Event: Policy Exchange: Peter Lilley MP on the Climate Change Act - all costs and no benefits
Attribution: Repeal the Climate Change Act (http://repealtheact.org.uk/).
Peter Lilley: Well, it's a privilege to be part of this panel. The document that was sent out says the presumption today is that there's a problem communicating climate change on the right, because some on the political right are suspicious of taking action to reduce greenhouse emissions, some are hostile to climate science, others worry that it's just a cover for anti-capitalist political aims, or they challenge the economics behind some of the policy measures. Well, I take it I am here set up as an example of this problem, a token denialist, one of the infamous five who voted against the Climate Change Act. In short, a suitable case for treatment.
Indeed I was worried and relieved when Dr Corner spoke, because I'd seen that Cardiff University houses his school on communicating climate change in the School of Psychology, and I wondered whether this was a sort of Stalinist approach, that anyone who was thought to deviate from the established line was in need of treatment, and in fact that wasn't the line taken. But I would suggest another line to take, for your studies of the psychology, is to study the groupthink in the climate change business. And I will happily give you an article on the subject, that I wrote in the Wall Street Journal some while ago.
Before I go on to what I say, can I - because I am somewhat of the grit in the oyster - explain my own position? I studied physics at Cambridge, before I went on to become an economist, and I fully accept the existence of the greenhouse effect. Without the warm blanket provided by greenhouse gases, notably CO2 and water vapour, the Earth would probably be a frozen, uninhabitable rock. If the amount of CO2 is doubled, it's well established that the direct effect, other things being equal, would be to raise the Earth's temperature by about one degree Centigrade. Since warmer air holds more water vapour, that could double the impact, or reduce it if the resulting clouds reflect back more sunshine.
All that's certain and settled. But a degree or two rise in temperature is, of itself, not a huge concern. To predict temperature increases large enough to generate catastrophic consequences requires invoking feedbacks, which are at best uncertain, or even unknown, and in order to amplify the initial greenhouse effect. So the debate is not about whether CO2 will warm the climate, but how much, how certain, how soon, how much harm it will cause, and how well we could adapt to it. And all those areas have great doubts and concerns, but also great opportunities for those of an alarmist disposition.
However, I voted against the Climate Change Act, not on the basis that the science is still so uncertain, but on the evidence provided to Parliament by the government about the costs and benefits of the Act. The government published an impact assessment of the Climate Change Act - it's always obliged to publish an assessment of the costs and benefits of any piece of legislation - in order that Parliament should know that the benefits substantially exceed the costs and it's worthwhile doing.
I got hold of a copy of the impact assessment. I was the only person to do so - I know that because when I went to the vote office, they said "Oh, we can't find that, no-one's asked for it." But they did eventually find it. And I read it. And this is the government's assessment of the costs and benefits of the Climate Change Act, the most expensive piece of legislation probably introduced in this country since the Welfare State.
And they said the benefits - that the costs of introducing the Act - excluding the transitional costs for the first 20 years, which could be 1% of GDP, excluding the costs of driving business overseas, if other countries didn't do likewise - was, potentially, over £200 billion, equivalent to a down payment of £17,000 for each household in the country - or, sorry, a little lower, about £15,000. The costs were over £200 billion. The maximum benefits, according to the government's assessment - and these are the benefits of reducing climate change worldwide, so most of those benefits accrue to other people - was put at £105 billion.
So the government's own assessment was that the costs were nearly twice the benefits.
And therefore, I voted against. It seemed to me that's the sensible thing to do in those circumstances. I couldn't get the minister to respond to the issue in the debate. Or anyone to respond to the issue in the subsequent debates we had on the subject. That taught me a little about the nature of this debate. It's not one of reasoned assessment, of balancing costs against benefits. It's one of belief and conviction, against reasoned argument.
The feed-in tariffs the government subsequently introduced were even worse. There the government's impact assessment was that the benefit of reduced global warming was some £400 million, as a result of the substitution of fossil fuels by solar power reducing the amount of global warming worldwide. That would save the world £400 million. However, the costs to consumers and taxpayers was put by the government at £8.6 billion - 21 times the benefits that they assessed of the measure. Again, it seemed to me good reason for not doing it. There may be other things you should do. There may be other policies that have benefits greater than the costs. But if the government puts forward proposals where the costs are greater than the benefits, one shouldn't proceed. Even George Monbiot of the Guardian, a champion of climate alarmism, pointed out that this measure would merely transfer billions of pounds from the pockets of poor people into the wallets of those who could afford absurdly subsidised solar panels.
So much for my position. It's shared by a tiny handful of colleagues in Parliament. We're largely ignored by the party machines and the media. We're effectively irrelevant. The extraordinary thing about the UK is that our political media and scientific elites are more committed to the doctrines of climate change alarmism - not the general science, that a doubling of the CO2 will produce a modest increase in temperatures, but the belief that it would produce alarming, catastrophic effects - our elites are more committed to them than almost any other country in the world. All three parties are committed. The BBC, until recently nearly all the newspapers, the great and the good - they're unanimous, and dissenters are cast into oblivion.
