June 9, 2017

Why I “Believe” in Climate Change (and Why it Doesn’t Matter)

Why do we believe what we do about the world? Why do I believe that climate change is a real and serious problem?

In total, 536 humans have been in space. Ever. They’re the only ones who have seen our spheroid planet from above. And yet most of the 7 billion of us alive today would agree that the earth is round. Ask yourself why you believe that. How do you know?

Consider a few more. How do you know that…
…everything around you is made up of things called “atoms”?
…there are black holes?
…smoking causes cancer?
…Plato existed?

If you’re not an physicist, oncologist, or historian, how do you know these things?

We take these truths to be self-evident because we trust experts. We trust history, written and spoken record, common understanding, and the assembled evidence of science. We listen to our teachers, our doctors, our parents, our journalists (most of us, until recently), and others. And yet, with climate change, it seems everyone is an expert.

I’ve received many emails lately from colleagues who have a [fill in the blank — uncle, in-law, friend] who doesn’t believe in the phenomenon known as climate change. Someone asked me to send over my “quick paragraph” on why we should consider climate change a real and dangerous problem.

This is an attempt to explain.

And it’s one that will certainly fail to an extent (those who don't buy it yet may not come around for any reason). I’ve heard the full panoply of climate denier arguments. (I apologize to those who bristle at the word “denier,” but finding a better word is for another time.) I wrote a couple of articles on climate denial recently that got heavy traffic. Check out the comment section on “Denying Climate Denial,” which was the #1 article on Medium for a day, to see most of the major arguments. I can’t cover all possible objections here (more on that in a moment).

All I can do is say what I know to be true (in about 350 words).

Why do I believe in climate change? The short answer is because of science. Overwhelming, abundant, multi-generational science.

Why do I believe in climate change?

The short answer is because of science. Overwhelming, abundant, multi-generational science. And to clarify, that means evidence, assembled over 150 years, that:

(a) the earth is warming at a radically abnormal rate and, most critically,
(b) it’s almost entirely because of human-related carbon (and other gas) emissions.

I trust scientists and science itself — there I said it. I trust them every day when I eat, get in my car, take medicine, fly in a plane, and do thousands of other things.

On climate change, the effort of the scientific community to figure out what’s going on has been historic. The Intergovernmental Panel on Climate Change (IPCC) has led what is likely the largest coordinated scientific effort in history. Read the basic IPCC story and/or check out the NASA climate sitefor more science stuff.

One of the best summaries I’ve seen on climate science came from the American Association for the Advancement of Science (AAAS), the “world’s largest general scientific body.” In a pithy, easy to read report, “What We Know,” AAAS lays out 3 big conclusions:

1. Climate scientists agree: climate change is happening here and now.
2. We are at risk of pushing our climate system toward abrupt, unpredictable, and potentially irreversible changes with highly damaging impacts.
3. The sooner we act, the lower the risk and cost. And there is much we can do.

The AAAS is not alone. Not by a long shot. Every major scientific body in the world agrees on the basics of human-caused climate change. Here’s a list of 200 of these bodies. If it helps at all, here’s also a sampling of some people who trust the science: basically every world leader (but one), the vast majority of large company CEOs, huge swaths of the military and security apparatus, and the Pope (his 2015 encyclical on climate and poverty is truly beautiful).

Uncertainty

Again, I don’t think that many who are super skeptical will buy any of this. They can always suggest that there’s uncertainty. Well, no kidding. Science is never 100% certain about anything. More specifically, we can’t know precisely how rising CO2 levels will play out in terms of temperature increases or the exact effects of those increases (more storms, droughts, floods, etc.). But that uncertainty suggests we need more action, not less (more on that in a minute).

To answer the biggest category of skepticism: Of course, there are other causes of temperature and climate flux throughout the earth’s history. But scientists have accounted for those: see this wonderful animated chart in Bloomberg Businessweek. There are many other arguments that skeptics make, and it would take books to combat them all. The best resource for systematically tackling the arguments is www.skepticalscience.com.

(My work is focused on business strategy and why it’s good for companies to tackle environmental and social challenges head on. But for years, I’ve been drawn into climate change debates (whether I wanted to or not). I’ve listened to attacks about the scientific method and whether science relies on “consensus” vs. verifiable, repeatable experiments (it’s both). But it’s really not worth rehashing all of that here. I’ll only say that the idea that thousands of scientists do not understand the scientific method, or that they considered different hypotheses, is bizarre.)

