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The Three Faces Of Climate Change

The U.S. Presidential election is over and climate change is back in the headlines. The bulk of America's population (if we can still trust surveys and polls) thinks there's a looming man-made climate crisis ahead. 195 nations signed the Paris climate accords in December promising to limit carbon and the attendant rise in global temperatures. Whether it will be effective or not we cannot say.

At another UN sponsored climate conference in Marrakesh, last week, numerous nations including the Chinese, (perhaps responding to certain allegations by the President-elect) seemed eager to address and limit the possible ravages of climate change. The new administration in the U.S., on the other hand, has firmly declared the whole business a hoax, aided and abetted by "scientific" input mainly from domestic oil and gas interests. Rather than join the shouting, let's look at the business and policy implications of some of the positions taken.

We can divide the climate change debate into three camps.

Those agreeing that human activity, especially burning fossil fuels, is mostly responsible for the rise in CO2 levels subscribe to the so called anthropogenic school of climate change. Let's call this paradigm ITHS! (It's the Humans Stupid!) The global scientific community overwhelmingly belongs to this camp. But ITHS! campers may disagree on policy prescriptions. Some even say that the forces unleashed by our carbon emissions are already so profound that a long range policy of coastal retreat and accommodation is the only sensible path.

In the second camp we find those offering an alternative explanation for climate change: that we're experiencing a long cycle of ongoing geological change not clearly caused by human activity. The proponents of this paradigm point out that in previous periods global temperatures rose and fell, and glaciers advanced and retreated totally without human interference. The present is merely one such episode. This paradigm we'll call INOF (It's Not Our Fault). Its proponents often include energy executives with impressive engineering backgrounds. This argument resembles that of tobacco executives who, years ago, tried to dismiss the high statistical link between smoking and lung cancer as not showing definitive proof of causation.

The third camp consists of outright denialists. Coming also primarily from the natural resources sector, they appear to have influence and are likely to affect policy in Canada and Australia as well as the U.S. However, more and more of their activities look like that of the Church in pursuit of Galileo for heresy. If this is the case, then science eventually prevails but only after all the old "cardinals" retire or die. Related: Japan Is Aggressively Buying Up Oil And Gas Around The World

Both the ITHS! and INOF campers can agree that average temperatures around the globe have been rising and rising temperatures means melting glaciers and higher sea levels. They may differ, though, among other things, as to the rate and degree of future temperature or sea level changes.

ITHS! argues for aggressive carbon remediation. INOF, by not accepting the carbon-climate link, would disagree using the old Scottish legal defense, not proven.

But's let's go back to temperature rise which we should all be able to agree on. If, as some project, a 2 degree increase in global temperatures leads eventually to a 25 meter increase in sea level, that would affect a significant percentage of the world's population residing in coastal areas. By some estimates severe coastal inundation, which some geophysicists consider virtually inevitable, may take place over long time horizons like 250 to 500 years. But smaller rises in sea level, and still severe damage from hurricane storm surges, could take place sooner and that is the issue we need to discuss.

Politicians and policy makers typically respond to the needs of living voters, not to the needs of generations yet unborn. Rising seas as an issue is important. But for many rising rents are a more critical issue.

Forward thinking urban planners in cities like New York are working with an anticipated 2.5 meter rise in sea level versus the climatologists really long term sea rise estimate of 25 meters or more.

Let's assume for a moment that the INOF camp is correct. Global warming is simply a long term process not directly connected to anthropogenic carbon emissions. This suggests little interest in shuttering coal fired power generating plants. But what about higher temperatures and rising sea levels?

INOFers should be totally fine with the notion of rising sea levels. After all, it happened before humans were a factor. Look at the geological record. Even coastlines expand and contract. But if we do accept the notion of coastal or riparian "mutability", this leads to a choice: do we fight or flee? Do we spend billions on sea walls, sand dunes, oyster beds and the like? Former NYC Mayor Bloomberg advocated for a seawall at mouth of the Hudson to protect Manhattan. Estimated cost: $20 billion. But the city has also "retreated" so to speak, purchasing homes in certain lowlying coastal communities for abandonment. Related: Tesla's Solar Roof Market: What's The Potential?

Or does it make more sense from the perspective of the public purse to acknowledge the long term futility of coastal fortification efforts and prepare instead to accommodate the ocean? (Perhaps Manhattan is the new Venice around the year 2200 minus the old world charm).

This problem may remain annoying and expensive near term. Only longer term does it become unmanageable.

Regardless of which climate paradigm is correct, if sea level rise projections curently being discussed are even remotely accurate, then by the end of this century much coastal infrastructure will need relocation. Acting on this is the "managed retreat" response to climate change.

Dr. James Hansen, the "godfather" of modern climate science, anticipates that due to the CO2 (and methane) we've already pumped into the atmosphere, global ice sheets will melt. The attendant rise in sea levels will eventually engulf all coastal cities around the world within 50-150 years.

These events may eventually prove catastrophic but only over long time horizons. And that's the problem. Global warming has the potential to impose enormous changes and hardships in human activity. But ones that we initially at least only experience irregularly via hurricanes, flash flooding and higher high tides.

A substantial number of adherents to the INOF paradigm admit the earth is warming.

There are some holdouts who deny change and others who say the planet is cooling, echoing earlier claims from the 1970s. But most of the denialist camp admits the truth of the thermometer. The world's been heating up.

INOF adherents accepting the idea of a warming planet have a choice of three policy options:

1) The government should leave this issue alone for longer. Extreme weather events are not proof of climate change.

2) Perhaps the rising level of greenhouse gas emissions will produce positive changes.

3) Lastly, Hansen and his ilk are right. It's too late. Don't waste billions on inefficient government programs (like seawalls) on a problem that can't be ameliorated in that fashion.

If all the ITHS! adherents joined with the warming planet faction of INOF they would probably constitute a majority.

It would be ironic if our newly elected President, supposedly an accomplished builder himself, turned his back on the biggest construction and relocation project in history due to a faulty paradigm.

By Leonard Hyman and William Tilles for Oilprice.com

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Leonard Hyman & William Tilles

Leonard S. Hyman is an economist and financial analyst specializing in the energy sector. He headed utility equity research at a major brokerage house and… More