stern review - a critique

A Collection of Reviews on the Stern Report Vol II

February 2007

209 Pennsylvania Ave. SE, Suite 2100 -Washington, D.C. 20003

202-454-5249 www.scienceandpolicy.org

Contents

Reviews of the Stern Report Contents Page The Stern Review: A Dual Critique 3 Part I: The Science Robert M. Carter, C. R. de Freitas, Indur M. Goklany, David Holland & Richard S. Lindzen Part II: The Economics Ian Byatt, Ian Castles, Indur M. Goklany, David Henderson, Nigel Lawson, Ross McKitrick, Julian Morris, Alan Peacock, Colin Robinson & Robert Skidelsky The Stern Review on the Economics of Climate Change 6 William Nordhaus Comments on the Stern Review's Economics of Climate Change.. 7 Partha Dasgupta Further Comments on the Stern Review.. 8 David Maddison A Critique of the Stern Report. 9 Robert O. Mendlesohn Recalculating the Costs of Global Climate Change 10 Hal R. Varian Stern Rebuke: Global-warming insurance is a bad buy. 13 Jerry Taylor& Peter Van Doren Its Official - Economists Think Sterns Nuts 16 Jerry Taylor Appendix I. Complete report of Carter et al. and Bryatt et al. Appendix II. Complete report of Nordhaus Appendix III. Complete report of Dasgupta Appendix IV. Complete report of Maddison Appendix V. Complete report of Mendlesohn

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http://www.cato-at-liberty.org/2006/11/30/its-official-economists-think-sterns-nuts/

The Stern Review: A Dual Critique Published in World Economics, Volume 7, Number 4 Part I: The Science Robert M. Carter C. R. de Freitas Indur M. Goklany David Holland Richard S. Lindzen Conclusions (Part I)

We conclude that the Stern Review is biased and alarmist in its reading of the science. In particular, it displays: a failure to acknowledge the scope and scale of the knowledge gaps and uncertainties in climate science credulous acceptance of hypothetical, model-based explanations of the causality of climate phenomena massive overestimation of climate impacts through an implausible population scenario and one-sided treatment of the impacts literature, including reliance on agenda-driven advocacy documents lack of due diligence in evaluating many pivotal research studies despite the scandalous lack of disclosure of data and methods in these studies lack of concern for the defects and inadequacies of the peer review process as a guarantor of quality or truth. These and other related problems arise because the Review has relied for advice almost exclusively on a small number of people and organizations that have a long history of unbalanced alarmism on the global warming issue. Most of the research cited by the Review does not, on inspection, make a convincing case that greenhouse warming constitutes a major threat that justifies an immediate and radical policy response. Contrary research is consistently ignored, as are basic observational facts showing that alarm is unwarranted. The Review fails to present an accurate picture of scientific understanding of climate change issues, and will reinforce ill-informed alarm about climate change among the general public, the bureaucracy and the body politic. HM Government will need to look elsewhere for a balanced, impartial and authoritative review of the current climate change debate.

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Part II: The Economics Ian Byatt Ian Castles Indur M. Goklany David Henderson Nigel Lawson, Ross McKitrick Julian Morris Alan Peacock Colin Robinson Robert Skidelsky Conclusions (Part II):

Our main conclusions coincide with, and serve to confirm and reinforce, those reached by our scientific colleagues in Part I above. Like them, we would emphasise in particular two interrelated features of the Stern Review: it greatly understates the extent of uncertainty as to possible developments, in highly complex systems that are not well understood, over a period of two centuries or more its treatment of sources and evidence is persistently selective and biased. These twin features have combined to make the Review a vehicle for speculative alarmism. We also endorse, from our own analysis, the judgement of our colleagues that the Review: mishandles data gives too little attention to actual observation and evidence, as distinct from the results of model-based exercises takes no account of the failures of due disclosure, and the chronic limitations of peer reviewing, that have been characteristic of work relating to climate change which governments have commissioned and drawn on. As to specifically economic aspects, we have noted among other weaknesses that the Review: systematically overstates projected costs of climate change, partly though by no means wholly as a result of its failure to acknowledge the scope for long-term adaptation to possible global warming

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underestimates the likely costincluding to the worlds poorof the drastic global mitigation programme that it calls for proposes worldwide adoption of a specially low rate of interest for discounting the costs and benefits of mitigation, on the basis of inadequate analysis and without regard for the problems and risks that would result. So far from being an authoritative guide to the economics of climate change, the Review is deeply flawed. It does not provide a basis for informed and responsible policies.

(The full report in its original format is presented in Appendix I or is available on the web, http://www.world-economics-journal.com/WEJArticle.asp?Vol=7&Iss=4&Id=261)

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http://www.world-economics-journal.com/WEJArticle.asp?Vol=7&Iss=4&Id=261

The Stern Review on the Economics of Climate Change Dr. William Nordhaus Sterling Professor of Economics Yale University Summary

How much and how fast should the globe reduce greenhouse-gas emissions? How should nations balance the costs of the reductions against the damages and dangers of climate change? The Stern Review answers these questions clearly and unambiguously: we need urgent, sharp, and immediate reductions in greenhouse-gas emissions. I am reminded here of President Harry Trumans complaint that his economists would always say, on the one hand this and on the other hand that. He wanted a one-handed economist. The Stern Review is a Prime Ministers dream come true. It provides decisive and compelling answers instead of the dreaded conjectures, contingencies, and qualifications. However, a closer look reveals that there is indeed another hand to these answers. The radical revision of the economics of climate change proposed by the Review does not arise from any new economics, science, or modeling. Rather, it depends decisively on the assumption of a near-zero social discount rate. The Reviews unambiguous conclusions about the need for extreme immediate action will not survive the substitution of discounting assumptions that are consistent with todays market place. So the central questions about global-warming policy how much, how fast, and how costly remain open. The Review informs but does not answer these fundamental questions.

(Dr. Nordhauss complete comments, in their original form, are included as Appendix II and are available on the web at http://www.econ.yale.edu/~nordhaus/homepage/SternReviewD2.pdf)

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http://www.econ.yale.edu/%7Enordhaus/homepage/SternReviewD2.pdf

Comments on the Stern Review's Economics of Climate Change Dr. Partha Dasgupta Frank Ramsey Professor of Economics University of Cambridge Excerpt: Are the numbers taken in the Review to reflect the two ethical parameters compelling? I have little problem with the figure of 0.1% a year the authors have chosen for the rate of pure time/risk discount (delta). But the figure they have adopted for eta - the ethical parameter reflecting equity in the distribution of human well-being - is deeply unsatisfactory. To assume that eta equals 1 is to say that the distribution of well-being among people doesn't matter much, that we should spend huge amounts for later generations even if, adjusting for risk, they were expected to be much better off than us. To give you an example of what I mean, suppose, following the Review, we set delta equal to 0.1% per year and eta equal to 1 in a deterministic economy where the social rate of return on investment is, say, 4% a year. It is an easy calculation to show that the current generation in that model economy ought to save a full 97.5% of its GDP for the future! You should know that the aggregate savings ratio in the UK is currently about 15% of GDP. Should we accept the Review's implied recommendations for this country's overall savings? Of course not. A 97.5% saving rate is so patently absurd a figure that we must reject it out of hand. To accept it would be to claim that the current generation in the model economy ought literally to impoverish itself for the sake of future generations. The moral of such finger exercizes such as the one above is that we should be very circumspect before accepting numerical values for parameters of which we have little a priori feel. What we should have expected from the Review is a study of the extent to which its recommendations are sensitive to the choice of eta. A higher figure for eta would imply greater sensitivity to risk and inequality in consumption, meaning that it could in principle imply greater or less urgency in the need for collective action on global warming. Whether it is greater or less would depend on whether or not 8 the downside risks associated with the warming process overwhelm growth in expected consumption under business as usual. To put it more sharply, a higher value of eta could imply that the world should spend more than 1% of GDP on curbing emissions, or it could imply that the expenditure should be less. Only a series of sensitivity analyses would tell. Curiously, the Review doesn't report any such sensitivity analysis. (Dr. Dasguptas full comments are presented in their original form in Appendix III or are available on the web at http://www.foundation.org.uk/events/pdf/20061108_Dasgupta.pdf)

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http://www.foundation.org.uk/events/pdf/20061108_Dasgupta.pdf

Further Comments on the Stern Review Dr. David Maddison Department of Economics University of Birmingham Birmingham, U.K. Conclusions

There is much in the Stern report with which one can wholeheartedly agree. Climate change is a problem. Climate policy can be informed by cost benefit analysis. The treatment of uncertainty is of paramount importance and economic instruments have a role to play in cutting carbon emissions. Permitting tropical deforestation is madness. Some of the background material commissioned by Stern is top quality. But the review also contains errors, questionable judgement and inconsistencies. Stern moreover misses the opportunity to say some things which needed to be said. There is often insufficient information to discover what Stern and his team have done and how they arrive at key results. It would currently be impossible for another researcher to replicate Sterns findings for lack of information. Some of the evidence upon which the review is based is dated whilst more recent evidence has been overlooked. The Stern review should have been subject to far more extensive peer review prior to its release, particularly in the light of its political impact. Because of the shortcomings highlighted here and elsewhere it is unclear whether the Stern report provides an economic rationale for the measures it recommends.

