Jeremy Grantham, who has long had investments in Timber and Natural Resources, puts a surprising smackdown on the Global Warming denialist crowd.
In the updated version of Bailout Nation, I specifically mention the same think tanks slavish devotion to ideology and disproven ideas (EMH, etc.). I find it encouraging Grantham calls them out as well.
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1) The amount of carbon dioxide (CO2) in the atmosphere, after at least several hundred thousand years of remaining within a constant range, started to rise with the advent of the Industrial Revolution. It has increased by almost 40% and is rising each year. This is certain and straightforward.
2) One of the properties of CO2 is that it creates a greenhouse effect and, all other things being equal, an increase in its concentration in the atmosphere causes the Earth's temperature to rise. This is just physics. (The amount of other greenhouse gases in the atmosphere, such as methane, has also risen steeply since industrialization, which has added to the impact of higher CO2 levels.)
3) Several other factors, like changes in solar output, have major in�uences on climate over millennia, but these effects have been observed and measured. They alone cannot explain the rise in the global temperature over the past 50 years.
4) The uncertainties arise when it comes to the interaction between greenhouse gases and other factors in the complicated climate system. It is impossible to be sure exactly how quickly or how much the temperature will rise. But, the past can be measured. The temperature has indeed steadily risen over the past century while greenhouse gas levels have increased. But the forecasts still range very widely for what will happen in the future, ranging from a small but still potentially harmful rise of 1 to 2 degrees Fahrenheit to a potentially disastrous level of +6 to +10 degrees Fahrenheit within this century. A warmer atmosphere melts glaciers and ice sheets, and causes global sea levels to rise. A warmer atmosphere also contains more energy and holds more water, changing the global occurrences of storms, � oods, and other extreme weather events.
5) Skeptics argue that this wide range of uncertainty about future temperature changes lowers the need to act: "Why spend money when you're not certain?" But since the penalties can rise at an accelerating rate at the tail, a wider range implies a greater risk (and a greater expected value of the costs.) This is logically and mathematically rigorous and yet is still argued.
6) Pascal asks the question: What is the expected value of a very small chance of an in? nite loss? And, he answers, "In?nite." In this example, what is the cost of lowering CO2 output and having the long-term effect of increasing CO2 turn out to be nominal? The cost appears to be equal to foregoing, once in your life, six months' to one year's global growth "“ 2% to 4% or less. The bene?ts, even with no warming, include: energy independence from the Middle East; more jobs, since wind and solar power and increased ef?ciency are more labor-intensive than another coal-? red power plant; less pollution of streams and air; and an early leadership role for the U.S. in industries that will inevitably become important. Conversely, what are the costs of not acting on prevention when the results turn out to be serious: costs that may dwarf those for prevention; and probable political destabilization from droughts, famine, mass migrations, and even war. And, to Pascal's real point, what might be the cost at the very extreme end of the distribution: De?nitely life changing, possibly life threatening.?
7) The biggest cost of all from global warming is likely to be the accumulated loss of biodiversity. This features nowhere in economic cost-bene?t analysis because, not surprisingly, it is hard to put a price on that which is priceless.
8) A special word on the right-leaning think tanks: As libertarians, they abhor the need for government spending or even governmental leadership, which in their opinion is best left to private enterprise. In general, this may be an excellent idea. But global warming is a classic tragedy of the commons "“ seeking your own individual advantage, for once, does not lead to the common good, and the problem desperately needs government leadership and regulation. Sensing this, these think tanks have allowed their drive for desirable policy to trump science. Not a good idea.
