Copenhagen Interpretation

How would you rank the following priorities for making the planet a better place?

* A major improvement in health in poor countries, saving millions of lives each year

* Substantial progress in reducing the rate of climate change, preventing large-scale species extinctions and other environmental damage

* New and improved advertisements for consumer goods

You don’t have to be Bjorn Lomborg to agree that, given the choice, improvements in health should get top priority. And you don’t have to be Vance Packard to think that the benefits of advertising, if they are positive at all, are trivial in relation to the first two choices.

In fact, however, countries in the developed world currently allocate about 1 per cent of its income to the advertising industry (this excludes the cost of the TV programs and so on financed out of advertising revenue), far more than to either development aid or climate change. The US, for example, spends about 0.1 per cent of GDP in development aid, and almost nothing on programs to mitigate climate change. If we were all prepared to watch the same old ads, instead of getting new ones every year, we would have enough money to finance either the proposals of the Commission on Macroeconomics and Health or a climate change mitigation program substantially more ambitious than the Kyoto protocol.

The fact that we don’t raises a couple of issues. First, our priorities are seriously screwed. We should all be making more noise, more of the time, about the need to increase development aid, as well as personally giving more than we do to aid organisations. I don’t claim to be much better than anyone else in this respect, though I do try from time to time.

Second, comparisons of this kind are clearly tricky. Even if we all agree that too much is spent on advertising, there is no easy way, in a market or even mixed economy, of stopping firms spending money to promote their products, let alone of redirecting any savings to socially desirable ends. Similarly, and contrary to Lomborg’s implicit premise, there’s no easy way of making a trade-off in which we decide to do nothing about climate change and instead to spend the money on improving the health of the poor.

Third, given that high-priority needs are going unmet, it’s hard to reason properly about social costs and benefits. The Copenhagen Consensus exercise illustrates this. It’s quite reasonable to say that, given the choice, clean drinking water for the world’s poor should rank ahead of mitigating climate change. But is this the appropriate comparison? If Kyoto goes ahead, it won’t be financed out of aid budgets. In fact, to the extent that emissions trading is involved, poor countries will actually benefit. So the appropriate comparison is between mitigating climate change and maintaining higher levels of consumption (including the advertising that is part of that consumption) in the rich countries.

Assessing the cost-benefit issues here isn’t easy, and I doubt that the members of the Copenhagen panel have managed, in the course of five days looking at a whole range of issues, to come up with better answers than those that have been found so far. There’s no easy way of putting a monetary value on species extinctions, the loss of coral reefs and so on, and there are also tricky conceptual issues about discounting. I can only say that I would happily accept an income cut of 1 per cent if even half of the damage projected by the IPCC could be avoided (some warming is, of course, inevitable).

It would, of course, be reasonable for Lomborg, and others who’ve participated in the Copenhagen Consensus exercise to say that climate change is a second-order issue and that it is far more important to devote attention to AIDS and other health issues. Lomborg could start at home if he wanted to. Denmark has been one of the few countries in the world that gives 1 per cent of its income in development aid. But the same government that appointed Lomborg to run its Environmental Assessment Institute has also cut foreign aid repeatedly. Lomborg is a figure with a world profile who could certainly bring some pressure to bear to have these cuts reversed. If I does so, I’ll be the first to cheer him on.

10 thoughts on “Copenhagen Interpretation

  1. Oy, vey! The unfathomable logic of leftists! 😉

    John Quiggin writes, “The US, for example, spends about 0.1 per cent of GDP in development aid, and almost nothing on programs to mitigate climate change. If we were all prepared to watch the same old ads, instead of getting new ones every year,…”

    Wait a second! What the #@$% does what the U.S. is doing have to do with the matter at hand? Bjorn Lomborg is in Copenhagen. And YOU’RE in Australia.

    Dr. Quiggin continues, “We should all be making more noise, more of the time, about the need to increase development aid, as well as personally giving more than we do to aid organisations. I don’t claim to be much better than anyone else in this respect, though I do try from time to time.”

    Well, part of the reason we’re not spending more time talking about increasing government development aid and private development donations is because certain seriously uninformed/misinformed people–no need to mention names ;-)–are writing about what a big deal global warming is!

    “Even if we all agree that too much is spent on advertising,…”

    What the @#$% does advertising have to do with the matter at hand? You and Bjorn Lomborg apparently both agree that more money should be spent on AIDS prevention or getting clean water to developing countries. Focus on those problems/solutions.

    “I can only say that I would happily accept an income cut of 1 per cent if even half of the damage projected by the IPCC could be avoided (some warming is, of course, inevitable).”

