Bjorn Lomborg responds to Stiglitz on climate change

NY Times letter to the editor.

"To the Editor:

Reviewing my book, “False Alarm,” in the Aug. 9 issue, Joseph E. Stiglitz misses its main argument: Climate change is a real, man-made and substantial problem. For instance, the U.N. Climate Panel estimates that hurricanes might become fewer, but fiercer, resulting in more damages.

The total negative climate impact is estimated by climate economics, spearheaded by the only climate economist to win a Nobel, William Nordhaus from Yale University. Studies show that while the cost of stronger hurricanes will rise, resilience from richer societies will counteract this effect. By 2100, one highly quoted Nature article suggests that fiercer hurricanes will cost the world 0.02 percent of G.D.P. Similarly, climate will mostly make agriculture harder, although adaptation will mitigate this impact. The largest empirical study finds the total cost by 2100 at 0.26 percent of G.D.P. Adding up these and many other costs, we can come to a total cost of unmitigated climate change by 2100 of about 3 percent of G.D.P.

That makes climate change a problem, but it seems counter to much end-of-world media coverage. That is because most climate stories are told without realistic, moderating effects. The recent headlines that 187 million people will be flooded by 2100 assumes no adaptation. With realistic adaptation, the actual number is 600 times lower.

Climate policies are also costly. Cutting 80 percent of the E.U. emissions by 2050 will cost 5 percent of G.D.P. Going net-zero, as proposed by the presidential candidate Joseph Biden, has been independently assessed by only one nation, New Zealand. It found the cost would be at least 16 percent of G.D.P.

The fundamental insight from climate economics is that we need to endure both the cost of climate damage and climate policy damage. Cutting too little carbon makes the world endure higher total costs, but similarly, cutting too much will lead to more total suffering.

I take issue with many other aspects of Stiglitz’s central argument. Crucially, in his rush to rubbish my book, its central point, with which I think Stiglitz would agree, gets lost: Since many climate policies are inefficient, we should be careful to tackle climate change with smart and effective policies like a carbon tax, green innovation and adaptation.

Bjorn Lomborg
Prague"