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5 November 2021

Is the energy crisis a bigger opportunity for the left or the right?

What Adam Tooze gets right and wrong about capitalism and climate change.

By Richard Seymour

How optimistic can we be about our chances of averting climate catastrophe? How should we interpret the so-called energy crisis with respect to achieving net zero carbon emissions? And how significant is the concept of crisis when thinking about political and economic transformation? These are the questions raised in two new essays by the historian and NS contributing writer Adam Tooze.

In his recent essay for the New Statesman, Tooze invokes the 20th-century Polish economist Michal Kalecki to show how business and energy lobbyists are defending their interests against the push to achieve net zero. We are living through what he calls “the first ‘climate Kalecki’ moment”.

Tooze’s NS essay takes aim at business lobbyists and their champions in the financial press. But in a follow-up piece in his Chartbook, Tooze writes that his essay “also marks a point of difference to some folks on the left who are trying to make sense of the current conjuncture”. He explicitly critiques my views on both the stress in energy markets and how we should think of the relationship between crisis and the struggle for a more sustainable future. “In Seymour’s analysis,” he writes, “crisis is an opening. I am not so sure.” In the New Statesman, Tooze writes:

In economic policy, crisis talk is never innocent. Already in 1943, the Polish economist Michal Kalecki warned his Keynesian friends that in their battle to shape economic policy, the business lobby would use tactics [to prevent this]. Too much government spending, employers would argue, was bad for “confidence” and would depress private investment and undermine growth and jobs. Invoking a “crisis in confidence” is an all-purpose rhetorical weapon.

Eighty years on, the discourse of today’s “energy crisis” follows the Kalecki playbook to the letter. First, the lobbyists and journalists, eager for a good story, declare energy price rises to be a crisis. Then they attribute the crisis to a shortfall in investment and blame this on a loss of confidence in the future of fossil fuels. The conclusion writes itself. To push down energy prices, all we have to do is moderate overly aggressive climate policy and give gas more latitude as a key transition fuel. Even the undead nuclear industry can be summoned from the crypt.

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I agree with Tooze that fossil industry lobbyists blaming the energy crunch on the transition to net zero are being disingenuous. I also agree that the causes of the recent energy crisis are various and contingent. Tooze mentions the resurgence of demand after lockdown, the closure of the Groningen gas field in the Netherlands, stresses on the UK’s fragmented and privatised energy market, the restriction of production by US fracking companies, and efforts by Russia and Saudi Arabia to balance the market. Tooze examines these causes to demystify the talk of crisis. As he sees it, conservative forces are using the idea of an energy crisis to bounce the world into fearful retreat from transitioning to net zero emissions. As a “self-confessed liberal Keynesian”, he writes, he is inclined to “disaggregate different lines of causation that are in play so that they can be addressed in a targeted way”.

This is where we differ. I argue that “this is how structural crises always manifest themselves: as moments of intense overdetermination, gatherings of apparently unrelated shocks”. I think these energy shocks are united and emerge from an underlying crisis in the energy system that has sustained world capitalism since the 1800s.

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The energy provided by fossil fuels has facilitated an historically matchless growth of modern societies – the workforce, towns, cities, human-made artefacts, transportation and profit. But fossil fuels are becoming more difficult to exploit. Their use is likely to become more expensive. Meanwhile, renewable energy is becoming cheaper and easier to scale up. According to the International Renewable Energy Agency, most new wind and solar projects will be cheaper than coal over the next two years. New discoveries of oil and gas reserves, and new technologies to extract them, may offset the tendency for fossil fuels to become less competitive, but not forever: and they certainly won’t reduce the “hidden costs” of fossil fuels which, a recent study suggests, amount to $25trn worldwide. If the transition to renewables is not achieved rapidly, we will face further ecological obstacles from runaway wildfires, flooding and storms that derail supply-chains and impede fossil fuel extraction. This means less work can take place, and that production will slow down. We will then be confronted by what the Italian Marxist philosopher George Caffentzis would call a work/energy crisis.

Owing to the increasing technological difficulties and commercial disadvantages associated with fossil fuels, Tooze worries that I am too “sanguine” about the chances of “green modernisation”. I do argue that the far-sighted members of the ruling class might react to this crisis by accelerating “the transition to renewables” with “more energy-efficient buildings, transport and supply chains” and even competition “over who transitions fastest”, resulting in trade wars over the control of the rare metals needed to make solar panels.

There is evidence this shift is under way: the broad acceptance of “the science”, a rise in the share of renewables in electricity generation to 28 per cent, the Paris Agreement’s goal to keep global temperature rises “well below 2°C above pre-industrial levels”, and the coalition of states supporting net zero emissions by 2050. This doesn’t mean these targets will be achieved. According to Climate Action Tracker, the policies pledged by the parties to the Paris Agreement would result in 2.9°C of warming. Investors continue to splurge on fossil fuel capacity because they expect the profits to keep rolling in.

