Review (Guest): How Much Have Global Problems Cost the World? A Scorecard From 1900 to 2050

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Bjorn Lomberg et al

2.0 out of 5 stars It just gets better and better!, November 15, 2013

By David Wineberg “David Wineberg” (New York, NY USA) – See all my reviews  (TOP 1000 REVIEWER)

Milton Berle once appeared for an interview on a morning TV show in New York. After, his interviewer threw to the weather woman. Berle left his seat and took over doing the weather. His analysis? A line of tornados ripped through New Jersey last night, causing $100 million in IMPROVEMENTS. That is the feeling I got with How Much Have Global Problems Cost the World?

Lomborg’s Copenhagen Consensus got a bunch of academics to look at issues from a common denominator. Everything has to be evaluated as a percentage of GDP. Everything has to be monetized to make the models work. Lives, disease, biodiversity – everything gets a dollar value in these studies. Lack of historical data is not a problem either; the models “backcast” to 1900. The conclusion is that our worrisome problems are an ever shrinking cost to us, relative to GDP.

But of course, prices have never reflected the ecological cost of production or use, so we’ve been freeloading, with GDP expanding while costs have been controlled. The bill will go to our grandchildren. These models don’t reflect that. Instead, the ballooning GDPs of the last century simply leave the cost centers in their wake, taking an ever smaller share.

There are ten studies, covering a wide swath of life on earth, “humanity’s biggest challenges”. Interestingly, Lomborg presents them not in order of impact, importance, conclusions or even dollar value, but in alphabetical order:
Air Pollution
Armed Conflict
Climate Change
Gender Inequality
Human Health
Trade Barriers

Some of the assumptions are worrying. Solid fuel (wood, coal) use is falling according to its study. But everything I’ve read says that coal is booming. It is being used more now than ever, with much more coming onstream. The World Bank is busy funding coal-powered power plants all over the planet – because they’re cheaper and so is coal. The cost of pollution-related health care is set at $70 per outpatient service in developed countries, $159 per illness episode, $200 per bed-day, and a five day average time disabled. Not in this part of the developed world. With those kinds of figures, by 2050, the cost of air pollution will drop from 5.6% of worldwide GDP to just 4%. Congratulations.

Overall, there are three big things wrong with the framework for these studies: 1) their only parameter is as a percentage of GDP, without also seeing how they interact with other facets, 2) they are linear – they assume nothing will affect them and their trajectory, and 3) funding institutions use them all over the world. That is the most frightening aspect of all.

The point that makes the studies the most invalid is the first. In any complex system, singling out one factor is meaningless, and conclusions are pointless. It’s like the Federal Trade Commission and the Food & Drug Administration allowing a new chemical compound without knowing how it interacts with the other 88,000 compounds they also never tested in the air, in soil, in water – or in humans. The result is new, incurable diseases that put the linear trajectory of improving health and longevity off its track. Just when we thought we were entering an era without killer infectious diseases, we’ve invented a new crop of autoimmune diseases. That is also the fatal flaw in Lomborg’s approach.

A number of the studies acknowledge that dollar losses are mounting in absolute terms, even as they shrink as a percentage of GDP. Similarly, there are acknowledged problems with health that the studies can’t examine. Cause of death cannot be coal, even if you are hit on the head with it. This is the tobacco defense, and it renders all stats inaccurate. We are only now getting a handle on the true cost of tobacco consumption, though the figures the health study uses are bad enough for now.

The list of caveats and qualifications over assumptions by the authors themselves is both gratifying and nullifying. Drawing conclusions from these houses of cards is at least suspect, if not invalid. But while his authors issue caveats and qualifications, Lomborg himself sees positives far and wide. In his view, it just keeps getting better and better. Longevity is increasing, war is declining (in scale at least), nutrition is up, epidemics are down…. Biodiversity may be down by almost a third (!), but the net benefit to humanity in dollars is up, so everything is good. Seriously.

Milton Berle would appreciate it. Somebody stole his line.

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