Show Hide image

World saved . . . planet doomed

Green activists are seeing the global economic crisis as an opportunity, but the truth remains: high

You could call it the see-saw effect: it has long been an article of political faith that as worries about the economy go up, interest in the environment must go down. It stands to reason: people who are concerned today about their jobs have more immediate matters of alarm than whether or not there may be more storms in 2055. Environmental concerns are a luxury of the rich, something we can no longer afford once the economy turns sour and recession looms. “I’m nervous,” wrote Jonathon Porritt in June – after Northern Rock and Bear Stearns but be-fore Lehman Brothers, Fannie Mae/Freddie Mac and Iceland. “Climate change is still tough for politicians to sell. This all feels very much like one of those periodic crunch moments for the sustainability agenda.”

In that same month, as the financial crisis deepened, the Oxford economist Professor Dieter Helm worried that we seemed to be seeing a "shift back to the safe territory of concrete and jobs". Certainly, David Cameron - having established his reputation with the "Vote Blue, Go Green" pledge - seemed scarcely to mention climate change any more. Alarmed, major environmental groups wrote an open letter to party leaders warning them not to drop the environmental ball, as it were. And news on the high street seemed to confirm the worst fears: sales of organic produce began to slow as worried consumers tightened their belts, while supermarkets such as Tesco dropped their environmental messages and began to focus once again on price.

Surprisingly, perhaps, the gloom hasn't lasted. Even as the news has worsened - as stock markets crashed and the jobless figures began to rise - environmental issues have stayed resolutely at the top of the agenda. In Britain the passing of the Climate Change Bill, which cleared the Commons late last month, was a major triumph for the green lobby, committing the government to much stronger targets than originally envisaged, and with loopholes on aviation and shipping firmly closed. (The bill is due to receive Royal Assent by the end of this month.) Instead of slamming the door shut on environmental issues, the crisis of confidence in conventional economics seems to have led to a surge of interest in green measures to address the crisis.

If trillions of dollars can be spent on propping up the world's banks, why cannot a similar amount be spent on shifting the world on to a greener track? Neither is a charity case: banks will eventually repay their loans and environmental investments, too, will generate a substantial return. (Indeed, US lawmakers seemed to recognise this implicitly when they attached a proviso extending clean energy subsidies to October's $700bn bank bailout.)

The election of Barack Obama is perhaps the biggest new endorsement of green issues. Can we solve climate change? Yes, we can

In the past few weeks, green economists and campaigners have noticed the emergence of an unexpected credit-crunch dividend. As Cam eron Hepburn, senior research fellow at Oxford University's Smith School of Enterprise and the Environment, told me: "The economic crisis softens people up to the scale of the numbers - $700bn doesn't seem impossible any more. In fact, the incremental cost of completely greening the world's energy system is certainly less than that per annum."

Sarah Best, a climate-change policy adviser for Oxfam, is also strikingly optimistic: "The good news is that climate and economic solutions can support rather than compete with each other," she says. "Developing a green economy offers us a way out of the present crisis. Investment in renewable energy, energy efficiency, green buildings and public transport will bring huge job-creation and enterprise opportunities."

Stressing that people in poorer countries affected by climate change should not be forgotten, Oxfam is asking for a proportion of carbon market cash to be allocated to financing climate adaptation in the developing world. The annual amount Oxfam estimates is needed for this from the UK is about £1.6bn annually. That would once have seemed like an inconceivably large bill. Now, in the present crisis, it seems small.

Even heads of state are beginning to repeat this hopeful message. The UN secretary general, Ban Ki-moon, joined the president of Indonesia and the prime ministers of Poland and Denmark this month to write a lead comment article in the International Herald Tribune which argued that "the answer" to the financial crisis and climate change "is the green economy". The authors described renewable energy as the "hottest growth industry in the world . . . where jobs of the future are already being created, and where much of the technological innovation is taking place that will usher in our next era of economic transformation".

The United Nations Environment Programme is capitalising on this sudden massing of political will by starting a Green Economy initiative, due to launch in Geneva on 1-2 December, which aims to help policymakers "recognise environmental investment's contributions to economic growth, decent jobs creation and poverty reduction", and reflect this in "their policy responses to the prevailing economic crisis".

