The Bogus Cost Of Carbon

[See update at the end]

From the New York Times a while back:

In 2010, 12 government agencies working in conjunction with economists, lawyers and scientists, agreed to work out what they considered a coherent standard for establishing the social cost of carbon. The idea was that, in calculating the costs and benefits of pending policies and regulations, the Department of Transportation could not assume that a ton of emitted carbon dioxide imposed a $2 cost on society while the Environmental Protection Agency plugged 10 times that amount into its equations.

At the time I protested loudly that this was only half an analysis. Even the dumbest anthropoid knows if he is faced with a complex decision, to take a piece of paper, draw a vertical line down the middle,  put “Pluses” at the top of one column, “Minuses” on top of the other, and fill in the columns with the pluses and minuses of the decision. He might put “Gains” and “Losses” at the top of the column, or he might put “Costs” and “Benefits”, it’s all the same.

What nobody does when faced with a complex decision is to take a piece of paper, put “Costs” at the top of the paper, and list all of the costs by themselves.

But that is exactly what the Obama Administration has done. They have devoted thousands of man-hours to the “Social cost of carbon”, but done nothing to determine the “Social Benefit of Carbon”. Yes, I know that as the NYT notes, they are supposed to use the “social cost of carbon” in a cost/benefit analysis, but that part just gets forgotten. In 2008, for example, the 9th U.S. Circuit Court of Appeals busted the National Highway Traffic Safety Administration because they failed to explicitly monetize climate benefits.

In my opinion, for the scientists involved, this is scientific malfeasance. For the bureaucrats involved, this is nothing but lying to the public. And they can’t claim ignorance. Nobody does just a “Cost” analysis, it’s called a “Cost/Benefit Analysis” for a reason.

Now, the Trump DOE Transition team, to their credit, asked who these miscreant DOE scientists and misguided bureaucrats were who were engaged in fooling the public. Following my maxim that “When a man hides something … it’s because he has something to hide“, the DOE foolishly refused to answer … as though the answer can’t be found in any one of a hundred public or internal documents, rec. It’s kids in the wheelhouse at DOE, that much is clear.

So … what to do about this? Well, here’s my suggestion. Trump should convene, what was it, oh, “12 government agencies working in conjunction with economists, lawyers and scientists” and ask them to “work out what they considered a coherent standard for establishing the social benefit of carbon”.

How about to start with, for the first benefit of carbon we include … development of the entire human race out of a pre-existing wretched short brutal life to the kind of lives we live today? Is that worth more than $30 per tonne?

Of course that would be turning their trick back on them. Notice that they are not discussing the social cost of carbon DIOXIDE. They know they can’t do that, it’s plant food.  So they called it the cost of CARBON … and by doing so, they opened the door to legitimately include the fact that carbon-based fuels are what keep us from freezing and starving.

If people want to know the true “social cost of carbon”, that would be the cost of doing without it. How about we do without carbon-based fuels (gas, diesel, kerosene, Jet-A, coal) and carbon-fuel-based products (plastics, synthetics, fertilizers, medicines) globally for a month … it would sure put “Earth Hour” to shame, that one hour a year where guilty carboholics seek absolution from their sins of commission and sins of emission by turning their lights out for an hour. We could call it “Earth Month” … voluntary, of course, for all those who are convinced that the costs of carbon outweigh the benefits …

But even if we don’t turn their trick back on them, and we just have the 12 agencies discuss the social benefit of increased CO2, estimates are that the present increase in CO2 over pre-industrial times has increased plant growth by 10%. Here’s a discussion of NASA’s measurements of plant increases from CO2. Makes sense, commercial greenhouses use increased CO2 levels up to 1000 ppmv to greatly increase their plant production. Here’s Sherwood Idso’s graphic of trees grown at different CO2 concentrations.

Now, how much is 10% of the value of all the vegetables and crops grown worldwide? Because that is one undeniable benefit of increased CO2. FAO says agriculture is about 10 percent of global GDP, which is about $75 trillion, so call it $7.5 trillion worth of agriculture. To that we have to add the main form of agriculture worldwide, subsistence agriculture. Let call it ten trillion all up for the value of agriculture. Ten percent of that is a trillion bucks a year … that’s a huge benefit.

And remember, that’s a long-term benefit, not just a one-off. That’s a trillion bucks a year for the foreseeable future.

Not only that, but the poorest woman trying to feed her kids in Africa gets the benefits of increased atmospheric CO2, not just the rich. How cool is that? It’s the bizarre inverse of a “carbon tax”, which hits the poor the hardest … the benefits of CO2 are egalitarian, even the poor get more food.

Finally, the claim is often made (based on some scale going from zero to unicorns) that the “social cost of carbon” is $30 per tonne. The current amount of CO2 in the atmosphere is about 125 ppmv above the 1750 level . The conversion is 2.18 gigatonnes of carbon per ppmv of CO2. That’s about 273 billion tonnes of emitted CO2 in the atmosphere. In addition, some 40% of the emitted total is sequestered, that brings emissions up to 450 billion tonnes of CO2 At a claimed “cost of carbon” of $30 per tonne, that is $15 trillion dollars of claimed damages from CO2 … so … where are the corpses?

Seriously, folks. If the “social cost of carbon” is truly that astronomically high, where is the ongoing damage? Where are the supposed ills? Where are the sunken cities? Where are the horrible results? Where is there an accounting of the $15 trillion in claimed losses? 

Anyhow … I do think that Trump ought to get twelve agencies and form a “working group” and tell them to produce the one true number to represent the social benefits of carbon … I’d do it just to see the talking heads explode.

Rainy morning, three and a half inches (90 mm) in this last storm. The hills are overjoyed, the plants are ecstatic, the animals … not so much.

Best to all, plants and animals alike,

w.

As Usual … If you disagree with someone, unlikely I know but it has happened on the web, please QUOTE THEIR EXACT WORDS THAT YOU OBJECT TO. That way we can see just exactly what you’re talking about.

[UPDATE 20 DEC 2016] From the Hoover Institute I find the following about the Social Cost of Carbon (SCC):

As all champions of cost/benefit analysis understand, it is a mistake to look at costs in isolation from benefits, or benefits apart from costs. Yet that appears to be the approach taken in these reports. In dealing with various objections to its reports, the IWG noted in its July 2015 response that “some commenters felt that the SCC estimates should include the value to society of the goods and services whose production is associated with CO2 emissions.” Their evasive response has to be quoted in full to be believed: “Rigorous evaluation of benefits and costs is a core tenet of the rulemaking process. The IWG agrees that these are important issues that may be relevant to assessing the impacts of policies that reduce CO2 emissions. However, these issues are not relevant to the SCC itself. The SCC is an estimate of the net economic damages resulting from CO2 emissions, and therefore is used to estimate the benefit of reducing those emissions.”

Hilarious. They say yes, they should include the benefits, but the SCC is so wonderful that it can be used all by itself … stunning.