This content is password protected. To view it please enter your password below:

How does upward redistribution work ?

The average consumer is under pressure to buy more goods than he can afford or needs. There is publicity, social and cultural factors that lead to an average spending of 140 % of the yearly income by each US citizen. This overspending explains the growing private debt ( sub prime, credit cards, individual credits) and it shows where the money flow is going. It went into volatile speculation and was partly destroyed, but it also found it’s way to the fortunate strata of the society. Through outsourcing to China manufacturing cost and jobs in the USA were reduced, China is also the major creditor (24 %), together with Japan (20%). Cheap liquidity was provided until interest rates started climbing due to mutual distrust among money lenders, and this led to the collapse of the system. This proves that this model is in contradiction with basic financial laws and is not sustainable.

After the crisis the administration is still following the advice of big finance, it is not acting in the higher interest of the US population. It avoids profound reforms and provides massive fresh liquidity again, to promote consumption rapidly. In the short term this is adequate and for the functioning of the economy, this is vital. In the longterm this will impose an intolerable burden on the US taxpayer and on the world economy. The consequence is either deflation ( no recovery), inflation ( in case of a recovery), if not stagflation.

What has to change

The change must happen at the level of the single citizen first. His spending pattern has to change. This is the inevitable prerogative. No more private debts should be produced, this means longterm austerity, leading to an expense of less than 100 % of the income. Of course, such an advice does not sound attractive. But is is practiced in other parts of the world with good result. People should spend only the money they actually possess and stop living on credits. All else is a recipe for disaster.

The second process is political. The US political system is taylor-made for the rich classes only, but this fact is a taboo wrapped up in images of the american way of life. The role of middle and lower classes is merely to finance the upper 10%, in political terms they are powerless. If 90 % ( 270 millions) of Americans are happy playing this role of living with unbearable debts for coming generations and with a continuous financial downward shift, then this may be fine.

Otherwise, the majority in the US population could seek a political change where the average income increases, job security is better, taxes get the money where it is and redistribute it towards those that really need it. Namely the middle and lower classes. They need effective instruments and measures against unemployment, a health care system for all, insurances for the disabled and provisions for retired people. And incentives to invest real money, (not debts) into longterm saving like the house, secure pension funds etc. I am talking about social security and a welfare-state that deserves this name.

The usual objection is : who will pay for this ? The typical question that only a millionaire can ask and answer. Does anyone object to billions being spent for a completely failed economic policy ?

Questions and Outlook

Does the wealth of the industrialized countries depend on the very poverty in developing economies ? Are they poor because we are rich ? Is the global toll of poverty ( malnutrition, diseases, war etc) indispensable for the good functioning of the global economy and particularly the US corporate and finance industry ? Would a less unjust, inhumane and arrogant world trade order destroy this world economy, does the affluence of a few depend vitally from 1 billion people living in apocalyptic misery ? The same question is valid for the US as a nation, where the mechanism is the same, but on a much higher material level.

Presuming that in the US the Gini coefficient became similar to the one in Japan, where there is much less economic inequality, how would this affect the economy ?

I start with a guess, that the GNP would remain the same, for simplicity. Now, if the middle class had a higher income and the upper class were „poorer“, I can conclude for sure that overall consumption would increase, benefiting the overall economy. This is because 10 persons earning 100 000 $ a year will consume more goods and services collectively than one person earning 1 million a year. Just consider food, housing, cars, clothes for 10 versus 1 households. The same holds true for any country.