Perhaps the biggest new endorsement of green issues has come with the election of Barack Obama, who made the word “hope” a central theme of his campaign. Can we solve climate change? Yes, we can. According to an interview he gave to Time magazine just over a week before the election, Obama sees the “new energy economy” as potentially the main “new driver” of the economy as a whole. His language leaves no room for doubt. “That’s going to be my number one priority when I get into office, assuming obviously that we have done enough to stabilise the immediate economic situation.” Obama’s climate credentials are unequivocal: he supports a US target of 80 per cent carbon-emission reductions by 2050, with a European-style cap-and-trade system as the centrepiece of his plan. In fact, the president-elect’s proposals are even stronger than Europe’s: rather than give emissions permits to industry for free, as the EU at present does, Obama proposes a system of 100 per cent auctioning, with the revenue going to fund clean energy investments and to help low-income Americans adjust to higher fuel prices. He also promises to put $150bn towards renewables investments, with the aim of creating five million new “green-collar” jobs.

According to David Roberts, a writer for Grist.org, the US-based online environmental magazine, energy and climate will be one of the Obama presidency's "three biggies" (the others being getting out of Iraq and passing health-care reform). However, he warns not to expect headline-catching announcements: "The key is the long game. Obama worked carefully, diligently and adeptly to get elected on a clean energy agenda" and will aim to secure success with his green economy plan in a similar way. Obama's response to the crisis in the US car industry gives an inkling of his pragmatism as well as his commitment: instead of offering simply to throw money at Detroit to prop up the ailing giants Ford and General Motors (which between them made a staggering $7.2bn loss in the last quarter), the president-elect has made it clear that any government support will be pegged to the industry developing higher-mileage and electric cars. For GM, which has built its entire corporate strategy over the past five years around gas- guzzling sports utility vehicles, this represents the ultimate humiliation.

In the current climate of political optimism, it seems that just about everyone is thinking imaginatively. Al Gore is proposing that the entire US electricity sector be decarbonised in the next ten years, and has been running post-election TV ads titled "Now what?" (answer: "Repower America"). Even Google has a plan - "Clean Energy 2030" - and has begun to shift its own investment towards renewable technologies. In the EU, fears that a group of countries that rely heavily on coal for power generation - including Italy, Poland and Latvia - could intervene to thwart climate targets have lessened, thanks to skilful diplomacy by President Nicolas Sarkozy. And the prospect of the credit crunch derailing this year's UN climate-change talks in the Polish city of Poznan also seems to have been averted; on 14 November, Australia's top climate diplomat, Howard Bamsey, reassured journalists: "I haven't detected any change in approach as a result of the financial crisis."

But how much of this is merely rhetoric? The financial storm has already inflicted grave damage on the clean energy sector; shares in wind and solar power companies have tumbled in the last quarter, some by as much as 75 per cent, as credit funding for capital projects dries up and power companies cut back on their investment plans. “If you can’t borrow money, you can’t develop renewables,” says Kevin Book, a senior vice-president at the investment firm FBR Capital Markets.

The swingeing cuts in carbon emissions needed to avoid catastrophic climate change are still politically and economically inconceivable

Demand for energy has slowed because of the economic crisis, pushing down the price of oil. This in turn has made solar and wind projects that looked profitable when oil was trading at $140 a barrel appear decidedly less attractive with the price of crude back down below $60. T Boone Pickens, the famous US oilman-turned-wind enthusiast, has quietly postponed his plan to build the world's biggest windfarm on the Texas panhandle, due in part to the falling price of oil. Tesla Motors, the California-based auto manufacturer whose all-electric sports car made headlines across the world in the spring, has been forced to cut jobs.

Gas prices have also fallen on international markets. "Natural gas at $6 [per thousand cubic feet] makes wind look like a questionable idea and solar power unfathomably expensive," says Kevin Book from FBR Capital Markets. Falling prices on the EU's carbon market - from ?30 in July to ?20 in November - have also made clean energy projects less competitive. (Despite this short-term blip, most analysts expect the long-term trend in oil prices to be up - the Inter national Energy Agency's executive director, Nobuo Tanaka, warned on 12 November that oil depletion rates seemed to be increasing, and that "while market imbalances will feed volatility, the era of cheap oil is over".)

