Tag Archives: global warming

Six studies that show everything Republicans believe is wrong

The great 20th-century economist John Maynard Keynes has been widely quoted as saying, “When the facts change, I change my mind. What do you do, sir?” Sadly, in their quest to concentrate economic and political power in the hands of the wealthiest members of society, today’s Republicans have held the opposite position – as the evidence has piled up against them, they continue spreading the same myths. Here are six simple facts about the economy that Republicans just can’t seem to accept:​

1. The Minimum Wage Doesn’t Kill Jobs.

The Republican story on the minimum wage takes the inordinately complex interactions of the market and makes them absurdly simple. Raise the price of labor through a minimum wage, they claim, and employers will hire fewer workers. But that’s not how it works. In the early Nineties, David Card and Alan Krueger found “no evidence that the rise in New Jersey’s minimum wage reduced employment at fast-food restaurants in the state.” Since then, international, national and state-level studies have replicated these findings – most recently in a study by three Berkeley economists. Catherine Ruetschlin, a policy analyst at Demos, has argued that a higher minimum wage would actually “boost the national economy” by giving workers more money to spend on goods and services. The most comprehensive meta-study of the minimum wage examined 64 studies and found “little or no evidence” that a higher minimum wage reduces employment. There is however, evidence that a higher minimum wage lifts people out of poverty. Raise away!

2. The Stimulus Created Millions of Jobs.

In the aftermath of the 2007 recession, President Obama invested in a massive stimulus. The Republican belief that markets are always good and government is always bad led them to argue that diverting resources to the public sector this way would have disastrous results. They were wrong: The stimulus worked, with the most reliable studies finding that it created millions of jobs. The fact that government stimulus works – long denied by Republicans (at least, when Democrats are in office) – is a consensus among economists, with only 4 percent arguing that unemployment would have been lower without the stimulus and only 12 percent arguing that the costs outweigh the benefits.

3. Taxing The Rich Doesn’t Hurt Economic Growth.

Republicans believe that the wealthy are the vehicles of economic growth. Starting with Ronald Reagan in the 1980s, they tried cutting taxes on the rich in order to unleash latent economic potential. But even the relatively conservative Martin Feldstein has acknowledged that investment is driven by demand, not supply; if there are viable investments to be made, they will be made regardless of tax rates, and if there are no investments to be made, cutting taxes is merely pushing on a string. Thomas Piketty and Emmanuel Saez, two of the eminent economists of inequality, find no correlation between marginal tax rates and economic growth.

In fact, what hurts economic growth most isn’t high taxes – it’s inequality. Two recent IMF papers confirm what Keynesian economists like Joseph Stiglitz have long argued: Inequality reduces the incomes of the middle class, and therefore demand, which in turn stunts growth. To understand why, imagine running a car dealership. Would you prefer if 1 person in your time owned 99% of the wealth and the rest of the population had nothing, or if wealth was distributed more equally, so that more people could purchase your cars?

Every other country in the Organization for Economic Cooperation and Development has far lower levels of inequality than the United States. Since there are no economic benefits of inequality, why hasn’t the right conceded the argument? Because it’s based on class interest, not empirical evidence.

4. Global Warming is Caused by Humans.

Even as global warming is linked to more and more extreme weather events, more than 56 percent of Republicans in the current congress deny man-made global warming. In fact, the infamous Luntz memo shows that Republicans have actually created a concerted campaign to undermine the science of global warming. In the leaked memo, Frank Luntz, a Republican consultant, argues that, “The scientific debate is closing [against us] but not yet closed. There is still a window of opportunity to challenge the science.”

In truth, the science of global warming is not up for debate. James Powell finds that over a one year period, 2,258 articles on global warming were published by 9,136 authors. Of those, only one, from the Herald of the Russian Academy of Sciences, rejected man-made global warming. That one article was likely motivated by the Russian government’s interest in exploiting arctic shale. Another, even more comprehensive study, examining 11,944 studies over a 10-year period, finds that 97 percent of scientists accepted the scientific consensus that man-made global warming is occurring.

This is not an abstract academic debate. The effects of climate change will be devastating, and poor countries will be hurt the worst. We’ve already seen the results. Studies have linked global warming to Hurricane Sandydroughts and other extreme weather events. More importantly, doing nothing will end up being far more expensive than acting now. One study suggests it could wipe out 3.2% of global GDP annually.