9) Also, I should make a brief note to my own group "“ die hard contrarians. Dear fellow contrarians, I know the majority is usually wrong in the behavioral jungle of the stock market. And Heaven knows I have seen the soft scientists who lead ?nance theory attempt to bully their way to a uniform acceptance of the bankrupt theory of rational expectations and market ef?ciency. But climate warming involves hard science. The two most prestigious bastions of hard science are the National Academy in the U.S. and the Royal Society in the U.K., to which Isaac Newton and the rest of that huge 18th century cohort of brilliant scientists belonged. The presidents of both societies wrote a note recently, emphasizing the seriousness of the climate problem and that it was man-made. (See the attachment to last quarter's Letter.) Both societies have also made full reports on behalf of their membership stating the same. Do we believe the whole elite of science is in a conspiracy? At some point in the development of a scienti?c truth, contrarians risk becoming ï¬?at earthers.
10) Conspiracy theorists claim to believe that global warming is a carefully constructed hoax driven by scientists desperate for "¦ what? Being needled by nonscienti?c newspaper reports, by blogs, and by right-wing politicians and think tanks? Most hard scientists hate themselves or their colleagues for being in the news. Being a climate scientist spokesman has already become a hindrance to an academic career, including tenure. I have a much simpler but plausible "conspiracy theory": that fossil energy companies, driven by the need to protect hundreds of billions of dollars of pro? ts, encourage obfuscation of the inconvenient scienti? c results.
11) Why are we arguing the issue? Challenging vested interests as powerful as the oil and coal lobbies was never going to be easy. Scientists are not naturally aggressive defenders of arguments. In short, they are conservatives by training: never, ever risk overstating your ideas. The skeptics are far, far more determined and expert propagandists to boot. They are also well funded. That smoking caused cancer was obfuscated deliberately and effectively for 20 years at a cost of hundreds of thousands of extra deaths.
We know that for certain now, yet those who caused this fatal delay have never been held accountable. The pro? ts of the oil and coal industry make tobacco's resources look like a rounding error. In some notable cases, the obfuscators of global warming actually use the same "experts" as the tobacco industry did! The obfuscators' simple and direct motivation "“ making money in the near term, which anyone can relate to "“ combined with their resources and, as it turns out, propaganda talents, have meant that we are arguing the science long after it has been nailed down. I, for one, admire them for their P.R. skills, while wondering, as always: "Have they no grandchildren?"
12) Almost no one wants to change. The long-established status quo is very comfortable, and we are used to its de?ciencies. But for this problem we must change. This is never easy.
13) Almost everyone wants to hear good news. They want to believe that dangerous global warming is a hoax. They, therefore, desperately want to believe the skeptics. This is a problem for all of us.
Postscript Global warming will be the most important investment issue for the foreseeable future. But how to make money around this issue in the next few years is not yet clear to me. In a fast-moving ?eld rife with treacherous politics, there will be many failures. Marketing a "climate" fund would be much easier than outperforming with it.
Jeremy Grantham hits the nail squarely on the head. Excellent analysis.
Well now. All this recession/depression porn finally gets too much, so we need end-of-the-world-as-we- know-it porn to keep us enthralled and credulous that indeed, if only we had the right policy prescriptions we could not only save our economies but the very planet itself?
There’s too much to refute in one post, so I’ll not bother with it here. In my Attic, I think I’ll rip it to shreds…
Before you swallow, please review these views..
http://www.kusi.com/home/78477082.html?video=YHI&t=a
http://www.youtube.com/watch?v=BVFOoJoaYog
Curmudgeon- “There’s too much to refute so I won’t bother” has the same effect as “I can’t refute it”. Any recommended reading you’d like to advocate instead of harrumphing off?
My favorite intervention is a carbon tax. You don't even have to accept global warming to accept that as a good idea. We would fight the deficit, reduce our funding of enemies like Iran, Venezuela and terrorist, reduce air pollution. Its already a win, win, win before we add the reduction in global warming.
Tezzer, yeah, I can refute it. And will. I just won’t bother with it here, and I haven’t the time at the moment. Give me a day and I’ll give you a linkfest. In the meantime, the video posted by icm63 should hold you over. Pick the first one.