Perhaps an economic collapse can save us by reducing emissions? After all, the reason the oil price is falling is that people are consuming less fossil energy. But according to Kevin Anderson and Alice Bows of Manchester University's Tyndall Centre for Climate Change Research, the collapse would have to be profound indeed to be sufficient on its own to bring about the emissions decline the planet needs. They estimate that in order to have even a 50-50 chance of keeping global temperatures from rising above 2° higher than pre-industrial levels (the stated aim of EU policy, among many others), the world must see energy-related carbon emissions peak by 2015 and decline thereafter by between 6 and 8 per cent per year. Anderson and Bows remind us that while "the collapse of the former Soviet Union's economy brought about annual emissions reductions of over 5 per cent for a decade", that still isn't quite enough. The suggestion is not that we should aim for a Soviet-style economic implosion, but that the dramatic cuts in carbon emissions needed to avoid catastrophic climate change are still politically and economically inconceivable.

"Green growth" can offer a positive way forward in the short term, but the impossibility of reconciling an endlessly growing economy with the limitations of a finite planet cannot be avoided. Even though, in Cameron Hepburn's words, a "dematerialisation of the economy is feasible in a thermodynamic sense", this hasn't happened so far anywhere - rising GDP is pegged to rising material consumption, and thereby to a rising impact on the environment.

The ecological economist Herman Daly says humanity should aim for "qualitative development", not "quantitative growth". He concludes drily: "Economists have focused too much on the economy's circulatory system and have neglected . . . its digestive tract." The financial crisis is certainly a circulatory ailment, but once it is solved the bigger challenge will remain - that the biosphere has limited sources for our products, and limited sinks for our waste. And that is the ultimate question politicians, environmentalists and economists will have to focus on answering if our ecological crisis is ever to give way to true long-term sustainability in the century ahead.

Mark Lynas's latest book is "Six Degrees: Our Future on a Hotter Planet" (HarperPerennial, £8.99 paperback)

The green economy: ten global facts

The London Array, planned for the Thames Estuary, could become the world's largest offshore windfarm.

A proposed tidal barrage over the River Severn could provide 5 per cent of the UK's electricity. It would cost £15bn and cut carbon emissions by 16 billion tonnes a year.

Barack Obama will invest $150bn in renewables, in the hope of creating five million new jobs in the US.

Abu Dhabi's Masdar Initiative, launched in 2006, will invest $15bn in global green energy. It will take eight years and cost $22bn to build Masdar City (model right), which will rely entirely upon renewable energy.

Qatar is investing $150m in developing green technology in the UK.

There is one large-scale commercial tidal power station in the world - in Brittany, France. It has operated for 30 years without mechanical breakdown and has recovered the initial capital costs.

Consumer goods in Japan will soon be labelled with their carbon footprints. Producing a packet of crisps emits 75 grams of CO2.

Nine out of ten new cars in Brazil use ethanol-based biofuels. Flex-fuel vehicles make up 26 per cent of the country's light vehicle fleet.

Since 2006, disposable chopsticks in China have been taxed at 5 per cent, safeguarding 1.3 million cubic metres of timber every year. Green venture capital accounts for 19 per cent of China's investments.

The Australian government has invested $10.4bn in making 1.1 million homes more energy-efficient, creating 160,000 jobs.

Samira Shackle

Mark Lynas has is an environmental activist and a climate change specialist. His books on the subject include High Tide: News from a warming world and Six Degree: Our future on a hotter planet.

This article first appeared in the 24 November 2008 issue of the New Statesman, How to get us out of this mess

Getty
Show Hide image

The New Times: Brexit, globalisation, the crisis in Labour and the future of the left

With essays by David Miliband, Paul Mason, John Harris, Lisa Nandy, Vince Cable and more.