    More than 90% of the damage projected by the IPCC can and ***will*** be avoided by the simple fact that the IPCC’s projections are complete bullsh@t! This has been pointed out to you already; no need to name names about who did so, but here is one webpage on the matter:

    http://markbahner.50g.com/what_will_happen_to_us.htm

    Instead of fantasizing (aka, BSing) about how you’d be willing to spend 1% of your income on global warming mitigation, why not actually SPEND 1% of your income something more worthwhile (see below)?

    “It would, of course, be reasonable for Lomborg, and others who’ve participated in the Copenhagen Consensus exercise to say that climate change is a second-order issue and that it is far more important to devote attention to AIDS and other health issues. Lomborg could start at home if he wanted to.”

    He ***IS*** starting at home! Where he has to start is to persuade a bunch of uninformed/misinformed people that their attention/time/money would be better spent on matters other than global warming. And it’s been a bloody hard effort, because there are so many uniformed/misinformed people running about.

    And he isn’t being helped by seriously uninformed/misinformed people–again, no need to name names ;-)–talking about how global warming is going to cause mass extinctions. (What an unbelievable bunch of crap! NatureTM should have fired it’s entire editorial board over that article. But that would require some scientific integrity on the part of Nature’s publisher.)

    “Lomborg is a figure with a world profile who could certainly bring some pressure to bear to have these cuts reversed. If I does so, I’ll be the first to cheer him on.”

    Well, whoopee! But first you’ll have to stop denigrating him for telling the truth…that the scenarios posed by the IPCC are dramatically exagerated, and that they’re causing the world to waste time on a relatively unimportant issue, leaving far more important issues unaddressed.

    But an even better idea would be to give the 1% of your income you SAY you’d give to help humanity to a charity that really does some good, e.g. WaterPartners, who are dedicated to providing clean drinking water in developing countries:

    http://www.water.org/about/index.html

  2. Mark, as I mention fairly regularly, I require commentators on this blog to adhere to the norms of civilised discussion. The comment above doesn’t meet this test (bleeping the swear words is not sufficient when there are used abusively). I don’t intend to engage in discussion with you over this policy or, until you adopt a more civil tone, the substance of your comment.

    I will, however, say that, although I don’t give as much as I should to charities of the kind you mention, I do give more than 1 per cent of my income.

  3. Thanks for the interesting post, John. Lomborg, and some others, assume that a fixed amount of money is going to be spent for the public good. More money spent on protecting the environment means less money for protecting health. But it does not have to be that way.

  4. Mark, I looked up your site and pop-ups started appearing all over the place. As it happens I’d cleaned my machine this morning and haven’t had a problem in weeks. So being suspicious I pulled out and did another clean. Noadware found one cookie, deemed “severe”. So the finger is pointing at you, Mark. As a engineer I’m sure you’re quite capable of fixing it, so there’s a good lad!

    Meanwhile may have another look at your site and then again I may not.

    Here’s a tip you didn’t ask for. It is clear that you are very frustrated about what you perceive as the wilful ignorange of a large slice of the intelligensia, but I do believe your tone is working against you if you actually want to convince any-one. Take some deep breaths, go for some long walks, join a yoga class or anything to calm down a bit. In the long run your health will be the better for it -:)

    I don’t have time to indulge in a full-on flame war on all the points you raise, so I’ll pick a couple.

    First what has the US to do with it? Well unlike you I think the indications on climate change are well enough established to warrant action. Much action can be taken by individuals, groups, firms, countries. But that is not going to get us there. Internationally the Kyoto Agreement, given its limitations and deficiencies, is the only game in town. If the US signed up, then it wouldn’t be up to the Russians now. We (the world) would be in business and we could improve things from there. The Australians would then be stuck like a shag on a rock.

    It will not have escaped your notice that the weather is a world system and also that, with international trade and investment, we are increasingly becoming interdependent economically. Frankly I think the onus is on you to demonstrate that as countries we can all sit in our own patch and take no interest or responsibility for what happens elsewhere.

    On the question of aid, again the US parsimony is pretty much self evidently a problem. Last year when I was having a look at the reasons for the failure of the Cancun trade talks I was appalled to find the the US subsidy of 25,000 of its own cotton farmers to the tune of US$3.9 billion was putting in jeopardy the livelihood of 10 million west African cotton farmers, not to mention those in other places like India, Brazil and Egypt. At the same time the USAID budget for the continent of Africa was about $3 billion or comparable, depending on how you count it, to US support for Israel.

    The expenditure of this aid and the manner of expending it have a pretty direct effect on economic sustainability, political viability and, dare I say, the environment in many poor countries in the world. But when it comes to aid expenditure, here too the US spends most of it to the benefit of its own corporations and farmers. (Of course the US is not alone in this.)

