Most of us greet news of a looming threat with skepticism. “Show me” is the usual reaction. We are like the mayor of the fictitious Amity Island in Jaws, who refuses to shut down the town’s beaches because officially acknowledging shark attacks would hurt tourism.
People who maintain that climate change demands a coordinated global response – now! – are in the same position as the police chief and the scientist in Steven Spielberg’s 1975 film. They implore the mayor to respond rationally to risk. If the evidence about a menace is properly explained, they believe, then the right policy will be forthcoming.
The mayor came around only after an unmistakable shark attack shamed him into acting. He gulped, “My kids were on that beach.” Sometimes reality mirrors the movies. When the role of chlorofluorocarbons in creating the ozone hole emerged in the late 1970s, the aluminum industry first squawked at proposed measures to eliminate the gases from their industrial processes. But they backed down, and the changes eventually mitigated the problem with little long-term disruption. Governments banned tetraethyl lead from gasoline once the cumulative neurotoxicity became clear, and levels of lead in human bloodstreams have been dropping since. These changes took years, but they did happen.
Action to deal with climate change might have followed this pattern: The scientific evidence reported in peer-reviewed journals has been mounting steadily. A large portion of climate scientists believe that the pace of climate change has surpassed the worst-case scenarios predicted just a few years ago. Prominent voices have been exhorting the public to set a price on carbon and other measures to reduce emissions. But the response to climate change has stalled.
Climate change denial plugs into a number of cognitive biases, the same ones that made the mayor in Jaws so determined to open the beaches in the face of warnings from a scientist. Everyone is prone to these blind spots, and resisting them requires vigilance. They include:
- The bandwagon effect: taking one’s cue from what everybody is doing, in this case, doubting the science
- Confirmation bias: accepting only data that confirms one’s prior beliefs
- Hyperbolic discounting: favoring immediate payoffs instead of larger long-term rewards
- Neglect of probability: the tendency to ignore probability when making a decision under uncertainty
- Zero-risk bias: a focus on reducing a small risk to zero rather than going for a larger reduction in larger risk
On top of these biases, stronger interests also come into play. Powerful companies find the theory of human-caused global warming a threat to their profits, and fund the denial business, particularly in the US. The media dutifully pass the propaganda to the public. Scientists find themselves butting against a wall of distortion.
One big similarity between the financial debacle of the past few years and climate change is that our own behavior is a source of both problems. After the crash, many people believed that they were the victims of a “black swan” event. These shocking contractions, however, were white swans, predictable and in fact, predicted.
In the years before the credit crunch, numerous analysts warned against weakening mortgage standards and faulty lending discipline. It was a bad problem made far worse with the advent of headlong, even fraudulent, securitization. Batches of shaky loans were bundled into new securities and then, in an even more egregious turn, blessed by the ratings agencies, which had major conflicts of interest. Other commentators pointed out the malign consequences of dissolving the Glass-Steagall Act in 1998, for example, and of failing to regulate derivatives at all.
The investing public and regulators were disinclined to make trouble as long as they were making money. These were the potent ingredients for intensifying disasters. Bailed out banks haven’t been forced to write down their bad debt. They have reacted like the mayor of Amity Island– the beaches must stay open for the Fourth of July weekend.
In both climate change and finance, the usual cognitive biases have been activated, since people making money tend to deny, object, and minimize warnings of future or of present trouble. Regulatory capture is also a big issue. Large emitters have proved skillful at blunting the effect of regulations to cut emissions. But they have much to learn from financial firms, which have vanquished and absorbed Washington almost entirely. In fact, the anti-regulatory ideologues in finance were the regulators.
The big one
The analogy between finance and climate isn’t exact. The scientific work supporting the IPCC is far stronger than that which exists in a less developed proto-science like economics.
When the financial system was on the verge of tottering, governments mobilized to inject trillions of dollars into the system. The U.S. acted quickly, almost without debate, because the peril was so extreme. Climate change demands a coordinated global response to counteract cognitive biases and well-funded ideological enemies. If that thought leaves you despairing, remember, we’ve done it before.
During the five years of World War II, the U.S. and its allies utterly transformed their economies and their societies in the face of an enormous challenge. Tremendous industrial energy and creativity were brought to bear on the logistical challenge of defeating a ruthless, powerful enemy. The Allies even found ways of cooperating with erstwhile enemies like the Soviet Union. The Axis was defeated in six years.
It took Pearl Harbor to silence isolationist sentiment in the U.S. Will it take the climate equivalent of Pearl Harbor – an event so overwhelming that it switches public opinion in a single day? Climate change is a larger challenge than the Axis. It’s global, impersonal, and it draws its terrible force from our own actions – our emissions into the atmosphere.
Brian Thomas is a sustainability consultant and has developed green-themed projects for clients including Merill Lynch, Good Energies, Edelman, the City of Chicago, the City of New York, and others. He is currently a member of the New York City Panel on Climate Change, EnviroComm, and the Association of Green Technology Auditors, to name a few, and is the author of Climate Change Adaptation in 2010. For more information, please visit www.carbon-based-ghg.com, and his blog.
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