What’s Florida Worth?
An inter-agency work group headed by the White House Office of Management and Budget is trying to find the real cost of a ton of carbon emitted. It turns out to be a hard number to agree on.
Would our grandchildren really miss Florida if it was under water? How about no more fruit or nuts from California? What about the loss of our breadbasket? Would the end of corn and soy from the Midwest really bother the grandchildren of our children? How much?
Cost/benefit analysis. Economists do it all the time. So, just what is the cost to society of a ton of carbon? The Institute for Policy Integrity consulted 144 top economists and released the result: (pdf) Economists and Climate Change: Consensus and Open Questions. By sensibly limiting the sample to economists with the most expertise on climate change, the survey was able to avoid the ignorance of economists who have not studied climate change.
84 percent agreed that the environmental effects of greenhouse gas emissions, as described by leading scientific experts, create significant risks to important sectors of the United States and global economies. A near unanimous 98 percent agreed that putting a price on carbon through a tax or cap-and-trade will increase incentives for efficiency and innovation. 55% preferred a tax, and 35% preferred cap-and‐trade.
But they came up with very widely divergent numbers for both the costs and the benefits. The cost estimates ranged from $10 a to $10 million a ton, with a median of $50 a ton. The benefits of prevention also ranged between $383 billion and $5.5 trillion over the next five decades.
