There is a neat profile in the NYTimes on the brothers Nordhaus:
Robert Nordhaus, a prominent Washington energy lawyer, and William Nordhaus, a Yale economist, who learned to love the outdoors while growing up on a New Mexico ranch, have taken leading roles in figuring out how to protect the environment.
Here is the meat:
While Bob began his career in Washington, Bill received a Ph.D. in economics from the Massachusetts Institute of Technology and began teaching at Yale. By the late 1970s, when an increasing number of scientists were raising the threat of global warming, Bill wrote a paper proposing a tax on industries and businesses based on the amount of carbon they emitted into the air. The idea was revolutionary at the time, but economists, scientists and many world leaders now say it will have a powerful market effect and is the best way to stave off the catastrophic impacts of a warming world. Already, more than 30 countries have passed carbon-pricing laws.
In the ensuing decades at Yale, Bill developed an economic model that put a price tag on the effects of climate change, like more droughts, flooding and crop failures and stronger hurricanes. He called it the Dynamic Integrated Climate-Economy model, or DICE. ...
DICE profoundly changed climate policy. Although the chief political argument against curbing carbon emissions from cars and coal plants has long been that doing so would harm the economy, the DICE models show that, depending on various scenarios, one ton of carbon pollution can inflict $20 to $30 in economic damage — a major cost, given that the global economy emits about 36 billion tons of carbon a year. ...
But it is, for the time being, politically untenable in the United States. The conservative Heritage Foundation has called the DICE model “flawed beyond use for policy making” and warned that it should not be used to justify “trillions of dollars of government policies and burdensome regulations.”
Here the work of Bob comes in: Mr. Obama tried but failed to push a carbon-pricing bill through Congress in his first term, which is why he has turned to Bob’s section of the Clean Air Act as the legal underpinning for the regulation due out in June.
Bob, who was an energy adviser to President Jimmy Carter and general counsel at the Department of Energy under President Bill Clinton, now says that because he was not writing the provision with climate change in mind, the new regulation is an imperfect and perhaps legally vulnerable solution to regulating carbon pollution. Environmental lawyers note that it has almost never been used. ...
But one way the E.P.A. will justify the new regulation is with an analysis showing that the economic benefits of the climate change rule would outweigh the costs.
A core component of that analysis? The DICE model.