Does Business Risk Facing a 'Climate Crash'?

With the publication of their report on climate risk, three multi-billionaires have started a campaign to frighten the public about global-warming “calamities” and to persuade business leaders to become worried about “climate risk” -- all in support of the White House’s misguided efforts to treat carbon dioxide, a natural constituent of the atmosphere and a blessing to successful agriculture, as a dangerous pollutant.  

The Risky Business Project, led by Michael Bloomberg, Henry Paulson, and Tom Steyer, released its report on "The Economic Risks of Climate Change in the United States" last June.  The project's co-chairs have been hitting the media ever since, promoting the project's report.  Yet the public does not seem scared -- and their campaign is going nowhere.  The global activists’ mass marches “to save the climate” are not getting any traction.  And the UN’s “Climate Summit” of Sept 23 is considered a flop, with top-emitting nations China and India sending only lower-echelon delegates.  Chinese President Xi Jinping and Indian Prime Minister Narendra Modi had more important business to attend to -- demonstrating the irrelevance of the UN and of Pres Obama’s climate warnings to the Summit.

An Open Letter in the Wall Street Journal [June 19, 2014] called attention to the Project; it was signed by about a dozen, including some nominal Republicans who are certainly not of the Tea Party persuasion.  The driving force is former hedge-fund manager Tom Steyer, a high-rolling Democrat supporter who has gained notoriety by his very public pledge of $100 million to the cause of “climate protection.”  

Never mind that such plans are based on climate models that don’t work -- incapable of explaining the absence of warming during the past 15 years.  Another strange fact: With a ranch on the North California coast, Steyer has become an implacable foe of the (mid-West) Keystone-XL oil pipeline -- and seems unfazed that Canadian oil must be transported by rail -- more expensive and less safe. 

The Open Letter addresses business leaders, urging them to consider “climate risk” along with other risks.  Fair enough.  But business already factors climate into their plans -- through commodity futures, and through insurance.  What worries business leaders most is government regulation that is as unpredictable as the climate.  Unlike the climate, regulation is most certainly influenced by humans, which serves to make it arbitrary or even capricious -- but profitable to the politically connected.

Meanwhile, former Treasury Secretary Henry M. Paulson has warned about a “coming climate crash.”  I am not sure what he means by “crash;” it certainly sounds scary.  Maybe it’s analogous to a stock-market crash, with temperatures suddenly dropping into deep-freeze.   If so, I imagine more greenhouse gases like CO2 might be called for -- not less.

The third member of the triumvirate is Michael Bloomberg, former New York City mayor and publisher of the influential Business Week.  He keeps flogging the dangerous and flawed White House concept of a “Social Cost of Carbon.”  Such an SCC could become a tax on CO2 emissions, circumventing the Congress and the US Constitution.  Sadly, the WH “calculation” of SCC totally ignores the positive benefits of CO2,  which far outweigh the so-called climate costs.

Climate Cycles

Climate is dominated by natural cycles of various lengths, whose causes are only poorly known.  Scientific studies of ice cores, ocean sediments, etc, suggest the existence of a 1000-1500-yr climate cycle of warming and cooling.  For example, we had a Medieval Warm Period (MWP) when Norsemen farmed in Greenland and Yorkshire produced wine, followed by a Little Ice Age (LIA), which ended only around 1750, close to the beginning of the Industrial Age.

The climate has warmed since then; but it is difficult to discern any human influence -- either from land clearing to expand agriculture or from burning of fossil fuels to produce the energy needed to sustain industry, food production, and the micro-climate to keep people comfortable.  More important perhaps, there hasn’t been any significant warming trend over the past 15 years or so, while atmospheric CO2 levels have climbed 10%.  Existing climate models have failed utterly to account for this “pause” in global warming; yet the EPA’s control policies for CO2 rely on these unverified models.

The science is likely to remain contentious as long as GW believers confuse correlation between a warming trend and CO2 trend with proof.  They don’t explain the cooling trend of 1940–75, or why the climate warmed strongly before 1940 when CO2 levels were quite low.

No Consensus on Future Climate

Climate scientists are sharply divided on the issue of future climate.  The UN-sponsored IPCC clings to the computerized model predictions that, as atmospheric CO2 levels rise, see an accelerated warming -- in contrast to actual observations. 

On the other hand, the independent NIPCC (Non-governmental International Panel on Climate Change) allows for the possibility that natural forcings swamp any human influence, while not denying the existence of a greenhouse [GH] effect. It is quite clear, however, that neither IPCC or NIPCC foresee the extreme future temperatures alluded to in the Open Letter

Henry Paulson posits an interesting analogy between the economic crash of 2008 and a coming climate crash -- unless the US institutes a carbon tax without delay.  To my simple mind, imposition of such a tax would delay recovery of economic growth, kill jobs, and hurt low-income households.  But my expertise is atmospheric science and does not include public finance and macro-economics; I cannot tell whether Mr. Paulson’s policies of injecting huge amounts of public funds into a few selected companies helped recovery or delayed it.  It depends on which expert I listen to.

Similarly, I suspect that Mr. Paulson has little expertise in atmospheric science and has been talking only to climate alarmists.  He even mixes up his facts.  Observed temperatures are not “catching up with … models.”  Quite the opposite: Climate models calculate a warming trend that grows as the level of atmospheric level of carbon dioxide increases; but there hasn’t been any warming now for at least 15 years -- with the temperature disparity growing larger year by year.  Perhaps Mr. Paulson should get a second opinion.

Most economists agree that a modest warming (of 2-3 degC, or 3-6 degF) would be beneficial, especially for agriculture: a longer growing season, fewer frosts -- plus the boost from higher levels of CO2.  In fact, agriculture got its start during the early Holocene, about 10,000 years ago, when it was much warmer than today.

Keep in mind that the use of global average temperatures can mislead.  Since GH-warming increases with latitude; a Siberian winter night might see -35 deg C instead of -40.  Also, the models based on GH theory do not suggest a “critical threshold temperature,” 2 degC or whatever, where warming becomes uncontrolled.  The climate history of our planet has shown remarkable stability.

Sea Level Rise

Aside from temperature, sea level rise [SLR] is a contested scientific issue.  Estimates for SLR in 2100 range from 6 additional inches [NIPCC] to 20 feet [Al Gore].  The point at issue is whether SLR depends on ocean temperature -- and how.  But there is no evidence of any acceleration during the warming of the 20th century.

Data from tropical corals show that global SL rose 400 feet in the past 18,000 years, since the Earth emerged from the depths of the most recent ice age. But once the continental ice sheets covering much of North America and Europe had melted off, SLR slowed to a steady 7 inches per century.We expect this rate to continue -- no matter what we do -- until the next ice age arrives.

Let’s see if Mr. Steyer and the other signers of the Open Letter are willing to sell their beach-front properties at distress prices to demonstrate their faith in climate risk.

S. Fred Singer is professor emeritus at the University of Virginia and director of the Science & Environmental Policy Project.  His specialty is atmospheric and space physics.  An expert in remote sensing and satellites, he served as the founding director of the US Weather Satellite Service and, more recently, as vice chair of the US National Advisory Committee on Oceans & Atmosphere.  He is a Senior Fellow of the Heartland Institute and the Independent Institute.  He co-authored NY Times best-seller Unstoppable Global Warming: Every 1500 years.  In 2007, he founded and has chaired the NIPCC (Nongovernmental International Panel on Climate Change), which has released several scientific reports [See].  For recent writings see and also Google Scholar.