bookcoverEd. note. This post is an excerpt from Carey W. King’s new book: The Economic Superorganism: Beyond the Competing Narratives on Energy, Growth, and Policy.  You can find out more about the book and purchase it from the publisher here. Carey’s website can be found here.

Excerpt from:

  • Chapter 9 titled “Delusions of Control”
  • Section titled: “The Political Will Delusion: Willpower and Temptation”

For the last 200 years, increasing global energy consumption has translated to increasing global GHG emissions. While this might not be the case in the future, how do we consider the conflict between our instincts to react to immediate circumstances (i.e., consume more energy now, grow the economy now) and the political will to choose a different path based upon a future goal (i.e., limit human-caused climate change)? As Daniel Dennett asks in Freedom Evolves:

Where does the oomph come from to overrule our own instincts? Tradition would say it comes from some psychic force called willpower, but this just names the phenomenon and postpones explanation. How is “willpower” implemented in our brains?64—Daniel Dennett (2003)

Psychologists and economists use the term discount rate to describe how people make decisions, within our brains, when there are multiple options that present benefits at different points in time. Do I want one dollar now or two dollars ten years from now? Largely driven by natural selection and perhaps some idea similar to the maximum power principle, humans tend to have “steep” discount rates indicating that we tend to select rewards that come sooner rather than later.

Dennett uses the story of Ulysses and the Sirens in Homer’s The Odyssey to demonstrate the link between willpower and the idea of the discount rate. The goddess Circe warns Ulysses that during his journey home, he will sail past the Island of the Sirens. The Sirens appear to have exquisite beauty and a sweet song that lures sailors to their shores. But on approach, the sailboats crash on the rocks, and the sailors remain on the island, unwilling to leave as they listen to the song of the Sirens until they wither and die. Ulysses wants to return home to reunite with his family, but he also knows he will fall into the temptation of the Sirens as he sails by their island. He heeds Circe’s advice on how to safely pass the Sirens. Upon approach of the island, Ulysses orders his men to fill their ears with beeswax, a gift from Circe, such that they will not hear the song of the Sirens. As for himself, Circe has given Ulysses a way to hear the sweet Siren song yet not be lured to his death. Ulysses orders his men to lash him to the ship’s mast, but under no circumstances are they to untie him, no matter how much he commands while he listens to the Sirens’ song.

The important concept related to political will is one of planning for a future time. Ulysses knows the situation that will confront him in the future, and he also knows himself. He knows his steep discount rate will not allow him to resist the Sirens when the time comes. Thus, before he is in the presence of the Sirens, he does exactly what is needed. He enacts a plan to avoid a disastrous fate. He restrains himself by ordering his men to physically tie him to the ship’s mast. Thus, when his ship passes the Island of the Sirens, Ulysses’ previous decision has removed his choice, or degree of freedom, to go to the island. While hearing the Sirens’ song, he absolutely believes he would be happier on the island at that moment than with his family later. Only his previous decision has allowed him to experience the life he wants in the long term.

Homer likely did not know when writing The Odyssey that he was demonstrating the concept of the discount rate. But he knew of temptation. Temptation is the base of many stories of struggle. Perhaps no more famous quote exists than that of Saint Augustine of Hippo when praying to God: “Give me chastity and continency, only not yet.”[23] As a young man, St. Augustine knew he should not lust, or at least he believed that he should not. When praying, he asked to be healed, but “not yet” because he “. . . feared that you [God] would hear me quickly, and that quickly you would heal me of that disease of lust, which I wished to have satisfied rather than extinguished.”65

In the context of the energy and economic narratives, who needs more willpower? Do our political leaders need “political will” to constrain the choices for both public and private energy company investments? Do we as citizens need the “political will” to elect leaders that will constrain our energy choices to those with low-carbon impacts? Do we, as consumers, need the willpower to buy fewer products and services? Do company executives and shareholders need the willpower to direct more investment and profits to low-carbon energy and conservation instead of to what they think is the most profitable investment option?

In considering these questions, we can consider our modern situation in light of both St. Augustine and Ulysses. Ulysses had highly reliable information from the goddess Circe, and he was certain that proper actions could avert a single bad outcome in the near term. He was not restricting the degrees of freedom for the long-term future choices that he or his crew could make once they made it home. He only needed the willpower to restrict himself during his homeward journey, not for the rest of his life. This is akin to a company or country planning for the next year or so, but as if with absolute certainty of what to expect.

On the other hand, St. Augustine struggled with the opposite time horizon as Ulysses. He sought the willpower to restrict himself from the lust he craved, not only for a while, but for the rest of his life. Immediate temptation was always too strong for him to change.

So why don’t we restrict ourselves to less than our full suite of greenhouse gas emitting energy options, much like Ulysses tied himself to his mast? The renewable energy narrative posits that all we need to do is plug our ears as we renewably sail past the Island of the Fossil Fuel Sirens. However, the problem is not that we’ll quickly approach and pass the Sirens in the near future. The problem is we’re already on the island!

Thus, St. Augustine’s lust is the more apt analogy. The temptation to continuously row the economy is ever present, and the historical data, maximum power principle, and drivers of evolution imply that our economy as a superorganism seeks more physical growth requiring higher energy consumption via the laws of physics.