(Dr. Maddisons full comments are presented in Appendix IV, or are available on the web at http://www.economics.bham.ac.uk/maddison/Stern%20Comments.pdf)

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http://www.economics.bham.ac.uk/maddison/Stern%20Comments.pdf

A Critique of the Stern Report Dr. Robert O. Mendlesohn Yale University Conclusions

The Stern Report shows, given certain assumptions, that adopting an aggressive near-term policy may be better than never doing anything at all. However, the question policymakers should be asking is how aggressive do policies need to be in the near term. Society needs to weigh a number of alternatives besides just stabilizing concentrations at 550 ppm. The risks of climate damages go up with ever-higher stabilization targets, but the mitigation costs fall rapidly. Society needs to settle on the best tradeoff. The Stern Report helpfully identifies assumptions that could justify spending more on mitigation. If the assumptions about damages prove to be valid, society should be prepared to mitigate more. However, the analysis needs to be based on solid science and economics before hundreds of billions of dollars per year are invested in abatement.

(Dr. Mendlesons full report in its original format is presented in Appendix V or is available on the web at http://www.cato.org/pubs/regulation/regv29n4/v29n4-5.pdf)

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http://www.cato.org/pubs/regulation/regv29n4/v29n4-5.pdf

Recalculating the Costs of Global Climate Change Dr. Hal R. Varian Professor of Business, Economics and Information Management University of California, Berkeley. New York Times, December 14, 2006 http://www.nytimes.com/2006/12/14/business/14scene.html?ex=1323752400&en=f752c231684bfc0a&ei=5088&partner=rssnyt&emc=rss

The Stern Review on the Economics of Climate Change was released Oct. 30 and became front-page news because of its striking conclusion that we should immediately invest 1 percent of world economic activity (referred to as global gross domestic product in the report) to reduce the impact of global warming. The British report warned that failing to do so could risk future economic damages equivalent to a reduction of up to 20 percent in global G.D.P. These figures are substantially higher than earlier estimates of the costs of global warming, and environmental economists have studied the 700-page report to try to figure out why the numbers are so large. Recently two noted economists, William D. Nordhaus of Yale and Sir Partha Dasgupta of the University of Cambridge, have written critiques of the Stern report that try to solve this puzzle. The reports are available at http://nordhaus.econ.yale.edu/SternReviewD2.pdf and http://www.econ.cam.ac.uk/faculty/dasgupta/Stern.pdf. The two critiques emphasize different but related aspects of the Stern Reviews economic model. Mr. Nordhauss major concern is with the Stern Reviews choice of the social rate of time discount, the rate used to compare the well-being of future generations to the well-being of those alive today. The choice of an appropriate social time discount rate has long been debated. Some very intelligent people have argued that giving future generations less weight than the current generation is ethically indefensible. Other equally intelligent people have argued that weighting generations equally leads to paradoxical and even nonsensical results. The Stern Review sides with those who believe in a low discount rate, arguing that the only ethical reason to discount future generations is that they might not be there at all there could be some cataclysmic event like a comet hitting the earth that wipes out all life. The report assumes that the probability of extinction is 0.1 percent per year. For all intents and purposes, this implies a social rate of discount that is effectively zero, implying almost equal weight to all generations.

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http://www.nytimes.com/2006/12/14/business/14scene.html?ex=1323752400&en=f752c231684bfc0a&ei=5088&partner=rssnyt&emc=rsshttp://www.nytimes.com/2006/12/14/business/14scene.html?ex=1323752400&en=f752c231684bfc0a&ei=5088&partner=rssnyt&emc=rsshttp://topics.nytimes.com/top/news/science/topics/globalwarming/index.html?inline=nyt-classifierhttp://topics.nytimes.com/top/reference/timestopics/organizations/y/yale_university/index.html?inline=nyt-orghttp://nordhaus.econ.yale.edu/SternReviewD2.pdfhttp://www.econ.cam.ac.uk/faculty/dasgupta/Stern.pdf

The report not only chooses to weigh all generations welfare almost equally, it also makes an extreme choice when specifying the relationship between consumption and welfare. These choices together imply that a 1 percent reduction in consumption today is desirable if it leads to slightly more than 1 percent increase in the consumption of some future generation, even though, in the model, future generations will be much wealthier than the current generation. Given these assumptions it is easy to see where the large numbers come from. Unchecked global warming will certainly make future generations worse off to some degree. If we add up these losses over all time using a zero social discount rate, we get a large sum: a dollar a year over a million years is a million dollars. Mr. Nordhaus examines a model of climate change that is similar to the one used in the Stern Review but with a 3 percent social discount rate that slowly declines to 1 percent in 300 years rather than the 0.1 percent discount rate used in the Stern Review. In his model, the welfare of future generations is given less weight than the current generations welfare. He finds that preventive measures like a tax on carbon emissions are certainly required. But they are of a much smaller magnitude than those recommended in the report. As Mr. Nordhaus says, While the findings of such mainstream economic assessments may not satisfy the most ardent environmentalists, if followed they would go far beyond current global emissions reductions and would be a good first step on a journey of many miles. So, should the social discount rate be 0.1 percent, as Sir Nicholas Stern, who led the study, would have it, or 3 percent as Mr. Nordhaus prefers? There is no definitive answer to this question because it is inherently an ethical judgment that requires comparing the well-being of different people: those alive today and those alive in 50 or 100 years. Still, we may at least ask for consistency in our decisions. Forget about global warming and consider the much simpler problem of economic growth. How much should we save today to bequeath to future generations if we really believed in a 0.1 percent social discount rate and the other assumptions built into the Stern model? The answer, according to Sir Parthas calculation, is that we should invest 97.5 percent of what we produce today to increase the standard of living of future generations. Sir Parthas stripped-down model leaves out uncertainty, technological change and population growth, but even so, such a high savings rate is totally implausible. It is even more implausible given that future generations will be much richer than those now living. According to Mr. Nordhaus, the assumptions used in the Stern

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Review imply that per capita yearly consumption in 2200 will be $94,000 as compared with $7,000 today. So, is it really ethical to transfer wealth from someone making $7,000 a year to someone making $94,000 a year? As these examples illustrate, the choice of an appropriate policy toward global warming depends heavily on how one weighs the costs and benefits it imposes on different generations. The Stern Review chose a particular way to do this, but many other choices could have been examined. Exploring the implications of alternative assumptions is likely to lead to better policy than making a single blanket recommendation. At least at this stage of our understanding, exploration beats exhortation.

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Stern Rebuke: Global-warming insurance is a bad buy Jerry Taylor Peter Van Doren Senior Fellows The Cato Institute http://www.cato.org/pub_display.php?pub_id=6782 Does global warming threaten to permanently cripple the global economy? According to a new report from the British Treasury prepared by economist Nicholas Stern, that's exactly what will happen unless we cut greenhouse-gas emissions to 25 percent below current levels by 2050. Should we do it? A close reading of the report reveals that the answer is "not necessarily." Not to be flip about it, but why should the relatively poor (us) sacrifice for the relatively rich (our children and grandchildren)? The Stern Report argues that the emissions cuts necessary to stave off disaster will likely cost about one percent of global GDP every single year, or about $1,154 in current dollars per household in the United States. A small price to pay, we're told, when GDP losses will likely total 5-10 percent of global GDP every year if we do absolutely nothing. But even with a ten-percent reduction in GDP relative to what it would have been, 100 years from now, people will still be extraordinarily well off by current standards. For example, since 1950 real U.S. GDP per capita has increased by about two percent a year. Given that growth rate, real GDP per capita 100 years hence would be $321,684, or more than seven times higher than it is at present ($44,403). If global warming cuts GDP by ten percent a year beginning about 50 years from now, then GDP per capita will be $289,515 in 2106 rather than $321,684. Would anyone, let alone liberals, ever propose a one-percent tax on those who make $44,000 to create benefits for those who make $289,000? In short, paying now to head off warming is a regressive intergenerational tax that takes from the poor and gives to the rich. The direct costs associated with greenhouse gas emission controls include avoidable deaths in the developing world. The United Nations, for example, reports that about two million people on this planet die every year because they don't have electricity and must burn biomass for heating and cooking. This results in greatly elevated levels of indoor air pollutants and premature deaths. Increasing the cost of electricity an unavoidable consequence of ridding the global economy of the fossil fuels that generate greenhouse gases will slow our ability to conquer this problem.

