A Brief Comment on Kerry Emmanuel on the 538 Launch, Roger Pielke, Jr., and Global Warming

I think the only complaint anyone reasonable could have with Kerry Emmanuel’s assessment of Nate Silver’s new 538 is that Emmanuel does not present enough graphs and charts: more data visuals would be very helpful…

Kerry Emmanuel: MIT Climate Scientist Responds on Disaster Costs And Climate Change: “I’m not comfortable with Pielke’s assertion that climate change has played no role in the observed increase in damages from natural hazards…

…I don’t see how the data he cites support such a confident assertion…. It’s not necessarily appropriate to normalize damages by gross domestic product…. Wealthier countries can better afford to build stronger structures and to protect assets…. A grass hut will be completely destroyed by a hurricane, but a modern steel office building will only be partially damaged; damage does not scale linearly with the value of the asset….

A casual inspection of both graphs… presented by Pielke leads me to question the statistical significance of either… 23 years is not a very long time to detect trends in natural hazard damages….

Fabian Barthel and Eric Neumayer… the United States… 36 years of data… detected “statistically significant upward trends in normalized insured losses from all non-geophysical disasters as well as from certain specific disaster types”… convective storms, winter storms, flooding events and high temperature-related losses, and were almost statistically significant for hurricanes at the conventional 95 percent confidence level…. It’s very hard to accept Pielke’s confident assertion that “[n]o matter what President Obama and British Prime Minister David Cameron say, recent costly disasters are not part of a trend driven by climate change.”

There is an even more significant problem with Pielke’s analysis. In a nutshell, he addresses trend detection when what we need is event risk assessment. The two would be equivalent if the actuarial data was the only data available…. But that is far from the case…. Suppose observations showed… that the bear population… had recently doubled. What would we think of someone who, knowing this, would nevertheless take no extra precautions in walking in the woods unless and until he saw a significant upward trend in the rate at which his neighbors were being mauled by bears?… Overall bear statistics should be much more robust than any mauling statistics…. Were it possible to buy insurance against mauling, no reasonable firm supplying such insurance would ignore a doubling of the bear population…. And even our friendly sylvan pedestrian, sticking to mauling statistics, would never wait for 95 percent confidence before adjusting his bear risk assessment. Being conservative in signal detection (insisting on high confidence that the null hypothesis is void) is the opposite of being conservative in risk assessment.

When it comes to certain types of natural hazards, there are more bears in the woods… a clear upward trend in overall North Atlantic hurricane activity by virtually all metrics…. One would be foolish to make plans that have to deal with U.S. hurricane risk without accounting for the evidence that the underlying risk is increasing, whether or not actuarial trends have yet emerged at the 95 percent confidence level. This is particularly so when one accounts for another form of prior information: theory and models. While some disagreement remains about projections of the weakest storms, which seldom do much damage, both theory and models are now in good agreement that the frequency of high category hurricanes should increase, as should hurricane rainfall and the flooding it produces….

I… Robert Mendelsohn and his colleagues… estimate that global hurricane damage will about double [by 2100] owing to demographic trends, and double again because of climate change…. There are robust theory and modeling results that show increased risk of hydrological extremes (floods and droughts) and heat-related problems. Some of these predicted trends are beginning to emerge in actuarial data. Governments, markets and ordinary people are beginning to account for the increased risk. Those who wait for actuarial trends to emerge at the 95 percent confidence level before acting do so at their peril.