The debate over climate policy in the U.S. is stalled on the side of the road like a hybrid car with neither a charging nor gas station for miles.
"The exchange between mainstream and contrarian scientific perspectives has hardened into something resembling a religious war, ideologically charged, politically entangled and resistant to productive communication," Northwestern University economist Charles Manski said. "Both camps assert their conclusions with a certainty that the underlying science cannot honestly support, producing firm predictions resting on unsubstantiated assumptions, or 'incredible certitude.'"
Now imagine if climate policy was like insurance, which is designed to minimize the harms of catastrophic events through an investment made over time.
Manski proposes in the working paper, "Credible Climate Planning Under Uncertainty: Beyond Incredible Certitude," an approach to climate policy based on an economic framework that promotes the general welfare and minimizes worst-case scenarios by taking into account both the cost of damage and cost of abatement and, critically, by acknowledging what science can and cannot say with certainty.
"An easy way to think about the need for some form of serious climate policy is to make an analogy with the purchase of health, home or car insurance. The entire idea of insuring against bad future events rests on uncertainty. If people and firms could predict the future with certainty, there would be no market for insurance."
