# Presentation: 462285

## “Plausible Fallacies”

- Paul P Craig
- Chairman, Sierra Club National Committee on Global Warming and Energy
- Professor Emeritus of Engineering
- University of California, Davis
- ppcraig@ucdavis.edu

## Coal crisis – 1865William Stanley Jevons

- 	“The thoughtless and selfish, indeed, who fear any interference with the enjoyment of the present, will be apt to stigmatize all reasoning about the future as absurd and chimerical...  It is true that at best we see dimly into the future, but those who acknowledge their duty to posterity will feel impelled to use their foresight upon what facts and guiding principles we do possess.  ...[***W]e ought not at least to delay in dispersing a set of plausible fallacies about the economy of fuel, and the discovery of substitutes for coal, which at present obscure the critical nature of the question, and are eagerly passed about among those who like to believe that we have an indefinite period of prosperity before us.***
- 	Jevons, W.S., *The Coal Crisis: An Inquiry Concerning the Progress of the Nation, and the Probable Exhaustion of Our Coal-mines.* reprint1965 ed. 1865, New York: Augustus M Kelley.[p4]

**Notes:**
Jevons was one of the premier economists of his time – so important that his book “the coal crisis” was reprinted on its centennial

## Global Climate Change research comprisesScienceandSocial ScienceThey’re different

**My comments are based on ideas in:**
**“****What Can History Teach Us? A Retrospective Examination of Long-term Energy Forecasts for the U.S.” ****	**
**	****	****Paul P. Craig, Ashok Gadgil, and Jonathan G. Koomey. Annual Review of Energy and **
**	****	****Environment, **_**27**_** (83-118) 2002**

## Long-range energy forecasts aren’t like forecasts based on science

- 	Long-range forecasting models necessarily make assumptions about human behavior (including social, institutional and personal) and human innovation
- 	Long-range forecasting models do not meet these criteria
- 	They’re useful anyway – provided one doesn’t lose track of their limitations

## Usefulness and Accuracy are different concepts. Long range forecasts are not “validatable”

- 1975

- 2000

**US Energy forecasts for 2000****(circa 1975)**

**Notes:**
Accuracy means little – by the time the forecast horizon comes around the forecasters are in other jobs, retired, or dead. The Forecasts after the oil embargos were mostly wrong and mostly way too high, but they were very useful.  Among much else, they explored the possible.

## Long-range Energy Forecasts are Not Validatable 

- “Validate” as used here is a technical term
- “Not validatable” means, in essence, that the standard principles for testing used in science don’t apply.
- The term – in the sense used here – was introduced by Hodges and Dewar at RAND. [their context was military planning]
-  “*Is It You Or Your Model Talking?  A Framework For Model Validation”. *Hodges J, Dewar J.  *Rep. ISBN 0-8330-1223-1*, RAND Corporation, Santa Monica, CA 1992.

**Notes:**
Not validatable means, in essence, that there is no way to apply standard principles of science; The models can’t be tested

## Situations described by “Validatable” Models

- 1)	must be observable,
- 2)	must exhibit constancy of structure in 	time,
- 3)	must exhibit constancy across 	variations in conditions not specified in 	the model,
- 4)	 must permit collection of ample and 	accurate data.

## Non-validatable forecasts can be useful

- To understand the Bounds or Limits on the Range of Possible Outcomes
- As training Aids
- As bookkeeping devices. To condense masses of data and to provide incentives for improving data quality
- As automatic Management Systems Whose Efficacy Does Not Require the Model to be a True Representation
- 				[continued]

**Notes:**
There isn’t time to explore these ideas.  A few comments.
Energy efficiency analysis has shown the potential for cost-effective energy efficiency.  Engineers tend to believe that there are lots of free lunches out there.  Economists tend to argue that there aren’t.  Models have played a key role in sharpening these differences in world view to a knife-edge.  I wish I had time to address this issue today.

## Seven ways in which non-validatable forecasts can be useful (continued)

- As aids in selling ideas or to achieve political ends.
- As aids in Communication and Education
- As aids to Thinking and Hypothesizing

**Notes:**
 Many models are designed as selling devices.  Amory Lovin’s “soft paths” is a famous historical example.  So was Richard Nixon’s “Project Independence Blueprint” of the early 1970s, which made the absurd claim that the US could be energy independent by 1980. 

## Nixon-Project Independence Blueprint (1973)

- Energy Independence by 1980
- 			[didn’t happen!!!]

- 1980

- 1973

**Notes:**
A forecast used to sell an idea. The intellectual content behind this figure is negligible – it was a sketch.

## Being “right” is not the same as being correct

- Hans Landsberg’s RFF (Resources For the Future) example of being fortuitously correct (1960 forecast, reviewed by Landsberg in 1980)

**Notes:**
The “Resources in America’s Future” team working in 1960 didn’t anticipate the OAPEC oil embargos. They were right by accident in 1980.  Further extrapolation shows they were way, way wrong in 2000. This figure is from a 1980 retrospective paper by the key author, Hans Landsberg

## Forecasting requires extrapolation

- History shows that accepted assumptions sometimes failed badly

**Notes:**
. Be careful of assumptions.  Analysts  in the 1960s and early 70s believed in a lock-step correlation of energy and GNP.   The embargos made them start to think hard about energy.  The lock step was massively broken. [Figure from Chauncey Starr]  ALL forecasting requires assumptions that structures will persist, or tensions will emerge that will break historic relationships

## Lessons“deer in the headlights”

- Keep reminding yourself that the uncertainties are huge
- There are few fundamental principles of human behavior
- Avoid hubris
- Assess both upside and downside risk [in the global warming arena it’s now clear (to the Sierra Club, at least) that the risks dominate, and the risk of the “business as usual” approach is enormous.
- Research supported by the US Climate Change Program is critically important in significant part because it may show the consequences of inaction.
- Sometimes success occurs because the forecast leads to behavioral change. “failure” is “success”

**Notes:**
A forecast can convince you that if you don’t change your ways, disaster will strike. A deer in your headlights leads to a forecast that you should hit the brakes  

## A comment from 1905

- 	“Modern life concentrates its attention with ever increasing earnestness upon care for the future. ..In strong contrast to this dominance of forethought  stands that apathy concerning the morrow, into which  a few of our unfortunates slip, but which is essentially characteristic of the savage”.
- 	Jevons, H.S., *Essays on Economics*. 1905, NY: McMillan. pp280. [p66]

**Notes:**
I quoted Jevons at the outset. He was one of the most famous economists of his time. “apathy concerning the morrow” seems to be the mood of the day.

**Notes:**
No Comment necessary!!!  I 

**“****When we try to pick out anything by itself, we find it hitched to everything else in the universe”**

**Paul Craig **
- Chairman, Sierra Club National Global Warming and Energy Committee
- Professor Emeritus, UC Davis
- _[ppcraig@ucdavis.edu](mailto:ppcraig@ucdavis.edu)_
- www.sierraclub.org/globalwarming