So, in short, I believe in what science is telling us. And it’s a dire situation — that’s not “alarmism” but realism. When the doctors tell you that you have advanced cancer, denigrating them, saying they’re being alarmist, or accusing them of being in it for the money are not healthy reactions.

In the end, asking why I believe in climate change is the wrong question. The one that matters…is this: Why do I believe we should ACT on climate change?

The good news is that, as AAAS says, we can do something about this. And that’s why, in the end, asking why I believe in climate change is the wrong question. The one that matters for making life, policy, and economic decisions is this:

Why do I believe we should act on climate change?

This one is much easier. It’s about risk and reward, regardless of my or anyone’s belief in the science. This is the “it doesn’t really matter if you buy the science entirely” argument.

Risk

Just ask yourself this: “What if scientists are right about the more extreme estimates about the impacts of climate change?” What are the outcomes at that end of the range of possible futures (i.e., what it does to our weather, ocean levels, food production, etc.)?

This brings up the powerful idea of tail risk. Entire multi-trillion-dollar financial markets exist to manage tail risk and so-called non-diversifiable risk (system risk qualifies, and there’s no bigger system than the planet itself). The financial industry and companies spend a ton to hedge against things like currency, commodity, or portfolio value fluctuations.

At the “tail” end of possible outcomes on climate change is making the planet uninhabitable for humans. (Please keep in mind that none of this is about “saving the Earth” which will be fine without us.)

So, what might happen, and what’s it worth to you to reduce that risk? We buy insurance because our house might burn down, or we could drop dead tomorrow. The OECD estimates that the richest countries spend about 9 percent of GDP on insurance. Isn’t ensuring a stable climate that we depend on for our existence worth some focus and investment?

Reward

But here’s the best part. The economic evidence is growing, and fast, that we save money building the clean economy. When someone tells you it will “destroy the economy” to pursue clean technologies, they’re lying to you. They’re making the status quo arguments that have never saved old technologies, from horse-and-buggies to typewriters to Blockbuster.

When someone tells you it will “destroy the economy” to pursue clean technologies, they’re lying to you.

Two years ago, Citibank produced a fantastic report, “Energy Darwinism II” which compared an “action” scenario — one where the world builds out the clean energy economy — to business-as-usual, fossil-fuel-based energy system. Citi’s key findings were these:

(1) If we do not tackle climate change, then by the middle of the century, it will cost the global economy tens of trillions of dollars.
(2) If we direct the vast sums we will spend on energy infrastructure and fuel toward the low-carbon action scenario, it will cost a couple trillion less.

Climate%20costs%20of%20inaction%2C%20Citi%20report.jpg
Citi estimates of cost of action and inaction on climate from Energy Darwinism II

To repeat, Citi says we can spend trillions less to get tens of trillions of benefits. That’s an infinite ROI for those keeping score. Other reports for years have said similar things, from the monumental Stern Review on the Economics of Climate Change to Mayor Mike Bloomberg’s Risky Businessreport.

And fyi, since Citi’s report, the odds of the world pursuing the inaction path have only gotten lower. The economics of the clean economy have improved at near exponential rates. The costs of renewable energy, storage, and other clean techs have dropped radically over the last 7 years (see this pithy chart from the U.S. Department of Energy):

Renewables%20-%20cost%20reductions%20since%202008%20%28DOE%29.jpeg

Cost reductions in clean technologies, Revolution Now 2016 report, Department of Energy

In total, there are markets worth trillions in building clean economy — cleaner buildings, transportation, energy, finance, and so on. And companies and countries are now racing to get their piece of it.

Winners and losers

It’s a non-trivial issue that the clean economy means some older industries disappear. There will be “losers” in the shift to the clean economy. Coal jobs are vanishing, and not just because the world wants to move to cleaner energy. Improved technology for digging up natural gas, plus automation, are killing those jobs. Some communities are losing their livelihood. We have a moral duty — based in part on what fossil fuels have meant to modern society, but also on basic human decency — to help people who are displaced.

The inevitable

But back to the main point here. The combination of overwhelming science and the risk/reward equation has convinced the world to act. It’s why businesses wanted Trump to stay in the Paris climate accord, and why, after he rejected a historic global agreement, so many U.S. states, cities, businesses, and universities pledged to keep the commitment to the Paris agreement (I’m keeping a running list of those signatories on Medium here).

I believe that science tells us that climate change is an existential risk. And that economics tells us it’s a giant opportunity. So we must, and should, act. We can debate how best to solve the climate problem, but debating the logic for action is an life-threatening waste of time.

In the end, I trust the powerful combination of science and economics. Both are most definitely on the side of climate action.

(This post first appeared on Medium here.)

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