When it comes to getting the big picture right, when it comes to preparing for environmental catastrophes, economists have a better track record than the scientists who specialize in analyzing environmental trends.
Last week’s column about Bjorn Lomborg’s ideas for combatting global warming generated lots of angry comments, including the suggestion that Dr. Lomborg and I be fed to polar bears. I was more interested in what Seth Masia had to say about the Copenhagen Consensus, which is Dr. Lomborg’s project for bringing experts together to set priorities in tackling global problems:
The root problem with Lomborg’s consensus group is that it’s composed entirely of economists. Most of them have only a shaky understanding of climate science, and they base decisions on the idea that it’s possible to place a cash value on a human life.
Most of the economists who contributed to Lomborg’s books assume that climate change proceeds smoothly and gradually. Scientists know this is not the case: it proceeds in spikes and lulls.
Yes, Dr. Lomborg thinks like an economist instead of a climate scientist, and he doesn’t have a degree in climatology. Critics say his lack of climatological expertise makes him an unreliable guide for foreseeing the consequences of a warmer world, but I think these critics are ignoring history. They claim to be taking in the big picture, to be foreseeing great trends over the next century, but they’re missing one of the most valuable lessons from the past half century: when it comes to getting the big picture right, when it comes to preparing for environmental catastrophes, economists have a better track record than the scientists who specialize in analyzing environmental trends.
The classic example is the “population crisis” of the 1960s and 1970s, when biologists like Paul Ehrlich were convinced humanity was about to suffer massive famines and devastating shortages of energy and other resources because the growing population would exceed the planet’s “carrying capacity.” This concept seemed obvious to biologists who study ecosystems, but economists realized there’s a big difference between animals and humans: Humans are remarkably adaptable and creative. When confronted with shortages and environmental problems, they have a long history of coming up with solutions — new methods of farming, new and cheaper sources of energy, cleaner technologies — that leave them better off in an environment that’s less polluted.
When the economist Julian Simon pointed this out and predicted that humanity wouldn’t run out of food or energy or other resources in an article in the journal Science, the journal was widely criticized by ecologists and other scientists for publishing the work of an ignorant outsider. Paul Ehrlich and his wife, Anne, said that economists like Dr. Simon were members of a “space-age cargo cult.” Trying to explain to these economists that commodities must inevitably become more scarce and expensive, the Ehrlichs wrote, “would be like attempting to explain odd-day-even-day gas distribution to a cranberry.”
So Dr. Simon challenged the supposed experts to pick any resource that was going to become scarce, and offered to bet them it would instead be cheaper in the future. Dr. Ehrlich and two specialists in energy and natural-resource issues, John Harte and John Holdren, picked five metals and bet $1,000 in 1980. Ten years the supposed experts in natural resources had to pay up, because all five metals were cheaper, just as Dr. Simon had predicted. (You can read more about this in my New York Times Magazine article on the bet.)
I bring up this history not because global warming is an exact parallel to the past “crises” of food and energy that never arrived. In some ways it’s a much tougher problem because it doesn’t lend itself to neat market solutions. There could indeed be unexpected spikes that damage humans and ecosystems. But it’s worth remembering that specialists in the biological or physical sciences can be terribly short-sighted when imagining what problems will beset humans in the future. They can forecast how the physical world will change, but they’re not always accurate even at that, and they’re not not experts in analyzing human responses or in determining the policies that make the most economic and social sense.