Economics – Page 120 – a sibilant intake of breath

Brief survey: the value of humanity

You versus the lot:

What proportion of your income would you be willing to give up to stop yourself from dying instantly in 1 year’s time?
If you were certain to die in one year’s time, what proportion of your income would you be willing to give up to prevent all of humanity from becoming extinct at that precise moment?
What proportion of your income would you be willing to give up to stop yourself from dying instantly in 10 years’ time?
What proportion of your income would you be willing to give up to prevent humanity from becoming extinct in 10 years?

The long-term perspective

What proportion of your income would you be willing to give up to prevent humanity from becoming extinct in 100 years?
What proportion of your income would you be willing to give up to prevent humanity from becoming extinct in 1000 years?

Delaying versus preventing

What proportion of your income would you be willing to give up to delay human extinction by 100 years, assuming it will otherwise occur in 100 years? That is to say, what would you pay to extend the length of the human species’ existence by 100 years?
What proportion of your income would you be willing to give up to delay human extinction by 100 years, assuming it will otherwise occur in 1000 years?
What proportion of your income would you be willing to give up to delay human extinction by 1000 years, assuming it will otherwise occur in 1000 years?

The relevance of the questions

Do you feel strongly about all of these possibilities, about some but not others, or about none at all?

Green energy ‘war’

A new blog written by a former California energy commissioner chooses to discuss the fight against climate change as a ‘war.’ At one level, this reflects the silly American tendency to discuss non-military problems using military language: the War on Drugs, the War on Poverty, etc. At another, the choice reflects the serious disjoint between what most people have publicly accepted about climate change and what the problem really involves.

The public consensus seems to be: climate change is happening and it will have some bad effects. Technology and consumer choices will probably deal with it. Hybrids and fluorescent lights for all! Some of the big issues missed in this viewpoint are:

Stabilizing greenhouse gas concentrations is a massive undertaking. It requires deep cuts (50-95%) in emissions from all countries, rich and poor alike.
Time is of the essence. Stabilizing at an atmospheric concentration likely to avoid catastrophic impacts probably requires global emissions to peak within the next ten years and fall dramatically within the next forty.
Once concentrations are stabilized, continued effort and restraint will be required to maintain that. Human emissions will need to be kept in balance with natural absorption of carbon dioxide forever.
Abrupt or runaway climate change could completely undermine the basis for the global economy. Potentially, it could even make the planet uninhabitable for human beings for thousands or millions of years.

Referring to the situation as a war does have some potential benefits. People expect sacrifice and the suspension of normal ways of operating during wartime. The lower quality of light from fluorescent bulbs seems less significant when the future of humanity is at stake; the same goes for bans on short-haul flights or inefficient cars. At the same time, there are huge problems with the war analogy. Wars end. While it is possible that we will eventually have such excellent zero-emission technology that the world’s coal reserves and tropical forests will not tempt us, that seems a distant prospect.

What this underscores is the degree to which climate change is a challenge of an altogether new and different type for humanity. It’s one that our previous ideas about collective action, the ethics of an individual in society, and the cooperation of sovereign entities need to grow to accommodate. While the seriousness and focus sometimes applied to warfare will surely be required, the metaphor probably ultimately distorts more than it clarifies.

Population and GDP

The Economics Focus in this week’s Economist makes some excellent points. Most importantly, it demonstrates the degree to which looking at national rates of GDP growth independently from national rates of population growth produces a misleading impression of what is really happening.

America and Australia usually have the kind of economies that people understand to be growing rapidly – a fact often attributed to their dynamism, lack of enthusiasm for income redistribution, etc. By contrast, Germany and Japan tend to be lamented as low-growth laggards. If you consider the changes in GDP per capita, Japan grew more quickly than either Australia or the United States between 2002 and 2007. Because of relatively high rates of population growth, the American economy needs to ‘run just to stand still.’ The problem is even more acute in places with still higher rates of population growth.

Arguably, this offers one more reason to cheer falling populations as a sign of national maturity. While an aging population does put strain on pay-as-you-go pension and health care systems, that is a one-time cost of adjustment. Once it has been borne, a diminishing population means fewer resource constraints, a higher level of physical and financial capital per person, and a increased factor price for labour, yielding improved economic returns for workers.

For both environmental and economic reasons, we may thus have good reason to hope for fewer members in each subsequent generation.

Israel’s electric vehicles

Shai Agassi has a bold plan to transform personal transportation in Israel: electric cars built by Renault and Nissan using lithium-ion batteries from NEC. The crucial difference between this plan and those simply intended to encourage customers to buy individual electric vehicles is that Agassi’s company plans to provide battery infrastructure, in the form of recharging outlets and battery swap stations. Each battery is initially expected to provide 124 miles (200 km) per charge, with recharging happening both at parking-meter type stations and at centres where depleted batteries can be swapped immediately for charged ones. The batteries are expected to last 1,500 charges, or 150,000 miles (240,000 km).