The danger, as I see it, is not “green capitalism”, a contradiction in terms for a system of perpetual growth operating in a biosphere with physical limits. Rather, it is a united bourgeois front that is “green on the outside, brown on the inside”. It is a policy of minimum mitigation, the slowest possible decline of fossil fuel usage, and the reliance on controversial geoengineering techniques such as solar radiation management and carbon dioxide removal to achieve net zero. The danger is that the impetus for drastic industrial and political transformation will be appropriated and killed off by a technocratic model of climate management.

Tooze thinks my analysis underestimates the chances of a fear-based reversion to the status quo. Business may have an interest in a manageable transition, but as Kalecki pointed out, business in the 1940s also had a discernible economic interest in full employment – yet fought against it because of its fear of a strengthened working class. The business lobbying is the first “climate Kalecki” moment, Tooze argues, because the spectre of collapsing industrial “confidence” is being used to frighten political leaderships into abandoning a net zero policy. He may be right. However, I note the impressive range of pro-capitalist authorities he cites in his two climate essays, from the Biden administration to the International Energy Agency to the Washington Post, all of whom insist that the energy crisis is not caused by the transition to net zero. The business lobbies scapegoating net zero do not necessarily represent the mainstream of bourgeois thinking.

The underlying source of our disagreement, however, concerns the significance we each attribute to crisis. Marxists have a tendency to see crises everywhere. We also have an unwholesome tendency to sniff political opportunities in their wake. In an essay of mine cited by Tooze, I highlight the ways in which the climate movement has “exploited and collaterally benefited from crises” of political economy “that are not directly related to” climate change. So, it would appear that I think hope lies in crises. But Tooze isn’t so sure this is true. “In the recent political economy of both the US and Europe,” he writes, “crisis has all too often been a generator of compulsive and highly conservative logics. Think of ‘too big to fail’, or the threat of bond market vigilantes, invoked to impose austerity. Or the meltdown that we saw in financial markets in 2020.”

He is right. Crisis is by itself no threat to the system. Capitalism is uniquely crisis-prone because of the anarchic and competitive way in which production is organised. Periodically, overproduction and stock market bubbles generate recessions, financial crashes and fiscal crises. Yet, capitalism thrives on this, as each crisis destroys uncompetitive businesses and moves workers to more profitable areas of production. Politically, these crises can often be more damaging to the left than to capitalism. The redoubts of industrial militancy, or public sector radicalism, can be smashed to pieces by a crisis.

As the Italian Marxist Antonio Gramsci wrote in his Prison Notebooks, composed after Mussolini’s regime imprisoned him in 1926, the “traditional ruling class” is better placed to adapt to crisis because, with its “numerous trained cadres”, it “changes men and programmes, and with greater speed than is achieved by subordinated classes, reabsorbs the control that was slipping from its grasp”. Finally, as a historian of fascism, Tooze knows that crisis can generate even more horrendous “conservative logics” than those he mentioned. The ecological crisis already contains an incipient fascist potential. Conservatism has long internalised Winston Churchill’s dictum: “never let a good crisis go to waste”.

Nonetheless, one has a responsibility not just to revel in images of apocalyptic doom. That, ironically, is the point of Marxist crisis theory. I grant that by always focusing on the relentless gathering of crises tending towards a giant political rupture, we can end up with a secularised eschatology. Worse, this can be accompanied by a tasteless slavering for the final judgment of history, and the destruction that it entails. Several times in its history, a version of Marxism has been the stated creed of millenarian movements and regimes: Stalinism in the 1930s, the Khmer Rouge in Cambodia, the Shining Path in Peru, and so on. In a way, as Geoff Mann shows in In the Long Run We Are All Dead: Keynesianism, Political Economy and Revolution (2017), the destructive enthralment with the end of days and the downfall of civilisation is the temptation that Keynes’s political economy was designed to avoid.

However, I don’t see crises as building towards a big day of reckoning. The clunky Marxist idiom of dialectics hasn’t weathered criticism very well, but one of its functions is to displace eschatology. To show that a system is riven with “contradictions” – or, let’s say, dysfunctions, antagonisms, chinks in the armour – is to also show that apocalypse is unnecessary. If capitalism is a fallible human creation with manifest irrationalities and self-destructive tendencies, that makes it dangerous and violent: however, it also means that it can be brought down by reasonable human beings reflecting and acting on their interests. And because “contradictions” are theoretical abstractions, the Marxist nose is attuned to real-world crises: they are what Americans might call a “teachable moment”, in which it is possible for us to learn something about the system we live in, and potentially change it. But that possibility is only likely to be realised if we are politically organised and equal to the challenge.

To say that a crisis contains potential opportunities is not to be casual or callous about its consequences, nor to be blithe about how readily an opportunity can be turned into real gains. It is simply to orient oneself, soberly and with an appropriately tragic sensibility, towards the tendencies that are most likely to generate transformative possibilities. The right already knows this; the climate movement must learn it too.

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