Nordhaus Seeks Magic Bullet, Will Pay

Nordhaus and Shellenberger have made a splash with their A Manifesto for a New Environmentalist, and there’s been much reaction hither and yon, of which what I have seen has missed the mark.

As usual with economists, I was planing to wheel out my “wrong question, therefore answer irrelevant” spiel, but somehow it didn’t quite fit. They aren’t growth-obsessed, at least not in the arguments they present.

As I read it, their problem is here, in their core paragraph:

…this money ought to be used to create a new military-industrial-academic complex around clean-energy sciences, similar to the one we created around computer science in the 1950s and ’60s. The transformation of Silicon Valley from a sleepy collection of apple orchards and small towns to the information technology powerhouse that it is today was the result of massive investments by the federal government into a set of interlinked military, industrial, and academic institutions in the region–a fact that is largely ignored by many high-tech executives, who prefer to imagine that it all started in Bill Hewlett’s garage. Concretely, this means creating undergraduate and graduate programs in new energy sciences; post-graduate fellowships for scientists, engineers, and technicians; and training for the electricians, construction workers, efficiency experts, and installers needed to make the clean-energy revolution real.

This is new-age magical thinking, which is to say, not actual thinking. There is no “clean-energy revolution”. No amount of expenditure on homeopathy or cold fusion will pan out.

Clean energy is, presently, expensive and limited. People are motivated to change this, but have so far not succeeded. Accordingly, the prognosis isn’t very good. You can no more wish this inconvenient truth away than any other. It is conceivable that there is a fix, but there’s no reason to expect that throwing money at the problem will pay off.

I will be cheering as loudly as anyone if something pans out, and I am certainly in favor of as much research in this direction as makes sense scientifically or technically. But there is a limit to what experts can achieve, no matter how much funding they get. Insufficeint funding slows things down, but excessive funding certainly does not speed things up. Ten scientists cannot get a decade’s worth of one scientist’s work done in a year any more than nine women can make a baby in a month.

If there’s anything to this stuff they ought to offer some arguments of substance. “Some energy experts have calculated that an investment of roughly $200 billion would bring the price of solar energy down to that of coal.” Names, details please? Solar advocates have long compared apples and oranges. Oh, and until storage problems are solved, coal will continue to be much cheaper at night.

No, the reason we are in trouble is not because we are too mopey. Yes, bad news is always a hard sell, but that’s no reason to deliver imaginary good news instead.

Exactly which research programs are underfunded, and by how much? I am sure there are some. That’s something we can talk about, and we can also talk about which programs haven’t panned out and should be cut.

Throwing too much money in the general direction of a problem never solved anything.

Update: To clarify, I have no objection to further R&D on renewables. In fact, I encourage it. I object to the idea that we can, without diminishing returns, avoiding subsidies or taxes, count on decreasing the unit cost of renewable energy to the point where it is cheaper than digging up some foul gunk and torching it. That’s wishful thinking taken to the point of insanity.

The collapse in prices per unit of information technology are a bizarre and possibly unique event in history. Relying on something similar happening in energy technology is where Nordhaus & Shellenberger lose touch with reality. And everything else they say is completely conventional.

In the end, we will be devoting a larger share of GDP to energy, and if we manage to prosper through our coming troubles, we will have plenty of it. This means the energy will be “more expensive”. So?

I say let’s get it over with. The disruption is tiny compared to the alternative, and investing huge efforts into magic pixie dust is probably not going to help. A gradually increasing tax on carbon emissions to the point where sustainable sources are competitive will do the trick. The magic pixie dust, maybe not.


Economist William Nordhaus , among the best of the breed, is giving a talk entitled Measuring the Economic Effects of Global Warming. It will be presented to the Committee on National Statistics of the National Academies (US) in Washington DC on May 10, 3 PM Eastern time. It will be webcast.

Here is a related Policy Forum letter in Science from 2004.

Though I find economists interesting, and I am gratified to see the cost/benefit approach I advocated in the 90s get some traction, I think they are approaching long time scales in a way that is fundamentally wrong.

I have made some progress in identifying and explaining my discomfort with their approach. Here’s a contributing event to my new understanding.

Now that I am living a car-based existence in a sprawly and ugly (albeit strangely lovable) town, I get to listen to NPR again. (By the way NPR has a plethora of climate stories on their website.)

Anyway, All Things Considered had some climate stories a couple of evenings ago. One economist stated “in order to deal with the greenhouse problem, we would have to change the entire economic structure of the world!”

Well, duh. The implication that this means we are doomed escapes me altogether. Economics are software, the control system of our society, not its infrastructure.

Maybe a couple of analogies will give you the idea of what I am thinking.

In order to keep our boiler from exploding we’re going to have to replace the entire thermostat!

In order for our car to get back on the road we’re going to have to replace the entire alternator!

Yeah, and…?

In short, economics should be a branch of engineering, not of science. The pretensions to pure science are confused and counterproductive.

I’ll have more to say on this, so stay tuned.

Update – I just had a look at the WGIII SPM,as I ought to do if I’m going to talk about this stuff. It is much better than I expected.

(The WGII muddle didn’t leave me expecting much, frankly, but I’m pleasantly surprised with WGIII.)