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http://www.cato.org/pub_display.php?pub_id=6782

Higher fossil fuel costs will also slow the general march out of poverty. Not only is poverty the number one killer on the planet, it is also the number one cause of environmental ruin. Deforestation, habitat loss, and air and water pollution are all strongly correlated with per capita income. Nor are citizens in the industrialized West immune from the health effects associated with reduced income. Academics have established that every $15 million reduction of aggregate income causes one statistical death. That stands to reason; the poorer we are, the less likely we are (on average) to eat well, exercise, procure necessary health care services, and avoid unhealthy lifestyles. This effect alone suggests that in the U.S., greenhouse gas abatement, on the scale suggested by the Stern report, would cost more than 8,800 lives per year. Of course, the Stern Report argues that the GDP losses associated with doing nothing dwarf the GDP losses associated with effective emissions controls. In a world with no doubts, spending one percent of U.S. GDP to eliminate a loss of ten percent of U.S. GDP every year beginning 50 years from now passes a cost-benefit test if we assume that GDP grows two percent per year, we discount future costs and benefits by five percent a year, and run our analysis out for 1,000 years. That calculation reveals that the present value of the costs would total $15,541 while the present value of the benefits would total $36,477. If the future stream of benefits were only five percent of future GDP, however, then it's about a wash; $15,541 would get us only $18,239 in benefits. But climate predictions are not certain. The Stern report argues that there's at least a 50-50 chance that temperatures will rise five degrees Celsius over pre-industrial levels if we do nothing. You won't find that argument in the latest report of the International Panel on Climate Change (IPCC), however, which offers a wide band of possible warming scenarios. The Stern Report's estimate is within the upper boundary of what's possible, but median warming projections are around 2-3 degrees Celsius. It's worth noting that when economists have crunched those median-warming projections in the academic literature, they have found that the costs associated with climate change are 0-2 percent of GDP rather than the 5-10 percent asserted in the Stern report. If the benefits are only two percent of future U.S. GDP, then $15,541 in costs in present value terms produces only $7,295 in benefits. Finally, none of the above calculations consider the possibility that the costs will buy no benefits at all. The latest IPCC report, for instance, notes that the warming we've detected thus far is "unlikely (bordering on very unlikely) to be entirely the result of internal variability," and that "natural forcing alone [i.e., solar and/or volcanic activity] is unlikely to explain the increased rate of global warming since the middle of the 20th century." No matter how you read that, it's clear that there is greater than zero chance that greenhouse-gas-emission cuts will produce no economic gains at all. Accordingly, all the benefit estimates above must be discounted to some degree (how much is in dispute) to reflect that possibility.

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Think of the Stern Report as an elaborate economic pitch for an expensive insurance policy. Well, we're not buying ... yet. (This article appeared in the National Review on November 20, 2006)

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http://www.nationalreview.com/

Its Official - Economists Think Sterns Nuts Jerry Taylor Senior Fellow The Cato Institute http://www.cato-at-liberty.org/2006/11/30/its-official-economists-think-sterns-nuts/

In this months issue of the Economists Voice, Robert Whaples, chair of the economics department at Wake Forest, reports on a survey (http://www.bepress.com/cgi/viewcontent.cgi?article=1156&context=ev) he recently conducted in which he sent questionnaires to 210 Ph.D. economists randomly selected from the American Economic Association. His charge: to find out how much disagreement there is within the profession and a number of high profile public policy issues. What did his respondents have to say about the impact that global warming will have on the economy? 19.6% agreed with the Stern Review on the Economics of Climate Change, that is, that U.S. GDP per capita would be reduced by 5% or more by the end of the 21st century if the world did nothing to address industrial greenhouse gas emissions; 35.7% believed that warming would reduce U.S. GDP by less than 1% and may even increase it up to 1%!; 21.4% agreed with Yale economist William Nordhaus in that U.S. GDP losses would be somewhere between 1-5%; 16.1% believed that U.S. GDP would increase by 1-5% as a consequence of warming; and 7.1% though U.S. GDP would increase by more than 5% because of warming! In short, the number of economists who thought global warming would improve the U.S. economy outnumbered the number of economists who thought that global warming would harm the economy to the extent feared by the Stern Review. Will those who demand that we bow down to the consensus of scientific opinion likewise demand the same regarding the consensus of economic opinion? Not bloody likely.

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http://www.cato-at-liberty.org/2006/11/30/its-official-economists-think-sterns-nuts/http://www.cato-at-liberty.org/2006/11/30/its-official-economists-think-sterns-nuts/http://www.bepress.com/ev/vol3/iss9/art1/http://www.bepress.com/cgi/viewcontent.cgi?article=1156&context=evhttp://www.hm-treasury.gov.uk/independent_reviews/stern_review_economics_climate_change/stern_review_report.cfmhttp://www.amazon.com/Warming-World-Economic-Models-Global/dp/0262640546/sr=8-1/qid=1164923595/ref=pd_bbs_1/103-6402928-1572608?ie=UTF8&s=books

Appendix I.

The Stern Review: A Dual Critique Part I: The Science

Robert M. Carter, C. R. de Freitas, Indur M. Goklany, David Holland & Richard S. Lindzen

Part II: The Economics Ian Byatt, Ian Castles, Indur M. Goklany, David Henderson, Nigel Lawson,

Ross McKitrick, Julian Morris, Alan Peacock, Colin Robinson & Robert Skidelsky

Published in: World Economics, the UK Journal for Current Economic Analysis

Volume 7, Number 4 October December, 2006

www.world-economics-journal.com
http://www.world-economics-journal.com/

The twin papers that follow present acritique in two parts of the SternReview on The Economics of ClimateChange. Part I focuses on scientificissues and their treatment in the Review.It forms the point of departure for PartII which deals with economic aspects.

The Stern Review was commis-sioned in July 2005 by the UKsChancellor of the Exchequer, GordonBrown. It was conducted under thejoint auspices of the Cabinet Office

and the Treasury, and the final text wasdelivered to the Chancellor and thePrime Minister who both spoke at itslaunching at the end of October 2006.Sir Nicholas Stern is Head of theGovernment Economic Service in theUK and Adviser to the British govern-ment on the economics of climatechange. Although the Review wascommissioned and financed by HerMajestys Government, and largelydrafted by British officials, it isdescribed as independent.

The Review is a formidable docu-ment. Its main text comprises over550 pages, and covers or refers to a vastrange of issues. It reflects the work of ateam of over 20 officials under the

WORLD ECONOMICS Vol. 7 No. 4 OctoberDecember 2006 165

The Stern Review:A Dual Critique

CONTENTS

Authors Introduction 165

Part I: The Science 167Robert M. Carter, C. R. de Freitas, Indur M. Goklany, David Holland & Richard S. LindzenAnnex: The Stern Reviews Mishandling of Basic Observational Data 195

Part II: Economic Aspects 199Ian Byatt, Ian Castles, Indur M. Goklany, David Henderson, Nigel Lawson, Ross McKitrick, Julian Morris, Alan Peacock, Colin Robinson & Robert SkidelskyAnnex: The Stern Review and the IPCC Scenarios 225

The Authors 230

AUTHORS INTRODUCTION

Details of the authors are to be found at the endof the article. The idea of a dual critique, withtwin papers authored respectively by scientistsand economists, originated with DavidHenderson, who has played the leading part inbringing it to fruition.

166 WORLD ECONOMICS Vol. 7 No. 4 OctoberDecember 2006

Authors Introduction

direction of Sir Nicholas, backed by asubstantial number of consultants.It draws on an array of already pub-lished studies and papers, as well on asubstantial number of specially com-missioned outside contributions. Indealing with the economic aspectswhich form its main concern, it developsa closely constructed argument of isown. On the basis of what it takes to beestablished science, together with itsown distinctive analysis of the eco-nomic issues, it draws strong and con-fident conclusions for policy.

The Review has been widely hailedas an authoritative guide to thinkingand policy. It is seen as providing anaccurate account of generally agreedand increasingly disturbing scientificconclusions, and as building on these,through solid economic reasoning, anunassailable case for far-reaching andimmediate collective action to limitand reduce emissions of greenhousegases in general and CO2 in particular.To quote the British Prime Minister, atthe launch of the Review,

what is not in doubt is that the sci-entific evidence of global warmingcaused by greenhouse gas emissions isnow overwhelming [and] that ifthe science is right, the consequencesfor our planet are literally disastrouswhat the Stern Review shows is howthe economic benefits of strong earlyaction easily outweigh any costs.

In what follows, we take issue withsuch assured and unqualified verdicts.In relation to both scientific and eco-nomic issues, we question the accuracyand completeness of the Reviewsanalysis and the objectivity of its treat-ment. We thus present a critique of theReview, rather than a full assessmentof the argument as a whole.

The subject of the Review is theeconomics of climate change, and itsterms of reference did not require it tocover scientific aspects. However, thetext carries substantial sections onthese; and it is on the basis of what sci-entific inquiry is taken to have estab-lished that the Review adopts as itsstarting point for the economic analysisthat climate change is the greatestand widest-ranging market failure everseen. The credibility of the Review as awhole thus depends in large part on whatit says or presumes about the science.Hence this critique, though it appearsin an economic journal, has a scientificas well as an economic dimension.

The analysis that we present below,and the views that we express, are oursalone: they should not be attributed toany of the various institutions that weare affiliated with. We represent nointerests, and we have neither soughtnor received any financial or institu-tional support for our work. We writeas independent commentators.

The Stern Review:A Dual Critique

PART I: THE SCIENCE

Robert M. Carter, C. R. de Freitas, Indur M. Goklany,David Holland & Richard S. Lindzen

Introduction

The Stern Review includes an introductory chapter that summarises thepresent state of climate science and, in Part II, an analysis of the physicaland environmental impacts of prospective future paths of climate change.The credibility of the document as a whole thus rests in large part on howfar the material presented under these two science headings is accurateand balanced.

Two distinct aspects are relevant here. First, there is the question ofwhether it can indeed be said, as the Review asserts in its opening sen-tence, that

The scientific evidence is now overwhelming: climate change presents veryserious global risks, and it demands an urgent global response.

Second, there is the related issue of how far the Stern Review, in thesections that it devotes to them, gives an accurate account of the scientificissues.

We consider that the Review is doubly deficient. The scientific evi-dence for dangerous change is, in fact, far from overwhelming, and theReview presents a picture of the scientific debate that is neither accuratenor objective.