The pricing model is also interesting. While it is still evolving, it will probably take the form of a monthly fee based on expected mileage. The company selling the battery exchange plans will subsidize the purchase of the cars, to some extent, increasing the rate at which people switch over from gasoline vehicles. The Israeli government has pledged $200 million to help get the scheme running. Given the incentives for clean vehicles that the government has promised to maintain until at least 2015, company officials suggest that their electric cars will cost half as much to buy and operate as gasoline ones would.

Israel does have unique characteristics that arguably make this approach especially suitable. Foremost among those may be its small size. One of Agassi’s batteries would be sufficient to drive across it from east to west, with two or three being required to go from north to south. That said, if this model proves successful, one could certainly imagine it working in other relatively confined high-density areas, from Manhattan to Shanghai.

Car standards in China and North America

The Toronto Star has reported that: “No gasoline-powered car assembled in North America would meet China’s current fuel-efficiency standard.” Even the proposed tougher Californian standards – the ones about which there is a big fight with the Environmental Protection Agency – will not do so. In the United States, there is a proposal to require 35 mile per gallon (14.9 km/L) performance by 2020. Today, all Chinese cars are 36 mpg (15.3 km/L) or better. Canadian cars average 27 mpg (11.5 km/L), and don’t have to meet any minimum standard of that type.

That’s certainly something to consider the next time you hear that tougher standards will maul the auto industry. Judging by the relative performance of Japanese and American car companies, it might be fairer to say that continuing to pump out dinosaur vehicles is more likely to leads to its demise on this continent.

Snake oil in science magazines

One odd tendency I have noticed is the frequency with which popular science magazines contain ads for very dubious products and services: often, precisely the sort you would expect the scientifically knowledgeable to shun. Looking through this month’s Scientific American there are ads for ‘stress erasing’ gizmos, a machine that supposedly makes you fit and muscled on the basis of four minutes of exercise a day, and dubious dietary supplements. I recall that Popular Science regularly featured ads for hypnosis machines and virtual reality helmets supposedly capable of teaching you a new language in hours.

Why do companies selling such things consider the readers of science magazines to be a good target audience? One element is probably that actual scientists don’t read these magazines. The articles they publish are not peer-reviewed and can sometimes be quite low-brow (Scientific American, in particular, seems to have made a big shift towards the Popular Mechanics end of the intellectual spectrum). While the readers are unlikely to be scientists, they are likely to have an acute interest in scientific things, novel ideas, and new technologies. Probably, advertisers are taking advantage of the way in which seeing an ad in a trusted publication already full of novel claims provides it with more legitimacy than it might accrue on its own.

In the broader picture, this is just one reflection of the fundamental problems of authenticity and verification that exist in our society. People can’t decide if climate change is happening, whether taking vitamins is helpful and worth the cost, or whether radiation from cell phones is dangerous. Perhaps more than ever before, people are in a world that is incomprehensible due to the abundance, rather than the absence, of information. Those looking to bring in a few dollars from gullible armchair scientists are taking advantage of that confusion.

Air travel and carbon capture

If carbon capture and storage technology does prove effective and economically viable, it might finally offer a decent answer to the problem of air travel emissions – at least for relatively affluent travelers willing to pay. The trouble with standard offsets is whether emitting X tonnes of carbon and then paying someone who would otherwise have emitted the same amount not to do so really represents equivalence.

CCS offers a more bulletproof answer: grow biomass, burn it in a power plant, bury the carbon dioxide in a saline aquifer or salt dome, and use the energy. Air travelers could pay to have X tonnes worth of carbon literally removed from the air by plants, and for that carbon to subsequently be stored indefinitely.

Other emitting activities – whatever their nature – could be similarly offset given sufficient infrastructure and funding.

Monbiot on British carbon capture plans

Of all the comprehensive plans I have seen to reduce greenhouse gas emissions from developed states, the one in George Monbiot’s Heat is the most ambitious. Whereas most people aim at stabilizing atmospheric GHG concentrations by 2100 or so, he thinks it must happen before 2030 is we are to avoid a mean temperature increase of more than 2°C and the very serious (potentially catastrophic) consequences such an increase would have. Part of Monbiot’s plan does involve continued use of fossil fuels, specifically the use of natural gas coupled with carbon capture and storage (CCS) for electricity generation.

While Monbiot stands behind the belief that CCS can work and can contribute to climate change mitigation efforts, he is increasingly critical of how the British government is planning to use the technology:

In principle, carbon capture and storage (CCS) could reduce emissions from power stations by 80% to 90%. While the whole process has not yet been demonstrated, the individual steps are all deployed commercially today: it looks feasible. The government has launched a competition for companies to build the first demonstration plant, which should be burying CO2 by 2014.

