rate. So replacing a disincentive to hire with a disincentive to use fuel could well be popular.
Point 3: Eliminate all the stupid stuff
Oddly enough, this might be the hardest part politically because every subsidy, no matter how idiotic, has a hard core of beneficiaries who will defend it to the death -- this the the concentrated benefits, dispersed cost phenomena that makes it hard to change many government programs. But never-the-less I propose that we eliminate all the current Federal subsidies, mandates, and prohibitions that have been justified by climate change. Ethanol rules and mandates, solar subsidies, wind subsidies, EV subsidies, targeted technology investments, coal plant bans, pipeline bans, drilling bans -- it all should go. The carbon tax does the work.
States can continue to do whatever they want -- we don't need the Feds to step on states any more than they do already, and I continue to like the 50 state laboratory concept. If California wants to continue to subsidize wind generators, let them do it. That is between the state and its taxpayers (and for those who think the California legislature is crazy, that is what U-Haul is for).
Point 4: Revamp our nuclear regulatory regime
As much as alternative energy enthusiasts would like to deny it, the world needs reliable, 24-hour baseload power -- and wind and solar are not going to do it (without a change in storage technology of at least 2 orders of magnitude in cost). The only carbon-free baseload power technology that is currently viable is nuclear.
I will observe that nuclear power suffers under some of the same problems as commercial space flight -- the government helped force the technology faster than it might have grown organically on its own, which paradoxically has slowed its long-term development. Early nuclear power probably was not ready for prime time, and the hangover from problems and perceptions of this era have made it hard to proceed even when better technologies have existed. But we are at least 2 generations of technology past what is in most US nuclear plants. Small air-cooled thorium reactors and other technologies exist that could provide reliable safe power for over 100 years. I am not an expert on nuclear regulation, but it strikes me that a regime similar to aircraft safety, where a few designs are approved and used over and over makes sense. France, which has the strongest nuclear base in the world, followed this strategy. Using thorium could also have the advantage of making the technology more exportable, since its utility in weapons production would be limited.
Point 5: Help clean up Chinese, and Asian, coal production
One of the hard parts about fighting CO2 emissions, vs. all the other emissions we have tackled in the past (NOx, SOx, soot/particulates, unburned hydrocarbons, etc), is that we simply don't know how to combust fossil fuels without creating CO2 -- CO2 is inherent to the base chemical reaction of the combustion. But we do know how to burn coal without tons of particulates and smog and acid rain -- and we know how to do it economically enough to support a growing, prosperous modern economy.
In my mind it is utterly pointless to ask China to limit their CO2 growth. China has seen the miracle over the last 30 years of having almost a billion people exit poverty. This is an event unprecedented in human history, and they have achieved it in part by burning every molecule of fossil fuels they can get their hands on, and they are unlikely to accept limitations on fossil fuel consumption that will derail this economic progress. But I think it is reasonable to help China stop making their air unbreathable, a goal that is entirely compatible with continued economic growth. In 20 years, when we have figured out and started to build some modern nuclear designs, I am sure the Chinese will be happy to copy these and start working on their CO2 output, but for now their Maslov hierarchy of needs should point more towards breathable air.
As a bonus, this would pay one immediate climate change benefit that likely would dwarf the near-term effect of CO2 reduction. Right now, much of this soot from Asian coal plants lands on the ice in the Arctic and Greenland. This black carbon changes the albedo of the ice, causing it to reflect less sunlight and absorb more heat. The net effect is more melting ice and higher Arctic temperatures. A lot of folks, including myself, think that the recent melting of Arctic sea ice and rising Arctic temperatures is more attributable to Asian black carbon pollution than to CO2 and greenhouse gas warming (particularly since similar warming and sea ice melting is not seen in the Antarctic, where there is not a problem with soot pollution).
Final Thoughts
At its core, this is a very low cost, even negative cost, climate insurance policy. The carbon tax combined with a market economy does the work of identifying the most efficient ways to reduce CO2 production. The economy benefits from the removal of a myriad of distortions and crony give-aways, while also potentially benefiting from the replacement of a consumption tax on labor with a consumption tax on fuel. The near-term effect on CO2 is small (since the US is only a small part of the global emissions picture), but actually larger than the near-term effect of all the haphazard current programs, and almost certainly cheaper to obtain. As an added benefit, if you can help China with its soot problem, we could see immediate improvements in probably the most visible front of man-made climate change: in the Arctic.
