Inconvenient truths
This book is the product of the Copenhagen consensus -- a group of smart, many Nobel winning, economists who divulge real inconvenient truths of our planet -- namely that global warming an economic loser.
The true believers hate to hear this, but at present global warming should be a major concern, but it cannot be a major economic priority.
There are, to be sure, hundreds and thousands of positive return investments that will improve the environment and there is an excellent chance that we will make them. Boosting energy productivity is also very promising (more on this soon) and should be a priority.There are positive return investments that reduce greenhouse gases and a few that reduce carbon emissions or sequester carbon but none that prevent global warming -- they at best defer it.
Declaring global warming to be the preeminent challenge facing humanity -- as many environmentalists including Al Gore do, is frankly immoral. Why? The work of these prominent economists assembled in Copenhagen in 2004 illustrates the problem. They asked how to spend $50 billion over four years to achieve the greatest benefit possible.
They identified ten leading global problems, including climate change. They assembled global experts in each area and evaluated the costs and benefits of investing in each area. Their conclusion was that the most ambitious international effort to regulate and reduce greenhouse gases made little economic sense:
...combating climate change through the Kyoto Protocol has a social value of less than a dollar for each dollar spent. These economists, who included four Nobel laureates, took part in a project called the Copenhagen Consensus which compared the social value of solutions to different challenges facing humankind.
The question that they strove to answer was: 'How could you spend $50bn to achieve the most good possible?' The costs and benefits of different ways of combating HIV/Aids, starvation, global conflict, climate change, corruption and other challenges were studied in detail. With access to specially commissioned research, the team came up with a concrete, prioritized 'to do' list that outlined how policy-makers could achieve the most good possible.
The economists found that spending $27bn on an HIV/Aids prevention program would be the best possible investment for humanity. It would save more than 28 million lives within six years and have massive flow-on effects, including increased productivity.
Providing micronutrient-rich dietary supplements to the malnourished was their second-highest priority. More than half the world suffers from deficiencies of iron, iodine, zinc or vitamin A, so cheap solutions such as nutrient fortification have an exceptionally high ratio of benefits to costs.
Third on the list was trade liberalization. Although this would require politically difficult decisions, it would be remarkably cheap and would benefit the entire world, not least the developing world. A staggering GDP increase of $2,400bn annually would accrue equally to developed and developing countries with free trade.
The economists would then focus on the huge benefits possible from controlling malaria with chemically treated mosquito nets. Next on their list would be agricultural research and improving sanitation and water quality for a billion of the world's poorest people. The benefits of these ventures far outweigh the costs.
If you want to see a compelling presentation by Bjorn Lomborg, the economist behind the Copenhagen Consensus, search it on YouTube. I recommend it highly.