But there is no God to whom to pray, or single authority that will command us, to restrict our lust for growth. To reduce greenhouse gas emissions we have to rely on ourselves, our institutions, and political officials to restrict some available energy and economic options. But countries compete for resources just as living organisms compete within ecosystems. Per evolution, a system or country that restricts its energy options more than another will in all likelihood reduce its fitness. Physical growth on our finite planet will stop someday, but unconsciously hitting some inexact upper limit is different than consciously choosing to stay below a predetermined target.

When I think of the 2015 Paris Agreement, signed by practically all countries in 2016, in which countries agreed to non-binding “nationally determined contributions” to reduce greenhouse gas emissions, I imagine rephrasing St. Augustine’s words in the context of political leaders that vote to rapidly reduce greenhouse emissions (my changes in italics):

Give me rapid reductions in greenhouse gas emissions, only not yet. For I fear that the economy would hear me quickly, and that quickly it would heal me of that disease of growth, which I wished to have satisfied rather than extinguished.

But I don’t have to rephrase St. Augustine to demonstrate the strength behind the infinite growth and substitutability economic narrative. We find this sentiment with economist William Nordhaus, who won the 2018 Nobel Prize in Economics “for integrating climate change into long-run macroeconomic analysis.” On the day of announcement of his prize, he stated to his undergraduate class: “Don’t let anyone distract you from the work at hand, which is economic growth.”66 The “task at hand” for Nordhaus and many other economists is growth, not some limit in atmospheric concentration of greenhouse gases.

This is not to say that Nordhaus’s statement is correct or incorrect, or that I agree or disagree with his statement. This is to say that his view is that the goal is growth now and in the future. If achieving this goal involves reducing greenhouse gases today to mitigate climate change, then so be it. If it involves increased greenhouse gas emissions today, then so be that as well. He has an economic growth model, based on neoclassical theory discussed in Chap. 6, that runs a cost–benefit calculation, and that tells him a world with 4 ◦C of warming optimally balances costs and benefits. Some vehemently disagree.67

One can argue about the structure of Nordhaus’s and others’ integrated assessment models (as in Chap. 6) and how they calculate benefits (i.e., economic growth) and the economic losses from climate change. Given the high-level abstraction and uncertainty of economic damages from climate change, some economists claim current modeling efforts are “close to useless as tools for policy analysis” [24].68 One can also argue against using any such economic models at all. In all likelihood, we won’t be able to tell if we ever reach some “optimal” level of warming.

To wrap up this section on political will, let’s make an analogy of Nobel Laureates to the mythological stories of the Greek Gods, who regularly fought among themselves. We can contrast Nordhaus to the scientists within the Intergovernmental Panel on Climate Change (IPCC) and Al Gore who together won the 2007 Nobel Prize for Peace for emphasizing the need to limit climate change impacts by urgently reducing GHG emissions. If we are Ulysses, is the IPCC our Circe, warning us to constrain ourselves in the short term so that we will achieve the future we want? Is Nordhaus a god or a Siren tempting us with the song of immediate growth?

Our Nobel gods are in disagreement. The Earth systems models of the climate tell the scientists that we need to rapidly reduce GHG emissions to zero in a few decades. The economic models tell us we don’t because they assume the economy grows about the same whether we transform the energy system to reduce emissions or not. Further, the Earth system models must assume the Earth is finite to model the feedbacks of GHG accumulation. The economic models generally assume the Earth is infinite.

No wonder we seem to get conflicting signals! The tragedy (pun intended) is these narratives speak past each other even when cobbled together in the integrated assessment models that force them to have dinner at the same table. The submodels speak the same language of mathematics, but their narratives are incompatible.

Footnotes:

64 Dennett [7, p. 210].

65 Book VIII, Chapter 7, The Confessions of St. Augustine [23].

66 Mike Cummings, YaleNews, “Cheers and roses from undergrads for Yale’s latest Nobel laureate,” October 8, 2018, https://news.yale.edu/2018/10/08/cheers-and-roses-undergrads-yaleslatest-nobel-laureate.

67 Steve Keen, “ ‘4 ◦C of global warming is optimal’—even Nobel Prize winners are getting things catastrophically wrong,” The Conversation, available November 14, 2019 at: https://theconversation.com/4-c-of-global-warming-is-optimal-even-nobel-prize-winners-are-gettingthings-catastrophically-wrong-125802.

68 The abstract from Pindyk [24] states: “A plethora of integrated assessment models (IAMs) have been constructed and used to estimate the social cost of carbon (SCC) and evaluate alternative abatement policies. These models have crucial flaws that make them close to useless as tools for policy analysis: certain inputs (e.g., the discount rate) are arbitrary, but have huge effects on the SCC estimates the models produce; the models’ descriptions of the impact of climate change are completely ad hoc, with no theoretical or empirical foundation; and the models can tell us nothing about the most important driver of the SCC, the possibility of a catastrophic climate outcome. IAM-based analyses of climate policy create a perception of knowledge and precision, but that perception is illusory and misleading.”

References:

7. Daniel Dennett. Freedom Evolves. Viking, 2003.

23. John K. Ryan. The Confessions of St. Augustine. Image Books, Doubleday Press, 1960.

24. Pindyck, Robert S. Climate Change Policy: What Do the Models Tell Us? Journal of Economic Literature, 51(3):860–872, SEP 2013