For those who have hung with me this entire series, many thanks for your interest. If you have questions, concerns, or outraged refutations, you are welcome to email me at the link above.
Can't fix stupid. The responses to my point range from breathtaking stupid to gobsmacking ignorant. Just like the evil people in the EPA who delight in destroying coal communities in the fight against an imaginary boogeyman.
1 and 2 are true with regards to exactly what he said. CO2 has not been proven (with EMPIRICAL evidence) to CAUSE planetary warming. And last I checked, plants thrive on CO2, so he's not incorrect in his assertion in number 2 (humans thrive in warmer weather instead of colder weather, crops yield more etc). Humans adapt very well and this is never talked about with regards to global warming either. Number three is speculative so I'm with you there.
There certainly all sorts of hidden agendas, and the quest for power is one of them.
I would add egoism, egotism and the proselytization of a secular stealth religion to the list.
They do agree. And all data is adjusted, whether in climate science, chemistry, astronomy, whatever. It's called "calibration."
I will say that's stupid. First, scientists are not 'alarmists." They're telling you what has been found. If you think that's alarming, good, because GW is alarming. And no, most scientists did not think the universe was steady -- Hoyle really was in a minority.
We can't predict where a flow of water will go exactly, but we can predict it will run downhill.
Ignored in this part of the post (but not in Point 5 when discussing the Chinese economy) is the quesiton of whether the health of the aggregate economy can be decoupled from a supply of abundant, cheap energy.
Placing a carbon tax on fossil fuels will drive the cost of energy up, because the so-called “green” energy supplies are not cost competitite with fossil fuels. They are more expensive.
So the bottom line is that a carbon tax would make the economy less efficient, which is antithetical to Progressivism, since its holy grail is economic efficiency.
How does putting fossil fuels off limits by penalizing their use, forcing the use of less efficient and more costly to produce energy sources, advance the goal of economic efficiency?
It doesn’t, of course.
http://i.imgur.com/0w42Jtn.png
If the cost of energy goes up, then the cost of labor has to go down (assuming no technological breakthroughs) if the cost of end-use commodities is to remain the same. This is simple math.
Without GHGs, the planet is a cold rock. And there are not a number of really good reasons that increasing carbon dioxide in the atmosphere is a pronounced benefit to mankind.
Thanks!
Best,
D
Henry, Very well said. There is no point arguing with the religiously converted, like Dano. Keep up the good work. The fact that CO2 is hugely beneficial seems to pass by most people, as well as all governments and their well paid cronies. Increased CO2 is already greening the deserts, as well as increasing crop yields. After all we are all carbon based.
You're not counting all the costs. Including the cost of doing nothing and continuing to warm the planet. Big, big costs even the banks don't want;
Cost of not acting on climate change $44 trillion: Citi
Anmar Frangoul | Special to CNBC.com
Tuesday, 18 Aug 2015 | 7:05 AM ET
"Up to $44 trillion could be going up in smoke if the world does not act on climate change, according to the latest piece of research from U.S. banking giant Citigroup.
The report – Energy Darwinism II: Why a Low Carbon Future Doesn't Have to Cost the Earth -- has forecast that spending on energy will hit around $200 trillion in the next 25 years..." http://www.cnbc.com/2015/08/18/cost-of-not-acting-on-climate-change-44-trillion-citi.html
best,
D
You were duped. Wny were you so easily duped?
Best,
D
The cosmic rays don't change the output of the sun. What they do is interact with particulates in the upper atmosphere to increase the number of high clouds. Those clouds increase the albedo which in turn reduces the incoming radiation from the sun. The electromagnetic effects of the solar wind bends those cosmic rays away from the solar system to a greater or lesser degree as it fluctuates.
While it's hardly the be all and end all cause, it is an another actual phenomena that enters into the chaotic mix that results in the net climate we experience.