From this fact I conclude, that without structural changes the present system in the US must and will increase the pressure on the classes indulging in mass consumption. This is the only way for your money to flow upward. The trend is inevitable : the poorer the people, the harder it is to make them spend. Because the middle class is getting poorer, the present system will simply offer new credits and push harder for consumption. This is the mentality of the governing class, they cannot exist without ever increasing gains and wealth, call it an ideological or mental problem. Because the US political and economical establishments are intimately linked, there is no democratic control over this mechanism. The natural limit of this development is a tiny rich society and an overwhelming poor mass, without any middle class, I expect this to happen in 50 years or so. By this time, low class Americans will know what is means to live in a third world country, back home…

Exactly for this reason, the US people will someday realize the striking parallel : the US and the world economy are both undergoing a process of wealth distribution that is sustainable neither economically nor ecologically. In the developing countries, the shocking consequences are apparent today. Famines are pushing people to hunger revolts. Rural populations are accumulating around cities, because traditional farming is not more possible. Epidemics, political instability, wars and mass emigrations into industrialized countries are the inevitable consequence. They can leave their ghetto for a richer country today, but can we leave our planet if we destroy it ?

Our iniquitous economic system is ransacking not only the American middle class, but poor populations worldwide.

The world economy should not be a poverty producing machine, it should allow people to live in dignity, just as the World Bank and International Monetary Fund are preaching on their websites as their mission.

A common effort is needed to force the WB, IMF ( and a few others) to do what they are supposed to do, and not exactly the contrary.

Useful links in the order used in the text :

en.wikipedia.org/wiki/File:Gini_Coefficient_World_Human_Development_Report_2007-2008.png

http://www.sustainablemiddleclass.com/Gini-Coefficient.html

http://en.wikipedia.org/wiki/List_of_countries_by_public_debt

http://en.wikipedia.org/wiki/List_of_countries_by_external_debt

http://pgpblog.worldbank.org/why_doesnt_capital_flow_from_rich_to_poor_countries

http://www.cepr.net/documents/publications/capital_flows_2003_03.htm

http://www.worldbank.org/depweb/beyond/global/chapter4.html

http://www.ilo.org/global/About_the_ILO/Media_and_public_information/Press_releases/lang–en/WCMS_099406/index.htm

http://moattari.info/2008/02/18/gini-index-a-measure-of-inequality/

http://en.wikipedia.org/wiki/Worldbank

http://en.wikipedia.org/wiki/Confessions_of_an_Economic_Hit_Man

http://en.wikipedia.org/wiki/International_Monetary_Fund

http://www.globalpolicy.org/socecon/bwi-wto/critics/stiglitzindex.htm

Democracy can be defined in several ways. Politics, society, education, health, economics, to name a few. Let’s pick out the economic angle. Does a substantial part of the population have access to the common wealth ? For this purpose, an Italian named Corrado Gini invented the Gini coefficient in 1912. If this Coefficient is 0, then everybody would have the same part of the wealth. The nearer the number is towards 1, the more the money is concentrated in the hands of a minority.  You can find lists of countries ordered by their Gini coefficient on Wikipedia.

Unequality in the USA

From these mathematical facts we can conclude two things : in the USA wealth is distributed unevenly. Unlike Europe or Japan, but very similar to developing countries. And the Gini coefficient of the US is rising steadily. What does this increase mean ? It tells us that in the past 40 years, the flow of capital has been from the lower income classes to the top earners. A bottom-to-top redistribution.

Definition of trade balance

Now lets expand the view to the world economy. Countries have trade balances. A country has a positive balance if it exports more than it imports. The reason being the benefit from exports, while imports create a trade deficit. Foreign exchange reserves increase and decrease accordingly.
Countries therefore can be characterized as economically solid if they produce a trade surplus. Which countries are on the positive side ? The first 5 are China, Germany, Japan, Saudi Arabia and Russia. The first three due to their strong export industries, the latter two due to oil exports. Now lets look at the last 5 countries on the list : Italy, Australia, United Kingdom, Spain and as the number 181, the United States of America. Italy and Spain suffer from overall bad management, while the others are main players in the globalized economy.

