Among some bloggers (such as Tim Worstall), and now on the BBC, it is becoming fashionable to say that Nicholas Stern's analysis of the economics of climate change overstates the case for intervention to prevent climate change, because it overstates the value we should attach to the income of future generations.
In simple language, the claim is that Stern does not properly take into account the principle that an extra pound of consumption is worth less to you as you get richer. This means that future generations – who are expected by everyone to be much richer than we are – will value an extra pound of consumption less than we we will. If you take account of this, we should attach less weight to the possible costs to future generations when we compare those to the immediate costs of making the adjustment. (For a technical version of this critique, you may want to read this piece by Byatt, Castles, Goklany, Henderson, Lawson, McKitrick, Morris, Peacock, Robinson and Skidelsky.) I am undecided on whether this is an important weakness in Stern's account, and I wish that the report had contained a more systematic analysis of the sensitivity of his conclusions to different assumptions about discount rates (there is some of this in the new Technical Annex to the Postscript).
But even if you do conclude that Stern overstates the case for action now to prevent future costs, there is an important distribution effect that is masked by the aggregate numbers that Tim Worstall and others quote. The likelihood is that the main beneficiaries of the anticipated economic growth will be in rich countries, as they have been through the twentieth century, while the costs of climate change will be borne disproportionately by the poor. If it turns out, as predicted, that agricultural productivity in Niger collapses as temperatures rise in sub-Saharan Africa, leaving 12 million people with nothing to live on, it will be little consolation to them that people in Western Europe and North America are living much better as a result of the economic growth that the high carbon consumption has permitted.
So this is the challenge to those who take the view that the overall numbers do not make the case for action against climate change: are you prepared to support the massive transfers in resources that will be required from those who enjoy the growth to those who suffer its consequences?