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THREAD: We can't afford NOT to decarbonize the world economy

Economists estimate the total cost of decarbonizing the world economy to be about 1% of global GDP.

Stern Review of Climate Change Economics (2006)


Like other experts, economists argue about this number. But 1% of global GDP is a robust ballpark #. Nobody thinks it will be free and nobody thinks it will be 5% of GDP.

William Nordhaus won the 2018 Nobel Prize in Economics for this kind of work.


Preventing global catastrophe for 1% of global GDP is terribly abstract. Hard to get our heads around that!

GDP = the total value of all goods and services in the world = about $85 trillion per year in 2019.

1% of that is $850 billion/yr


Wow! $850 billion/yr to prevent an imminent global catastrophe sounds like a LOT of money!

For context, the US Senate just agreed to boost the defense budget to $738 billion/yr.


But compared to preventing catastrophic climate change, the costs of failing to prevent it are VASTLY LARGER!

Burke et al (2015) estimate that unmitigated global warming will cost 20% of world GDP by 2100.

It will cost 20x more NOT to decarbonize!


To get our heads around what it will cost to prevent global catastrophe and save our kids $20 on the dollar, consider some of the other big expensive things we spend boatloads of money on.

Oil & Gas: We spent more than $2 trillion in 2017.


Compared to $850 billion/yr to prevent global catastrophe,

Brand-new cars & trucks: we spend $3.3 trillion/yr
(how old is *your* car?)

[ 88 million new cars @ $37,500 ]



Compared to $850B/yr to prevent global catastrophe --

Brand-new smart phones: We spend $566 billion/yr
(how old is *your* phone?)

[1.56 billion smartphones @ $363]



Compared to $850B/yr to prevent global catastrophe --

Fossil fuels:

The International Monetary Fund estimates hidden costs of fossil fuels ABOVE AND BEYOND the retail price are about $4.7 TRILLION/YR (5.5% of GDP)

(IMF calls these "subsidies")


Compared to $850B/yr to prevent global catastrophe --


There are about 40 million miles of roads, which cost an average of about $1 million/mile to build.

Get this -- we spent more than $40 TRILLION on roads!



Compared to $850B/yr to prevent global catastrophe and $40 TRILLION on roads --

don't even get me STARTED on what we spent on indoor plumbing, water treatment, sewers, subways, rural electrification, the Cold War, the telephone system, computers, and the global internet!

In summary, our generation ABSOLUTELY has it in our budget to prevent catastrophic global climate change by completely and immediately decarbonizing the world economy.

It will cost us a little more than we spend on NEW smartphones but MUCH LESS than we spend on oil & gas.

In round numbers, preventing global catastrophe will cost LESS THAN 25% of what we currently spend on BRAND NEW CARS.

Not only is it affordable, it's just 5% of what it will cost our kids to clean up the mess if we fail! (1% of GDP vs 20%)

Talk about a good investment!

But wait -- there's MORE!

Not only is preventing global catastrophe cheaper than oil & gas, and not only does it pay off better than 20-to-1,

doing this will create all the jobs and prosperity in the coming decades!

Our grandparents' generation didn't go bust installing indoor plumbing, sewer, and electrical grids. Our generation didn't go bust building computers and mobile phones and the internet.

Rather, these massive projects provided most of the jobs and prosperity in our times

For 500 years, our ancestors have spent HUGE money replacing perfectly serviceable old stuff with new stuff that was better but more expensive -- candles with light bulbs, outhouses w/toilets, buggies w/cars.

These ginormous expenses generated ALL the wealth of their times!
Replacing old stuff w/more expensive new stuff is the very definition of modernity. It's what we do.

We're not going to stop doing that, no matter what anybody says.

Some people say the modern world is built on extraction.

There's value in a lump of coal. Somebody sells it for a profit to somebody who sets it one fire and sells the energy for a profit to somebody who makes goods & services to sell for a profit.

Maybe it's true that we prop up our modern world with coal, and that when we either quit burning it or eventually run out, billions of our descendants will freeze and starve in the dark.

But God I sure hope not!

What a grim & hopeless view of the meaning of human history!

I prefer to think that WE make the world a good place.

Our quality of life isn't made of coal -- it's made from creativity, innovation, good ideas and hard work.

Our kids aren't running out of those things!

Our happiness and well-being doesn't come out fo the ground.

It comes from the sweat of our brows and the sparks in our souls!

The kids are gonna be alright.

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