Stern report 1: why has Sir Humphrey turned green?

Stern report on the economics of climate change: first part of a multi-post comment

    • Climate change presents a unique challenge for economics: it is the greatest example of market failure we have ever seen.

 

  • There is still time to avoid the worst impacts of climate change if strong collective action starts now.

 

 

  • It is already very clear that the economic risks of inaction in the face of climate change are very severe.

 

These messages give the radical flavour of the Stern report, a large study on the economics of climate change published, surprisingly, a fortnight ago by the stuffy British Treasury. It bears the name of the Whitehall mandarin and LSE professor Sir Nicholas Stern, the former head of the British Government’s economics service and Chief Economist at the World Bank.

So this is a political as well as an academic document. Why is Gordon Brown sponsoring it?

The occasion seems to have been the publication in June 2005 of a sceptical report by the obscure House of Lords Economic Affairs Committee. According to John Quiggin of Crooked Timber, this enquiry had been hijacked by the shrinking band of climate change denialists, instigated by Nigel Lawson, a less successful Tory predecessor of Gordon Brown’s. This flimsy polemic presented Brown with a soft target for a rebuttal. With one stroke, he could get in a good party political blow against the Tories; get ahead of David Cameron in the race for the British Green vote; gain stronger intellectual cover for his unpopular but correct policy of high energy taxes; advertise his policy wonk credentials as superior to those of Tony Blair or any rivals for his succession; and showcase himself as world-statesman-in the-making.

Attaching the name of a serving Sir Humphrey to a report is unusual in British terms. It gives Brown wiggle room and even deniability if politically necessary; but it puts Stern’s professional reputation on the line, not to mention his prospects of a cushy retirement job as head of an Oxbridge college. He could easily have had the report published anonymously in the usual way. It’s probable that both men genuinely think the situation critical, and action on it good politics as well as good policy.

So my expectations of the report, which I’ve only started to read, are:

– it will be a professional piece of work, offering a narrow target for rebuttal;

– it will if anything err on the side of caution, as false alarms would be politically damaging.

I’m writing about this, rather than some other document in the vast literature in the bin beneath the White House shredder, for two reasons. First, the report is lucidly written for a policy audience. It’s shorter and more accessible to non-specialists than the IPCC reports, the last comprehensive set dating back to 2001. Second, this report concentrates on the economics. There is no longer a serious question about the fact and causation of global warming, so the real debate has moved on to the strategy for mitigation. I know a little more about economics than about climate science, and am more likely to understand the arguments and have something moderately useful to say. I shall be commenting on the full version as I plough though it, rather than the executive summaries.

Next post on the science. Don’t expect fireworks.

 

Author: James Wimberley

James Wimberley (b. 1946, an Englishman raised in the Channel Islands. three adult children) is a former career international bureaucrat with the Council of Europe in Strasbourg. His main achievements there were the Lisbon Convention on recognition of qualifications and the Kosovo law on school education. He retired in 2006 to a little white house in Andalucia, His first wife Patricia Morris died in 2009 after a long illness. He remarried in 2011. to the former Brazilian TV actress Lu Mendonça. The cat overlords are now three. I suppose I've been invited to join real scholars on the list because my skills, acquired in a decade of technical assistance work in eastern Europe, include being able to ask faux-naïf questions like the exotic Persians and Chinese of eighteenth-century philosophical fiction. So I'm quite comfortable in the role of country-cousin blogger with a European perspective. The other specialised skill I learnt was making toasts with a moral in the course of drunken Caucasian banquets. I'm open to expenses-paid offers to retell Noah the great Armenian and Columbus, the orange, and university reform in Georgia. James Wimberley's occasional publications on the web

8 thoughts on “Stern report 1: why has Sir Humphrey turned green?”

  1. "Attaching the name of a serving Sir Humphrey to a report is unusual in British terms. "
    Is that based on the star of 'Yes, Minister'?
    Is it in common use in the UK?

  2. Could I put in a request for the economics summary, not the science?
    I mean, for christs sake, the only people on earth who don't know this science are people who are not going to read or believe you anyway. CO2 levels rising, 280 to 380 to 550 ppm, rising temperatures, ice cores, arctic melting, earlier spring, later winter, China burning 10% more coal every year, etc etc. We've all heard it a thousand times.
    It's the ideas and their expected consequences regarding economic policy, and what will happen politically that we don't hear about very often.

  3. Maynard Handley wrote, "Could I put in a request for the economics summary, not the science?"
    Wasn't there some kind of issue with the discount rate being used in the report? Can't remember whether people thought it was too much or too little.

  4. Liberal
    See my comment to James 'Niger' post earlier.
    Yes. The criticism is the discount rate is unspecified, and too low.
    see http://www.marginalrevolution.com for a libertarian critique.
    So costs in 2100, and 2200 are given too high a value relative to costs of avoidance now.
    Actually this seems to me to be a pretty thin critique: Stern spends a chapter explaining why he thinks that we should value future generations on a level playing field with the current generation (at a small, positive, discount rate).
    What Stern essentially says is 'spend 1% of GDP now, to avoid losing 15-20% of GDP by 2100'.
    Now if we are off by a factor of 5, so it is spend 5% now, to avoid losing 15-20% by 2100, then that *still* seems to me to be a pretty good bet.
    *and*
    avoiding the real possibility (which the IPCC) gives as 20%) of a rise in temperatures of *more than* 5 degrees centigrade (as far above current temperatures as we are now above the last ice age) at which point Stern throws up his hands and says that the costs cannot be quantified.

  5. Barry
    Yes. 'Sir Humphrey' is taken as a generic term for a senior british civil servant.
    Even now, the show has resonance with those who remember it when it was on TV. It was so popular that Margaret Thatcher did a cameo as the voice of the Prime Minister on the phone.
    So Tony Blair appearing on the Simpsons was *not* the first such concession to popular culture.
    Interestingly, the first world leader to sound the alarm on global warming was none other than Mrs. T. herself– as a chemistry graduate, she had a greater understanding of science than almost any world leader.

  6. BastBoo
    I don't think JFK ever wrote about global warming.
    After all, the biggest passer of environmental legislation in US history was *Richard Nixon*.
    The only politician who arguably surpassed him was *Theodore Roosevelt*.
    TR was about his long held love of nature and distrust of corporate interests. Nixon, as far as I have read, felt that it was politically popular and astute. He couldn't give a damn about nature (or about much besides getting and clinging to power).
    Although the first forecaster of Global Warming was Arrhenius, a Swedish scientist who wrote about it in the 1890s, and there was another scientist who wrote about it in the 1950s, AFAIK it was the realm of science fiction authors until the middle 1980s.
    Some day, if they ever hand out Nobel Prizes on this (as they did for the guys who discovered the ozone-CFC link) then I hope they give James Hansen a prize. That one man has done more to change the world opinion on Global Warming than any other individual I can think of– and put his career more at risk doing it.

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