Stern report - what they are saying about it
Posted by DavidM in Climate change | 3 November 2006
Not surprisingly, given the importance of the Stern Report to environmentalists, governments and non-believers in climate change, there has been plenty said since Monday's publication.
I've had a look around and picked out some of the more robust comments.
First, the Treasury has included a number of comments from leading economists along with the report. These are generally very favorable and include a reasonably positive response from Paul Wolfowitz.
However, I also found a response by Prof. Patrick Michaels, published on the Treasury site, that argues the environmental assumptions are overstated and the economics are naturally biased, thereby exaggerating the problem.
There is also a lengthy critical paper by Richard Tol of the Economic and Social Research Institute again claiming Stern has over-estmated the impact of climate change and therefore the benefit (thanks to prometheus where the comments are worth a read - both supporting and challenging Tol's paper).
There is also a paper by Nigel Lawson, based on a lecture to the Centre for Policy Studies. Again he criticises the report's climate change assumptions and solutions to tackle it. One example being that he claims the Stern Report's view that farming will be damaged relies on the principle of 'dumb farmers' who don't adapt to climate change by planting different crops.
On Dave's Part, the reliance on emmissions trading is questioned, especially in light of the experience with the EU's current trading scheme. However, as I understand it, the UK wants to tighten the EU scheme to make it more effective, plus the Stern Report doesn't cite emmissions trading as a sole solution - rather part of a package.
At the other end of the spectrum, World Changing thoroughly endorses the Stern Report, saying it uses the best models of Climate Change and pointing out that the quoted 5% GDP cost of doing nothing is the low end of expectations. If anything, World Changing thinks Stern over-egged the 'cost' of tackling climate change as much of it is investment that will make returns rather than sunk costs - unlike feeding starving millions.
Friends of the Earth were unsurprisingly positive about the report and want legally binding emmissions reduction targets and greater green taxation. They reinforce the point that tackling climate change is affordable and won't harmful the world economy.
This last point echoes my own view. The significance of the Stern Report is that it is a review by a serious economist showing that claimate change is real, can be tackled and the cost of doing so doesn't have to be a burden.
I struggle to see the downside of economic and social reforms that reduce emmissions. More efficient products and services will reduce costs and reliance on limited natural resources. Cleaner air is healthier and the political aspects of reduced reliance on oil especially have never been more obvious.
I agree wih World Changing to some degree - we should be looking at it as investment in improved efficiency and cleanliness not as a cost. Regardless of whether Nicholas Stern has used precisely the right climate change models or his economic analysis is 100% accurate, the message is clear and simple. Invest now and reap the rewards. Keep procrastinating and it'll be more expensive and we'll get less back.
