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PaperclipPerfector  5d ago (text post)   16354 thread views

Culture War Roundup for the week of May 25, 2026

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Every so often, I see a number that strikes me in a particular way. More than once, the way that it strikes me has been in comparison to climate change damage estimates. Yes, yes, there are many many different estimates out there, and they're even presented in different terms, too. Some are in percentage of GDP/GWP; others are dollar figures. One of the numbers that has stuck in my brain, thanks to David Friedman back at the old old old place, comes from one of the early world leaders in trying to produce such estimates, Nobel-winning William Nordhaus. It would take epsilon more effort to find one of his old old old comments at the old old old place, so I just found an example from his substack.

Nordhaus’s final and most important point was based on his own research.

My research shows that there are indeed substantial net benefits from acting now rather than waiting fifty years. A look at Table 5-1 in my study A Question of Balance (2008) shows that the cost of waiting fifty years to begin reducing CO2 emissions is $2.3 trillion in 2005 prices. If we bring that number to today’s economy and prices, the loss from waiting is $4.1 trillion. Wars have been started over smaller sums.

What he does not mention is that his $4.1 trillion is a cost spread over the entire globe and an extended period of time. I initially assumed his calculations of cost were for the rest of the century, making his $4.1 trillion total about $48 billion a year, but in A Question of Balance he appears to be summing over the next 250 years which reduces the annual cost to $16 billion.

It's a quote from Nordhaus' 2012 NYT opinion piece, citing his 2008 book, so yeah, the estimate is quite old. There are many many other estimates out there since then, but this one stuck in my brain. I think he was trying to get it to stick in your brain. "Wars have been started over smaller sums," is meant to do that. It worked.

This morning, Tyler Cowen posted How Much Has Shale Gas Saved U.S. Consumers? It's just quoting an NBER working paper. I'll just reproduce the whole quote, so there's no need to click through:

It may seem like a distant memory now, but as of the mid-2000s, U.S. natural gas production had been flat for a decade, and the U.S. was importing liquefied natural gas (LNG), with plans to import much more. Then shale gas happened. Advances in hydraulic fracturing and horizontal drilling caused U.S. natural gas production to increase significantly, and the U.S. went from being a net importer of natural gas to being the world’s largest exporter. This paper calculates how much shale gas has saved U.S. natural gas consumers. Using price differences between the United States, Europe and Japan, we calculate that U.S. natural gas consumers have saved $3.1-$4.3 trillion between 2007 and 2025, equivalent to $164-$227 billion annually. Access to low-price U.S. natural gas has been particularly valuable during major supply shocks such as the war in Ukraine, and the benefits of shale gas have been experienced broadly across sectors and states.

It's not a direct analog, but that number, though. It's in my brain. $4.1T is right in that range of $3.1-4.3T. That's a swing in one country over less than 20 years, not 250 years. The dynamics of economic systems can move fast, much faster than climate change. But how big of a swing does that 'feel like'? Sure, life would have been more awful in a variety of ways in the counterfactual without the shale revolution. But, like, cataclysmically bad?! End of the world bad? I kind of doubt it.

I don't really like to focus too much on any particular estimate. There are higher ones; there are lower ones. I actually think the entire endeavor of estimating economic impacts of climate change is probably impossible, but we're stuck in a world where we have the various estimates we have and they matter to people. But I never underestimate how difficult the scale of numbers is to folks, so I appreciate when I occasionally see numbers of roughly similar scale in different contexts.

Have you actually examined the details of Nordhaus’ models?

Nordhaus assumed that the majority of the economy (which is to say > 87%) is immune to climate change because it takes place in "carefully controlled environments" (i.e., indoors). That’s an elementary mistake of taking the “climate” to be the “weather.” Climate change can destroy infrastructure, disrupt supply chains and completely upend the availability and distribution of energy and resources, regardless of whether the work occurs under a roof or not.

His math also uses a simple quadratic function to estimate the relationship between rising temperatures and output and his approach is mathematically incapable of adequately capturing tipping points or any non-linear breakdowns. Also the standard discount rates you have in Neoclassical models are bad for the existential timescales involved in climate change. And other economists have actually pointed out that his rates lead to an artificial undervaluation of future damages, and so you can’t accurately estimate economic growth over the long-term habitability of the planet.