5. The Affordable Care Act is Working

President Obama’s centrist healthcare bill was informed by federalism (delegating power to the states) and proven technocratic reforms (like a board to help doctors discern which treatments would be most cost-effective). Republicans, undeterred, decried it as Soviet-style communism based on “death panels” – never mind the fact that the old system, which rationed care based on income, is the one that left tens of thousands of uninsured people to die.

From the beginning, Republicans have predicted disastrous consequences or Obamacare, none of which came true. They predicted that the ACA would add to the deficit; in fact, it will reduce the deficit. They claimed the exchanges would fail to attract the uninsured; they met their targets. They said only old people would sign up; the young came out in the same rates as in Massachusetts. They predicted the ACA would drive up healthcare costs; in fact it is likely holding cost inflation down, although it’s still hard to discern how much of the slowdown was due to the recession. In total, the ACA will ensure that 26 million people have insurance in 2024 who would have been uninsured otherwise.

It’s worth noting that every time the CBO estimates how much Obamacare will cost, the number gets lower. Odd how we’ve never heard Republicans say that.

6. Rich people are no better than the rest of us.

Politicians on the right like to pretend that having money is a sign of hard work and morality – and that not having money is a sign of laziness. This story is contradicted by human experience and many religious traditions (Jesus tells a graphic story about a rich man who refused to help the poor burning in hell). But it’s also contradicted by the facts – more and more rich people are getting their money through inheritances, and science shows that they are no more benevolent than others.

More and more, the wealthy in America are second or third generation. For instance, the Walton family, heirs to the Walmart fortune, own more wealth than the poorest 40 million Americans. Thomas Philippon and Ariell Reshef have found that 30 to 50 percent of the wage difference between the financial sector and the rest of the private sector was due to unearned “rent,” or money they gained through manipulating markets. Josh Bivens and Larry Mishel found the same thing for CEOs – their increased pay hasn’t been correlated to performance.

If rich people haven’t really earned their money, are they at least doing any good with it? Studies find that the wealthy actually give less to charity as a proportion of their income than middle-class Americans, even though they can afford more. Worse, they use their supposed philanthropy to avoid taxes and finance pet projects. Research by Paul Piff finds that the wealthy are far more likely to exhibit narcissistic tendencies. “The rich are way more likely to prioritize their own self-interests above the interests of other people,” Piff recently told New York magazine. “It makes them more likely to exhibit characteristics that we would stereotypically associate with, say, assholes.”

Originally published on The Rolling Stone.

How to tap latent conservative support for global warming policy

Both last month’s Senate Climate Talkathon and Tom Steyer’s $100 million dollarpledge to back environment-friendly candidates indicate the same thing: Democrats are getting serious about global warming again. But even when Democrats have managed to close ranks behind previous legislative efforts like Waxman-Markey, Republicans have stymied them. Can the left forge a coalition to tackle the problem?

The environment was once a bipartisan issue. The 1970 Clean Air Act, the 1972 Clean Water Act, and the 1973 Endangered Species Act were all passed with bipartisan support, as was legislation strengthening those acts in the 1980s and 1990s. Since then, the environment has become increasingly divisive. Data from the Pew Research Center show that the decrease in support for environmental protection is not only very recent but also one-sided:

Despite that decline, Republican support for environmental causes is stronger than it might appear. Two Ph.D. students at the University of California Santa Barbara, Phillip Ehret and Aaron Sparks, found that a quarter of individuals self-identifying as “very conservative” or “conservative” support environmental regulations, even if they risk harming the economy. A Yale Study finds that 85 percent of Democrats and 55 percent of Republicans favor “regulating CO2 as a pollutant” and majorities from both parties favor investing in renewable energy. If Republican voters are concerned about the environment, haven’t we seen an action?

One explanation is that the framing of environmental issues is often anathema to conservatives. Matthew Feinberg and Robb Willer’s important paper on the subject, “The Moral Roots of Environmental Attitudes,” finds that liberals view environmental issues as moral concerns informed by a harm principle, while conservatives view environmental issues through the lens of purity, and particularly for religious people, stewardship.

