Worldly Philosopher: The Cost of Climate Change - More Than Disasters
This week's Worldly Philosopher, Anthony Bonen, writes on the economic and social costs of unmitgated climate change.
A heated debate was sparked last week after Robert Pielke, Jr. wrote an article for Nate Silver's fivethirtyeight.com arguing that the rising costs of natural disasters are driven not by climate change, but by the world's increasing wealth. Pielke's spurious assertions have already been picked apart by ThinkProgress and Salon. But what strikes me is the bizarre narrowness of his argument.
For example, in a misleading statement on the IPCC's recent findings Pielke says: "There have been more heat waves and intense precipitation, but these phenomena are not significant drivers of disaster costs." Well sure, heat waves and intense precipitation are only minor aspects of disaster costs. But the economic costs of unmitigated climate change are far more wide-ranging than disasters alone.
In a recently released SCEPA report, my co-authors and I examine how the three integrated assessment models (IAMs) used by the US government translate climatic change into economic impacts. The report focuses on the formal mechanisms by which the DICE, FUND and PAGE models convert temperature increases, sea level rises and more intense storms into a dollar figure. These mechanisms are known as damage functions.
Although the IAMs use very different damage functions, they all base the impact of climate change costs on comparative scenarios. This only makes sense. The cost of climate change is not just the destruction of structures and objects; it comes from lower food production, worse health outcomes, higher indoor cooling costs and lost land to higher sea levels. While big storms and earthquakes capture the media's attention, incremental changes will have by far the greatest cumulative impact on our wellbeing.
Even among economists the consensus is that these costs will be profound. In fact, our report and an earlier article by our colleagues show these leading economic models, if anything, greatly underestimate the costs of climate change.
So don't be bamboozled by pseudo-climate skeptics like Pielke. Economists and climate scientists don't just add up the value of capital lost in storms like insurance agents. We are looking ahead and mapping out alternative options we, as a society, can take. That is how one assesses economic costs.