It will cost way too much to decarbonise the global economy. We would be better off just adapting to climate change.
Fact:
It’s not true that decarbonising the global economy is excessively expensive – at least not if it’s done over a 25 year period. Ross Garnaut, one of Australia’s leading economists, estimates that a move to zero emissions would cost the country between 0.67 and 1 percentage point of GDP growth per year, if a price were put on carbon. That’s not 1 percent of GDP, but of GDP growth. In the long run, the move will actually save money, as it will spawn a raft of new industries, with new sets of skills and export potential. More importantly, it will generate jobs that have a long-term future, because they will not be threatened by declining resources, changing international demand or government action to reduce pollution.
And even if the move to renewables did cost a lot, it would be far less than what was spent on dealing with COVID-19. And it would certainly be less than what was spent by the major combatants during World War Two. By 1945, the US was devoting 37 percent of its GDP to the military, without destroying its economy. Australia was devoting 40 percent of its GDP without collapsing, while for Britain and Germany the figures were 52 percent and 70 percent respectively. Yet it was not this spending that destroyed the German economy; it was bombing by the Allies.
Finally, there is an important comparison to be made with the cost of home insurance. Although this is not cheap, the vast majority of people still choose to take it out, even though the chance of their home burning down is about one in 3,000, or 0.03 percent per year. The chance of dangerous climate change is much greater than this and the cost of dealing with it is significantly less. In fact, offsetting your lifestyle against climate emissions costs about 10 percent as much as insuring your home. And it should be remembered that as the impacts of climate change increasingly manifest themselves, it will become prohibitively expensive to insure against them – especially in regions prone to fires, floods and storms.