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The economic impact of Arctic melt
The world is about to get a lot more real estate and also some new water lanes:
The shipping shortcuts of the Northern Sea Route (over Eurasia) and the Northwest Passage (over North America) would cut existing oceanic transit times by days, saving shipping companies -- not to mention navies and smugglers -- thousands of miles in travel. The Northern Sea Route would reduce the sailing distance between Rotterdam and Yokohama from 11,200 nautical miles -- via the current route, through the Suez Canal -- to only 6,500 nautical miles, a savings of more than 40 percent. Likewise, the Northwest Passage would trim a voyage from Seattle to Rotterdam by 2,000 nautical miles, making it nearly 25 percent shorter than the current route, via the Panama Canal. Taking into account canal fees, fuel costs, and other variables that determine freight rates, these shortcuts could cut the cost of a single voyage by a large container ship by as much as 20 percent -- from approximately $17.5 million to $14 million -- saving the shipping industry billions of dollars a year. The savings would be even greater for the megaships that are unable to fit through the Panama and Suez Canals and so currently sail around the Cape of Good Hope and Cape Horn.
Here is the full article, which is interesting throughout; if you read only five magazine-like articles this year, this should be one of them. How about this bit?
Between 1958 and 1992, Russia dumped 18 nuclear reactors into the Arctic Ocean, several of them still fully loaded with nuclear fuel.
I might add that, historically, struggles over new territory tend to bring conflict. The creation of new Arctic "territory" is one of the most important issues in the world right now.
Posted by Tyler Cowen on March 7, 2008 at 08:01 AM in Current Affairs | Permalink
Comments
Reportedly the Russians have been planting flags on the floor of parts of the Arctic Ocean and claiming it as their territory.
Posted by: spencer at Mar 7, 2008 10:04:48 AM
Is there a way to short these guys?
We're currently a nudge above average in global sea ice. See here.
Posted by: Jody at Mar 7, 2008 10:12:44 AM
It's only march, how do you know one of the top 5 articles of the year?
Posted by: stuart at Mar 7, 2008 10:16:42 AM
But will Rotterdam still be there when the ships arrive? Or will they need to go an extra distance to drop off their cargo at Eindhoven or maybe Dusseldorf?
Posted by: M. Hodak at Mar 7, 2008 10:39:43 AM
The savings would be even greater for the megaships that are unable to fit through the Panama and Suez Canals and so currently sail around the Cape of Good Hope and Cape Horn.
No ships are too large to fit through the Suez Canal. Some of the very largest supertankers can't quite make it when fully loaded, but they work around that issue by offloading some of their oil into a pipeline when they enter the canal and picking up an equivalent amount from the pipeline at the other end.
Posted by: Peter at Mar 7, 2008 11:20:17 AM
It is disappointing, though not surprising, that the Bush administration has dropped the ball entirely on this issue.
Posted by: mpowell at Mar 7, 2008 11:52:52 AM
"The creation of new Arctic "territory" is one of the most important issues in the world right now." I disagree.
The most important issue will be how the melting of ice will increase sea level and wipe out parts of Africa, Asia and Latin America. If you saw what happened in Gaza a few weeks ago--people breaking down the border and move into Egypt, multiply that by several fold.
This will not be considered important issue because it does not affect "us," only the remote "them."
Posted by: Asif Dowla at Mar 7, 2008 11:54:48 AM
"The creation of new Arctic "territory" is one of the most important issues in the world right now." I disagree.
The most important issue will be how the melting of ice will increase sea level and wipe out parts of Africa, Asia and Latin America. If you saw what happened in Gaza a few weeks ago--people breaking down the border and move into Egypt, multiply that by several fold.
This will not be considered important issue because it does not affect "us," only the remote "them."
Posted by: Asif Dowla at Mar 7, 2008 11:55:28 AM
So what do we louse as the water goes up. This is only the upside. There is a clear down side as pointed out above. What if Rotterdam, is no longer functional? (water goes up, dikes fail) Seems like what the BlackSwan's that might come up should be looked VERY hard here.
just my $.02.