In 1971’s Octogesima Adveniens, Pope Paul VI laid out a religious case for protecting the environment, using the language of responsibility, duty to future generations, and purity—in other words, the conservative framing under Feinberg and Willer’s standards:

Man is suddenly becoming aware that by an ill-considered exploitation of nature he risks destroying it and becoming in his turn the victim of this degradation … thus creating an environment for tomorrow which may well be intolerable …. The Christian must turn to these new perceptions in order to take on responsibility, together with the rest of men, for a destiny which from now on is shared by all.

In his 2006 “Letter to a Southern Baptist Pastor,” E.O. Wilson showed how to use the religious framing in defense of the environment:

You have the power to help solve a great problem about which I care deeply. I hope you have the same concern. I suggest that we set aside our differences in order to save the Creation. The defense of living nature is a universal value. It doesn’t rise from, nor does it promote, any religious or ideological dogma. Rather, it serves without discrimination the interests of all humanity. Pastor, we need your help. The Creation—living nature—is in deep trouble.

The environmental movement has stumbled because it has not framed the issue as Wilson and Paul VI did. A 2012 study by Matthew C. Nisbet, Ezra M. Markowitz, and John E. Kotcher found that climate campaigns overwhelming frame the issue in terms of harm and care, fairness, and oppression of marginalized groups. These frames fall into what Feinberg and Willer would consider left-wing frames, alienating conservatives.

Adopting a more conservative framing wouldn’t lead to liberals winning more elections. More likely, moderate Republican and centrist thought leaders could make green policy a bipartisan initiative of the sort that was common during the Eisenhower, Nixon, and Bush Sr. days. There are already right-leaning pro-environment groups, like Atlanta’s Green Tea Coalition and Ducks Unlimited. That’s unlikely to be enough to bridge the divide. Because people are more likely to respond to arguments made by someone within their community than outside of it, progress depends on more Republican voices.

But Republican thought leaders and policymakers have abandoned the environment in droves. ThinkProgress calculates that 56 percent of Republicans in the current congress deny anthropogenic global warming. Among the general public, 26 percent of adults don’t believe global warming is real (although only 11 percent of Democrats do, versus 46 percent of Republicans and an astonishing 70 percent of Tea Partiers). Deborah Guber, a professor at University of Vermont,argues that there has been a concerted effort among right-leaning elites to downplay the environmental issue. “Partisan conflicts are not inherent in the subject of climate change,” she writes. “Party sorting seems to occur only as citizens acquire information and become familiar with elite cues.” This helps explain the lack of political movement, despite evidence that conservative voters are concerned about the degradation of the environment.

Guber notes the infamous 2003 Frank Luntz memo arguing that the environment was the issue on which Republicans were most vulnerable. “The scientific debate is closing [against us] but not yet closed. There is still a window of opportunity to challenge the science,” Luntz wrote. “A compelling story, even if factually inaccurate, can be more emotionally compelling than a dry recitation of the truth.” Funders took Luntz’s idea and ran with it—with impressive success. A Drexel University study released in December bolsters the idea of a concerted denial campaign led by elites. The survey found that the climate-denial movement consists of 91 organizations supported by 140 primarily conservative foundations.

“The Republicans and (at least a large part of) the business community are against doing anything about climate change, because doing something about it would mean government intervention in the economy, which is ideologically bad but also having tangible and real economic costs on certain segments of the business world,” Benjamin Radcliff, a professor of politics at Notre Dame, told me.

Regulating greenhouse gases would hurt some big businesses. If IPCC estimates are correct, some 80 percent of existing fossil fuel reserves must remain unused. That presents a risk for companies like Koch Industries and Exxon Mobil—companies whose donations give them an outsize influence on the political process. Recently, Exxon said it is “highly unlikely” that governments would implement policies to significantly reduce emissions. (Just to be sure, the company has donated millions to climate denial groups.)

Tom Steyer’s example aside, Martin Gilens and Benjamin Page find “that economic elites and organized groups representing business interests have substantial independent impacts on U.S. government policy, while average citizens and mass-based interest groups have little or no independent influence.” And elites are less likely to be concerned about climate change than other citizens. Benjamin I. Page, Larry M. Bartels, and Jason Seawright have found that the issue ranks below “the loss of traditional values,” budget deficits, and inflation among policy priorities for the wealthy. While the wealthy in their study generally favored reducing spending on the environment (the difference between “expanded” and “cut back” was -8) the public strongly favored increasing spending (+29).