The question is whether or not it's an honest adjustment.
Scientists are not angels any more than are politicians or activists or anyone else for that matter. They know which side of the bread is buttered and they like that side as much as anyone else.
I suggest you learn what scholar.google.com says about 1 and 2 instead of using a search engine that leads you to the sites that feed your incorrect belief system.
There is no question. Since denialists and fossil fool companies can't show anything better or wrong, the question is whether it is an honest question in the first place.
Best,
D
The net result is a tiny fraction of 1 w/m^2 negative forcing, out of ~2.1 w/m^2 of human positive forcing thus far.
Best,
D
This is the most intelligent response I have seen on this subject. Congratulations.
With the fossil fuel industry being very capital intensive and highly automate, the employment in very inelastic relative to demand. Look at the small drop in employment with a 50% drop in sales. The corresponding payroll taxes is far more elastic with more jobs gained with lower cost labor and labor that has more net in their pockets. As we have already used payroll tax decreases for a stimulus, presumably we know the stimulus impacts. Per payroll tax dollar decrease, the stimulus effect is very large which is why we had the temporary decrease in 2008.
With a $25/ton of CO2 tax increase, that would be about 4.5¢ / lb of coal (25.00 * 44/12 / 2000) and one lb of coal makes about a KWH of electricity for an increase of about 4.5¢/kwh. My electricity costs in California over 20¢/kwh so even for coal sources, it isn't big. Electricity is only a small % of my total budget and less than things like medical insurance so an increase of about 20% in my electricity, if it was coal powered, is far less significant than what the medial establishment has done to me this year. In natural gas area, the impact would be down in the < 1¢ /kwh range for combined cycle gas powered plants which is in the noise everywhere. For gasoline were are talking about 14¢/gal range which is less than the monthly variation in my area or variation between stations.
A detailed economic analysis will show that your proposal is a net economic stimulus and should be done just to improve the economy independent of global warming. The political class and associated cronies are the groups that won't benefit from a revenue neutral tax shift from payroll to carbon dioxide. It would destroy their rent seeking symbiosis. Isn't "We the People" the real objective, not benefiting political rulers and their dynasties.
The potential miliary savings would also be huge. If the carbon tax increased fast enough to maintain the same amount of payroll tax reduction as people responded with lower carbon usage, it would force the Middle East to cut their prices creating payroll problems for ISIL and the other thugs of the ME. Without something worth stealing, war and terrorism become less viable. We could even have a futures market on the carbon tax rate necessary to hold the payroll tax constant. The big fossil fuel companies could then hedge against some new lower cost technology blowing them out of the energy market.
FYI - oxygen and nitrogen are also greenhouse gases maybe not as powerful, though the are in fact greenhouse gases. The claim that the planet earth would be a cold rock without the GHG's that make up less than 1% of atmosphere is false.
The claim that the planet earth would be a cold rock without the GHG's that make up less than 1% of atmosphere is false.
Physics.
Educate yourself.
Best,
D
Here is a crazy suggestion...let people decide for themselves if they want to purchase low carbon options, not have it forced down their throat by a power that will always corrupt itself.
China is also moving forward on next-generation nuclear reactors.
By volume, on a global average, water vapor makes up about 95% of atmospheric greenhouse gases, CO2 is maybe as much as 3%. HOWEVER and FURTHERMORE, water vapor molecules are somewhat more potent than CO2 molecules at producing a greenhouse effect.....
Now, why is the role of water vapor disregarded or ignored in just about all of the literature? Elifino. Maybe the control freaks looked at the implications and said, "OOPS, BY ALL MEANS, DON'T GO THERE." They saw no opportunity to deceive for the purposes of exercising control over their semi-trained marionettes, maybe?
Wups.....Whoa, hold it. If the thermometers that are being used are adjusted so that the temperature that they read matches the temperatures of a natural temperature standard such as an ice water bath, then the thermometer is being calibrated.
Are you saying that if the thermometer is then used to measure an unknown temperature and the reading that is made does not match the theoretical or desired temperature, then the measurement data should be adjusted and that is called "calibration?" Sheesh-a-mighty. "Bastardized data" is the phrase that I have heard used quite often to describe the results of that kind of procedure.