Posted by: Eric at Mar 7, 2008 12:09:49 PM
Tyler,
All your AGW links of late remind me of the slew of "NASDAQ 20,000" articles and books in the summer of 2000.
Given that the globe hasn't detectably warmed in the last decade, and that there are now lots of indications that we are entering a cooling phase, perhaps it is time for a smidgeon of AGW skepticism. . .
Posted by: Matthew at Mar 7, 2008 1:31:18 PM
You assume global warming will continue. The most accurate measure of global warming are satellite measurements, which indicate global temperatures have been constant for the last ten years or so, and may now be falling. Present ice levels are pretty much what they typically have been throughout the twentieth century.
The urban heat island effect is several degrees centigrade, which makes it impossible to get an accurate measure of global temperature from weather stations unless one carefully selects stations, and there are not enough known good stations. Sea surface measurements and satellite measurements provide a more accurate measure.
If you look at the graph of ice coverage one way, there is a trend to lesser ice levels. Look at it another way, no obvious trend. We had one summer of much reduced ice levels - an unusual, but far from unprecedented summer. And now, back to normal levels of ice.
Posted by: James A. Donald at Mar 7, 2008 2:21:32 PM
"No ships are too large to fit through the Suez Canal. Some of the very largest supertankers can't quite make it when fully loaded, but they work around that issue by offloading some of their oil into a pipeline when they enter the canal and picking up an equivalent amount from the pipeline at the other end."
Actually my good friend in the Navy will be taking the long route to Japan this year as his boat won't be able to go through the canal. What is with all the AGW skepticism here? They haven't burnt all you guys at the stake yet for heresy?
Posted by: Jayson Virissimo at Mar 7, 2008 3:00:54 PM
What is with all the AGW skepticism here? They haven't burnt all you guys at the stake yet for heresy?
Their application for carbon credits was lost in the UN bureaucracy. It's burn skeptics at the stake or heat their homes this winter, but I'm sure they'll try again next year.
Posted by: 8 at Mar 7, 2008 3:12:07 PM
We do should prepare for Black Swans.
Posted by: aaron at Mar 7, 2008 3:54:10 PM
[oops. I'd apologize for the typo, but if I got in that habit I'd never get anything done.]
Anyway, you don't look at possible Black Swans. By definition, you can't. They are completely unexpected.
They also don't tend to follow the narratives we like to assign to them ;)
Posted by: aaron at Mar 7, 2008 3:59:01 PM
I do like this blog much. But the absolute certainty of:
The world is about to get a lot more real estate and also some new water lanes
does not behoove TC. As others have eloquently noted, the tiniest smidgen of healthy skepticism with regards to AGW is what is certainly warranted.
Posted by: Varangy at Mar 7, 2008 4:04:55 PM
My understanding is that TC does not put much stock into NNT's ideas.
Posted by: Varangy at Mar 7, 2008 4:09:25 PM
Some people seem to have their arctics and antarctics confused. The vast majority of arctic ice is sea ice. Floating on water.
Posted by: aaron at Mar 7, 2008 4:33:46 PM
mpowell: I think we can safely trust the Canadians with a shipping lane. It is a rather more predictable country than, say, Egypt.
Which is an interesting thought: If the worlds shipping lanes pass through, and oil comes from, Canada rather than the Middle East, will we finally be able to forget about the latter location?
Posted by: ad at Mar 7, 2008 5:26:54 PM
Skeptics, in the face of any evidence a person can always say 'you could still be wrong.' That is true. The question is how much we should bet on overwhelming scientific opinion being wrong, and whether we hedge at all.
Rather than having "the tiniest smidgen of healthy skepticism" you are in fact asking for it all. You are asking us to bet our future on not science, but on (often untutored) dissent.
Shouldn't we be able to ask you to go get your PHDs, and make your case with real science, for something that big?
Why is this always grumbling from the back-rows?