Internationally, the environment isn’t so polarized. Right-leaning politicians like David Cameron and Nicolas Sarkozy have embraced the environment, and Angela Merkel won reelection in part by promising to phase out nuclear energy in favor of renewables. And within the U.S., some Democratic governors in red states have had success pursuing environmental issues. In Wyoming, the most conservative state in the country, Dave Freudenthal’s administration focused on a long-term strategy for resource extraction that included, among other things, preserving the state’s forests and regulating hydraulic fracking. The result: a reelection margin of 20 percent and a reputation as one of the most popular governors in the country, including 66 percent approval among Republicans.

But at the national level in the United States, environmental progress has been stymied by elites with a vested interest in fostering denial and the economic means to do so. This is not an easily surmountable challenge, but the polling reveals that underlying support offers hope for moving climate-change policy forward; and unlike hot-button issues like abortion or gay rights, the policy solutions are well agreed-upon. Yet the environmental movement has not helped itself by framing the issue in terms that appeal mostly to the converted. Activists will find more success if they focus on promoting sanctity and responsibility, showing how protecting the environment is economically beneficial and leaving a legacy for future generations.

Originally published on The Atlantic.

The oil industry is not only hurting the environment — it’s a bad investment, too

Environmental activists have long gone after oil companies for contributing to global warming. But a new campaign has sought to hurt the industry where it really hurts: the bottom line.

We know that we have to dramatically slow carbon emissions if we are to prevent catastrophic climate change. A conservative estimate is that two-thirds of extant fossil fuels must stay in the ground. These would then become “stranded assets” that oil companies will never be able to extract. And that has provided an opening to a broad-based divestment campaign, which is making a persuasive economic case against investing in Exxon and its Big Oil ilk.

As Brett Fleishman, a senior analyst at 350.org, told me, “There’s too much carbon embedded in fossil fuel reserves to burn. Those reserves are on the balance sheets of fossil fuel companies. Those companies are valued by those balance sheets. Therefore those valuations are incorrect.”

The divestment campaign seeks to enlighten investors about these shaky assets underlying the oil industry’s wealth. College students have taken aim at their university endowments, with Divest Harvard organizing divestment groups at more than 400 campuses. Towns, cities, and religious organizations have also promised to divest from fossil fuels. The action is even hotter in Europe, where financial services companies Rabobank and Storebrand have already divested from the industry, as have Swedish and Norwegian pension funds.

Institutional investors, even those that are not particularly socially conscious, are taking notice.MSCI — one of the world’s top investment analysis firms — called divestment one the top trends of 2014 to watch out for. Bloomberg recently released a tool to aid companies in assessing their portfolio’s exposure to climate change.

Of course, the whole campaign hinges on the premise that those fossil fuels will remain in the ground. As The Economist puts it, “Either governments are not serious about climate change or fossil fuel firms are overvalued.” In other words, if there is no political will to combat climate change, then the companies are valued accurately.

Obviously, the oil industry has no intention of stranding those assets. This became evident last week when Exxon Mobil considered the risk of stranded assets. The company found that it is “highly unlikely” that government action will force it to abandon its reserves. Rather, the company said, “All of Exxon Mobil’s current hydrocarbon reserves will be needed, along with substantial future industry investments, to address global energy needs.”

All of this indicates that the divestment campaign must pursue a two-pronged approach. Ben Caldecott, who directs the Stranded Assets Program at the University of Oxford, tells me that the campaign could impact the oil industry indirectly, saying, “Certain companies and sectors will also become stigmatized and these could face a higher cost of capital.”

But these companies are not changing their business model. “It’s like asking Levi’s jeans to keep 80 percent of their jeans on the shelf,” Caldecott says. The fact that that national oil companies now control 90 percent of world oil reserves complicates the matter further.

That means governments are going to have to get involved. First, any action on climate change will have to be international, with the most effective strategy being the introduction of a global tax on carbon. Second, we need to begin financing a renewable energy sector to better compete with carbon-based forms of energy. And third, we have to accept the hard truth that the global economy must grow slower for sustainability’s sake.

The alternative is ecological collapse. The divestment campaign has always been aimed at raising awareness among investors, the public, and politicians. The campaign has forced the issue, and Exxon Mobil has showed its cards. Right now, the company is betting governments won’t act. Let’s prove them wrong.

Originally published on The Week.