Thomas Schelling on Adapting to Climate Change

Yesterday, Thomas Schelling gave a seminar on climate change
here at the Center for Study of Public Choice. Schelling’s
main argument was that lots of resources are going into predicting
and understanding climate change but very little thought or
resources are going into planning for adaptation.

If Washington, DC, Boston and Manhattan are to remain dry, for
example, we are almost certainly going to need flood control
efforts on the level of the Netherlands. It takes twenty years just
to come up with a plan and figure out how to pay for these kinds of
projects let alone to actually implement them so it’s not too early
to beginning planning for adaptation even if we don’t expect to
need these adaptations for another forty or fifty years. So far,
however, nothing is being done. Climate deniers think planning for
adaptation is a waste and many climate change proponents think
planning for adaptation is giving up.

Schelling mentioned a few bold ideas. We can protect every city
on the Mediterranean from Marseilles to Alexandria to Tel Aviv or
we could dam the Strait of Gibraltar. Damming the strait would
be the world’s largest construction project–by far–yet by letting
the Mediterranean evaporate somewhat it could also generate enough
hydro-electric power^[1]
to replace perhaps all of the fossil fuel stations in Europe and
Africa.

Schelling didn’t mention it but in the 1920s German engineer
Herman Sörgel^[2]  proposed such a
project calling it Atlantropa^[3] (more here^[4]). In addition to power,
damming the strait would open up a huge swath of valuable land.
Gene Roddenberry and Phillip K. Dick were fans but needless to say
the idea never got very far. A cost-benefit analysis, however,
might show that despite the difficulty, damming the strait would be
cheaper than trying to save Mediterranean cities one by one. But,
as Schelling argued, no one is thinking seriously about these
issues.

I argued that capital depreciates so even many of our
buildings, the longest-lived capital, will need to be replaced
anyway. Here, for example, is a map^[5]
showing the age of every building in New York City. A large
fraction, though by no means all, are less than one hundred years
old. If we let the areas most under threat slowly deteriorate the
cost of moving inland won’t be as high as one might imagine–at
least if the water rises slowly (not guaranteed!). Schelling
agreed that this was the case for private structures but he doubted
that we would be willing to let the White House go.

If we are going to save cities, especially buildings not
yet built, should we not start taxing land today that is under
threat of future flood? Act now to mitigate future moral hazard
problems. John Nye and Robin Hanson raised this issue. See Robin’s
post^[6] for more.

It was an enjoyable seminar. At 94, Schelling remains
sharp, provocative, and in command of the facts.