Unfortunately, despite Hutton’s repeated assurances, this has nothing to do with Kingsnorth or the other new coal plants he wants to approve. If Kingsnorth goes ahead, it will be operating by 2012, two years before the CCS experiment has even begun. The government says that the demonstration project will take “at least 15 years” to assess. It will take many more years for the technology to be retro-fitted to existing power stations, by which time it’s all over. On this schedule, carbon capture and storage, if it is deployed at all, will come too late to prevent runaway climate change.

He also suggests that using CO2 from power plants for enhanced oil recovery risks actually increasing emissions. On the one hand, that is because it will allow extra oil to be extracted from declining fields, which will subsequently emit CO2 when burned. On the other, he touches upon concerns that CCS using depleted oil and gas fields will not be safe or permanent enough to effectively and indefinitely sequester carbon.

As with nuclear power, the issue of timelines is critical. Even good technology, when installed at a plodding rate, could propel us into very serious danger. Even if it does prove possible to start slow and late and still make the transition to a low-carbon economy, it seems highly likely that the total costs of adjustment will be much higher: a crash-building program akin to the one undertaken by Russia after Germany turned against it during WWII, rather than an economically optimal trajectory towards a low-carbon global economy.

Cooperation tipping points?

All regular readers of this blog will be familiar with the idea that there are physical tipping points in the climate system: places where one additional unit of warming produces much more harm to people and natural ecosystems than the previous units did. Politically, it is worth considering the possibility that another kind of tipping point exists, namely one beyond which the willingness of various actors to cooperate on climate change alters dramatically on the basis of some critical increment of climate change effects.

It’s possible that the effect could be one of rallying – the world suddenly realizing the seriousness of the issue and thus taking immediate action. States previously obsessed with exactly who should pay how much and exactly what timeline should be followed might just buckle down and do what needs to be done. A fair number of people seem to think that only a pretty substantial disaster will make the threat of climate change sufficiently concrete for enough people for the hard work of stabilization to begin.

The other possibility (mentioned here) is that the world will pass from hesitation and avoidance of the issue directly into conflict, accusation, and counter-productive action. Severe climatic impacts could drive states and individuals to focus on their own short term internal and external security, rather than making serious efforts to address the root of the problem. This is a classical prisoner’s dilemma scenario and, unless it flips to a state of desperate cooperation once things got really bad, it could push the world across the physical thresholds that are so worrisome.

In any case, it is as necessary to be aware of the existence of hidden feedbacks within public sentiment and government planning as within ecosystems or patterns in air and water currents. Of course, that just adds additional uncertainty to a very threatening brew.

Lady Chatterley’s Lover

In many ways, Lady Chatterley’s Lover reminds me of Anna Karenina. Each uses a relatively straightforward narrative as a means of conveying philosophical positions about the changing nature of the world – often through nakedly analytic passages. Chatterley seems largely concerned with the question of how to endure in an unnatural world: how to persist in humanity despite the challenges brought by capitalism, industry, and global interconnections. The major conclusion seems to be that the best one can hope to do is opt out, rejecting societal expectations and returning to some kind of natural intimacy with a fellow refugee.

At the heart of the book are contrasts between situations and personalities: between coal mines, the literary world, high society, and a simple pastoralism. Also, between Constance’s crippled husband and her intentionally unsophisticated lover; between Constance herself and her sister; between Constance and Mellors’ relationship and that between her husband Clifford and his nurse and confidant. By setting these things against each other, Lawrence gains both an opportunity to share insight and a platform from which to issue condemnation. Usually, the crime a person or situation stands accused of is being compromised in nature and inauthentic. Constance’s return to authenticity is thus a triumph, even if it does little to alter any of the societal forces that led her initially to a hollowed-out life.

The book also has a certain ecological concern, though more in the spirit of a lamentation for the passing of pastoral life than in the form of an argument for social reform and improved behaviours and conditions. The coal mines are condemned – and the kind of lives that the miners have built around them – but the situation is treated as one almost fated. Similarly on the issue of class separation, some negative aspects are identified, but the book never really rallies for reform. It is all about individual resurrection despite society, not any hope that society might change so as to better foster and accommodate authentic individuals. Connie chooses to withdraw from her place in society, though never considers sacrificing the automatic income that makes her an aristocrat to start with: an income as tied to the stratification and industrialization of society as Clifford’s coal wealth.

No short review can cover all the insightful flourishes that pepper the book, arising, as they do, from a slightly odd omniscient point of view that happily flits through characters both major and minor. The books is intriguing, convincing, and clearly written. To a greater degree than I would have expected, it also speaks directly to some of the major tensions in the modern world. Though a venerable classic of literature, it is in no sense dated.