Yet opinion polls show, by contrast, that the British electorate is more sceptical of their claims than any other country, even the United States of America. This is a wonderful achievement, on the part of our elites, that they have managed to make the British people more sceptical than any other country.
Now the panel, I think, is of the view - we've got one more to come - that the problem is a communication problem, and the solution is better communications, more psychology, happily not sending me off - people like me - off for treatment, I'm relieved to discover. But, hopefully, stopping people like me from having too much of a voice. In my experience, the failure to convince people of your policies usually springs from one of two things - a lack of conviction or a lack of evidence. As for conviction, as Margaret Thatcher said, it's those with conviction that carry the day. And she was right. And the truth is that the Conservatives in particular - not just Conservatives, Tony Blair is probably much the same - adopted climate alarmism, not out of scientific conviction but as part of our modernising strategy. No-one really pretends otherwise. Now people are becoming increasingly sceptical of global warming, it's hard for Conservatives to sound sufficiently convincing to convince them. And the green voters we were wooing turn out to be more interested in protecting their green and pleasant land from the real and immanent threat of wind farms than from the less visible threat of global warming.
Now why are people becoming more sceptical? Because a grimmer economic situation makes them question more closely policies whose costs are beginning to bite. Household electricity bills are up by about 11% because of climate change measures - the Renewables Obligation puts the cost of electricity for business up 18% and expect it to go to a 25% premium by 2025, according to the government.
And when people, spurred on by this impact on their wallets, look at the evidence, they find little to convince them that it's worthwhile. There's been no warming for 15 years. After being told we might never see snow again, we've had a run of cold winters. Tell people that 15 years is too short, you need 30 years to determine a climate trend, and the pig-headed, obstinate British people say "Let's wait for another 15 years, then we'll know."
And if they're told that snowy winters don't count, they're less likely to be convinced that a local flood or a "phew, what a scorcher" of a summer is really evidence of a real climate threat. The experts warn them that a 2 degree Centigrade rise will be dangerous. This sounds absurd to most people. After all, it's 10 degrees Centigrade warmer now than it was 12 hours ago. And nobody has dropped dead. It's a great relief to me that you've all survived the traumatic shock to your systems. And most people go off on their holidays to places which they hope will be at least 10 degrees warmer. Tell them, of course, that that's not the point, it's the effect of the average temperature on aspects of the climate like cyclones, and so on, and then people come back and say: well actually, there is very little evidence of that. The latest World Bank study suggests that by the end of the century, the impact of global warming - assuming that the IPCC is true - on the amount of cyclone damage will be only one hundredth of what Lord Stern was telling us a few years ago.
So - and when you come to the real iconic threat, the one that was raised by Hansen originally, that Manhattan would be - I forget how many metres it was - under water by now, and the slightly longer term use of Gore, that when the ice caps of Greenland and Antarctica melt, we'll all be x metres underwater. And when you look closely at what the IPCC says, it says that this will only happen if the temperature rises, and is sustained, over a millennial period, over thousands of years. It takes a very long time to melt several kilometres deep of ice. So people think: well, we've probably got a little time to think about this, if it's going to take several thousand years to happen.
Now those are all populist arguments. I won't go through all the full scientific approach, because we're talking about communication rather than the science. But effectively, those who are trying to put the argument over are forced to rely on the argument from authority. And they usually say: 97% of scientists agree with us. When you look at the survey on which this is based, you find that 97% did indeed agree with two statements. But the statements were ones which I agree with. The first was: "When compared with the pre-1800s level, do you think that mean global temperatures have generally risen, fallen or remained relatively constant?" Well, I'm with the 97% who say they've risen. "Do you think that human activity is a significant contributing factor in changing mean global temperatures?" Yes, I'm with the 97%. There is no consensus among most people that we face an alarming and catastrophic consequence. Indeed, when the Inter Academy Group of all the national science academies in the world, who themselves have tended to come out at their governments' behest as in favour of climate alarmism, looked at the IPCC, they concluded that - and I quote - the IPCC was to be criticised for emphasising the negative impacts of climate change. The authors of the IPCC reported high confidence in some statements, for which there is little evidence.
There is an inbuilt tendency to exaggerate, to cause alarm, to get over-excited. I'm a Conservative, and Conservatives believe you base things on the facts. Not on theories, not on imagination or wild assertions or horrible alarms, but facts. My great hero of political writing is Thomas Sowell, who wrote a book Is Reality Optional? His thesis was: the left thinks reality is optional. It should be like what we want it to be, or what we fear it to be. Actually, reality isn't optional. We should take the facts, measure what's happening, examine it, look at the costs, look at the benefits, compare the two and behave in a sensible, rational fashion. So far, we've been doing exactly the opposite, and voting for and implementing policies, which on the assessment of those who put them forward, cost at least twice as much as any benefits we're going to get from them.