Sustainability of Debt

The national debt must be considered in relation to the GNP and the ability to pay it back. Therefore absolute figures say little about the effective burden imposed on an economy by this debt. World Bank and IMF hold that “a country can be said to achieve external debt sustainability if it can meet its current and future external debt service obligations in full, without recourse to debt rescheduling or the accumulation of arrears and without compromising growth.” One measure is the ratio between the debt and the GNP. Examples : Zimbabwe 218.20, Lebanon 186.60, Japan 170.00, USA 60.80. Another useful information is the absolute debt of a country.

Relation between rich and poor countries

To assess the relation between the first and the third world, the net capital flow is a useful parameter. The world bank asks : why doesn’t capital flow from rich to poor countries ? You guessed it : it flows towards the rich countries. In poetical terms : When Rivers Flow Upstream.

How is the GNP and GDP evolving in comparison of industrialized and third world countries ?
World bank in 1995 : GDP and GNP growth rates in developing countries are on average higher than those in developed countries. Moreover, the difference became even larger in recent years because GNP growth in developed countries slowed from more than 3 percent a year in the 1980s to about 2 percent a year in the first half of the 1990s. Low-income countries, by contrast, appear to have performed much better during this period, with GNP growing by almost 6 percent a year in 1980-95. So, will the poor countries soon catch up with the rich? Unfortunately, the economic growth patterns described above do not mean that the world is on its way to “convergence”- that is, to the gradual elimination of the economic gap between rich and poor countries. Much faster population growth in most developing countries is offsetting comparatively faster GNP growth, causing GNP per capita growth rates in these countries to be low or even negative.

People in developing countries are not improving their economic situation. Accordingly, the gap between high-and low income nations is growing worldwide. Again a bottom-to-top redistribution.  And population growth is only a part of the explanation, it has something to do with the system itself.

The causes of inequality between industrialized and developing world are complex. Colonization and it’s sequels are fundamental, I will skip enumerating them.

Definition of the Bretton Woods institutions :

World Bank : The World Bank Group (WBG) is a family of five international organizations responsible for providing finance and advice to countries for the purposes of economic development and eliminating poverty. The World Bank’s activities are focused on developing countries, in fields such as human development (e.g. education, health), agriculture and rural development (e.g. irrigation, rural services), environmental protection (e.g. pollution reduction, establishing and enforcing regulations), infrastructure (e.g. roads, urban regeneration, electricity), and governance (e.g. anti-corruption, legal institutions development).
IMF : The IMF describes itself as “an organization of 185 countries, working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty”

WB and IMF have a strong control over developing economies (DE). Due to the mentioned trade imbalance, GNP of DE often cannot finance the external debt. Money is borrowed from the IMF. The universal currency being the US $ and DE often having high inflation rates, they risk enormous growth of the debt, if expressed in $ (Mexico, Argentina, Zimbabwe). They are also exposed to fluctuations of trade, agricultural production and of interest rates. Some countries were driven into bankruptcy. Several countries received debt reliefs. This interaction makes DE vulnerable to external pressure. IMF and WB being under US control, they usually exert pro-US political and economic pressure. According to a former „Hit-Man“, governments were removed with the help of manipulated IMF debts. It is probable that, apart from these extreme cases, pressure is being exerted regularly to enforce acceptance of global trade, agricultural and other policies.

As a result, there is a generalized aversion against these institutions among poor countries. Emerging countries like China and Brazil are actively pushing for a thorough reform to lessen the power of industrialized countries and increase democracy for poorer members. The moment is auspicious, due to the present crisis.

Consequences of trade policies

The financial measures of the IMF seem value-free. In fact, the IMF often enforces austerity measures to reduce debt and inflation. The consequences for the civil populations can be dramatic. Due to massive amortizations, no new investments are possible, even basic food and medicine might suffer shortage. One prominent critic is Prof. Joseph Siglitz (read the extensive collection of excellent papers).

Parallels

There is a remarkable correlation between the Gini coefficient of developing countries and the USA. Moreover, the income gap is widening worldwide. This seems independent of particular political systems, it seems to be related primarily to the globalized economy.