    On water, the preferred modus operandi coming out of the Jo’berg conference on sustainability in 2002 was PPPs (private-public partnerships). Here too we have aid as a cover for transnational corporations taking over the world’s water supply. Vandana Shiva is on record as saying that water privatisation is almost inevitably associated with increases (often dramatic, even ruinous) in cost to the user, and decreases in quality and reliability of supply. In this I think she makes sense.

  5. Prof. Quiggin’s earlier use of the cost of road accidents and now his use of advertising appear to be a strategy to make readers question expenditure priorities (“seriously screwed”, he says). While I welcome this and usually cheer when somebody points out that the amount spent on, oh, gambling (for example) would fix our health system overnight, it is probably necessary to get a bit more systematic than just throwing out the odd teaser.

    To me, the priorities problem is well exemplified by the ease with which indices of well-being can be constructed. Take for example the Australian version of the Genuine Progress Indicator published by Clive Hamilton in Eckersley (ed.) (1998) “Measuring Progress”. There are many value-judgements involved, as the article by Prof. Quiggin (with S.Dowrick) in the same volume notes. Yet some progress is being made, and even in the absence of markets in which, say, clean air could be valued in sushi, would it not be better to take the broad view and campaign for improved (if not perfect) accounting rather than pick from time to time on particular examples (accidents, advertising)? Surely this is where a Federation Fellow could have the most impact.

  6. There is a big difference between what should be done and what can be done and “Global Warming” has two properties that the other problems do not have. Those are that first most money is spend locally and not in some faraway place, and second that it is an easy excuse for increasing tax which is something that any state likes to do.

  7. Ethical priorities for expenditure can be objectively determined: that allocation which prolongs the existence of consciously-experiencing moral beings is best.
    By that standard, health expenditure/investment comes way ahead of foreign aid, which comes way ahead of climate relief, which comes way ahead of consumer advertising.
    In my rough estimate, their should be an order of magnitude difference between each. ie 50% on health E+R&D, 5% on foreign aid, .5% on climate relief and .05% on consumer ads. Consumer advertisements probably detract from Gross National Happiness, by encouraging envy, spite and defensive expenditure.
    The expenditure on health is obviously a stunning figure, but is fair and reasonable in the light of the economic value of life, which is estimated at ~$100,000 pa ie three times average annual income. If health investment were able to extend working-life of each citizen by five to ten years, this would easily justify the extra economic cost.
    That is a raw utilitarian calculation, independent of humanitarian considerations.

  8. Jack, I think assigning percentages, with an ethical filter, makes a bit more sense than nominating an overall priority. But some problems are intrinsically more expensive than others. For example it could be that there is nothing useful to do on climate change beyond 0.5%.

    OTOH this does not take into account the criticality of any expenditure. It may be absolutely critical for example, to spend 1% on climate change and leave 49.5% for health. The failure to do so could lead to a chain of events that devastate human populations, as for example if the sea rose by a few meters.

    Faced with this prospect an increase in the expenditure on climate change, small in absolute terms but large in terms of the existing effort, becomes a no-brainer.

    All this is by way of illustration. I have no idea what the percentages should be. I think the question as put by Lomberg is simplistic and a bit silly.

  9. “The failure to do so could lead to a chain of events that devastate human populations, as for example if the sea rose by a few meters.”

    Extraterrestrials could invade and devastate human populations.

    The odds that sea levels will rise by “a few meters” in even the next 200 years (let alone the next 100) are virtually zero.

    Even the IPCC, with it’s ridiculously and unscientifically large projections for temperature increases in the coming century (approximately 1.4 to 5.8 degrees Celsius) doesn’t project the sea level to rise by even 1 meter in the 110 years from 1990 to 2100:

    “For the 35 SRES scenarios, we project a sea level rise of 0.09 to 0.88 m for 1990 to 2100, with a central value of 0.48 m.”

    http://www.grida.no/climate/ipcc_tar/wg1/409.htm

  10. Mark, you should be aware that sea level rising is one area among others where Hansen departs from the IPCC. Hansen believes the IPCC in relying mainly on the thermal expansion effect, neglecting ige sheet degradation, and hence underestimate the full effect of global warming on sea levels.

    Furthermore, Hansen believes the positive feedback mechanisms are likely to work well into the future on ice sheet degradation. At some unknown point such degradation may reach a critical phase where further degradation is unstoppable as futher degradation itself produced positive feedback.

    I’m surprised, astonished actually, that you can be so definite about what will NOT happen when factors come into play in which you admit you have no expertise.

    But even half a meter, when you add high tides, storm surges and cyclonic activity to it could cause extreme difficulty for a number of Pacific Islands, and considerable alarm near me here in Brisbane at the Sunshine Coast, the Gold Coast, the Moreton Bay shoreline and further north in Cairns, to mention a few that come readily to mind.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s