Ignored in them thar lit'ritcher everybody!
I'll take those points on offer:
o Water vapor makes up 95% of the greenhouse effect [30 points]
https://www.facebook.com/ClimateDenialistTalkingPointGame
Best,
D
The claim that the planet earth would be a cold rock without the GHG's that make up less than 1% of atmosphere is false.
Physics.
Educate yourself.
Dano2 - We are called skeptics because we dont believe every unsupported "scientific fact"
Since co2 and the other so called greenhouse gases have increase nearly 50% in the last 150 years, maybe you can explain why the earths temp has only increased to a relatively small amount that time span. (ie a comparable level with the MWP)
If you need to give us a citation - try to use a real science web site instead of the advocacy web sites that pretend to be science web sites such as skeptical science or real climate.
Cheers.
You'll be taught these basics in 10th grade, good luck!
Best,
D
Scientists who enjoy a nice income that depends on government grants to study climate change are likely to find evidence to support the government’s chosen narrative on climate change.
The fact is that our species could not have developed without our protective atmosphere, which created a climate suitable for humankind to flourish. A second fact is that that CO2 level has averaged 280 ppm for tens of thousands of years. We are now over 400 ppm, and have started to see the gradual increase in temperature. Over time, it lines up with CO2 increase. With too much CO2, the planet becomes too hot to sustain us. Try living in 120 degree temperatures. While certain crops thrive in increased CO2, others do not. And the nutrients they need from the soil disappear. Plus none thrive in excess heat, or without water. As growing regions move toward the poles, there is less and less sun. So we simply will not grow enough food. Think it through.
Absurdity. Most people understand that capitalism has been the best system known to lift people from poverty, but it still requires some regulation and oversight or you end up with massive pollution and lower quality of life. Global warming is a scientific observation, and it is not debated or disputed anywhere else in the world. Only in the US. And only because the right has been duped by the fossil fuel lobby into disputing science by the same people who disputed that cigarettes cause cancer.
The difference is that we are not creating more water vapor. Water exists in a balance. It goes up, it rains down. CO2, however, has been sequestered for thousands of years, and we are removing it and burning it at a rapid rate which changes the atmospheric balance.
A carbon fee makes sense, if only to remove the indirect subsidy we provide to fossil fuels, since we absorb the external costs rather than the fuel source. It has been estimated that the health care costs alone of burning coal approach $100B/yr, which we pay for in our health care, rather than making coal pay its way. If you are going to eliminate subsidies for renewables, fine, but start by eliminating the massive subsidies we provide to fossil fuels, both direct and indirect. The fossil fuel industry benefits from tax breaks we provide to no other industry (the depletion allowance, which lets you depreciate forever, even after depreciating 100% of costs), plus it extracts resources from taxpayer owned land without paying a market royalty, plus we absorb the externalities. So start there. Then, apply the proceeds to taxes which make US business less competitive globally, like our corporate tax rate, the highest in the developed world, to net faster growth, and rebate a large chunk to the people to offset higher energy prices. Then as the carbon revenue gradually declines, we have eliminated a burdensome tax, grown the economy, and held families harmless.
Good point, but there is more water vapor in the system, with the increased heat evaporation increases putting more WV into the air. ;o)
Best,
D
Catastrophic anthropogenic global warming is not a scientific observation, as this series lays out in some detail. It is a projection based on mathematical models which are legitimately subject to challenge. You are not a "sensible centrist" if you swallow the alarmists' position hook, line, and sinker. As to the fossil fuel lobby, in today's world the incentives (in terms of foundation grants, academic advancement, media acclaim, etc.) to support the alarmist view are far greater than the incentives to be skeptical. No one denies that capitalism requires some regulation and oversight; the question is how much and on what basis. And my original post was at least somewhat tongue-in-cheek.
http://www.drroyspencer.com/wp-content/uploads/CMIP5-73-models-vs-obs-20N-20S-MT-5-yr-means1.png
Dano - how about comparison with the mid troposhere - a more accurate comparison of the models
But hey - nice cherrypicking of the data - just like all the agw believers
Always impressive that your best citation is a non-scientific juvenile website
It's a list, not a citation. Where would you like the list to be kept so you don't pretend to have a little sads? AOL? ClownHall?
