Causes and consequences of the climate science boom.

• Author: Butos, William N.
• Position: Report

The market economy is not the only arena of human interaction to experience booms and busts. Science is another. We argue that government policies and funding as well as the emergence of a scientific "Big Player" that has aggressively championed the hypothesis of anthropogenic global warming (AGW), (1) the United Nations Intergovernmental Panel on Climate Change (IPCC), have together fomented a boom in climate science that began in the early 1990s and has grown markedly over the past decade.

Recent science booms (and ensuing busts) in the United States include the boom in space science and some related disciplines in the aftermath of the Sputnik launch in 1957 and the boom in computer science prompted by the Japanese "Fifth Generation" project in 1984. These phenomena were relatively short-lived, and the busts came when political interest (and funding) waned because the purported crisis was no longer seen as a pressing concern. More comparable to the situation in climate science would be the long-lasting scientific booms in eugenics and nutrition science. (2)

The eugenics boom, although very adequately funded, came to an end with the exposure of the eugenics-inspired atrocities committed by the Nazis, and the nutrition science boom has slowly (and quietly) given way to the gradual accumulation of empirical evidence difficult to fit within the government-favored hypothesis. In both of these cases, the object of scientific study was, like the climate (and the economy), a complex system that was not susceptible to the precision of empirical testing possible on simpler physical systems.

Evidence for an ongoing climate science boom can be seen in figure 1, showing the trend in published climate science papers, (3) and in figure 2, showing the trend in the level of U.S. federal government funding of climate science research and development (R&D), initially via the National Climate Program Office and later via the U.S. Global Change Research Program. Whether this boom is sustainable or not is another matter; we argue here that there are strong indications that it is artificial and unsustainable, but we offer no predictions of the nature or the timing of the bust.

Our exposition of the causes and consequences of the climate science boom proceeds as follows:

(a) We invoke the economic theory of the Big Player and indicate how this theory can be applied not only to market interactions but also to science. We identify two Big Player types in the climate science saga, with separate but intertwined effects: the government funding agencies who dominate the financing of research and the IPCC, whose pronouncements about the state of the science carry enormous clout. We describe how the herding induced by the IPCC in the scientific arena interacts with the government-funding activities in mutually reinforcing ways.

(b) We provide data on the recent levels of funding for both basic climate science research and other government-sponsored activities that presume the accuracy of the IPCC climate projections. Our findings indicate that government-funded climate science and technology have massively increased over the past twenty years.

(c) The IPCC's operations are found to entail "crony science." We highlight the organization's political nature, its unscientific procedures for generating "consensus," and the editing of its summaries by political appointees, and we document the alleged violations of scientific procedure by some of the more ideologically committed scientists.

(d) In assessing the sustainability of the boom, we note the complex and unpredictable nature of the climate and the inconclusive nature of the evidence amassed so far in establishing a case for any of the hypotheses put forward to account for the warming trend observed over the past century.

(e) With policy preceding the science, a host of crony capitalist enterprises has emerged to seize on government support of the AGW hypothesis to obtain loans, tax breaks, and other financial backing from public sources, and we document the overall performance of these entities to date.

Our overall conclusion is that a confluence of scientific uncertainty, political opportunism, and ideological predisposition in an area of scientific study of phenomena of great practical interest has fomented an artificial boom in that scientific discipline. The boom is driven and sustained by the actions of Big Players--the IPCC and various government entities--in funding the boom and singularly in promoting only one among a number of plausible hypotheses describing the relevant phenomena. Given the scientific uncertainties inherent in the system under study (4) and the incentives for continued political involvement (even in the face of widespread failures in government-supported businesses whose activities were premised on the reliability of the AGW hypothesis), it is possible, even likely, that the boom will persist for a considerable time, as did the previous booms in eugenics and nutrition science. The likelihood of a continuation of generous funding to maintain the boom is bolstered, on the one hand, by a widespread faith (among both scientists and the general public) in government's ability to solve problems through legislation and control and, on the other, by the political attractiveness of a putative crisis apparently calling for a large expansion of state power (see White House 2013). (5)

Big Players in Markets and Science

Big Players, as described by Roger Koppl in an economic context, are "privileged actors who disrupt markets" in the sense that although they are not subject to market constraints or to the discipline of market competition, their discretionary actions have widespread impacts on market participants' expectations and actions (2002, 120-23; see also Butos and Koppl 1993; Koppl and Langlois 1994; Koppl and Yeager 1996). Their effects are felt in two ways: in the diversion of entrepreneurial concern away from the assessment of fundamental economic data and toward the attempted prediction of the activities of the Big Player and in the blunting of the weeding-out effects of the normal market mechanisms on participants less adept at appraising economic data, especially in the cases of those data actively favored by the Big Player. In markets, prototypical Big Players are central banks and government agencies empowered with discretionary policymaking. As Koppl argues, markets dominated by Big Players are prone to herding, where market participants, with little reliable information about the Big Players' next move, look to what others are thinking and doing (2002, 129-30; see also Butos and Koppl 1999).

That the Big Player phenomenon has relevance in science as well as in markets can be appreciated if it is understood that although markets and science, as systems of social interaction, differ vastly in the particular transactional forms employed, they are similar in their structural form. (6)

Scientists interact with each other in ways that are every bit as complex and structured as the interactions between market participants. (7) As scientists, they don't produce or buy and sell marketable goods, speculate on future asset prices, or seek financial gain and risk financial loss, but they do participate in interactions that have analogous feedback effects. They publish hypotheses and report experimental findings, use or criticize (and cite) the work of their peers, make choices about areas of research to pursue often based at least in part on anticipated reputational returns, and face the risk of loss of scientific credibility and funding. In both cases, market and science, the repeated interactions between the participants feed back recursively to generate emergent effects: in markets, a spectrum of goods, prices, and brand names that reflect the realities of resource availabilities, production technologies, and consumer tastes; in science, a body of knowledge and attendant scientific reputations that reflect the realities of the world under observation, experimental techniques, and the dictates of good practice. (8)

In markets, money is the essential component in all exchanges, and the manipulation of money by a discretionary central bank (a prototypical Big Player) can have unintended effects, including the promotion of unsustainable booms. (9) In science, the essential ingredient needed by most scientists to continue their participation is funding, and because science itself is not self-funding, this financial support must come from an outside source--an employer (often a university), a private donor, or a government entity. Sources of large amounts of funding directed to a specific area of scientific study can generate, in their (perhaps unintended) ability to affect the direction and content of research, an unsustainable boom of activity in that area. However, generous funding of a scientific discipline does not necessarily give rise to an unsustainable boom, and large increases in scientific activity in a particular area are not necessarily unsustainable. (10) So funding by itself, even if directed to favor one hypothesis over another, is not the problem; the problem arises when the provision of funding allows for or even encourages the continuation of research and publication activities that undermine the operation of the feedback inherent in the standard procedures of science--feedback that performs the scientific analog of profit and loss in assessing the scientific value of publications and in furthering their authors' scientific reputations.

In rare cases, science is also susceptible to another sort of Big Player, one with the ability to portray a favored hypothesis as settled, consensus scientific knowledge even in the absence of a substantial body of confirming evidence. This is difficult or impossible to carry off in the hard sciences. But when the object of study is a complex adaptive system, where the internal feedbacks are poorly...