State of Fear, Science and the Dismal Science

By popular demand (the President of Merrill Hall no less!) I'm unearthing and posting my comments on "State of Fear" from several months back. I'm sorry I've been AWOL the last while...I've been hit with the double whammy of 1. working in finance where the world is melting down and 2. buying a house and moving. Not done with either just yet...

If it feels like it abruptly ends without much conclusion...well that's why it's been unposted for so long. I also have lots of other thoughts on the topic I wanted to share...will have to wait for another post (I'd also enjoy a serious book on the topic).

1. On the book. Now I know what it feels like to read a "dollar-theater" movie. It really felt to me like Crichton was writing a screenplay for an action film---with the lack of depth, predictable plot and totally unrealistic and unnecessary stunts. Of course, I did read it in about a week, while my book club selection (Men hating church) took me a month to get through. So I guess I have no right to complain.



2. On global warming. I am not a scientist. I therefore rely on an appeal to authority here, and my understanding is that most authorities are in broad agreement that global warming is occuring. I do, however, have several reasons I'm less sure of the details (and therefore the appropriate response) than I would like to be:



a. People are selfish. This includes grant- and publicity-seeking scientists. Incentives certainly play a role here.



b. Sample selection bias. People who believe strongly in global warming or "environmentalism" are much more likely to be passionate enough to devote their life to the study of these issues. Most civil rights attorneys think racism is a big problem; most nutritionists think people should be more careful about what they eat. They certainly have more information on these issues...but you can't ignore that they also are a biased sample.



c. Climate is a complex and unpredictable system. I will here make a comparison that may strike the scientists in the group as unfair. I will compare economics to climate science. Economics, my field of study, is known as the "dismal science." Many people believe this is a commentary on the quality of economic research---in fact the term originated as nothing of the kind. It referred instead to the predictions of economists like Thomas Malthus whose predictions about the future and fate of humanity were rather pessimistic. Malthus observed humanity as a system of production and consumption and used the data available to him to predict the path of that system. He predicted that overpopulation would devastate the human race within a short period of time---that standards of living were doomed to continuously decline. Of course he was wildly wrong. But his methods were sound. He tried to predict something very complicated based on observations on a much smaller (and simpler) scale.



Take a more recent example. Economists nearly all agree that increasing government debt raises interest rates. The relationship between debt and rates is simple and nearly irrefutable in theory---it's just supply and demand. Yet recently Dick Cheney declared he did not believe in this relationship because the data supporting it is so hard to interpret. And unfortunately it's hard to blame him for that conclusion. The economy is a complex system with many variables interacting. To quantify the effect of debt on rates requires a specification of the whole system. It requires controlling for all the other variables which affect interest rates. Economists can experiment with these things on a small scale and can build mathematical models to simulate. But in the real world the relationships are very hard to identify and quantify. Predictions can be and have been very far off. Economics cannot be as precise as science most of the time because economists cannot conduct controlled experiments. We have to infer from the data we observe in the world.



Isn't global climate science similar in this regard? You can know the greenhouse effect is real...you can understand the theory behind it, model it, simulate it, observe it on a small scale...but predicting it in a system as complex as world climate is no small task. Economists also tend to vastly overestimate their ability to forecast. It would not surprise me were global climate models to suffer from the same bias.



A common argument I encounter is that while the extent of global warming (or other environmental problems) may be unknown, why not have clean air and water? This seems to me a useless point. It conveys no information---if I say I'll pay $0 for something you know nothing about its worth to me. The cost is not $0. It may be $0 to much of the developed world, but it most certainly is not to the third world. It is unfair to duck the hard questions here---life (and public policy) is about trade-offs and it doesn't get us anywhere to pretend otherwise.