The question of ‘why are we waiting?’ is one which Nicholas Stern addresses in his recent book Why Are We Waiting? The Logic, Urgency and Promise of Tackling Climate Change. It is a ridiculously big question for which there can be no single definitive answer, but the question is still worth asking and exploring. The final chapter discusses four reasons why we are waiting that Stern argues are central:
- Analytical difficulties and controversies, both misunderstandings (e.g. of climate risks and action opportunities) and falsehoods. The book discusses the limitations of economic modelling and integrated assessment models, and discusses controversies over how we value the future – such as over discounting – and the need look more deeply at moral philosophy and ethics;
- Communication deficits: Stern argues that climate change deniers and opponents of action have often communicated their arguments far more effectively than climate action advocates have. Interestingly, he suggests climate action advocates must better “utilize rhetoric and frames that resonate with the values and emotions that could inspire action” (p. 306);
- Psychological barriers such as due to cognitive heuristics and biases, psychological issues that shape risk perception, and loss aversion and status quo biases; such barriers can also help to explain why climate actions that are economically rational are not taken; and
- Structural and institutional barriers to achieving a new energy-industrial revolution, such as due to the ‘dislocations’ such revolutions entail and related political challenges/issues.
These categories would be very familiar to folk working on, or researching, climate change action.
Throughout the book are other assertions made by Stern which point to other issues which may be more important. These include:
-The perception that climate action “could impede growth”: Stern argues that “one of the major obstacles to climate action has been the perception that it could impede growth in both developed and developing countries” (p. 260). “The portrayal of climate action as being in inexorable conflict with growth, poverty reduction, and radical improvements in human wellbeing is false and diversionary” (p. xxvii), writes Stern. This reminded me of Mark Jaccard’s critique of Naomi Klein’s latest book This Changes Everything: Capitalism vs the Climate which recently prominently raised these issues.
-Narrow preconceptions about low-carbon paths. This reminded me of Dan Sarewitz’s observation that “the philosophical commitment to technoskepticism hampers liberals [meaning those of progressive liberal political views, as in the American use of the term, not conservatives as per the Liberal Party in Australia] from achieving their political and social goals because it constricts their imagination about how to accomplish what’s important, often leading them to focus on small risks to individuals rather than the potential for very large benefits to society that technological advance can bring”.
-Ideological barriers to market interventions to address market failures
-Investors face inherent risks when investing in “a variety of new situations: e.g. new technologies, new policy environments, new return profiles” (p. 98). Whilst many risks can be managed in sophisticated ways “it is impossible to cover all of them” and this introduces many related challenges.
-The “inherent conservatism” of science (p. 134) and limits of related modelling: regarding the use of models and modelling, Stern also points out that “the essential point of using models in the first place is that they leave out many things in order to focus on others” (p. 133).
-Insufficient investment in energy R&D. The following stats are shocking: public energy R&D in 2012 is “less than half what it was in real terms in the late 1970s”. Private sector R&D spending in the energy sector is also low, especially related to other more innovation-focussed industries.
Other points/potential barriers could be inferred in relation to Stern’s core arguments (also made in The Stern Review on the Economics of Climate Change) about the risks and costs of inaction, and about benefits and costs of action on climate change. Over the past decade Stern has made these arguments – centrally, that the benefits of strong, early action considerably outweigh the costs – along with arguments for market interventions to deal with market failures. Whilst making such arguments for climate action in Why Are We Waiting? Stern also frequently says things like:
- “We cannot anticipate with accuracy which technologies will progress more quickly and where new ones will appear; and different technologies can combine in diverse and innovative ways” (p. 87);
- “the transition will be learning process” (p. 34); “much of the learning will be by trial and error” (p. 38);
- Whilst “these broad strands [of technological options/changes] look promising now (and some are already mature technologies), we will find out much more along the way” (p. 42);
- “We cannot be certain about outcomes: the issues concern the management of risk and uncertainty” (p. 12);
- “We cannot say precisely what the risks are” (p. 133) associated with potential factors/effects that are generally omitted from climate models (e.g. in relation to ocean acidification and associated feedbacks, permafrost, potential tipping points, etc); and
- “we have to make policy in real time while we are trying to build better models and learn about the many underlying uncertainties… we face the difficulties and tensions of real-time policy making and model improvement in extreme form” (p. 149).
Linked with the above, in the chapter entitled Building a New Energy-Industrial Revolution he writes that:
this chapter is not a comprehensive treatment or a definitive treatise or manual on how to manage a transition. We should, in any case, beware an attempt at such a treatise, since so much of the story will be about learning as we go (p. 85).
I agree. For some reason environment groups like Beyond Zero Emissions seem committed to pursuing the opposite approach of definitive/detailed treatise (as per its Zero Carbon Australia project).
All of the above issues can potentially weaken arguments that the benefits of strong, early action considerably outweigh the costs. Given the centrality of learning and ongoing processes trial and error in most cases we don’t know how much action will cost. It depends on a multitude of factors, many of which are currently unknowns. Similarly, estimates of the benefits of strong, early action depend on associated estimates of impacts that are avoided (i.e. avoided costs from climate change) and estimates of the potential “co-benefits” of action such as from developing new industries. Whilst it is clear that extreme climate change is a terrifying prospect and we should do all we can to avoid this, beyond this forming solid arguments on the costs and benefits of particular actions is often challenging and many risks can only really be considered qualitatively given the limits of quantitative modelling. Arguments for climate action often are, in part, political arguments as much as being evidence-based ones.
The issues and many unknowns also create challenges when building a case for change and building sufficiently strong constituencies for change. For example, whilst we cannot be certain about outcomes, in the broad sense stated by Stern, some will incur losses from climate policies/action and resist change (i.e. there is no doubt/uncertainty regarding those losses). Here in Australia this isn’t exactly news; we saw these issues around the short-lived carbon price which was repealed after only two years.
Interestingly, Stern has shifted to viewing climate action more from a Schumpeterian perspective (as per the theories of Joseph Schumpeter), which he views as a “more dynamic and structural approach to growth and development than in The Stern Review” (p. xvii). This perspective emphasises investments “in the innovation, learning and discovery that are crucial for a transition on this scale” (p. 74). Linked with this, Stern suggests a current barrier is that climate policy does not place innovation at the centre stage and emphasises the ways that government-induced uncertainty can stall or jeopardise investment and innovation. Again, here in Australia this isn’t news and we can clearly see this playing out.