We present our argument under three main headings. In Section 1 weconsider the Reviews treatment of basic issues of climate science, and itsover-confident conclusions about the prospective course of greenhouse



The Stern Review: A Dual Critique

gas concentrations and global warming. In Section 2 we turn to what theReview says about the prospective impacts of the climate changes that itenvisages as possible or likely. Under both headings, we note two interre-lated features of the Review: First, that it greatly understates the extent ofuncertainty, for there are strict limits to what can be said with assuranceabout the evolution of complex systems that are not well understood.Second, that its treatment of sources and evidence is selective and biased.These twin features combine to make the Stern Review a vehicle foralarmism.

Section 3 is concerned with fundamental issues of scientific conductand procedure that the Review fails to consider. Professional contributionsto the climate change debate very largely take the form of published peer-reviewed articles and studies. It is widely assumed, in particular by gov-ernments and the Intergovernmental Panel on Climate Change (IPCC),that the peer review process provides a guarantee of quality and objectiv-ity. This is not so. We note that the process as applied to climate sciencehas tolerated gross failures in due disclosure and archiving, and that peerreview is both too inbred and insufficiently thorough to serve any auditpurpose, which we believe is now essential for science studies that are tobe used to drive trillion-dollar policies.

Besides these three main sections and our summary conclusions in Part4, we comment in an annex on some aspects of the mishandling of data inthe Stern Review. Overall, our conclusion is that the Review is flawed toa degree that makes it unsuitable, if not unwise, for use in setting policy.

1. FLAWS IN THE ALARMIST PARADIGM

The alarmist view of climate science

Sir Nicholas Stern made a revealing comment in his OXONIA lecture ofJanuary 2006: in August or July of last year, [he] had an idea what thegreenhouse effect was but wasnt really sure.1 It seems that, starting froma position of little knowledge of the issues, he has swiftly espoused theofficial view of the Hadley Centre for Climate Prediction and Research, on

1 http://www.hm-treasury.gov.uk/media/695/8C/OXONIA_Oxford_31012006.pdf


Part I: The Science

whose advice the Review relies heavily. But this Hadley Centre picture ofreality, though broadly in line with that of the IPCC, is by no meansuniversally held. Many of the specific claims that are endorsed in theReview have been seriously challenged in the scientific literature, whilethe text plays down the great uncertainties that remain.

The Hadley message, as reflected in the Review, is an alarmist one. Itpresumes without question that moderate further increases in atmosphericCO2 levels will give rise to major climatic changes and that these are likelyto be seriously damaging; that the climatic changes observed over recentdecades can be reliably blamed on emissions of greenhouse gases in gen-eral, and CO2 in particular; and that climate model projections and fore-casts present a sufficiently accurate view of the future at relevantgeographic and temporal scales to form a basis for major policy decisions.

The Stern Review itself fails to take proper account of the profounduncertainties and major gaps in knowledge of climate science, and neitherdoes it address the many continuing debates regarding climate changemechanisms and impact assessments. Like its sources, the Review givesunwarranted credence to model projections over firmly established dataand findings. By exaggerating climate alarm it focuses on implausiblerather than likely outcomes, and thereby fails to provide a sound basis forpolicy.

Mishandling of uncertainty

The Review states on page 10 that: The analysis of climate changerequires, by its nature, that we look out over 50, 100, 200 years and more.Any such modelling requires caution and humility, and the results are spe-cific to the model and its assumptions. They should not be endowed witha precision and certainty that is simply impossible to achieve.

Yet in this respect the Review repeatedly fails to heed its own warning.The tone is set by the Executive Summary which announces withoutqualification that These concentrations [of greenhouse gases] havealready caused the world to warm by more than half a degree Celsius andwill lead to at least a further half degree warming over the next fewdecades, because of the inertia in the climate system. This is only thefirst of dozens of unqualified Review statements that attribute causality orstate what will happen to climate or the biosphere.



A prime element of this unwarranted certainty is the Reviews confi-dence in computer model outputs. Indeed, the Review gives these out-puts even more credence than the IPCC, which warned in its ThirdAssessment Report (TAR) of 2001 that:

In climate research and modeling, we should recognize that we are dealing witha coupled non-linear chaotic system, and therefore that the long-term prediction offuture climate states is not possible. The most we can expect to achieve is the pre-diction of the probability distribution of the systems future possible states bythe generation of ensembles of model solutions.2

The IPCC has highlighted the process whereby uncertainty accumu-lates throughout the process of climate change prediction and impactassessment [which] has been variously described as a cascade of uncertainty(Schneider, 1983) or the uncertainty explosion (Henderson-Sellers, 1993).3

There are many levels of cascaded uncertainty, each one contributing tothe overall uncertainty. These cascades of uncertainty extend from esti-mates of relevant location-specific climatic changes to their biophysicaland socioeconomic impacts.

The Review attempts to deal with these uncertainties by comparingthousands of model runs under varying assumptions. The model parame-terisation chosen takes no account of the possibility that carbon dioxideemissions may have minor or benign effects, and is slanted towardsemphasis on larger impacts, feedbacks and damages than even the IPCChas implied to date.

In arguing that the Review has misread the state of the science, we shallchallenge some of its specific assertions on climatic mechanisms. In doingso, we do not deny the possibility of future climate risks, especially fromnatural climate change; nor do we argue that models should only be usedif they are able to meet an unrealistic standard of perfection, for their mainvalue is heuristic, not predictive. But we do assert that it is misleading ofthe Review to draw so predominantly from the upper end of risk distribu-tions and then present these as representative of the range of credibleoutcomes.

2 IPCC TAR, Working Group I report, Chapter 14.2.2.2. (Emphasis added.)3 Uncertainties in the IPCC TAR: Recommendations to Lead Authors for More Consistent Assessment andReporting, cf. http://stephenschneider.stanford.edu/Publications/PDF_Papers/UncertaintiesGuidanceFinal2.pdf. (Emphasis added.)


Part I: The Science

Climate prediction: is it a mature or a new science?

Some of the unjustified confidence in the Review appears to derive froma perception that climate prediction is a mature branch of science with apedigree of unchallenged research dating back to work by Fourier in1827.4 This is not so. The reality is that climate prediction, far from beinga mature science, is a new area that has emerged from the science ofweather forecasting, aided by the dramatic increase in power and avail-ability of computers in the last three decades.

In its last Assessment Report, the IPCC still rated the level of scien-tific understanding of nine out of twelve identified climate forcings aslow or very low,5 highlighted the limitations and short history of cli-mate models,6 and recognised large uncertainties about how clouds reactto climate forcing.7 Since then, major scientific papers have claimed,among other things, that the forcing of methane has been underestimatedby almost half,8 that half the warming over the twentieth century might beexplained by solar changes,9 that cosmic rays could have a large effect onclimate,10 and that the role of aerosols is more important than that ofgreenhouse gases.11 Generally speaking, none of these suggestions isincluded in current climate models though, as mentioned later, aerosolsare used, without any proper or rigorous basis, to cancel greenhouse warm-ing which would otherwise be far in excess of what we have experienced.

Moreover, given that the estimated temperature change over the latetwentieth century amounted to only a few tenths of a degree, there mustbe significant doubt as to whether model simulations of external forcingsare even required as an explanation. Such minor fluctuations may ratherbe due to natural, internal, unforced variability. The primary sources ofthis natural variability are oceans that are never in equilibrium with the

4 Review, page 7.5 IPCC, TAR, Working Group 1, Technical Summary, page 37.6 Ibid., pages 489.7 Ibid., page 49ff.8 Shindell, D. T., G. Faluvegi, N. Bell, and G. A. Schmidt (2005), An emissions-based view of climate forcingby methane and tropospheric ozone, Geophysical Research Letters, 32, L04803, DOI:10.1029/2004GL021900.9 Scafetta, N., and B. J. West (2006), Phenomenological solar contribution to the 19002000 global surfacewarming, Geophysical Research Letters. DOI: 1029/2005GL025539.10 Henrik Svensmark, Jens Olaf P. Pedersen, Nigel D. Marsh, Martin B. Enghoff, and Ulrik I. Uggerhj (2006),Experimental evidence for the role of ions in particle nucleation under atmospheric conditions, Proceedings ofthe Royal Society A: Mathematical, Physical and Engineering Sciences. DOI: 10.1098/rspa.2006.1773.11 Kilcik, Ali (2005), Regional sun-climate interaction, Journal of Atmospheric and Solar-Terrestrial Physics, 67(16): 15731579, November 2005.



surface (because of irregular and poorly understood exchanges betweenthe huge abyssal heat reservoir and the thermocline), together with a tur-bulent and heterogeneous atmosphere where changing circulationdeposits heat in regions with differing infrared opacity. It may be manydecades before models can account for this level of complexity, if indeedthat ever proves possible.

Exaggerating warming trends

Early in the OXONIA Technical Annex, it was said with unjustified cer-tainty that The rate and scale of 20th century warming has been unprece-dented for at least the past 1,000 years. While the Review backtrackssomewhat,12 the claim raises the issue of context. We have at most a50-year span of accurate global measurements of temperature and green-house gases. Meaningful judgements about climate change and, in partic-ular, natural variations, cannot be made based on such a trivially short timespan; even 1000 years is short on the climatic time scale.