Posted by: odograph at Mar 7, 2008 5:35:01 PM
I suspect that the fee to cross the NW Passage (payable to Canada) will exceed the fee to cross the Panama Canal in 2030.
Posted by: Paul N at Mar 7, 2008 6:13:05 PM
Odograph,
I will bet you $100 that the average global temperature as measured by satellite will be lower for 2015-2017 than for 2005-2007. In addition, the loser has to create a video where he will smash a raw egg on the side of his cheek and post it to youtube, admitting that he has "egg on his face".
Are you up for the bet?
Posted by: Matthew at Mar 7, 2008 7:06:16 PM
Asif Dowla: "The creation of new Arctic "territory" is one of the most important issues in the world right now." means global warming will spread water over lowlands.
Also, I did some research the other week about global warming... There is a global warming TREND for the past 200 years, ever since the "little ice age" started to end. The issue is the warming correlates with increased carbon dioxide found in ice, NOT emissions!
As is my understanding, it was not until 2000 when carbon dioxide emissions exceeded levels from 200 years ago when the US slowed its burning of almost all the forest for energy.
Anyone who has taken intro to stats knows that correlation does not equal causation! Major volcanic eruptions would cause global cooling AND increases carbon dioxide in the atmosphere(of which there has not been in 200 years). Wouldn't these periods in the ice measurements show high enough P values to make it immoral to accept the correlation hypothesis? These are written off as outliers, as is this past year where we saw a .5 degree Celsius DECREASE in average global temperatures(as large as the increase in temperature over the past 150 years).
This decrease was POSSIBLY due to the failure of the last sunspot cycle to reach a peak (correlating with hotter weather). We may be going into another "little ice age", and the global warming we experienced for the past 200 years may have saved more lives than it potentially destroyed!! Only the next 2 decades will tell. Either way, the solution is simple: we need to invest more in Pro-life research.
Also, don't worry about the arctic, the US will definitely control that territory as it does the others.
Posted by: Brainwarped at Mar 7, 2008 7:06:36 PM
odograph: I have a PhD. Not in climate science, but in engineering. Do I still get to comment?
(Though my skepticism was merely pointing out that it's way too early to be making plans on the assumption of sea ice melt as we actually have slightly more sea ice than normal.)
Posted by: Jody at Mar 7, 2008 8:10:35 PM
Mathew, do you notice that people bet all the time on Wall Street? Some of them win, but it's harder to tell when they are right for the right reasons. Certainly though, the ability to find a market for a bet does not prove truth.
Jody, you might have quite interesting opinions, but you know, we in engineering rely not just on skill but domain knowledge. If you prefer your answers (for bridge building or climate change) from those without the domain knowledge (or those that dabble) I'd worry.
Some of this gets back to a sort of "successful man's disease." Some of those who have skills or have succeeded, still retain the ability to judge themselves honestly in a new domain. Others are a little ... presumptuous.
I saw that when we all cashed our dot-com options, and some of the best engineers blew their money on bad investments the fastest.
Heh, so having seen engineers as investors should I be ready to see them (or other engineers) suddenly set themselves as climate scientists?
Posted by: odograph at Mar 7, 2008 8:30:15 PM
odograph: Look, I'm just trying to satisfy the conditions you're setting out.
If I might step back for a moment and ignore opinions, can we at least agree that data is data?
And that the most relevant data point to if the Arctic is going to melt enough to open up the NW passage for normal shipping would be the extent of sea ice?
So I ask you, as you're at least positioning yourself as having superior domain knowledge (which is how I read this exchange), if there's more (though only slightly more) sea ice than normal, would that be consistent or inconsistent with a hypothesis of a massive sea ice melt-off?
Personally, I view it as inconsistent. But my PhD is in the wrong field so I might not be giving the data the proper context. So is there a context where more sea ice is consistent with much less sea ice?
Posted by: Jody at Mar 7, 2008 9:41:14 PM
odograph, if you'd take a step back, you'd see that's one of the points that Jody (and Matthew?) are making. People are being presumptuous (to the point of absurdity).
