Environmental harms are often cast as externalities, even by those seeking to emphasize their urgency. Yet the major modern environmental statutes, written before America's neoliberal turn toward Coasean thinking, expressly rejected the use of economic analysis in designing pollution regulation. What does this history teach us, and how might our thinking shift if we rejected the idea that climate change is best thought of as an externality?

Since the 1990s, mainstream economists have used past weather data to forecast the future costs of climate change. This mode of econometric prediction ignores the alarming tipping points and pervasive uncertainty that characterize our warming world.