The only genuinely global records of measured temperature come fromweather balloon radiosonde measurements (since 1958) and satellitemicrowave sounding units (since 1978). These data, for what they areworth over such short time periods, indicate a gentle warming trend ofabout 0.10.2 degrees C/decade.13 On a century scale this is at the low endof the trends the Review considers. Moreover, much of the increase in theballoon data is associated with a single step-like event in 197677. In thepost-1979 interval, the most recently revised satellite data show littlechange, especially in the tropics and Southern Hemisphere.14 The trend,such as it is, is at least in part an artifact caused by irregularities such asvolcanic eruptions and El Nino events,15 and anywayprima facieit isunalarming in both rate and magnitude. Nor is there any sign of accelera-tion either in surface or tropospheric data, calling into question theReviews emphasis on outcomes involving decadal trends of 0.30.6degrees C. Despite the accumulation of CO2 in the Earths atmosphere

12 Recent research, for example from the Ad hoc detection and attribution group (IDAG), uses a wider range ofproxy data to support the broad conclusion that the rate and scale of 20th century warming is greater than in thepast 1000 years (at least for the Northern Hemisphere). Review, page 6.13 Temperature trends in the lower atmosphere: Steps for understanding and reconciling differences, (2006),US Climate Change Science Program.14 http://vortex.nsstc.uah.edu/public/msu/t2lt/tltglhmam_5.2 15 Gray, V. (2006), Temperature trends in the lower atmosphere, Energy & Environment, 17: 707714.


Part I: The Science

since 1900, and especially since 1950, no global temperature databasesexhibit temperature trends of such magnitude. The rates of modern tem-perature change observed fall well within the rates of minor warmings andcoolings inferred for the Holocene in, e.g., the GRIP ice core.16

If comparison is made with the global average temperature statisticsince 1860 that is computed from near-surface thermometer measure-ments,17 then the late twentieth-century warming is similar in both amount andrate to an earlier (natural) warming between 1905 and 1940. Comparisons overlonger and more climatically relevant time spans have to be made usinglocal proxy datasets. The best such datasets come from ocean seabed andpolar ice cap drill cores. For example, the oxygen isotope (proxy air tem-perature) record from the Greenland GRIP drilling project shows that thelate twentieth-century warming represents an intermittent high on a sinu-soidal, millennial temperature pattern18 of possible solar origin.19 Thisrecord shows that recent warming occurred at a similar rate, but was of lesser mag-nitude, than the earlier, millennial warmings associated with the Mediaeval,Roman and Minoan warm periods.

Thus the Reviews apodictic claim that An overwhelming body of sci-entific evidence indicates that the Earths climate is rapidly changing, pre-dominantly as a result of increases in greenhouse gases caused by humanactivities20 is without foundation.

Reinventing climate history

Public and governmental concerns over anthropogenic global warming(AGW) soared with the intense and, until recently, continuous media useof a single graph from the IPCCs Third Assessment Report of 2001. Thisdiagram, originally taken from papers in 1998 and 1999 by Mann et al.,21

16 Davis, J. C., and G. C. Bohling (2001), The search for patterns in ice-core temperature curves, in: Gerhard,L. C. et al. (eds), Geological Perspectives of Global Climate Change, American Association of PetroleumGeologists, Studies in Geology, 47: 213229.17 Review, Figure 1.3, page 5.18 Grootes, P. M., M. Stuiver, J. W. C. White, S. Johnsen, and J. Jouzel (1993), Comparison of oxygen isotoperecords from the GISP2 and GRIP Greenland ice cores, Nature, 366: 552554.19 Bond, G., B. Kromer, J. Beer, R. Muscheler, M. N. Evans, W. Showers, S. Hoffmann, R. Lotti-Bond, I.Hajdas, and G. Bonani (2001), Persistent solar influence on North Atlantic climate during the Holocene,Science, 294: 21302136.20 Review, page 3.21 Mann, M. E., R. S. Bradley, and M. K. Hughes (1998), Global-scale temperature patterns and climate forcingover the past six centuries, Nature, 392: 779787; Mann, M. E., R. S. Bradley, and M. K. Hughes (1999),Northern hemisphere temperatures during the past millennium: Inferences, uncertainties, and limitations,Geophysical Research Letters, 26: 759762.



showed nine centuries of near constant global temperatures followed by adramatic rise in the twentieth century correlating with the rise in CO2 con-centrations. The Mediaeval Warm Period (MWP), previously believed sig-nificantly warmer than now, and the much colder Little Ice Age (LIA) didnot appear on this graph, which was dubbed the hockey stick (owing tothe shape of its curve) soon after its publication and became the basis ofclaims that natural climatic variation had been very small for a thousandyears.

Other scientists have undertaken temperature reconstructions that areclaimed in the Review to corroborate the hockey stick, but overlap in theproxies and methods used in these reconstructions casts doubt on theirindependence. For many, from various disciplines, from the outset theimplications of the hockey stick appeared unlikely. Historians and otherscientists had documented the LIA, with its frozen Thames, and the flow-ering of civilizations in the MWP. Taken at face value, these lines of evi-dence22 suggest that natural factors played a far more significant role inclimate changes than the hockey stick reconstruction suggested. Theyput in question claims that recent warmth can only be explained byhuman-induced increases in greenhouse gases.

Despite implying that the debate on the science of climate change isnow settled, the Review had no choice but to admit that major doubtsexist over the hockey stick. Two recent US reports, one by the NationalResearch Council (NRC) and one by Edward Wegman, Chair of theNational Academy of Sciences Committee on Applied and TheoreticalStatistics, have invalidated the hockey stick conclusion.23 These reportshave confirmed earlier findings that the hockey-stick shape is an artifactresulting from a combination of defective statistical methods and inclusion

22 The Medieval Warm Period Project summarises scores of scientific papers on this subject and sets out theresulting temperature histories: see www.co2science.org/scripts/CO2ScienceB2C/data/mwp/mwpp.jsp. TheProjects analysis suggests that about 80 per cent of areal studies estimate that peak MWP temperaturesexceeded recent warmth. 23 Wegman concludes that Overall, our committee believes that Manns assessments that the decade of the1990s was the hottest decade of the millennium and that 1998 was the hottest year of the millennium cannot besupported by his analysis. http://energycommerce.house.gov/108/home/07142006_Wegman_Report.pdf. TheNRC panel concluded that uncertainties of the published reconstructions have been underestimated, andconfirmed flaws in Manns methodology: seehttp://www.house.gov/science/hot/climate%20dispute/NAS%20full%20report.pdf.


Part I: The Science

of data on bristlecone pine tree-rings, which have been demonstrated tobe unreliable as temperature proxies.24

While previously the hockey stick study was represented as proof ofhuman-induced climate change, the Review now says in Box 1.1 (ouremphasis) Climate change arguments do not rest on proving that thewarming trend is unprecedented over the past Millennium. Whether or notthis debate is now settled, this is only one in a number of lines of evidence forhuman induced climate change. However, page 6 then adds that (ouremphasis) Much of the debate over the attribution of climate change hasnow been settled as new evidence has emerged to reconcile outstandingissues. The Review fails to specify this new evidence but in any case,attribution studies can never be evidence: they are heuristic thoughtexperiments designed to explore possibilities, not provide definitiveexplanations. Some further problems with such studies are discussedbelow.

While earlier Stern Review documents cited the hockey stick as validevidence25which it is notthe Review now treats it as irrelevant. Butthis also is not a tenable position. Climate models are tuned to the low esti-mate of natural climate variability put forward by the IPCC in 2001. Wereit proved that the world was much warmer in mediaeval times, the mod-els could not replicate this without giving more weight to natural variabil-ity and, perforce, their ability to identify anthropogenic forcing would bedecreased.

Attribution studies: circular reasoning

The Reviews confidence that greenhouse gases are likely to give rise tomajor, deleterious climate change appears to be based in large measure onthe results of a single Hadley Centre paper prominently used in the IPCC

24 McIntyre, S., and R. McKitrick (2003), Corrections to the Mann et al. (1998) Proxy Data Base and NorthernHemisphere Average Temperature Series, Environment and Energy, 14 (6): 751771; McIntyre, S., and R.McKitrick (2005), The M&M critique of the MBH98 Northern Hemisphere Climate Index: update andimplications, Energy and Environment, 16 (1): 69100.25 So I should say while I had temperature in the previous slide starting in the 19th century, if you send thatone a long way back as far as we know, if you send it back another 8 or 9 hundred years it would look pretty flatwith oscillations around the level. So thats what has been happening to the stock of carbon dioxide and you cansee that it is very suggestive in relation to the story of the temperature and of the science. The relation tohuman activity: this is the stock of carbon dioxide, this is the flow of carbon dioxide simply from the burning ofthe fossil fuels, so that is the direct link with the human activity. OXONIA Lecture, op. cit.



WG1 Third Assessment Report.26 However, as can be seen from theAssessment Report, in order to simulate observed trends in global meansurface temperature, the Hadley Centre had to eliminate about two-thirdsof the anthropogenic greenhouse forcing with countervailing aerosols (thenet result being referred to as anthropogenic forcing). That is to say, themodellike others of its kindexaggerates the actual warming whichwas only a few tenths of a degree. Further, as leading researchers in aerosolscience reported in Science,27 the aerosol forcing is so poorly known thatthey felt that calculating how much aerosol forcing is needed to cancelgreenhouse forcing is as good a way of estimating the aerosol forcing asany. At the same time, the IPCCs use of this level of uncertainty to claimthat the model had simulated observations is self-evidently circular. Inactuality, even the sign of aerosol forcing is unknown. In a more rationaland less politicized environment, one would at least entertain the simplestresolution of the problem: namely, that the models are exaggerating theresponse to anthropogenic greenhouse forcing.