Fooled by Randomness is a very simple book. It gets very repetitive after about 50 pages. Black Swan is a much better read. Point is similar. I recommend reading one of them again with a more relaxed and open mind.
Posted by: aaron at Mar 7, 2008 9:51:03 PM
Odograph- you must decide whether you follow the crowd or look at the evidence. The AGW conjecture is not based upon facts, its based upon simulations. The facts are very inclusive, the models are conclusive. The question is then about models and the assumptions that ultimately animate them. As a PhD who has modeled numerous phenomena I have a problem with the models. I will not go into the details given that you are not qualified to comprehend what I am saying ;)
Posted by: bee at Mar 7, 2008 10:23:01 PM
1. Burn oil
2. Melt ice
3. Save oil by going over America
4. ...
5. Profit!
Posted by: Sune at Mar 8, 2008 5:51:01 AM
LOL Jody, you do not "satisfy my criteria" by arguing AGW in the back-comments of a blog thread.
I asked you why you couldn't make the case, toe to toe, with the scientists?
Why can't ANYONE publish and win with your arguments?
Why do skeptics live for the blogs these days?
Posted by: odograph at Mar 8, 2008 8:29:37 AM
I thought the biggest issue with the melting of the north pole is the new oil and gas resources it releases for the surronding countries (Denmark/Greenland, Canada, the U.S., Norway and Russia) not so much the shortening of shipping lanes.
Posted by: JSK at Mar 8, 2008 8:30:37 AM
Reading back, maybe I was not clear. I should have explained when I said 'real science' in my first post that I meant in that venue.
Can you win in that venue, or do you choose the blog-comments venue intentionally?
The alternative would be, say, to get the American National Academy of Sciences to overturn their GW positions
Posted by: odograph at Mar 8, 2008 8:49:48 AM
Odograph,
Perhaps because of my training as a scientist, I am much less impressed with the "scientific consensus" than you are. Childbirth fever, the existence of meteorites and ball lightning, plate tectonics, and helicobacter pylori are all great examples of an utterly flawed "consensus view".
On the other hand, I'd be happy to make the $100 "egg on your face" bet anytime. So at least my beliefs have consequences -- apparently your faith in the popular AGW theory doesn't extend far enough to take some money from me and make an AGW skeptic look bad. Or maybe you just don't believe it as much as you think you do. Perhaps there is a niggling bit of doubt gnawing at the back of your mind -- why have the satellite temps stopped rising over the last decade, why have they begun to fall, why did CO2 emissions never match up with temperature trends over the 20th century, why is the best evidence for AGW and the "hockey stick" from hokey paleoclimate tree ring data and urban ground temperature stations in heat pollution hotspots?
Posted by: Matthew at Mar 8, 2008 10:18:32 AM
It is a very silly bet Mathew, and the reasons it is silly undermine my confidence in your arguments:
1) making the bet proves neither of us correct
2) if I "win", $100 hardly offsets my losses (and those of my friends, family, future generatinos) as a result of GW
Shouldn't you really be offering me to indemnify me (and all comers) against climate related losses?
Posted by: odograph at Mar 8, 2008 10:32:56 AM
Ooo!
What do experts in that area of expertise say?
One of the world's largest insurers warned today [November 2005] of the economic costs of global warming."Climate change will significantly affect the health of humans and ecosystems and these impacts will have economic consequences," concludes a new study cosponsored by Swiss Re, a global re-insurance company.
Sorry about the missing t in your name Matthew, as you can see I'm a somewhat haphazard typist.
Posted by: odograph at Mar 8, 2008 10:46:10 AM
odograph,
A study sponsored by insurers arguing that higher premiums are necessary is about as objective as the Egg Institute sponsoring a study that says that eggs aren't bad for you.
Posted by: happyjuggler0 at Mar 8, 2008 11:29:54 AM
did you know that by drinking two glasses of milk per day, you will lose weight? It was a diet advertisement for milk, sponsored by farmers. Last time I checked, adding 300 calories to your diet everyday will make you gain weight. I can't weight until Milkyways advertise the same thing!
