Climate Change: Get Ready to Adapt!

World Bank President Jim Yong Kim attends a panel session at during the 43rd Annual Meeting of the World Economic Forum, WEF,
World Bank President Jim Yong Kim attends a panel session at during the 43rd Annual Meeting of the World Economic Forum, WEF, in Davos, Switzerland, Saturday, Jan. 26, 2013. T (AP photo/Keystone/Jean-Christophe Bott)

WB President Jim Yong Kim's recent Washington Post op-ed "Make Climate Change a Priority" warned that "global warming imperils all of the development gains we have made." Jim Kim drew on a recent World Bank report that points to the possibility for global temperatures to rise by 4 degrees Celsius or more by the end of the century, with severe natural, economic and social impacts.

Jim Kim's call is all the more urgent given how grim are actual trends on efforts to mitigate greenhouse gas emissions. Growth in world carbon emissions from energy use in the 2000s more than tripled compared to the 1990s, averaging 3 percent a year. After repeated failures in negotiations, the goal of a global agreement on mitigation feels to be even further away today than 20 years ago. With current battles over fiscal policy, U.S. government spending on energy R&D is expected to fall rather than rise in coming years. Many experts have concluded that the aim of keeping global temperature increases down to 2 degrees Celsius or less (roughly equal to an atmospheric concentration of equivalent carbon dioxide of 450 ppm or less) is now simply no longer feasible. A study by the Stanford Energy Modeling Forum found that in most cases its models simply could not solve for a 450 ppm scenario.

So, not only is a 4 degree rise possible, the burning question is just how far we will actually exceed 2 degrees and get close to or exceed 4 degrees.

I draw three conclusions from this scenario. First, as Jim Kim stressed in his op-ed, there is an urgent need for action on mitigation outside the global negotiating framework, especially among the six biggest emitters. Second, let's not fall under the famous definition of insanity attributed to Einstein, of doing the same thing over and over and expecting different results. In other words there is also a need for fresh "blue sky thinking" about why global negotiations are failing and how we might be able to structure approaches that are more "incentive compatible," to use the economics jargon, including how to foster massive R&D into new energy technologies that are both clean and cheap. And lastly, given that substantial temperature increases are already "baked in the pie," we must figure out ways to protect human welfare and development gains, by helping poor people and countries adapt to climate change.

Fortunately, adaptation should be easier to do, because it is usually not subject to the "environmental externality problems" that hamper mitigation -- because it is mostly in people's self-interest to adapt to climate change, regardless of what others are doing. Farmers, for example, will shift to different crops and growing methods that are better suited to new climate conditions. People will continue to shift out of agriculture -- the most vulnerable sector -- into industry and services, and from the countryside to cities, which -- as Matt Kahn argues in his book Climatopolis -- are better able to adapt to extreme shocks of all kinds. International trade itself is an adaptation mechanism, as agriculture possibly shifts to more northern climes, and as developing countries in the tropics gain comparative advantage in manufacturing and services. Perhaps most important, we can also expect ingenious human beings to innovate and find new and better ways to adapt.

So, can we just sit back and complacently twiddle our thumbs? Of course not! The more extreme and catastrophic climate change gets the more there is a possibility that it could overwhelm human capacity to adapt. So mitigation remains an urgent priority. But even outside that extreme scenario, there is an important policy agenda to deal with all sorts of market and policy failures that can hamper people's -- especially the poor's -- ability to adapt, a policy agenda which is usually good for development anyway. Poor farmers, for example, often lack access to the credit that would help them change their crop mix and growing methods. Poor economic policies can subsidize overly capital (and energy!) intensive technologies in industry, reducing unskilled job opportunities in the cities. Trade restrictions can hamper people's ability to access new adaptive technologies from abroad, as well hampering people's ability to adapt to climate change through trade. Investments in adaptation public goods -- for example high quality meteorological forecasting and early warning systems -- will become increasingly valuable.

Adapt and mitigate, mitigate and adapt -- we must walk on both legs to deal with the challenge of climate change.

* This post was co-written with my World Bank colleague Milan Brahmbhatt

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