In the US, the middle class functions much like the developing countries in relation to industrialized countries. Due to inequitable conditions imposed by politics and the economic establishment, there is a continuous redistribution from bottom to the top. The US middle class is experiencing increasing poverty.
Between the richest 10 % in the US and their middle class we see the same functional relationship as the one between a developed and a developing country. The US middle class plays the same role within the US as Zimbabwe plays in world economy. There are more similarities in economic terms between rich US and Zimbabwean upper class citizens than vertically within each of the two societies. Economic stratification or class belonging is independent of national borders and follows a universal pattern determined by the actual overall economic rules.

Part 1 of 2

Freddie has been laid of, his bank is broke, and he is a broker. With the bonus he buys a house and plans to spend one year relaxing, jetting around the world.

Joe lost his job in a car factory, his budget was already tense, but now he lost his house. His wife is back from hospital, and they will spend winter in a camping ground. The church and some friends are helping.

The economic crisis is not democratic. What do statistic figures mean ? The working population of the USA is around 154 million ( cf http://www.bls.gov/news.release/empsit.nr0.htm). Presently, 9 % is the unemployment rate, this corresponds to an armada of 6.9 million people. The government has injected vast sums into the finance sector, but now another 75 billion are needed again for the major banks. Probably not for the last time.

How many jobs and how many firms will be saved with this amount ? What would this sum mean for the average jobless population ? What is being done for people hit by unemployment ?

Presuming that each of the 6.9 millions received a salary of 25 000 $ a year, this would cost the government 172 500 000 000 $, or 172 billions a year.

Does this sound like a lot of money to you ? Simply compare it with the cash injected in the finance sector and car industry to name a few. And the bill is not final, more is coming along.

Economic aspect : Unemployment causes a productivity loss measurable in the GNP. It is also a reduction of human resource cost and salaries, for firms still in business. In any case, there are costs for the community, along with lost tax revenues. The private sector has gotten rid of a dead weight, while the community somehow has to assume this human burden. What has been prepared for such a scenario ? Where do these people get a relief, a new social function, a certain sense back into their existence ? Generally, advice is directed towards keeping up moral and remaining attractive for the next job. No moroseness, make the best out of it, be positive. Is it somebody’s fault ? Does the employer or the authorities have a certain responsibility ? How does the private sector regard employees ? Unemployment keeps the workforce quiet, the larger their number, the lower the salaries. Jobless people are geographically mobile, they tend to compromise, they are the raw material for the next boom. All this looks great for the next recovery, from the management side. Firms need help to get started again. Tax cuts, cheap human resource, financial incentive. Aren’t they the motor of the nation, creating wealth, jobs, tax revenue etc ?

Is there an alternative from this scheme ? Could there be a less job-oriented identity for workers ? Does the government only have responsibilities for big firms, not for the individual employees ? Should not the responsibility for the debacle determine who gets financial help ? Among the employees, those in middle to lower positions carry no fault for the crisis. But they are the vast majority and are hit hardest. Firms should not only make profits with the help of their employees, they should also help their staff if they are laid off. It’s a causality principle.

Here is a possibility : the government actually plans ahead for good and for bad times. For the first case, the instruments are known. In the reverse case, there must be more than a help to prevent starvation. The quality of live and human dignity cannot depend exclusively on the exertion of a paid job.

There has to be an alternate pool of activities provided for jobless people. An example would be this : an old idea is to offer works of public interest, building roads etc. The idea is good, since infrastructural work is necessary independently of the economic cycle. During a boom, it would be hard to find people for such tasks. I would like to expand this concept. We don’t need only traditionally unqualified jobs (roads, agriculture). Let’s evaluate what are the most important infrastructural needs of a country right now and invest an equivalent amount of money (as the finance sector received) to realize them before the next economic boom starts. One possibility would be the manufacturing and installation of a. electro galvanic panels, b. thermo solar elements, c. thermal isolation material (walls, roof, windows) on private houses presently empty, on hospitals, schools and other public buildings. To avoid a direct competition with commercial firms doing the same work, there should be a clear separation between the mentioned clients and the usual house owners able to pay for it – a sectorized market. A partly state-controlled economy, yes, I know. And who is running Fannie and Freddie ? Stalin or rather politicians elected democratically ?