The circular reasoning that characterizes attribution studies based ondeterministic modeling of presumed forcings undermines claims that theyprove warming could only be caused by those forcings. The formerDirector of Research at the Royal Netherlands Meteorological Institute,Dr Hendrik Tennekes28 recently pointed out that:

[T]hose that advocate the idea that the response of the real climate to radiativeforcing is adequately represented in climate models have an obligation to provethat they have not overlooked a single nonlinear, possibly chaotic feedback mechanismthat Nature itself employs.[T]he task of finding all nonlinear feedback mecha-nisms in the microstructure of the radiation balance probably is at least asdaunting as the task of finding the proverbial needle in the haystack.

Even the IPCC cautioned in relation to the Hadley attribution studythat These results show that the forcings included are sufficient to

26 See Figure A1 in the OXONIA Technical Annex available atwww.hm-treasury.gov.uk/media/695/0E/OXONIA_Technical_Annex_FINAL.pdf, where the source is given onlyas Hadley Centre (as reported in IPCC 2001). The original paper was Stott P. A., S. F. B. Tett, G. S. Jones, M.R. Allen, J. F. B. Mitchell, and G. J. Jenkins (2000), External control of twentieth century temperature bynatural and anthropogenic forcings, Science, 290: 21332137. 27 Anderson, T. L., R. J. Charlson, S. E. Schwartz, R. Knutti, O. Bucher, H. Rhode, and J. Heitzenberg (2003),Climate forcing by aerosolsa hazy picture, Science, 300: 11031104.28 Published on the Roger Pielke, Sr. Research Group Weblog at:http://climatesci.atmos.colostate.edu/2006/01/06/guest-weblog-reflections-of-a-climate-skeptic-henk-tennekes/.Dr Hendrik Tennekes, prior to retirement has been Director of Research, Royal Netherlands MeteorologicalInstitute; Professor of Aerospace Engineering at Pennsylvania State University; and Professor of Meteorology atthe Free University, Amsterdam. (Emphasis added.)


Part I: The Science

explain the observed changes, but do not exclude the possibility that other forc-ings may also have contributed.29 The Review, however, disregards thesewarnings and flatly asserts that more than a decade of research and dis-cussionhas reached the conclusion there is no other plausible explanationfor the observed warming for at least the past 50 years.30

Though the Review neither mentions nor discusses them, several otherplausible explanations of recent warming have been advanced in the pro-fessional literature. One line of research has correlated recent temperaturetrends with local heating caused by urbanization and industrialization.31

Other studies using longer-term geological evidence also suggest minimalimpacts from greenhouse gas forcing. One of these concludes that:

the global warming observed during the latest 150 years is just a shortepisode in the geologic history. The current global warming is most likely acombined effect of increased solar and tectonic activities and cannot be attributedto the increased anthropogenic impact on the atmosphere. Humans may be responsi-ble for less than 0.01C (of approximately 0.56C total average atmosphericheating during the last century).32

The Review fails to refer to any of this research, the very existence ofwhich contradicts claims that the science is settled or that GHG forcing isneeded to explain current warming. It also fails to notice that modelstrained to emulate climate using both the instrumental record and long-term geological evidencee.g. the last 140 years of surface temperaturemeasurements,33 the last 5,000 years of proxy climate data from aCaribbean marine core and a South African speleothem,34 or the 100,000year-long GRIP ice core35are not only successful in predicting the cur-rent warming phase, but also suggest cooling over the next few decades.This conclusion has also recently been strengthened on a more analytical

29 IPCC, TAR, Working Group 1, Summary for Policymakers, page 10. (Emphasis added.)30 Review, page 3. (Emphasis added.)31 de Laat, A. T. J., and A. N. Maurellis (2004), Industrial CO2 emissions as a proxy for anthropogenic influenceon lower tropospheric temperature trends, Geophysical Research Letters, 31, L05204, DOI:10.1029/2003GL019024;Kalnay, E., and M. Cai (2003), Impact of urbanization and land use change on climate, Nature, 423: 528531;Hale, R. C., K. P. Gallo, T. W. Owen, and T. R. Loveland (2006), Land use/land cover change effects ontemperature trends at U.S. Climate Normals stations, Geophysical Research Letters, 33, L11703.32 Khilyuk, L. F., and G. V. Chilingar (2006), On global forces of nature driving the Earths climate. Are humansinvolved?, Environmental Geology, 50: 899910.33 Klyashtorin, L. B., and A. A. Lyubushin (2003), On the coherence between dynamics of the world fuelconsumption & global temperature anomaly, Energy & Environment, 14: 733782.

(Emphasis added.)

34 Loehle, C. (2004), Climate change: detection and attribution of trends from long-term geologic data,Ecological Modelling, 171: 433450.35 Kotov, S. R. (2001), Near-term climate prediction using ice-core data from Greenland, in: Gerhard, L. C.et al. (eds), Geological Perspectives of Global Climate Change, American Association of Petroleum Geologists,Studies in Geology, 47: 305315.



basis by NASA and the Russian Academy of Sciences, both of which haveissued predictions that cooling will occur early in the twenty-first centuryas solar activity decreases.

Carbon dioxide in perspective

It is important to distinguish CO2 emission levels, CO2 concentrations inthe atmosphere, and climate forcing. It is the last that is directly relevantto the purported problem of warming. Emission reductions proposed bythe Kyoto Protocol would have only a minuscule effect on atmosphericconcentrations, while increments in these concentrations would anywayhave a diminishing impact on climate forcing. A doubling of CO2 is usedas a benchmark for climate sensitivity and represents a forcing of about3.7 Watts per square meter. Since anthropogenic greenhouse forcing isalready estimated at about 2.7 Watts per square metera little over halfdue to CO2, with about half of the rest to methanethen in terms of cli-mate forcing, we are already about three quarters of the way to an effec-tive doubling of CO2, yet we have experienced much less warming thansuch forcing would suggest. The Review assumes, against all empirical evidenceand physical reasoning, that future increments of CO2 will have substantiallygreater effects than those in the past.

Changes in the CO2 concentration are not well correlated with the0.6 degree C increase exhibited by the surface thermometer global aver-age temperature estimates during the twentieth century. First, the phaseof temperature increase between 1905 and 1940 occurred before anygreatly increased industrial emissions of CO2. Second, the rapid post-1940increase in CO2 emissions was accompanied by a falling temperaturebetween 1945 and 1965. The hockey-stick curve had the striking propertythat its heavy smoothing and axis-scaling visually diminished these match-ing problems, and led to a much more plausible-looking match betweenthe alleged temperature changes and actual CO2 curves. Even the direc-tion of causality is open to question. Data from ice cores indicate that, dur-ing ancient climate changes, increases in temperature preceded parallelincreases in CO2 by at least hundreds of years.

36

36 Mudelsee, M. (2001), The phase relations among atmospheric CO2 content, temperature and global icevolume over the past 420 ka. quaternary, Science Reviews, 20: 583589; Siegenthaler, U., T. Stocker, E. Monnin,D. Luthi, J. Schwander, B. Stauffer, D. Raynaud, J.-M. Barnola, H. Fischer, V. Masson-Delmotte, and J. Jouzel(2005), Stable carbon cycleclimate relationship during the late Pleistocene, Science, 310: 13131317.


Part I: The Science

This brings us to the matter of feedbacks. It is generally calculated thata doubling of CO2 would, other factors kept constant, result in a globalmean warming of about 1 degree C. Alarming predictions all require thatwater vapour and clouds act so as to greatly amplify the impact of CO2. Butit is freely acknowledged, including by the IPCC, that water vapour andespecially clouds are poorly modelled, while the underlying physics fordetermining their behaviour is missing or even unknown. The governingequations of fluid dynamics (Navier-Stokes) have resisted solution for over100 years; indeed the Clay Institute is offering a $1 million prize to any-one who can merely prove a solution exists. The Reviews glib treatmentof this fundamental issue again spotlights its failure to grasp the uncer-tainty of climate research.

The Reviews only substantive remarks on water vapour feedback37 turnout to be irrelevant. These relate to Lindzens 1990 suggestion for a mech-anism whereby a warmer surface might lead to a drier tropopause region, eventhough it has long been shown that changes in water vapour at these levelswould have marginal impact on climate.38 To be sure, water vapour nearthe surface (where the bulk of the atmospheres water vapour is found) isalso relatively unimportant. Rather, it turns out that water vapour near themiddle of the troposphere dominates this feedback. Thus, the 2005 Sodenreanalysis of trends in upper atmosphere water vapour,39 which the Reviewadvances as a definitive refutation of Lindzens 1990 suggestion, does notrelate to any important feedback. More important, it has long been notedthat the water vapour and the related cirrus cloud distribution are extremelyspatially heterogeneous with distinct moist/cloudy and dry/clear regions.The restriction to clear regions (as is, in fact, done in Sodens study) isunlikely to be meaningful on this count either. For some time now it hasbeen recognized that the real feedback in the atmosphere likely consistsin simply changing the relative areas of moist/cloudy and dry/clear regions.40

37 Review, page 7, footnote 17. This misidentifies Lindzens paper as Lindzen 2005. The references sectionmisidentifies it as Lindzens 2001 paper on the Iris Effect. The actual suggestion addressed by Sodens analysis wascontained in Lindzen, R. S. (1990), Some coolness concerning global warming, Bull. Am. Met. Soc., 71: 288299.38 See, for example, Shine, K. P., and A. Sinha (1991), Sensitivity of the Earths climate to height dependentchanges in the water vapor mixing ratio, Nature, 354: 382384; and Sun, D.-Z., and R. S. Lindzen (1993),Distribution of tropical tropospheric water vapor, J. Atmos. Sci., 50: 16431660.39 Soden, B. J., D. L. Jackson, V. Ramaswamy, M. D. Schwarzkopf, and X. Huang (2005), The radiativesignature of upper troposphere moistening, Science, 310 (5749): 841844.40 Udelhofen, P. M., and D. L. Hartmann (1995), Influence of tropical cloud systems on the relative humidity inthe upper troposphere, J. Geophys. Res., 100: 74237440; Lindzen, R. S. (1997), Can increasing atmosphericCO2 affect global climate?, Proc. Natl Acad. Sci. USA, 94: 83358342; Lindzen, R. S., M.-D. Chou, and A. Y.Hou (2001), Does the Earth have an adaptive infrared iris?, Bull. Amer. Met. Soc., 82: 417432.