Posted by: Brainwarped at Mar 8, 2008 11:40:42 AM
Heh, the funny thing Happy, is that the list of People Who Cannot Be Believed is ever expanding with the Denialists.
Insurers are kind of small fish in that though. We have to start with people like Ralph Cicerone, president of the National Academy of Science and disbelieve him first.
From my standpoint it's much easier, ;-), I don't have to invent a conspiracy theory for all these mainstream groups.
I can just listen to them.
Posted by: odograph at Mar 8, 2008 11:43:48 AM
Geez Brain, can you follow your argument to its logical conclusion? It makes no difference if some corps promote lies. To square the argument that "a corp said it so it must be false" you have to prove that everything a corp ever says is always false.
(I have no idea how milk-drinking affects your hunger for other, more calorie rich, foods.)
Posted by: odograph at Mar 8, 2008 11:47:39 AM
odograph, thank for consistently repeating your same non-arguement. Please tell us why we should have to disprove the beliefs of a politcal head of the national acadamy, not supported by the facts?
Posted by: aaron at Mar 8, 2008 1:37:36 PM
And how does what he says support your contention?
Posted by: aaron at Mar 8, 2008 1:44:20 PM
You don't need a conspiracy to want push fear and raise rates, you just need a good oportunity and the mind of a salesman. Who I know in re-insurance said they were thrilled with Katrina, it was a great excuse to pursue government money and raise rates without taking on any new risk.
Posted by: aaron at Mar 8, 2008 1:59:36 PM
It isn't just the National Academies in the US, right? You have to also disbelieve the British Royal Society? And on, and on?
(I think some of the "misleading arguments" in their list have made this page.)
Posted by: odograph at Mar 8, 2008 2:18:23 PM
Odograph,
Given that these worthies were utterly and completely wrong about plate tectonics, the existence of meteorites and ball lightning, the iatrogenic cause of childbed fever, and the genesis of ulcers from an infectious agent, among many others, why should I fall into lockstep about a consensus on a highly politicized hypothesis such as AGW instead of reading the evidence and making up my own mind?ha
BTW we were talking about "climate change" in my earth science classes for many years before the popularity of the AGW theory. What it meant then, was the extraordinary amount of change in the earth's climate over the earth's lifetime recorded in the geologic record --none of it caused by human beings. . . The mind-bending parochiality and hubris of the Johnny-come-lately "climate change" crowd is a sight to behold.
In any event, I would love to hear from you why satellite records show no change in average global temperature over the past decade (the period with the largest increase in CO2 fraction, in human history), and indeed are now showing indications of a new cooling phase. Isn't part of science paying attention to what the thermometers are actually saying?
Posted by: Matthew at Mar 8, 2008 3:05:31 PM
Why do you continue to contend that you have to disbelieve them to disagree with them?
Posted by: aaron at Mar 8, 2008 3:10:30 PM
Yike, the Royal Society piece is make a good case for not believing them though. It makes for a pretty damning indictment of their credibility. It's pretty shameful.
Posted by: aaron at Mar 8, 2008 3:13:54 PM
Coming back to this country, we've got the American Physical Society.
You have, no doubt, a reason for putting them on the "don't believe" list as well?
Posted by: odograph at Mar 8, 2008 3:43:41 PM
Much better. Compare that with the Royal Society piece and see why the RC got a belly laugh out of me.
Posted by: aaron at Mar 8, 2008 4:35:25 PM
RS, sorry. Losing control of my fingers.
Posted by: aaron at Mar 8, 2008 4:37:23 PM
odograph: I see where you find little value to blog arguments. Odd. Nonetheless, I shall respect your wishes.
