Niskanen Center Ignores William Nordhaus By David Henderson

Decades ago, Nordhaus’s work provided a set of tools that should have appealed to market-minded politicians as a way to tackle greenhouse gas emissions. Yet American conservatives chose denial instead. And because the right ignored Nordhaus (and those who picked up on his work), it seems unlikely that this country will take the “unprecedented” actions that the U.N. Intergovernmental Panel on Climate Change said this week are necessary to hold global warming to 1.5 degrees Celsius.

This is the second paragraph of David Bookbinder and Joseph Majkut, “Nobel laureate William Nordhaus provided tools to fight global warming. It’s tragic conservatives ignored him.” Washington Post, October 12, 2018. Bookbinder and Majkut are chief counsel and director of climate policy respectively at the Niskanen Center.

As you can see in the quote above, Bookbinder and Majkut are claiming that ignoring Nordhaus makes it unlikely that the United States will act to hold global warming to 1.5 degrees Celsius. But it’s Bookbinder and Majkut who are ignoring Nordhaus.

Nordhaus found that sum of the present value of damages and costs for the “do nothing” option was $22.59 trillion; for his optimal carbon tax was $19.52 trillion; and for the 1.5 degree Centigrade limit was $37.03 trillion. In other words having no carbon tax gives results much closer to those of Nordhaus’s optimal policy than limiting the temperature increase to 1.5 degrees Centigrade. Getting to that temperature increase would cost an extra $17.5 trillion.

So if anyone should be accused of ignoring Nordhaus, it would be the authors at the Niskanen Center.

The authors published their piece before an interview with Nordhaus ran in the New York Times. But Nordhaus’s response on an important question doesn’t exactly add clarity where it’s needed. Here’s the relevant part of the Q&A:

Do we have enough time to avoid the warming that will bring severe and damaging effects of climate change? It’s not going to happen in time for 1.5 degrees. It’s very unlikely to happen for 2 degrees. We’d have to be very pessimistic about the economy or optimistic about technology for 2 degrees. If we start moving very swiftly in the next 20 years, we might able to avoid 2 degrees, but if we don’t do that, we’re in for to changes in the Earth’s system that we can’t begin to understand in depth. Warming of 4, 5, 6 degrees will bring changes we don’t understand because it’s outside the range of human experience in the last 100,000 to 200,000 years.

Nordhaus should have said, not “It’s not going to happen in time for 1.5 degrees,” but rather “We shouldn’t try to impose a policy that keeps the temperature increase to 1.5 degrees because such a policy would have way more costs than benefits.”