Much recent work supports the existence of such a mechanism, thestrength of such a mechanism, and the failure of current models to repli-cate the data from which such conclusions emerge.41 Much new researchis currently in progress. The process (sometimes referred to as the IrisEffect), it should be noted, would reduce sensitivity to a doubling of CO2to less than 0.5 degrees Crather more consistent with observations.

The Review is too confident and unqualified in assigning an overridingrole to greenhouse gases in determining climate. Its approach ignoresobservational facts and cherry-picks among papers that promote alarm.

2. OVERSTATING CLIMATE IMPACTS

The same pattern of alarmism is apparent in the Reviews treatment of cli-mate impacts, for these impacts are made to appear dire by the introduc-tion of two systematic biases. The first is the choice of scenarios. Thestudies of impacts used in the Review are based largely on four of the40 scenarios developed by the IPCC.42 They thus omit two of the sixillustrative scenarios chosen by the IPCC as equally sound.43 Themissing scenarios are both from the A1 very high growth family: A1B(Balanced) and A1T (predominantly non-fossil fuels). The only A1 sce-nario used by the Review is the extreme A1FI (fossil fuel intensive) scenario,44 which yields a central estimate of warming in the twenty-firstcentury of 4.33C, compared to 2.79C for scenario A1B and 2.38C forA1T.45

In addition to focusing on the highest of three emissions scenarios thatassume rapid global economic growth and ignoring the other very higheconomic growth scenarios that yield much lower warming projections,the Review selects IPCC scenario A2 as its base case.46 This scenario

41 Clement, A. C., and B. Soden (2005), The sensitivity of the tropical-mean radiation budget, J. Clim., 18:31893203; Choi, Yong-Sang, and Chang-Hoi Ho (2006), Radiative effect of cirrus with different opticalproperties over the tropics in MODIS and CERES observations, Geophys. Res. Ltrs., in press; Chou, M.-D., andR. S. Lindzen (2005), Comments on Examination of the Decadal Tropical Mean ERBS Nonscanner RadiationData for the Iris Hypothesis, J. Clim., 18: 21232127. 42 IPCC Special Report on Emissions Scenarios, 2000; summary available at www.ipcc.ch/pub/sres-e.pdf.43 Ibid, p. 4.44 Review, page 61.45 IPCC WG1 TAR, page 552, available here: www.grida.no/climate/ipcc_tar/wg1/552.htm.46 Review, Box 6.1, page 154.


Part I: The Science

projects global population in 2100 at 15 billion.47 But according to theInternational Institute for Applied Systems Analysis, there is only a 2.5%probability that world population will exceed 14.4 billion in 2100.48 Thus,the A2 population projection is considered highly unlikely by the researchinstitute that prepared it. This is not surprising, since the A2 estimate for2100 is more than 50% above the UNs latest medium population scenarioand 7% above its high scenario.49 This inflated population estimateinflates emissions and, more important, the numbers at risk for each of theclimate-sensitive hazards examined in the Review, and hence the conse-quences and costs of dealing with them.

A second systematic bias in the Reviews consideration of climateimpacts is its reliance on papers that assume either that human beings willtake no countermeasures to combat adverse impacts of climate change, orthat any measures they do take will utilize existing technologies. In fact,we can confidently expect improved technologies in the wealthier andmore technologically advanced worlds that will eventuate, and are indeeddepicted by IPCCs scenarios.

In these and other ways, the Reviews consideration of various climateimpacts is biased towards damaging or disastrous outcomes. Some specificexamples follow.

Hunger and agricultural productivity

The studies cited by the Review under this heading can be traced mainlyto a paper by Parry et al.50 This study allows for some adaptations andincreased use of existing technology that would improve productivity. Butit explicitly excludes any technologies that may be developed specificallyto cope with negative impacts of climate change.51 This is not a sound pro-cedure. The potential for future technologies, including biotechnology, tocope with climate change is large even in developing countries, especially

47 Review, Box 3.2, page 61.48 See http://www.iiasa.ac.at/Research/POP/proj01/index.html?sb=5; Lutz, W., W. C. Sanderson, and S. Scherbov(eds) (2004), The End of World Population Growth in the 21st Century: New Challenges for Human Capital Formationand Sustainable Development (London: Earthscan).49 UN Population Division (2004), World Population to 2300 (New York: United Nations).50 Parry, M. L., C. Rosenzweig, I. Iglesias, M. Livermore, and G. Fischer (2004), Effects of climate change onglobal food production under SRES emissions and socioeconomic scenarios, Global Environmental Change, 14(1): 5367.51 Ibid., page 57.



given the prospective continuing increases in their per capita income.Thus, the abrupt declines in yields predicted by the Review once certaintemperature thresholds are reached are unlikely given appropriate breed-ing, crop switching and other adaptations in the decades during whichtemperature might be rising towards these thresholds.52 Most other threatsto agriculture and food supply, e.g., waterlogging, drought, and salinity,have also to be weighed in the light of the obvious possibilities foradaptation.

The approach used in Parry et al. to estimate the impacts of climatechange decades from now is, in essence, tantamount to estimating todayslevel of hunger (and agricultural production) based on the technology offifty years ago. Past prognostications made along these lines have provento be spectacularly wrong precisely because they omitted from considera-tion developments in agricultural technology that occurred in subsequentdecades.53

Another source of the Reviews overestimates of future levels of hungeris its treatment of the prospective fertilisation of crops by additional car-bon dioxide. The Review says that, following Parry, it assumes that carbonfertilisation is weak and smaller than previously thought.54 Closescrutiny of the Reviews footnotes is required to descry the fact that theactual assumption is not weak fertilisation but no fertilisation effect.55 Thebasis for this assumption, which flies in the face of numerous papers on thereality of carbon fertilisation, is a recent paper (Long et al., 2006), whichsuggests only that under field conditions, carbon fertilisation may be athird to less than half of what is suggested by experiments using growthchambers.56 The Reviews effective assumption of no carbon fertilisation,which is wholly unrealistic, allows it to make a headline projection that250550 million additional people may be at risk57 of hunger, whereas,on its own figures, an assumption of strong fertilisation would have

52 See Goklany, I. M. (2001), The Precautionary Principle: A Critical Appraisal of Environmental Risk Assessment(Washington, DC: Cato Institute).53 Recall, for example, the inaccuracy of the catastrophic warnings in Paul Ehrlichs The Population Bomb (1968).54 Review, pages 678; Box 3.4 (page 70). Figure 3.6 on page 73 shows the huge impact of this assumption ofweak fertilisation on projected numbers of hungry people. The numbers under the A2 scenario, used by theReview as a base case, are also far higher than under any other scenario.55 Review, page 72, footnote 43.56 Review, page 67, footnote 35; Long, S. P., E. A. Ainsworth, A. D. B. Leakey, et al. (2006), Food for thought:lower-than-expected crop yield stimulation with rising CO2 concentrations, Science, 312: 19181921.57 Review, page 72.


Part I: The Science

suggested declining numbers of hungry people, even for a temperatureincrease of up to 3.5 degrees C.58

Ecosystems and extinction risks

The Review acknowledges that much of the information furnished withregard to impacts on ecosystems and extinction risks that it quotes origi-nates with Thomas et al. (2004) and concedes that there is a great deal ofuncertainty inherent in such estimates.59 This acknowledgement, how-ever, is offered only several pages after the results of the Thomas et al.study have been highlighted in the Executive Summary, and in KeyMessages for Part II and Chapter 3. Moreover, the Review uses these esti-mates repeatedly and often without any qualification. For example, Figure 2of the Executive Summary notes Many species face risk (2050% in onestudy), but it fails to note the uncertainties associated with that onestudy. Similarly, the Executive Summary states that Ecosystems will beparticularly vulnerable to climate change, with around 1540% of speciespotentially facing extinction after only 2C of warming.60 Here, as else-where, the reader is not warned that this statement is based on a singlestudy, which, moreover, is fraught with uncertainties.61

After finally acknowledging the substantial uncertainty associated withthe Thomas et al. (2004) study, the Review attempts to justify its use bysaying that other studies looking at climate suitability also predict highlevels of extinction.62 But many of the problems inherent in the Thomaset al. study are also endemic to these other studies. A basic issue is whethersuch climate suitability studies are even able to predict extinction risksunder different climatic regimes. For each such regime, atmospheric con-centrations of CO2, rates of plant growth, water use efficiency, the energyrequirements of species and their predatorprey relationships would all bedifferent from what they are today.63 As noted by Schwartz et al. (2006),

