I finally got around to watching this 16-minute talk by Stuart Kirk of HSBC on why climate risk is so small.
It’s beautiful.
I love the way he goes after Mark Carney.
Later, Kirk considers the implications for GDP in 2100 if we do nothing. His numbers are substantially more optimistic than the ones I gave in my recent talk (starting at about the 44:00 point) and I’m not sure why. But Kirk and I agree that the effect of climate change will be to lead us to have a multiple of current GDP that is only a little lower than the multiple we would have had: virtually everyone will be substantially better off in 2100 than their counterparts today. He makes the point I made about the Netherlands (I made the point at about the 49:20 point of my talk.)
Well worth watching.
READER COMMENTS
Kevin Dick
Jun 2 2022 at 12:02am
Apparently, Kirk was suspended and HSBC vociferously disavowed these remarks.
I watched and they seem pretty tame. Certainly, he makes specific arguments that could be refuted individually if one disagreed with himself.
And it’s not like he denied the issue. He made points about the relative threat and our ability to deal with it.
It’s a sign of how semi-religious this topic is that not preaching doom and gloom is grounds for be shunned.
Kevin Dick
Jun 2 2022 at 12:08am
Apparently, HSBC suspended Kirk and vociferously disavowed these remarks.
I watched the video and they actually seem pretty tame. He’s not denying the issue. Rather he’s making points about the relative magnitude of the threat and our ability to deal with it. Certainly, he makes specific claims that someone could argue if they disagreed.
It’s a sign of how semi-religious this topic has become that he is shunned for not preaching full doom and gloom.
Dylan
Jun 2 2022 at 7:24am
I wouldn’t say he’s entirely being shunned by the community. I first read about the remarks on GreenBiz, a site for ESG professionals and the commentary was mostly supportive of the message. They took away a slightly different message than David did, but were in large agreement that Kirk said something that needed to be said.
https://www.greenbiz.com/article/kirks-inconvenient-truth-about-esg-investing
Kevin Dick
Jun 2 2022 at 2:31pm
Sure, not entirely shunned. But a shunning doesn’t have to be absolute to be effective. Being suspended, having the public call for your head, having the UK pension regulator issue a statement, etc., seems like a rather chilling response.
Dylan
Jun 3 2022 at 7:13am
Sure, what’s happened to him sucks, but I thought it was encouraging that there are voices in the community (and GreenBiz isn’t some free market think tank) that are pushing back and saying that he said what needed to be said.
Kevin Dick
Jun 3 2022 at 2:20pm
Yes, that was certainly better than it could have been.
Thomas Lee Hutcheson
Jun 2 2022 at 6:20am
Yes. The idea that “we are doomed” only leads to paralysis.
The real question is how much greater could income be (not just GDP as we want to minimize as well investments in mitigating harms) with a tax on net emissions of CO2 and methane than with a do nothing approach. And, more realistically realistically, how much greater with a pigou tax than with “do something!” approach: a plethora of subsidies and green investments and set asides and regulations flailing away at the problem of CO2/methane concentrations in the atmosphere. On the margin, we want to create incentives to avoid causing costly harms at the least net cost, however great future income is..
Jose Pablo
Jun 3 2022 at 10:09pm
God Bless Stuart Kirk!
How refreshing!
The ability to be both smart and brave is really remarkable (given its scarcity).
The biggest impact of climate change in the economy will, very likely be, the excess of regulation that will be imposed on the economy by politicians trying to do something about it.
The other remarkable consequence of the climate change will be to expose, once again, the naivete of economist when hoping for “policies/regulations”, imposed by “real” (as opposed to “ideal”) politicians. After they failure with “international commerce”, “comparative advantage”, “minimum wages”, etc … they still believe can win the “carbon tax sensible policy contest”.
Thomas Lee Hutcheson
Jun 5 2022 at 6:37am
Pay your money and take your choice: Advocate doing nothing becasue politicians can never do anything right or advocate for a tax on net CO2 and methane emissions.
Jose Pablo
Jun 8 2022 at 5:45pm
Who is in charge of implementing a solution to a problem is a key element of that solution (“key” like in most important one. Far more important than the “technical” solution to the problem).
Even with the best orbital calculations and rocket design in place, if New York Zoo’s herd of rhesus monkey is put on charge of the launching of a space craft, the whole thing is going to end in a colossal disaster.
Suspending the launching (doing nothing) is in that case the best option by far. Way better than wasting time improving the calculations or suggesting that the launching should be “revenue neutral”.
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