Climate Change Report by Economist Sir Nicholas Stern

Sir Nicholas Stern, Chief Economist and Senior Vice-President of the World Bank from 2000 to 2003, released a climate change report on 30 October 2006. The report suggests that the global economy could be forced to shrink by 20% due to the effects of climate change. However, the report says taking action now would only reduce global gross domestic product (GDP) by 1%.

I've heard of several previous studies on the economics associated with climate change prevention policies, and most suggest a small reduction in economic growth to make dramatic impacts on our emissions. A lot of the information in the Stern Report is not new, but this is definitely the first global economic report produced by such a prominent economists.

Are there any more excuses left for not pursuing climate change prevention policies? Initially, lack of scientific evidence for climate change was cited as a reason not to take action. There is an overwhelming abundance of data supporting climate change, so that excuse certainly won't work. Another excuse often used is that climate change prevention is too costly, but as the Stern Report and others have shown, the cost is minor, and the cost of not taking action is significantly higher. The only excuses left are self-interest and shortsightedness, which are not good excuses at all - unfortunately they tend to be powerful ones.

Here are some of the findings of the report

- "The benefits of strong, early action on climate change outweigh the costs"

"Our actions over the coming few decades could create risks of major disruption to economic and social activity, later in this century and in the next, on a scale similar to those associated with the great wars and the economic depression of the first half of the 20th century. And it will be difficult or impossible to reverse these changes. Tackling climate change is the pro-growth strategy for the longer term, and it can be done in a way that does not cap the aspirations for growth of rich or poor countries. The earlier effective action is taken, the less costly it will be."

- "Scientific evidence points to increasing risks of serious, irreversible impacts from climate change associated with business-as-usual paths for emissions."

"The current level or stock of greenhouse gases in the atmosphere is equivalent to around 430 parts per million (ppm) CO2, compared with only 280 ppm before the Industrial Revolution."

- "The impacts of climate change are not evenly distributed - the poorest countries and people will suffer earliest and most. And if and when the damages appear it will be too late to reverse the process. Thus we are forced to look a long way ahead."

- "Emissions have been, and continue to be, driven by economic growth; yet stabilisation of greenhouse-gas concentrations in the atmosphere is feasible and consistent with continued growth."

- "Policy to reduce emissions should be based on three essential elements: carbon pricing, technology policy, and removal of barriers to behavioural change."

- "An effective response to climate change will depend on creating the conditions for international collective action."

- "There is still time to avoid the worst impacts of climate change if strong collective action starts now."

Below is a link to a BBC article on the Stern Report's release and a link to a 27 page summary of the report.

BBC Article: http://news.bbc.co.uk/2/hi/business/6096084.stm

Report Summary: http://news.bbc.co.uk/1/shared/bsp/hi/pdfs/30_10_06_exec_sum.pdf

Entire Report: http://www.hm-treasury.gov.uk/independent_reviews/stern_review_economics_climate_change/stern_review_report.cfm