While Bjorn Lomborg has never literally denied that the climate is changing, his economic theories have always served those who do. A Danish economist, Lomborg has won international notoriety. The Wall Street Journal loves his editorials.
But Lomborg’s arguments defy the dismal science’s universal principle that there was never anyone so useless as a one-handed economist (because the best economic analysis is all about “on the one hand” and “on the other hand.”)
“My own government’s exploits into the idea of electric cars,” the boyish, blue-eyed, blond-haired, black t-shirted Lomborg said in an interview last week, referencing Denmark’s support of Shai Agassi’s bold and iconoclastic Better Place project, “have been completely bungled by the way they’ve just simply said, ‘We’re gonna give a huge discount on cars,’ which is essentially the most expensive way of getting this going.”
The trouble with such subsidies for cutting-edge car buyers, Lomborg said, is “you get a few rich people to drive around and feel good about themselves and you have no impact. If you were to try to reach the numbers that we’re talking about, it would be an incredible giveaway.”
This is solid economic reasoning. On the other hand, Lomborg characteristically neglected to mention that some economists believe that disproportionately large government investment is necessary to overcome entry barriers in incipient markets and to create demand momentum.
To his credit, Lomborg’s thinking is still evolving.
In his 2001 magnum opus that made him the darling of the Wall Street Journal and climate change deniers, he essentially said the climate was changing but insisted nobody could be certain why or how fast. “We need to separate hyperbole from realities in order to choose our future optimally,” he wrote.
By 2007, Lomborg had concluded climate change was aggravated by fossil fuel emissions but thought there was no need to panic. “Statements about the strong, ominous and immediate consequences of global warming are often wildly exaggerated,” he wrote. Society’s limited resources could be far better used.
Now, he admitted in the interview, things have changed. “The world has moved in the sense that we’ve gotten better information about what’s smart,” he said, referring to advances in renewable energy technology. But, he said, “I do still worry about the fact that global warming gets all the headlines.”
Half of the world’s population, Lomborg said, “live in abject poverty, don’t have access to clean drinking water or sanitation and their kids are likely to die from easily curable infectious diseases. I don’t think their main concern is rising temperatures in a hundred years.”
True, but governments must focus on such long-term concerns, even as they assist their poor in dealing with immediate desperate needs, because such needs will only be more immediate and more desperate if governments do not do so.
Today, the consequences of an increasingly dynamic global climate are becoming more undeniable month by month and the renewables industries have proved themselves, despite disdain suffered from the shortsighted and inspired by the likes of Lomborg. But now, Lomborg's views have shifted again.
“The reason why I’ve been saying for a long time that we should not deal with it is because we basically only had bad solutions,” Lomborg said. Subsidizing renewables “was a very expensive way to do little good,” though research now shows “investing in research and development of green energy -- that is actually a great investment,” because “you can avoid eleven dollars of climate damage for every dollar spent.”
In other words, when he could have inspired action, he used his statistical wizardry to support inaction. When he could have helped drive investment in research, he argued it was unwise. And now that spending to build is an option, he argues that keeping the renewables in the laboratory is the smartest approach.
Of his opposition to the Danish government’s attempt to grow an electric vehicle market, Lomborg says, “My sense is that there’s often a push to do it way too early -- to feel good, to get great photo ops, but to not actually manage to do very much.”
Feel-good measures trouble Lomborg. “I think we have been way too blinded by the feel-good measures of wind and solar, forgetting that over the next decade or two the only real substantial cuts in carbon emissions are going to come from the switch from oil and coal to gas or to nuclear.”
Of Denmark’s extraordinary achievement of building enough wind energy infrastructure to provide twenty percent of its electricity, he said, “We need to make sure we don’t do stuff that just feels good.” His contention is that because it was done too soon, it was far more costly than it will someday be (though the poles may have melted by then).
“If you look at the cost curves, it seems very unlikely that wind will not be cost competitive within the next five to fifteen years,” he acknowledged, “I would have liked to have said it was sooner, but what we’ve seen in Europe is that wind has actually gone up in price dramatically, mainly because of bottlenecks.”
He neglected to mention that, on the other hand, as economies of scale driven by government support grow, industries eliminate bottlenecks and prices fall.
Any two-handed economist would easily see and confirm the likelihood of this.
Tags: better place, bjorn lomborg, bottlenecks, clean drinking water, climate change, climate change deniers, coal, cost competitive, cost curves, demand momentum, denmark, economic reasoning, economic theories, economies of scale, electric cars