John Vidal had a very good piece on the pre-Copenhagen talks in the Guardian last Friday. Reading this article reminded me of something I have often read elsewhere - that one of the real reasons why developing countries will always lose out at the climate change talks is that they haven't enough negotiators or expertise - a stupidly simple, practical reason that western governments take ruthless advantage of.
Vidal reports that the whole of Africa - 55 countries - has only 145 negotiators - to cover every area, to be present at all the meetings. 'At least 50 countries have only one or two, but the WWF… has a team of 50'. What is more, 'the G77 has no offices, no permanent staff and no budget to meet in advance of conferences'. Even the language - invariably English - is against many of them. Meanwhile, the UK, USA and Denmark have 142 participants between them, plus innumerable lawyers, interpreters and consultants on tap, all armed with huge budgets, etc. The conferences are organised and run and the agenda and processes are comprehensively dominated by white diplomats from industrial countries. It's quite impossible for developing countries, and the real decisions are made when they are not present, in closed meetings.
But this is exactly the model on which the WTO operates - effective exclusion by lack of representation and expertise, the manipulation of meetings and a constant and quite deliberate war of attrition and divide and conquer against the poor and weak.
And why are they poor and weak in the first place? Because of the last couple of centuries of colonial and post-colonial exploitation.
So well done all you clever western negotiators! Who knows how many people will die because you exercised your talent for bullying and deceit so expertly in the name of the glorious western way of life! And how soon do you plan to start blaming the poor for their plight, or congratulating yourselves on your wonderful humanity? But I forgot -you started on that one the moment you set foot in their countries and heroically took up the White Man's Burden.
Words fail me. (Well, obviously not, Richard...)
Wednesday, 11 November 2009
Wednesday, 23 September 2009
China's non-promise
Today China promised that it will seek to reduce the 'carbon intensity' of its economy - the carbon emissions per unit of economic output - starting from 2020.
Hooray, I hear the world shout. And endless editorials have already hit the newstands, proclaiming this a great day for humanity and an important step towards a successful climate conference in Copenhagen.
But this is a complete non-promise. Any economy undergoing development will start to eventually reduce the carbon intensity of its economic activity through basic processes of technological advance and cost reduction. So China's carbon intensity would fall even if it had no environmental targets at all. All more developed countries have already done this. China has not in fact promised to anything other than what they were going to do anyway, which is pursue economic growth. Nor do they have much choice: having embraced capitalism, there is no option, especially for an industrially backward country.
Nor is it likely that this will do much towards solving the world's environmental problems. Although it obviously makes a difference, its net effect will only be positive if China's rate of economic growth (i.e., the total number of economics produced) is not so great that it completely negates the reduction in intensity per unit. But China's growth rate has hovered at the 8-10% mark for decades now, and there is no realistic chance that it will reduce its carbon intensity at anything alike this rate. Also, the reduction is only relative to 2005 - a very high baseline. So even after 2020, it is highly probable that China's carbon emissions will still be growing.
And up until 2020? Again, present growth rates - which do not seem to have been dented much by the current global recession - mean that China's economy will have more than doubled in size. Given present carbon intensity levels, that means 12 billion tons of carbon. And after 2020, it will keep on growing. Given that the estimated sustainable level for the whole planet is about 6 billion tons, what satisfaction are we to get from China's non-promise?
Hooray, I hear the world shout. And endless editorials have already hit the newstands, proclaiming this a great day for humanity and an important step towards a successful climate conference in Copenhagen.
But this is a complete non-promise. Any economy undergoing development will start to eventually reduce the carbon intensity of its economic activity through basic processes of technological advance and cost reduction. So China's carbon intensity would fall even if it had no environmental targets at all. All more developed countries have already done this. China has not in fact promised to anything other than what they were going to do anyway, which is pursue economic growth. Nor do they have much choice: having embraced capitalism, there is no option, especially for an industrially backward country.
Nor is it likely that this will do much towards solving the world's environmental problems. Although it obviously makes a difference, its net effect will only be positive if China's rate of economic growth (i.e., the total number of economics produced) is not so great that it completely negates the reduction in intensity per unit. But China's growth rate has hovered at the 8-10% mark for decades now, and there is no realistic chance that it will reduce its carbon intensity at anything alike this rate. Also, the reduction is only relative to 2005 - a very high baseline. So even after 2020, it is highly probable that China's carbon emissions will still be growing.
And up until 2020? Again, present growth rates - which do not seem to have been dented much by the current global recession - mean that China's economy will have more than doubled in size. Given present carbon intensity levels, that means 12 billion tons of carbon. And after 2020, it will keep on growing. Given that the estimated sustainable level for the whole planet is about 6 billion tons, what satisfaction are we to get from China's non-promise?
Tuesday, 15 September 2009
The worst threat to the environment on Earth
By far the single best demonstration that business is about profit, not any sort of social or environmental responsibility, is the Alberta Tar Sands. Billed by Greenpeace and others as the largest industrial and energy project, the biggest capital investment and the worst environmental crime on earth, it really does have to be seen to be believed.
For a first-hand view, click here. Right now.
The real point? That tar sands make no environmental or social sense at all. Imagine someone replacing Florida with a slag heap - that's the new Alberta.