58 Figure 3.6 on page 73.59 Review, page 80, footnote 79.60 Review, page vi.61 For other notable examples in the Review of failure to identify the single-study basis of these conclusions,see the cover page and Key Messages of Part II (pp. 55 and 56), and Table 3.1 on page 57.62 Review, page 80, footnote 79.63 See Pearson R. G., and T. P. Dawson (2003), Predicting the impacts of climate change on the distribution ofspecies: Are bioclimatic envelope models useful?, Global Ecology and Biogeography, 12: 361371; Guisan, A., andW. Thuiller (2005), Predicting species distributions: Offering more than simple habitat models, Ecology Letters,8: 9931009.



the efficacy of using bioclimatic models to assess the possible extinctionpotential of climate change, particularly among species with small distri-butions, requires empirical assessment, while claiming that climatechange puts a particular endemic species at risk of extinction requires adetailed understanding of the responsiveness to climate of the targetspecies, as well as that of species with which it is likely to interact.64

The Review also ignores what has been written about the likelihoodthat carbon fertilisation, and other factors likely to extend secular increasesin agricultural productivity, will reduce habitat loss and increase water useefficiency of plants, thereby reducing pressures on ecosystems and biodi-versity.65 Lower habitat loss would also conserve migration corridors,something that has been advanced as a mechanism to aid species adapt tochanged circumstances. Changes in forest productivity (because of higherCO2 concentrations, for instance) would similarly promote biodiversity.Thus it is conceivable, indeed probable, that at low to moderate levels ofclimate change, the overall pressure on biodiversity, ecosystems andspecies would on balance be lower.66 In sum, the Reviews assessment ofecosystem and extinction risks are a worse-than-worst-case scenario, basedon a nave and one-sided appeal to the literature.

Water availability and water shortages

With respect to water supplies and water availability, the Reviews infor-mation is based mainly on Arnells studies which indicate that althoughaggregate populations under water stress through the 2080sthe periodconsideredmay decline, people in some regions could have greater watershortages, while others may have too much water during the rainy seasonwhich could lead to both flooding and water shortages during other seasons.67

64 Schwartz, M. W., L. R. Iverson, A. M. Prasad, S. N. Matthews, and R. J. OConnor (2006), Predictingextinctions as a result of climate change, Ecology, 87: 16111615.65 Idso, S. B., and A. J. Brazel (1984), Rising atmospheric carbon dioxide concentrations may increasestreamflow, Nature, 312: 5153; Gedney, N., P. M. Cox, R. A. Betts, O. Boucher, C. Huntingford, and P. A. Stott(2006), Detection of a direct carbon dioxide effect in continental river runoff records, Nature, 439: 835838;Goklany, I. M. (1998), Saving habitat and conserving biodiversity on a crowded planet, BioScience, 48: 941953.66 Goklany, I. M. (2001), The Precautionary Principle: A Critical Appraisal of Environmental Risk Assessment(Washington, DC: Cato Institute); Goklany, I. M. (2003), Relative contributions of global warming to variousclimate sensitive risks, and their implications for adaptation and mitigation, Energy & Environment, 14: 797822.67 Arnell, N. W. (2004), Climate change and global water resources: SRES emissions and socioeconomicscenarios, Global Environmental Change, 14 (1): 3152; Arnell, N. W. (2006), Climate change and waterresources: A global perspective, in: Schellnhuber, H. J., et al., Avoiding Dangerous Climate Change (Cambridge:Cambridge University Press, pp. 167175).


Part I: The Science

But the magnitude of these adverse outcomes is exaggerated, sinceArnells papers ignore even the adaptation possible with existing tech-nologies, let alone possibilities from new and improved technologies.68 Noaccount is taken of the fact that human beings have had a long, and mainlysuccessful, history of combating floods as well as dealing with erratic waterflows through a variety of supply and demand side adaptations.69

Melting ice sheets

The Reviews comments concerning Greenland ice melt are similarlyslanted. The text repeatedly emphasizes significant melting and anacceleration of ice flows near the coast70 and hammers the possibility ofirreversible melting of the Greenland ice sheet.71 Yet, of the four papersrelied on, two, based on satellite altimetry, show a slight net gain in themass of the Greenland ice sheet (over 19922002 and 19922003), sincealthough the ice margins of Greenland are shrinking, ice is building upinland due to higher snowfall.72 A third paper, using data from 1996 to2005, indicates a net loss of ice mass.73 The fourth study, which uses mete-orological models to estimate the overall mass balance of the ice sheet,finds no significant trend from 1961 to 2003.74 None of these data has beengathered for a sufficiently long period to enable us to discern whether theyconstitute short-term fluctuations or long-term trends, let alone for us toidentify their causes. We note, however, that papers based on longer dataseries have found that the temperature around the Greenland coast, whileit may have risen just in the last few years, is still lower than it was around

68 Page 16 in: Warren, R., N. Arnell, R. Nicholls, P. Levy, and J. Price (2006), Understanding the regionalimpacts of climate change, research report prepared for the Stern Review, Tyndall Centre Working Paper 90(Norwich, UK: Tyndall Centre, available from http://www.tyndall.ac.uk/publications/working_papers/twp90.pdf).69 Goklany, I. M. (2003), Relative contributions of global warming to various climate sensitive risks, and theirimplications for adaptation and mitigation, Energy & Environment, 14: 797822; Tol, R. S. J. (2005), Adaptationand mitigation: trade-offs in substance and methods, Environmental Science & Policy, 8: 572578.70 Review, page 16; also pages v, 2, 14, 56, 57, 59, 81, 82, 84, etc.71 Review, pages v, 81, 82, etc.72 Zwally, H. J., M. B. Giovanetto, J. Li, H. G. Cornejo, M. A. Beckley, A. C. Brenner, J. L. Saba, and D. Yi(2005), Mass changes of the Greenland and Antarctic ice sheets and shelves and contributions to sea-level rise:19922002, Journal of Glaciology, 51 (175): 590527; Johannessen, O. M., K. Khvorostovsky, M. W. Miles, and L.P. Bobylev (2005), Recent ice-sheet growth in the interior of Greenland, Sciencexpress: www.sciencexpress.org,20 October 2005.73 Rignot, E., and P. Kanagaratnam (2005), Changes in the velocity structure of the Greenland Ice Sheet,Science, 311: 986990.74 Hanna, E., P. Huybrechts, I. Janssens, J. Cappelin, K. Steffen, and A. Stephens (2005), Journal of GeophysicalResearch, 110: 10.1029/2004JD005641.



1940,75 and little changed from the very first instrumental measurementsin the 1780s.76

The Review also fails to mention that temperatures in the Arctic as awhole are only as warm now as they were in the 1930s,77 or that the muchlarger Antarctic ice sheet is growing.78 A continual build-up of snow andice on the continent will have a tendency to lower mean global sea level.

General health impacts

The estimates presented in the Review for the present day health impactsof climate change and increases in such impacts through 2030 due to a 1degree C increase in temperature79 can be traced directly, or indirectlythrough Patz et al. (2005), to McMichael et al. (2004).

Evidence of bias can be seen in McMichaels explanation of his method:

climate change occurs against a background of substantial natural climatevariability, and its health effects are confounded by simultaneous changes inmany other influences on population health.Empirical observation of thehealth consequences of long-term climate change, followed by formulation,testing and then modification of hypotheses would therefore require long time-series (probably several decades) of careful monitoring. While this process mayaccord with the canons of empirical science, it would not provide the timely informationneeded to inform current policy decisions on GHG emission abatement, so as to offsetpossible health consequences in the future. Nor would it allow early implementa-tion of policies for adaptation to climate changes.80

In other words, the estimates in this paper are based not on robust sciencebut on a desire to be policy-relevant. The unquestioning use of the

75 See, for example, Chylek P., J. E. Box, and G. Lesins (2004), Global warming and the Greenland ice sheet,Climatic Change, 63: 201221.76 Vinther, B. M., K. K. Andersen, P. D. Jones, K. R. Briffa, and J. Cappelen (2006), ExtendingGreenland temperature records into the late eighteenth century, Journal of Geophysical Research, 111,10.1029/2005JD006810.77 Polyakov, I. V., G. V. Alekseev, R. V. Bekryaev, U. Bhatt, R. L. Colony, M. A. Johnson, V. P. Karklin, A. P.Makshtas, D. Walsh, and A. V. Yulin (2002), Observationally based assessment of polar amplification of globalwarming, Geophysical Research Letters, 29: 10.1029/2001GL011111.78 Wingham, D. J., A. Shepherd, A. Muir, and G. J. Marshall (2006), Mass balance of the Antarctic ice sheet,Philosophical Transactions of the Royal SocietyA, 364: 16271635; Van de Berg, W. J., M. R. van den Broeke, C.H. Reijmer, and E. van Meijgaard (2006), Reassessment of the Antarctic surface mass balance using calibratedoutput of a regional atmospheric climate model, Journal of Geophysical Research, 111: 10.1029/2005JD006495;Vaughn, D. G. (2005), How does the Antarctic ice sheet affect sea level rise?, Science, 308: 18771878.79 Review, pages 756.80 McMichael, A., et al. (2004), Global climate change, in: Comparative Quantification of Health Risks: Global andRegional Burden of Disease due to Selected Major Risk Factors (World Health Organization, Geneva, page 1546).(Emphases added.)


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