So, if I were a real economist, I’d spend a few weeks doing these estimates. Kudos to anyone who wishes to take a crack.

When it comes to so called “natural capital” the same is not true. God put honeybees on this earth. One reason they are on this earth is to pollinate the billions of dollars worth of crops that are grown world-wide and that are vital for our continued existence. But those bees are part of the natural capital stock. And they get paid squat. After all, it is said, that the bees never leave an invoice with the almond growers in California! Nor do countries in South America pay the Amazon rain forest each year for the water that it generates to sustain their agriculture.

Is this right? Do such valuable natural assets not receive payment for their services (and by extension are doomed to exploitation and demise)? Well, not exactly. Imagine a simple world where there are two states. In each state the weather conditions are identical, the climate is suitable for growing the same crops, the soil and landscapes are identical and the workforces are identical. The only thing different is that in one state there are huge swarms of honeybees in existence and in the other state honeybees are afraid to enter because of an abundance of kingbirds that like to eat them. Now, you are a farmer hoping to plant 500 acres of apple trees. In which place would you be likely to purchase your land? In the place where the natural capital stock exists or in the place where it does not? All else equal, you will of course purchase the land in the place with the bees. In equilibrium in this simple world you’d see the price of the bee-infested land be higher than the other property. So while the bees themselves are not sending you a bill, someone is surely sending it to you – and it was whomever was the rightful owner of that land before it was commonly known that the bees were useful.

That the marginal cost of accessing God’s bees is zero is not changed by this account, and thus there may be reasons to suspect that the bees themselves may not be treated well, but it is certainly not the case that when we have market forces operating in a relatively open economy that natural assets are not valued or priced in some way. And as for whether the bees are destined to be doomed (or the gold or tin or clean water, etc.) I’ll leave it to your imagination for now.

Once you put it in those terms, you should be utterly astounded by how small this stock seems to be. For example, the total net worth of households and nonprofits in the US is roughly $60 trillion.

Julian Simon famously called people the ultimate resource. Can we crudely estimate the value of this “natural capital stock” (which happily does not get depleted with additional “use”)? Sure. The US GDP is about $15 trillion right now. Based on the national income and product accounts, it appears that about two-thirds of this value is generated by labor (i.e. labor’s share of income). So, workers generate and receive about $10 trillion per year of income in the United States alone. In other words, American workers produce a flow of income that is 2.5 times the stock of the entire world’s natural ones. If you want to consider people in the US a permanently long-lived amorphous blob of an asset, and assume long term interest rates of around 3%, then the value of this human capital stock is about one-third of a quadrillion dollars. That’s for the US alone.

Is there a deeper lesson in the data? Perhaps not. It illustrates to us the point economists make regularly. A pile of dirt (which is nothing more than tightly packed chemicals) is just a pile of dirt. It takes a human mind to figure out it can turn itself into a soda can, pottery, or even the beginning of a new, truly innovative and green car engine.

SPIEGEL: If you were the president of a global government, and you alone could determine the course of international climate policy, what would you do?

Röttgen: I can only offer the view of the German environment minister — and from my perspective, it is reasonable and necessary to introduce rules of competition that protect the climate. The ultimate objective would then be a per capita budget for greenhouse gas emissions, which would apply to every person on the planet. It’s ultimately also a matter of justice

By the way, am I the only one who cannot stomach the cultural exceptionalism that is wafting through the entire piece?

HT to William Tucker, writing recently in reference to anti-energy crusades. I used to reject this characterization. Not any more.

In the world we typically live in, the kind of precaution we exercise is to not act (at least not consciously and collectively). Indeed, this should be attractive to those folks who understand the complex ordering of modern societies precludes perfect outcomes from being achieved. The precautionary principle is invoked to change the default order for society to being “act, and act collectively.” If you take such propositions seriously, how come they are not applied consistently? Think about global warming. We are being told to reduce carbon emissions by 80% below 1990- levels by 2050 or else … something bad might happen. Fine, let me accept that argument, despite it being a physical impossibility right now. Where are folks out there advocating that we “do something” about other serious threats? Wouldn’t consistency require that we invade Iran right now, or send an atomic bomb over there to flatten every molecule within their borders? Sure, that is costly, but there is a possibility that they will unleash nuclear weapons and bioterrorism on us and Israel. There is no scientific way to prove that they will or they won’t and surely the possibility that they will bomb us is out there, so I say let’s launch our missiles.

If you wish to argue we ought not preemptively nuke the Iranians, why not? Rolling back modern civilization to get an 80% emissions reduction may kill as many people, albeit unidentifiable at the outset, so I am not convinced by the “we are killing people in one case and not the other” arguments. What other threats are out there? I submit that we should eliminate the use of ALL anti-biotics today. Why? Because our overuse of them has encouraged bacteria to evolve to become more powerful and we may end up creating the Superbug of Superbugs – the mother of all infections, that will wipe out far more of the human race than global warming could ever do in the worst scenarios. On what grounds should we not exercise caution in the use of antibiotics yet use caution when it comes to global warming?

Or finally, what if I offer up the suggestion that, “we ought to subsidize the building of millions of churches so that we can all go and pray that global warming will not doom us” as the “do something” response to the global warming crisis. Would you object to such a plea? I’d guess that you’d say yes. On what grounds would you say yes? I submit that you’d say that “praying for less serious consequences will not affect whether we get less serious or more serious consequences.” And I’d ask you, “how do you know?” I suspect you’d have to invoke science. In other words, you’d have to rely on the very axiom you are trying not to rely on in order to justify your preferred conclusion. You can’t do that, at least not if you are interested in being taken seriously. But I don’t suspect many of us really want to be. Well, that’s not quite right. I just think many of us are delusional — including yours truly.