The fact that Nordhaus ever won the Nobel Prize is a scientific travesty and sad state of affairs, and behind closed doors was aggressively challenged by others. If you want to understand climate change and why it’s so catastrophic, you have to model and understand the complex interactive feedbacks and it’s abundantly clear that he doesn’t.

Here’s why it’s a problem. (Some basic science)

If you have a steady state equilibrium condition, the first law of thermodynamics (which is conservation of energy) says that inflows of short-wave light into the Earth have to be balanced by energy outflows in the form of infrared heat. Otherwise what happens is the Earth heats up too much or cools down too much. Both of these outcomes are bad. Normally the energy imbalances are small and responses to changes are slow. But now due to human activity, the climate is changing faster than the response to it. One of the problems with comparing the climate at other points in the Earth’s history, is that it doesn’t take stock of cyclical phenomenon like the gains or losses in natural systems like glaciers, forests, deep water, etc. The problem with getting human beings to understand this is most of us have only two modes of psychological operation: complacency and panic.

A better person to listen to and read on this is Nate Hagens (he’s also very entertaining).

Have you actually examined the details of Nordhaus’ models?

Oh boy have I. I went through it extensively way back in the day, when we were at the old old old place. That experience was part of my coming to the conclusion that the entire endeavor is simply an impossible task. You mention some of the problems; there are others. I agree that his Nobel was a scientific travesty and sad state of affairs.

If you want to understand climate change and why it’s so catastrophic, you have to model and understand the complex interactive feedbacks and it’s abundantly clear that he doesn’t.

I would echo this, but with one very minor modification:

If you want to understand climate change and its interaction with economics, you have to model and understand the complex interactive feedbacks and it’s abundantly clear that he doesn’t.

You simply state that it's "catastropic". Whereas I think it's pretty much impossible to actually model the complex interactive feedbacks... especially when it comes to their intersection with political/economic systems.

But now due to human activity, the climate is changing faster than the response to it.

One of the problems with the whole sort of analysis you do in this paragraph is that everyone does timescale-separated coupled dynamical systems backwards in the case of political/economic-climate coupling. As I alluded to in my comment, the dynamics of political/economic systems are fast, much much much faster than the dynamics of climate, even with human activity. If one spends time with the theory of such coupled systems (the canonical text being Khalil's book), which I have done extensively for non-climate-related professional reasons and prior to engaging with any economic-climate models, then one understands the proper way to go about analyzing such systems. And, well, nobody does it the proper way. Why not? In my view, it's because they can't. It's impossible. Rather than the problem lying with human psychology, the problem is that the math doesn't math that way.

We could probably have a debate over the details of some of this. I don’t know what your background is, but I’m just an advanced layman who’s more than just a little bit literate on these topics. I agree that mathematically modeling this is hard. Very hard, in fact; but you can still do it well enough to extract valuable data from this. Just a note on such models ln how I see it.

If you look at global circulation models (GCM’s), they use physical data on the chemical composition of the ground, atmosphere, air and sea temperatures, wind velocities, rainfall, river flows, et al., the key variable in all these being greenhouse gases (‘GHG’s’ which we all know) because they absorb and re-radiate heat back to the Earth. The most important GHG is water vapor; but the problem is it’s inherently localized; making it the least controllable and hardest to obtain data on a global average; and it accounts for between 1/3rd or 2/3rd’s of the GHG effect. The next one is CO2, followed by methane and a few other industrial chemicals. If you compare things on a simple molecular basis, methane is more potent than CO2, but it doesn’t remain in the atmosphere for as long (about 5-6 years if I recall), compared to roughly a century for CO2. There’s much less methane in the atmosphere than CO2 but that could change if emissions from the methane clathrates in the sediment under the east Siberian shelf begin to accelerate.

This might be more to your point perhaps but yes it’s known that GCM’s have weaknesses. The first is that they assume vertical atmospheric thermal convection without wholly taking to account the horizontal component of circulation that arises from ocean currents and mixing. The other is that they divide the surface of the globe into icosahedrons but the minimum size of the grid area (with the exception of the poles) is way too large. You can’t simulate small scale behavior within just a few kilometers (which is nowhere near the 10’s of 100’s of meters necessary to predict local precipitation patterns or storm paths). That’s one of just a handful of problems which is why they also rely on comparative models, but the general trend of things has accelerated even faster than scientists forecast after factoring in the uncertainty of their models.

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