DeDude–you know what’s funny? I do not belong to the church of global warming alarmism, yet I believe that we need to drastically alter (at least in the US) the source and rate of our fuel consumption, if for no other reasons than it would alleviate the need for more dead soldiers in God-awful places that happen to have oil. I’m a global warming heretic, but I’d heartily support a massive gasoline tax, for just the reasons you offer, except global warming, which is nonsense.
More convincing would be more discussion of the science & less discussion of the inferior psychology of the “deniers”. Some topics I would like discussed: 1. Why is Mars getting warmer too? Sun activity is a huge factor & needs more than Grantham’s glancing blow. 2. The NASA graft needs to be over a longer period; furthermore, description of the measurement methodology is needed to dispel the stories about weather stations located in what were once rural but are now heat islands, etc. 3. Tho’ CO2 has increased tremendously, it is still a tiny portion of the atmosphere. It’s effect & the counter reaction to whatever effect is has is a complicated issue that is not likely perfectly understood. 4. Why do we never see a good coherent concise presentation of the evidence from the scientists, but instead condemnations of the ‘deniers’ as stupid people who have missed out on the debate that is already over?
This “smackdown” is sadly very poor from a scientific perspective. I think it could be as effective at proving the opposite of its premise. First hint: when someone says “This is certain and straightforward.” You can safely conclude that they do not really understand science.
If you want to put forth an argument for global warming to someone who will evaluate it with scientific honesty, it does not take all of those easily rebuffed words. Simply ask what is more likely: that Mankind is adding energy to the system, or removing it.
Here is an interesting thought: It is actually politicians that determine what scientists believe in the modern world. How can that be? Scientists have to make a living too. Guess where their funding comes from.
P.S. I have no opinion on global warming itself, not my field.
The arrogance and conceit of the global warmsters is awesome to behold.
We have been on this rock and rolling, tilited, dynamic ball of earth and water for what amounts to .01 cent vs the existence of the earth in quadrillions of Euros.
To think that we are any more than a pimple on the ass of a gnat is light years beyond hubris.
When the planet has had enough of our mistreatment, she will just get rid of us and go on her merry way bubbling, spinning, and doing her own thing until her light naturally goes out and she turns into a frigid cinder.
All treatises from the global warmsters should begin with a cautionary statement that it is for the ongoing relative comfort of humans that is at stake, and not the preservation of our climate thru various taxing schema, conservation, which is nothing more than a delaying tactic, and austerity.
They would gain a hell of a lot more credibility than they and their disciples and imitators now have.
I want to see at least one of these Cassandras refute the blinding light of truthiness about the REAL motives of the Warmsters.
And what Curmudgeon says….. in spades.
And who decides that it is “man made” global warming? The solid sheet of ice that covered North America disappeared rather quicky. What were the dynamics then?
Are we taking it on faith that man causes the warming and not the earth itself? If tempertures have risen since the industrial revolution does that equate to causation?
Kind of silly really to think we can keep the earth from doing what it does all on its very own.
Would one of the commenters who disagree with Grantham comment on why the scientific community, especially those referenced in the article, would take such a strong pro-global warming stance? What’s their motivation?
Oh god here we go again. A money manager telling us about the “facts” of global warming. Jerry should stick to trying to beat the S&P. He reminds me of Al “take care of this” Gore’s 2500 scientists who backed his inconvenient half truths. As it turns out most them could not read a thermometer.
There may or may not be global warming. I certainly hope there is warming because cooling kills by the 100’s of millions. But that said the idea that Jerry and crew have the sligthest idea how to slow it down is laughable. That’s the real tragedy–the hubris of the people who first failed with global cooling in the 70’s now put gauges at airports and tell us that it is warming.
LOL, then cry.
This site, http://motls.blogspot.com/, is hosted by a Czech physicist and is much like the TBP – heavy on the primary purpose (string theory and physics), related passions (anti-global warming), and personal interests (local community, etc.) He’s as passionate about the mathematics of climate modeling as BH is about Fusion IQ and market data analysis. If you want to see well documented and thoroughly explained counter-arguments for a well balanced picture, check him out.
Hey Barry,
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