Posted by: jody at Mar 8, 2008 5:14:12 PM
Odograph-
Science is not based upon consensus, it is built upon a collection of facts that form a pattern which are then mapped to a theoretical domain (Universities do employ social conventions to create and enforce consensus for different reasons than the advancement of knowledge). We typically also require a theory to be the only parsimonious explanation of the phenomena (it is replaced when another theory can more parsimoniously explain the pattern). This requirement assures us that we have not specified a problem to narrowly that it affords itself to many possible explanations.
What does this have to do with AGW and your misguided grasping at authority figures? First, you will note that in the process there is no step that seeks validation by the experts. Second it offers us a possible explanation as to why a consensus is unlikely to arise in the practice of science. Specifically, a theory may not fully capture the phenomena being investigated. Either by way of unexplained behaviors in the system or more than possible explanation. Third, AGW must prove superior to the alternative explanation, natural variation of the earth's temperature.
Your continued assertion suggests that you do not understand science and prefer dogma blessed by the authorities (Some Papists would be proud of you.). Please feel free to believe this if it makes you feel secure, but please refrain from asserting that you practicing anything called scientific thought when you disparage Jody, Matthew, et al for their practice of reasoning.
Posted by: bee at Mar 9, 2008 6:38:04 PM
Is this how you do science, bee? With blog comments?
At what point to do you publish? Get your peer review? Present at conferences?
Or are publication, review, and conferences themselves "Papist?"
(It is no doubt safer to stick to the blogs.)
Posted by: odograph at Mar 9, 2008 8:11:56 PM
Odograph-
No, but I assume you made that inference because it is how you prefer to practice your science :)
Posted by: bee at Mar 9, 2008 9:17:06 PM
An interesting paper recently published in a peer reviewed journal suggests cooling for the Artic over the past 1500 years. I understand that peer reviewed is not a guarantee, but it is a better quality gauge than a committee consensus.
Grudd, H. 2008. Torneträsk tree-ring width and density AD 500–2004: a test of climatic sensitivity and a new 1500-year reconstruction of north Fennoscandian summers. Climate Dynamics, DOI 10.1007/s00382-007-0358-2.
http://www.springerlink.com/content/8j71453650116753/fulltext.pdf
Odograph the peer review process works very well when academics do not stray from the narrow definitions of a discipline or speculate beyond the bounds of their actual research results. BTW I have been quite pleased with the process to date :)
Posted by: bee at Mar 9, 2008 9:51:32 PM
Is that your paper? That would be pretty wild.
If not though, I've sort of noticed that papers average out over time. That is the process of consensus, that changing indicators (a swinging compass?) settle on a final course over time.
===
Maybe I shouldn't be mean, but really you guys give me such an asymmetric argument. I can say that I don't really know the science, but that I can defer to the National Academies, NASA, the Royal Society, the American Physical Society, etc. ... heck the Supreme Court.
I can be humble.
On the other hand, you poor guys have to say "no, don't belive them, believe us!"
Well, who the heck are you, and what makes you the biggest guns in climate science?
Posted by: odograph at Mar 9, 2008 10:04:52 PM
Greenland is experiencing a farming boom, as once-barren soil now yields broccoli, hay, and potatoes. Less ice also means increased access to Arctic fish, timber, and minerals, such as lead, magnesium, nickel, and zinc -- not to mention immense freshwater reserves, which could become increasingly valuable in a warming world. If the Arctic is the barometer by which to measure the earth's health, these symptoms point to a very sick planet indeed.
Quite the non-sequitur. Until I got to the last line, I thought "Wow, that's great news for Greenland!"
Putting aside the AGW debate, isn't it sick to take to the position that more farmland and more resources are a BAD thing?
Posted by: Nanani at Mar 9, 2008 10:34:20 PM
I think its crazy how theres a dispute over who owns the NorthWest passage. How can the U.S dispute that Canada owns its own land. There is a portion of the artic that has been considered part of Canada since the creation of the nation and now all of a sudden there is economic potential in the area and the U.S doesn't recognize this. It's Canada we should reap the benifts of our resources just like you should gain the benifts of yours.
Posted by: Canadian at Oct 9, 2008 10:45:10 PM
