The Economic Denialism Built into Climate Change
A Discussion of Peter Foster’s Why We Bite the Invisible Hand Chapter 14 “Moral Climate”
I find this chapter a fascinating explanation of the histrionics that surround the climate change topic. I don’t want to get into whether it is man-made or not, real or hoax, but I do want to get into why bringing up such a discussion is so inflammatory in today’s society.
Foster notes a psychologist Philip Tetlock came up with the term, “psychology of taboo” for just this phenomena. (p. 307)
It is defined as “the tendency to regard some perspectives as so morally wrong as to be both beneath contempt and beyond examination.” (p. 307)
Some topics Tetlock found met this level with his students included the buying and selling of human organs, auctioning adoption licenses, and buying your way out of jury duty. (p. 307) Climate change skepticism would definitely fit into that list for many people.
And I think that is what I like about this idea of a psychology of taboo. When I see any debate or pushback to the dominant consensus on climate change, the response is not to engage with the ideas, data, or criticism raised, but instead it is just to insult the ones who dare to object to the consensus.
I always wondered why that is. Now at least I have a theory — that it is being treated as a morality issue, not a scientific one.
Few dispute that there was a slight overall warming in the 20th century, of around 0.8 degrees Celsius. No sensible person denies that the climate changes. The issues are the causes of the temperature movements, the case for projected catastrophe and the viability and implications of draconian policies proposed to prevent it. (p. 307)
As an economist, it is the last part of that quote that I always want to engage with: the “draconian policies”. But instead of having the sort of rational discussion we can have about other issues regarding the costs and benefits of suggested policies, any attempt is met with this moral hysteria of the psychology of taboo.
As long as I am touching the untouchable, I may as well throw in the similarity to our Covid policies. Again, where was the rational cost-benefit analysis that should accompany any major policy issue? It, too, was wrapped up in moral hysteria.
One possible answer Foster gives is due to Jonathan Haidt’s theory of morality he explored in an earlier chapter that posits we have five concerns: harm, fairness, loyalty, authority, and purity.
According to Haidt, the Left is most concerned with harm and fairness while those on the Right are concerend with a balance of all five.
When it comes to harm and fairness…climate change is like Red Bull, not merely because of the alleged existential threat to humanity, but because the main culprit is the old enemy: capitalist big business, in particular the fossil fuel industry. Skeptics were thus to be discounted or ignored on moral grounds. Even if they weren’t financially — or even wickedly — motivated, they were clearly biased by their irrational “fundamentalist” commitment to perfect markets. (p. 308)
And so we are back at the root of the problem of the argument. If I try to discuss the issue by looking at the costs and benefits, I am dismissed as immoral for even considering the impact on the economy.
Foster even points out the term “climate change denialism” has the conclusion built in: “The term ‘denialism’ implied mental disorder…” (p. 309)
Foster says the theory of catastrophic man-made global warming is offered as evidence that the Invisible Hand failed, and the denialists were therefore more committed to their love of the Invisible Hand dogma than being objective.
However, externalities are a well-known part of economics that I do not know of anyone denying. An externality is when you take an action that has unintended consequences on another person.
They can be positive, like education and training. You growing your skills leads to a better job for yourself, hopefully, but you are also helping the economy for us all. That part is a positive externality and has been used to justify subsidizing education.
You can also have negative externalities. Pollution is a common example where a business generates a waste product in the course of their production.
Economists have always recognized that industrial activity may generate pollution that inflicts costs on third parties. Such externalities have to be dealt with through the market — by a deal between polluters and pollutees — or controlled by regulation or mitigated by innovation. However, in the notion that industrial emissions would lead to mighty floods, unprecedented droughts, violent storms and international conflict we see the mother of all externalities. (p. 309)
Thus the policy reaction has also been the mother of all policies: extreme reductions in industrial emissions of carbon dioxide without seeming concern to the impact of the economy and those that live in it.
And it has led to government subsidies for supposedly green energy technology. Again, the morality goggles are blinding people to a real discussion about solar and wind generation. It is well known how oil, gas and coal pollute, but what about solar and wind?
Once solar and wind are in place, they do seem green because they rely on the naturally occurring sun and wind. But what does it take to build the infrastructure?
Solar requires lots of batteries, just as EV’s do, which requires lots of rare earth mining, an often environmentally damaging practice like oil and gas drilling.
And windmills require tons of oil and gas derived plastic just to be built. Recycling them after they are decommissioned is another challenge yet to be faced.
However, these sorts of facts are not listened to because the psychology of taboo shuts down conversation if you try to say anything contrary to green energy solutions.
Al Gore is a good example of one who operated on moral grounds, shutting down any questions or inconvenient facts as evidence of the questioner’s evil nature.
Gore, typically, treated all skeptics as apostates, who either had been corrupted by naked self-interest or were suitable for psychiatric treatment. (p. 320)
Speaking of self-interest, however, the solutions he pushed seemed to work out well for himself.
What Gore really seemed to be claiming was that we should move past “quibbling” about objective truth and get straight to draconian action, which just happened to coincide with his own brand of politics: more regulation and bigger government; more redistribution both within and between states; and more government support for “alternative” energy (in which Gore was a major investor.) (p. 321)
The rest of Foster’s chapter delves deeper into the quality of the climate data and other similar issues. To me, however, the most interesting part of this chapter is the idea of psychological taboo because it explains why rational conversation is shouted down.
There is no recognition that while pollution is bad, the green energy solutions currently on offer are not by definition good.
Our system is designed for compromise. Maybe the “deniers” are right, maybe they are wrong.
Either way, those who want policies to reduce emissions need to work with everyone and maybe move slower. There are real costs to their solutions so we need to consider all the trade offs.
The inflation we have now has multiple causes, but absolutely one of them is the sudden increase in the cost of hydrocarbons due to the change in policies of the current administration.
Like it or not, our existing economy is very dependent on the price of oil. An increase in oil raises the cost of production for many items and raises the cost of transportation for many more.
The idea that we can rapidly turn away from oil and gas is causing many of our current economic problems.
And it has its own kind of denialism built in: how are we supposed to replace all the petroleum derived plastics that are everywhere in our system today? Medical products, safety products, consumer products, and so many more.
At the moment, 99% of all plastic is derived from fossil fuels.
Foster turns to the next chapter to a similar issue, global salvationism, which combines the environmental concerns with concerns about developing nations.
Reference: Foster, Peter, 2014. “Moral Climate” Chapter 14 of Why We Bite the Invisible Hand, Pleasaunce Press.