Best,
D
Thanks for the deceptive Christy chart, not published and widely panned as deceptive.
It's the best denialists can do: depending on charts designed to mislead.
Best,
D
Cosmic rays have no correlation with temp, period. If X isn't correlated with Y, X cannot cause Y.
What is a Wny?
Read the East Anglia emails -- Michael Mann and others argued after they were exposed that they were joking -- I guess Stalin was too, eh?
Anyhow:
1) Retrospective data are of inherent low quality because they are highly prone to bias. At best, even when fairly done, they are hand-wavers. This doesn't mean they carry no weight in cost (including risk) v. benefit discussions but they are far from weighty.
2) Publication bias is only part of a larger problem, namely grant-awarding bias. The same folks who are heavily invested in the current narrative are the same guys who control the ever-increasing pile of funds. Little surprise that they are prone to fund those with whom they anticipate will develop "results" in concordance with the popular narrative. East Anglia and the other universities supposedly "investigated" the emails, but they are far from objective since the email folks are major rain-makers for the universities themselves.
3) Humans generally do things for just a few base reasons: 1) gold, 2) God, 3) glory, 4) fame, 5) sex. The god of science has largely replaced the conventional God, but the rest remain in play. Heck, Michael Mann answered an editorial in our small local newspaper within TWO days of when the former was published.
4) The proponents are highly organized. They seek to run our lives for our own good. So did Lenin.
I'm going to go with solar effects causing increase in water vapor creating the canopy effect.
Seems reasonable considering a pause in warming coinciding with an extended vacation of solar activity.
In the end, the cycle of warming even as much as 2C doesn't seem to have the doom and gloom projected, that history seems to show such variation in temps that obviously humans have very, very little impact - if any.
Yeah, I know - models, models, models. Bottom line is... climate changes, regardless of what humans do. It would be more appropriate to address waste and pollution and spend the money there than adjusting the .04% of CO2 down to .039%.
And I live in Vermont so a temp rise is welcomed. Just saying.
Cuz them thar scientist all livin in the lap of luxury, don'tcha know.
Best,
D
Climategate! Drink!
Best,
D
I'll need a nice vinaigrette to go with that word salad.
Best,
D
Read Mann's pleadings in the appeal of the denial of the dismissal of the suit under the SLAPP statute. Amazingly he claimed to have been exonorated by 7 investigations even though only 2 did any investigation of mann (both those of which could hardly be termed a credible investigation)
And I'll go with that climate inducing grilled steak made from flatulent cows.
So rare it moos.
I was directed here by Megan McCardle's fine essay on Bloomberg today. Here is the problem: too many economists refuse to acknowledge Public Choice economics. While I don't dispute that your proposed plan would be benign or beneficial, the problem is, not a single governmental entity, nor their allied ENGOs have ever expressed openness to your plan. Yes, they'll take the tax or cap-and-trade. But they have never, and will never agree to remove the giant mass of regulations related to greenhouse gases that are massively distorting the economy. Thinking otherwise is just as fallacious as those who think we'll power the world with unicorns and rainbows. Too many economists allow themselves to become efficiency engineers for the state. They're too willing to say "Oh, okay, you want to drive this industry (coal) or that consumer choice (SUVs) out of existence...here's the most economically efficient way to do it." As a colleague of mine one said, only half in jest, there are too many economists willing to build a more efficient path to serfdom.
As a one-time biomedical scientist and federal research institute director, your assessment is, at least in part, accurate, especially for areas like anthropogenic climate in which where pronouncements can not be prospectively demonstrated to be wrong (or right) within human lifetimes. The government money game you hint at is a portion of the generally well-disguised but not small underbelly of the secular quasi-religion we like to call science.
Better to payout the proceeds of the CO2 tax to those who remove co2 from the air. Possible methods include biochar, deep ocean iron fertilization and enhanced weathering. You might be able to reach equilibrium at a low price.