Once again the “new times” are associated with the ascendancy of the right. The financial crash of 2007-2008 – and the Great Recession and sovereign debt crises that were a consequence of it – were meant to have marked the end of an era of runaway “turbocapitalism”. It never came close to happening. The crash was a crisis of capitalism but not the crisis of capitalism. As Lenin observed, there is “no such thing as an absolutely hopeless situation” for capitalism, and so we discovered again. Instead, the greatest burden of the period of fiscal retrenchment that followed the crash was carried by the poorest in society, those most directly affected by austerity, and this in turn has contributed to a deepening distrust of elites and a wider crisis of governance.

Where are we now and in which direction are we heading?

Some of the contributors to this special issue believe that we have reached the end of the “neoliberal” era. I am more sceptical. In any event, the end of neoliberalism, however you define it, will not lead to a social-democratic revival: it looks as if, in many Western countries, we are entering an age in which centre-left parties cannot form ruling majorities, having leaked support to nationalists, populists and more radical alternatives.

Certainly the British Labour Party, riven by a war between its parliamentary representatives and much of its membership, is in a critical condition. At the same time, Jeremy Corbyn’s leadership has inspired a remarkable re-engagement with left-wing politics, even as his party slumps in the polls. His own views may seem frozen in time, but hundreds of thousands of people, many of them young graduates, have responded to his anti-austerity rhetoric, his candour and his shambolic, unspun style.

The EU referendum, in which as much as one-third of Labour supporters voted for Brexit, exposed another chasm in Labour – this time between educated metropolitan liberals and the more socially conservative white working class on whose loyalty the party has long depended. This no longer looks like a viable election-winning coalition, especially after the collapse of Labour in Scotland and the concomitant rise of nationalism in England.

In Marxism Today’s “New Times” issue of October 1988, Stuart Hall wrote: “The left seems not just displaced by Thatcherism, but disabled, flattened, becalmed by the very prospect of change; afraid of rooting itself in ‘the new’ and unable to make the leap of imagination required to engage the future.” Something similar could be said of the left today as it confronts Brexit, the disunities within the United Kingdom, and, in Theresa May, a prime minister who has indicated that she might be prepared to break with the orthodoxies of the past three decades.

The Labour leadership contest between Corbyn and Owen Smith was largely an exercise in nostalgia, both candidates seeking to revive policies that defined an era of mass production and working-class solidarity when Labour was strong. On matters such as immigration, digital disruption, the new gig economy or the power of networks, they had little to say. They proposed a politics of opposition – against austerity, against grammar schools. But what were they for? Neither man seemed capable of embracing the “leading edge of change” or of making the imaginative leap necessary to engage the future.

So is there a politics of the left that will allow us to ride with the currents of these turbulent “new times” and thus shape rather than be flattened by them? Over the next 34 pages 18 writers, offering many perspectives, attempt to answer this and related questions as they analyse the forces shaping a world in which power is shifting to the East, wars rage unchecked in the Middle East, refugees drown en masse in the Mediterranean, technology is outstripping our capacity to understand it, and globalisation begins to fragment.

— Jason Cowley, Editor 

Tom Kibasi on what the left fails to see

Philip Collins on why it's time for Labour to end its crisis

John Harris on why Labour is losing its heartland

Lisa Nandy on how Labour has been halted and hollowed out

David Runciman on networks and the digital revolution

John Gray on why the right, not the left, has grasped the new times

Mariana Mazzucato on why it's time for progressives to rethink capitalism

Robert Ford on why the left must reckon with the anger of those left behind

Ros Wynne-Jones on the people who need a Labour government most

Gary Gerstle on Corbyn, Sanders and the populist surge

Nick Pearce on why the left is haunted by the ghosts of the 1930s

Paul Mason on why the left must be ready to cause a commotion

Neal Lawson on what the new, 21st-century left needs now

Charles Leadbeater explains why we are all existentialists now

John Bew mourns the lost left

Marc Stears on why democracy is a long, hard, slow business

Vince Cable on how a financial crisis empowered the right

David Miliband on why the left needs to move forward, not back

This article first appeared in the 22 September 2016 issue of the New Statesman, The New Times