For the past year, Sir Nicholas Stern, Head of the UK's Government Economic Service and former World Bank Chief Economist, has been conducting a comprehensive review on the economics of climate change. Today, he released his report - and its a stern warning indeed. Climate change has the potential to cause immense damage, with even 2 degrees of warming expected to cause the extinction of 15 - 40 percent of all species as habitats shift and vanish. Three degrees will cause the dislocation of millions of people due to sea-level rise, while four degrees would seriously reduce global food production. And of course most of these impacts will fall on the poor - so there's definitely a moral imperative for action.
For a long time, action on climate change was limited by worries about the economic cost. Stern - who is about as credible as you can get on this front - blows those worries out of the water. Dealing with climate change will cost us 1% of GDP a year - steep, but manageable. Not dealing with it is expected to cost 5% of GDP a year, and possibly as much as 20% if the worst-case scenarios come true. That makes action a no-brainer (though I'm sure that those with no brains and large wallets will continue to oppose it).
Fortunately, we still have time - but not much. The window is 10 to 20 years to get a solution in place and set emissions towards a downward path, or we will commit ourselves to paying the price of inaction. This means that we need to push ahead quickly on negotiating a successor to Kyoto, with stronger emissions reduction targets and some way of eventually bringing in major developing countries (note "eventually". The rich countries created this problem, so we have a moral obligation to bear most of the burden of solving it). Hopefully the Stern report will help make that task easier.
The report was welcomed by the Confederation of British Industry, who called for swift action to build a global carbon market. Meanwhile, in "clean and green" New Zealand, business leaders aren't so sure about this whole Green thing, while on National Radio this morning the Business Round Table and Federated Farmers were doing their best to pooh-pooh the entire idea of climate change (let alone dealing with it). Clearly, if we want to act, we are going to have to go over these people rather than working with them. Fortunately, it looks like there is now the public support to do that.