With these measures, the future dependency from fossil fuels, the overall energy consumption and the emission of greenhouse-gases could be reduced markedly. If jobless persons received an appropriate salary, they would remain in a productive cycle, experience a useful activity and produce a plus-value for the society, compensating at least their salary. The products a – c could be used for improving houses now devaluated by the sub-prime crisis, belonging to people unable to pay for it, for victims of natural disasters etc. Once restructured, these houses could be sold to people working in these occupational programs. Or the work could be traded against a house. The details would have to be elaborated. Assuming that houses could be sold at a markedly higher price, this profit could go into a jobless foundation and be redistributed among those who work in that system. This is just a rough idea. At this time, techniques for synthesizing fuel from gaseous carbon dioxide are being developed. It would therefore make sense to build large parks of solar panels in advance to power such plants in 1-2 years time. Solar and wind parks in general could replace other power plants and could be installed with such jobless-programs.

The principle detailed here is to pay jobless people real salaries for real products that have a real market value.

There are certainly other and better possibilities. The present approach, whereby people simply drop out of a productive job is a waste for both sides. Since every employee produces a plus-value, a public occupation program could not lose. If longterm improvements of the infrastructure can be created, I see a certain scope in examining such a possibility. The economy would profit from a better infrastructure and from motivated and freshly trained personnel. Other venues are dams ( New Orleans), public transportation, public buildings, computer recycling.

The idea is to create a second economic sector controlled by the government. Having to assume the burden of unemployment without getting a compensation from the sectors responsible, I see no moral obstacles in using free market tools creatively and in the interest of the majority. The government does not only have duties towards firms, he should take his responsibilities equally serious in regards of the primary victims of the crisis.

Global Cooling

May 8, 2009

But knowing that it is Global Warming. Belief or facts. Create confusion with apparent facts. Overnight experts claming to know what nobody else on this planet knows, or that is being hidden – the conspiracy feeling. There are bloggers insisting on the existence of global cooling (Ref 1). To prove this, a multitude of isolated facts are produced, going from periodic solar activity, the oceanic temperature to graphs showing seasonal variations of arctic ice. A luster of scientific seriosity impresses many readers not aware of the pitfalls.

The worldwide consensus regarding climatic change is this (Wikipedia)  : In February 2007, the IPCC released a summary of the forthcoming Fourth Assessment Report. According to this summary, the Fourth Assessment Report finds that human actions are “very likely” the cause of global warming, meaning a 90% or greater probability. Global warming in this case is indicated by an increase of 0.75 degrees in average global temperatures over the last 100 years.
The phenomenon of arctic shrinkage has been observed since at least 1950 and it is accelerating, with the cold winter of 2007 marking an exception (Ref 2)
At least since the publication of the IPCC in 2007, global warming is a fact accepted by scientists and informed laymen (Ref 3).

I am a layman, but I know that the worldwide ecology is infinetely complex. Climate change, desertification, the polar melting, the migration of flora and fauna due to these factors, all this is being researched seriously and requires profound knowledge. Research has been conducted for decades and the conclusions are concordant. Computer programs extrapolating climatic changes can simply not be reproduced or invalidated by anybody during a commercial break, on his laptop.

