Many Climate Economists Don’t Believe Climate Economic Models
My latest at IER. Some excerpts:
As the numbers indicate, 59 percent—a solid majority—[of the 365 peer-reviewed climate economists] thought that climate change would be beneficial for the global economy at least through the year 2025. Moreover, 37 percent of the experts thought that climate change would be beneficial to the global economy until at least the year 2050. Does this match up with the apocalyptic rhetoric coming from Vox and other quarters?
And:
The irony here is incredible. Americans have been beaten over the head for years about the “settled science” of the peer-reviewed research, and the Obama Administration assembled an Interagency Working Group that has spent years calculating and updating estimates of the “social cost of carbon.” We at IER have reported on all of the problems with these models, and cited MIT economistRobert Pindyck’s scathing critique. Now guys like Roberts are coming along and effectively saying, “I don’t care about the peer-reviewed literature that the IPCC uses, or the models chosen by the Obama Working Group. Let’s make policy by conducting a survey to see what the group thinks.”
Powerball and the Lucas Critique
I realize a few commentators gave a nod to this consideration, but I don’t think they realized just how critical it is. An excerpt:
To see the point, suppose the Powerball official jackpot somehow rose to $1.3 trillion, with a lump-sum payout of $806 billion. Running through the same calculations as above, we might get a ballpark gross expected value of one ticket equal to $1,700. That is far higher than the ticket price of $2, making it a no-brainer to play. In fact, in order to eliminate any risk, a hedge fund might devote $585 million to buying every combination of Powerball numbers. It would appear that by spending $585 million on tickets, the hedge fund could guarantee itself the $806 billion lump-sum payout. Who wouldn’t put up $585 million to win a guaranteed $806 billion?
Yet hold on a second. If one particular hedge fund sees this opportunity, why wouldn’t dozens more seize it? Yet it obviously can’t be the case that dozens of hedge funds can all guarantee themselves $806 billion from the same pot of money. In this contrived scenario, what would happen is that the dozens of hedge funds would all buy every combination of Powerball ticket, and so whatever the winning number happened to be, there would be dozens of winners splitting the pot. Realizing this, some of the hedge funds might buy multiple tickets for each possible number…until the point at which it no longer made sense to buy a ticket.
David Hume Loves 100% Reserve Banking
I’m not sure I fully appreciated this when I read it as a young lad:
II.III.4
This has made me entertain a doubt concerning the benefit of banks and paper-credit, which are so generally esteemed advantageous to every nation. That provisions and labour should become dear by the encrease of trade and money, is, in many respects, an inconvenience; but an inconvenience that is unavoidable, and the effect of that public wealth and prosperity which are the end of all our wishes. It is compensated by the advantages, which we reap from the possession of these precious metals, and the weight, which they give the nation in all foreign wars and negociations. But there appears no reason for encreasing that inconvenience by a counterfeit money, which foreigners will not accept of in any payment, and which any great disorder in the state will reduce to nothing. There are, it is true, many people in every rich state, who having large sums of money, would prefer paper with good security; as being of more easy transport and more safe custody. If the public provide not a bank, private bankers will take advantage of this circumstance; as the goldsmiths formerly did in LONDON, or as the bankers do at present in DUBLIN: And therefore it is better, it may be thought, that a public company should enjoy the benefit of that paper-credit, which always will have place in every opulent kingdom. But to endeavour artificially to encrease such a credit, can never be the interest of any trading nation; but must lay them under disadvantages, by encreasing money beyond its natural proportion to labour and commodities, and thereby heightening their price to the merchant and manufacturer. And in this view, it must be allowed, that no bank could be more advantageous, than such a one as locked up all the money it received,*25 and never augmented the circulating coin, as is usual, by returning part of its treasure into commerce. A public bank, by this expedient, might cut off much of the dealings of private bankers and money-jobbers; and though the state bore the charge of salaries to the directors and tellers of this bank (for, according to the preceding supposition, it would have no profit from its dealings), the national advantage, resulting from the low price of labour and the destruction of paper-credit, would be a sufficient compensation. Not to mention, that so large a sum, lying ready at command, would be a convenience in times of great public danger and distress; and what part of it was used might be replaced at leisure, when peace and tranquillity was restored to the nation.
Krugman Wants His Readers to Understand Hillary Is Better Than Republicans
Or so I speculate in the latest episode of Contra Krugman.
Also, there’s a special announcement in the opening minutes. Just when you thought Tom and I had plateaued, we take it up a notch.
If Bible Stories Are True, Then We’d Expect Other Cultures to Have Stories of Them as Well
As with just about anything humans argue, there are good and bad versions of the claim that Christianity must be false because other cultures have similar traditions/beliefs dating back earlier. (Gene Callahan’s post prompted me to write on this.)
For example, by itself I think it’s a decent argument for an agnostic to say, “There are lots of pagan myths about gods impregnating virgin human women who then give birth to superhuman offspring, so that makes me think the gospel accounts of Jesus are also myths.”
However, it is a terrible argument to say, “There are lots of pagan stories of a great flood in antiquity, and so I think the Genesis account is just a myth.”
If there really were a giant flood, then everybody alive after the fact must have been descended from the survivors. It would be odd if other cultures didn’t have accounts of it.
For another example of a terrible argument (though I must confess I probably used something like this when I was an atheist), I often see people saying, “Humans throughout history have believed in tens of thousands of deities. You think every single one of them is wrong except yours. Really?”
Again, if there is a living being who created the universe, then it should not surprise us that every culture pines to know more about this being. It would be evidence against the God of the Bible if the Hebrews were the only ones who had a notion of God.
If we find evidence that the Egyptians in 800 BC studied the stars–and moreover that they had many erroneous beliefs about them–does that make us doubt modern astronomy?
Outsourcing: E. Harding Discovers Krugman Kontradiction on Reich That Makes You Cringe
Frequent Free Advice commentator (who is no slave to the demands of courtesy, I should say) E. Harding posted this link to his analysis of Krugman’s recent book review of Robert Reich. It is absolutely mind-blowing to see how this guy rolls. Look at how Krugman talks now about his thoughts of Reich’s earlier book (from the 1990s), compared to how he talked about Reich back then. I think Krugman really still hasn’t understood that the Internet changes the rules; you can’t go Kontradicting yourself so blatantly when there’s an electronic record.
I’m tempted to do an excerpt, but then you might not click the link and see the various quotes juxtaposed. You really need to go to the link to see how bad it is.
Potpourri
==> Tribute to the recently deceased Florence King.
==> Arnold Kling on Scott Sumner’s book.
==> I write about Ryan Gosling’s shorts.
==> An interview I did yesterday about Austrian economics and the financial markets.
==> Scott Adams, the Dilbert creator, has had some very interesting posts on Trump. I haven’t seen anyone else analyze Trump like this. Try this one on climate change.
==> My peeps in Nashville printed up a debt chart and hit the streets to get feedback from the common man and woman:
Musical Parodies Related to Health Care
My co-author in The Primal Prescription, Doug McGuff, sends along these parodies which will resonate with health care professionals. If that’s you, I encourage you to get our book. We explain why this is happening!
(Note that EHR = Electronic Health Record.)
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