Friday 24 Sep 2021 | 23:13 | SYDNEY
Friday 24 Sep 2021 | 23:13 | SYDNEY

Reader riposte: Climate 'insurance'


Sam Roggeveen


23 December 2009 10:08

Dominic Meagher writes:

I think you miss the point of the precautionary principle in relation to climate change. The idea isn't that people should take out insurance against a risk they consider insignificant - personally, I wouldn't want to take out an expensive insurance plan against something I was almost sure wouldn't happen. This seems to be what you think is unpersuasive, and rightly so.

But more persuasive is, given so many reputable scientists say the risk is real, skeptics should doubt their own judgment of the risk. If I think something is perfectly safe, but everyone else tells me its incredibly risky, I would be prudent to consider the possibility that I'm wrong.

I haven't listened to Turnbull much on this, but I suspect he is suggesting that even if you think climate change is a giant misguided effort and a potential waste of money, you should still take out insurance against the possibility that you're wrong. This is distinct from suggesting that negative ramifications of climate change are low probability, but we need to take insurance against low probability events.

Dominic adds an important layer to Turnbull's argument, but I don't think it changes my basic point about the precautionary principle. It seems to me Dominic's argument can be boiled down to the proposition that 'it is always prudent to take out more insurance'. But that's clearly not true — beyond a certain point it becomes highly risky and foolish.

Take Australia's defence policy, which (and this is crudely put, but stay with me) is premised more or less on the same logic as Dominic's wager: we don't really think anyone is going to invade us, but what if we're wrong? Better to take out some insurance, in the form of a Defence Force that costs us about 2.4% of our GDP.

But as everyone knows, only the US has the capability to invade and occupy Australia, and our Defence Force would be powerless against them. Sure, we're in no danger of being invaded by the US, but that's a prudential judgment we've made. In other words, prudence in this case demands we take out no insurance against US invasion.

The sceptics think climate change is about as likely as the prospect of the US Marines landing on Bondi Beach. There's no way you can persuade them to take out insurance until you persuade them they are wrong on the science.