The ongoing debate over the very existence of global warming has no scientific base, it is an ideologic one. Let’s recall the Bush administration. They systematically denied any human influence on the climate change, they boycotted the Kyoto agreement, systematically blocking all efforts of the worldwide community to take effective measures against the CO2-induced climatic change. One specifity of the US debate is a tendency to engage and perseverate in undefensable theories like : infallibility of a totally deregulated economy, creationism, worldwide menace through terrorism, feeling of superiority over all international laws and organisations etc.
The Bush administration preached low taxes, a lean state and the inexistence of any climatic problems for the simple reason that they did not want to spend any money for infrastructure, for international organisations, and among these was the Kyoto protocol – money was the motif. Behind a religious, almost ideologic façade, this administration simply and effectively directed all public and private financial resources towards their own lobbies and for specific objectives : finance sector, oil industry, military-industrial complex etc. The general public bought this smokescreen so well, because the average GOP voter was convinced that every tax $ was wasted. A certain avarice led people to vote not for their convictions, but for these reasons. In this way, the GOP administration has ransacked their countries resources and partly those of the worldwide economy and ecology.

After this small recapitulation lets get on with the climate debate. Based on pseudo-scientific facts presenting a fragmented and thus distorted view, the overwhelming positive evidence is simply eclipsed. Psychologically certain people might get a kick from convincing a group of adepts to believe a theory that is diametrically opposed to the conclusions of thousands of scientists. I would call this the conspiracy feeling : a group is formed by a hermetic belief that is contrary to the mainstream.  Negationism is a well-known subterfuge used in many contexts. Apart from the all-time classic (the shoa), it is very popular to displace the discussion, psychologically this is known als freudian repression. Creationsts build a complex system only to contradict the evident existence of natural evolution. The pope makes backwards contortions to avoid admitting that jews can go to heaven without being first converted to christianism, he creates arguments to deny priests a right of marriage, to deny the necessity of using condoms, just to cling to the holy scripture in the face of overwhelming evidence. In the US, politics has castrated scientific research for years only to please certain religious groups fighting against abortion etc. While forbidding stemcell research, use of embryos and red genetic technology, green genetic engineering was supported without any criticism, again using a tactic of denial, namely of it’s potential dangers. Denial is also used by adepts of sects believing in intelligent design, in the return of aliens … the list is endless.

I see this psychological trait of denial or negationism as quite characteristic of certain sections of the US population. It is quite remarkable to see such a degree of irrational thinking in a socienty claiming to be so rational and scientifically savvy. Of course, admitting that greenhouse-gases are the main culprit for global warming might be a confession too painful to make, since the US are the largest producer of CO2 worldwide. It could challenge the way of life of a nation.

Ref 1 : Wikipedia : Global cooling was a conjecture during the 1970s of imminent cooling of the Earth’s surface and atmosphere along with a posited commencement of glaciation. This hypothesis never had significant scientific support, but gained temporary popular attention due to a combination of press reports that did not accurately reflect the scientific understanding of ice age cycles, and a slight downward trend of temperatures from the 1940s to the early 1970s. Today, General scientific opinion is that the Earth has not durably cooled, but undergone global warming throughout the 20th century.[“Summary for Policymakers” (PDF). Climate Change 2007: The Physical Science Basis. Contribution of Working Group I to the Fourth Assessment Report of the Intergovernmental Panel on Climate Change. Intergovernmental Panel on Climate Change. 2007-02-05. http://ipcc-wg1.ucar.edu/wg1/Report/AR4WG1_Print_SPM.pdf. Retrieved on 2007-02-02.]

Ref 2 Wikipedia : Records of Arctic Sea ice from the United Kingdom’s Hadley Centre for Climate Prediction and Research go back to the turn of the 20th century, although the quality of the data before 1950 is debatable. Still, these records show a persistent decline in Arctic Sea ice over the last 50 years.[2].
Reliable measurements of sea ice edge begin within the satellite era. From the late 1970s, the Scanning Multichannel Microwave Radiometer (SMMR) on Seasat (1978) and Nimbus 7 (1978–87) satellites provided information that was independent of solar illumination or meteorological conditions. The frequency and accuracy of passive microwave measurements improved with the launch of the DMSP F8 Special Sensor Microwave/Imager SSMI in 1987. Both the sea ice area and extent are estimated, with the latter being larger, as it is defined as the area of ocean with at least 15% sea ice.
In a modelling study of the 52-year period from 1948 to 1999 Rothrock and Zhang (2005) find a statistically significant trend in Arctic ice volume of −3% per decade; splitting this into wind-forced and temperature forced components shows it to be essentially all caused by the temperature forcing.
The trends from 1979 to 2002 have been a statistically significant Arctic decrease and an Antarctic increase that is probably not significant, depending exactly on which time period is used. The Arctic trends of −2.5% ± 0.9% per decade; or about 3% per decade[3]. Climate models simulated this trend in 2002[4], and attributed it to anthropogenic forcing.
The September ice extent trend for 1979–2004 is declining by 7.7% per decade[5].
Record Low Arctic Sea Ice in 2007 – Showing the Northwest passage open
In 2007 the ice melt accelerated. The minimum extent fell by more than a million square kilometers, the biggest decline ever. The minimum extent fell to 4.14 million km², by far the lowest ever. New research shows the Arctic Sea ice to be melting faster than predicted by any of the 18 computer models used by the Intergovernmental Panel on Climate Change in preparing its 2007 assessments.[6]
While the Northern Hemisphere sea ice reached new record lows, on September 12, 2007 the Southern Hemisphere sea ice area reached 15.91 million km², close to the maximum recorded of 16.02 million km².[7]
The Antarctic increase is 0.8% per decade[8] although this depends on the period being considered. Vinnikov et al.[9] find the NH reduction to be statistically significant but the SH trend is not.
Scientific parameter to quantify the extent of sea ice
In the overall mass balance, the volume of sea ice depends on the thickness of the ice as well as the areal extent. While the satellite era has enabled better measurement of trends in areal extent, accurate ice thickness measurements remain a challenge. “Nonetheless, the extreme loss of this summer’s sea ice cover and the slow onset of freeze-up portends lower than normal ice extent throughout autumn and winter, and the ice that grows back is likely to be fairly thin”[2].

Ref 3 : Global warming is the increase in the average temperature of the Earth’s near-surface air and oceans since the mid-twentieth century and its projected continuation. Global surface temperature increased 0.74 ± 0.18 °C (1.33 ± 0.32 °F) during the last century.[1]A[›] The Intergovernmental Panel on Climate Change (IPCC) concludes that anthropogenic greenhouse gases are responsible for most of the observed temperature increase since the middle of the twentieth century,[1] and that natural phenomena such as solar variation and volcanoes probably had a small warming effect from pre-industrial times to 1950 and a small cooling effect afterward.[2][3] These basic conclusions have been endorsed by more than 40 scientific societies and academies of science,B[›] including all of the national academies of science of the major industrialized countries.[4]
Climate model projections summarized in the latest IPCC report indicate that global surface temperature will probably rise a further 1.1 to 6.4 °C (2.0 to 11.5 °F) during the twenty-first century.[1] The uncertainty in this estimate arises from the use of models with differing climate sensitivity, and the use of differing estimates of future greenhouse gas emissions. Some other uncertainties include how warming and related changes will vary from region to region around the globe. Most studies focus on the period up to 2100. However, warming is expected to continue beyond 2100 even if emissions stop, because of the large heat capacity of the oceans and the long lifetime of carbon dioxide in the atmosphere.[5][6]
Increasing global temperature will cause sea levels to rise and will change the amount and pattern of precipitation, probably including expansion of subtropical deserts.[7] The continuing retreat of glaciers, permafrost and sea ice is expected, with the Arctic region being particularly affected. Other likely effects include shrinkage of the Amazon rainforest and Boreal forests, increases in the intensity of extreme weather events, species extinctions and changes in agricultural yields.
Political and public debate continues regarding the appropriate response to global warming. The available options are mitigation to reduce further emissions; adaptation to reduce the damage caused by warming; and, more speculatively, geoengineering to reverse global warming. Most national governments have signed and ratified the Kyoto Protocol aimed at reducing greenhouse gas emissions.