But for business? Lots and lots and lots of money. A no brainer, really. Say goodbye to Alberta now, children - and don't worry about the mess. No, I don't ahve any plans to clear up after me, but always remember - Daddy Business knows best.
For a first-hand view, click here. Right now.
The real point? That tar sands make no environmental or social sense at all. Imagine someone replacing Florida with a slag heap - that's the new Alberta.
But for business? Lots and lots and lots of money. A no brainer, really. Say goodbye to Alberta now, children - and don't worry about the mess. No, I don't ahve any plans to clear up after me, but always remember - Daddy Business knows best.
Tuesday, 1 September 2009
Market irrationality and the environment
There are in fact at least five ways in which the rationality of markets can be challenged, and all of them have implications – not all negative - for the environment.
Firstly, sometimes people just aren’t rational by any standard. However, this is not all innocent folly or individual caprice. Not only are individuals open to irrational behaviour on their own account, but they can often be manipulated, stampeded and panicked into actions that are, from their own point of view, profoundly irrational, but that are very much in the economic interests of others.
This possibility is routinely exploited through (and often by) the mass media, of course. In the absence of a systemic account of the ways in which individuals in the economy are behaving irrationally, it is hard to say just what that means, or what it does to conventional economic theory apart from render it more or less fuzzy. But whatever the answer is, it is unlikely to figure in conventional economic theory, as it my suggest that the power to exploit and control is fundamental to our economic system, yet decidedly not the benign (or at least neutral) thing markets are supposed to be.
Secondly, if by ‘rational’ we mean, ‘pursuing economic self-interest’, it is obvious that a great deal of human behaviour can’t be forced into this particular (indeed, peculiar) mould. That does not mean that we are irrational – only that the rationality according to which we operate is not narrowly economic. I doubt that a committed church-goer tithes a significant fraction of their income out of reasons of economic self-interest, and the idea that people contribute to charities out of a very indirect calculation that they may need that charity’s services one day is surreal, to say the least. It would be doubtful to propose that a person on the streets of Manchester or San Francisco contributes to Oxfam because they expect to need Oxfam’s support any time soon. People have values, goals, interests, relationships, and any number of other motives that affect their behaviour, all of which can be pursued rationality without ever reflecting economic rationality.
This can be extremely fortunate for the environment, because it means that people are willing to pay for environmental management even when it ‘harms’ their economic self-interest. Unfortunately there are quite a few ways in which the same ability to rise above economic self-interest is likely to harm the environment – as when a certain kind of fundamentalist is persuaded that environmental problems are signs of Last Days, or that any kind of collective action is ‘communism’.
Thirdly, when we hand over the direct management of our economic interests to others (typically investment professionals, the senior management of the firms by which we are employed, our government’s treasury department, and quite a few others), this creates a dilemma for the theory of economic rationality. Either they pursue our interests on our behalf, and not their own, in which case they are not being rational from their own perspective, or they do the reverse – in which case they aren’t being rational from our perspective.
This is the problem of ‘agency’, as economists like to call it, and it had a major impact on creating the recent global economic crisis. Investment banks hotly pursuing their own interests netted themselves billions in fees for investment advice and dubious sales, not to mention outright fraud, but added little value as far as the rest of us – including their immediate customers – were concerned.
From an environmental point of view this could prove to be a serious issue, as it is crucial that environmental problems are seen as affecting all of us equally, and, conversely, that one group cannot evade the consequences by exploiting another. Unfortunately, although this may be true in the long run, especially if the problems turn out to be still more severe than most people expect, it is unlikely that such a long-term perspective will be the rule. Indeed, we can certainly expect some groups – from privileged individuals up to corporations and national governments – to do their utmost to exploit the weaknesses of others.
Fourthly, there is the more profound kind of irrationality that follows from the fact that what is rational for an individual can be counterproductive, or even outright destructive, when replicated all across a market.
From an environmental perspective this is all too common, as can be seen from the ratchet effect of many investments. To take a very parochial example, right now the London underground train system (the Tube) is being blighted with hundreds of screens that show dynamic advertisements in place of the old posters. This raises the impact of these advertisements, but they probably also represent only the thin end of the wedge, and we can certainly expect these deeply annoying devices to become the norm. But with that, all advertisements will be restored to an equal footing, so no advantage will be gained by using electronic screens. But no one will be able to go backwards either, to old fashioned paper posters. From an environmental point of view, these necessarily lead to more material resources – electronics, energy, and so on - being invested to achieve absolutely no net material benefit (as opposed to monetary) value.
Finally, there are situations – some extremely widespread – in which the economically ‘rational’ option simply isn’t available. In any market that is dominated by large-scale capital (which is to say, any area of heavy industry, any long-term commitment, and so on), rapid movements to reflect a sudden change of circumstance are simply not options.
For example, if a lower-cost operator suddenly enters the market – as often as not taking advantage of the most recent methods, processes, technologies, etc. – they can price their goods and services below more established operators, who are still committed to the old approach. The latter may have the option of moving to a lower-cost operation too – but the long-term nature of many financial commitments may mean that the old investments still have to be paid off, and the arrival of a radically new operating model may mean that the systems and resources by which they currently operate simply cannot be sold off, because no one want them.
From an environmental perspective, this is almost invariably disastrous, as it obliges the owners of that capital to carry on using it, regardless of the environmental consequences. A power station or car plant built today must be operated for decades to come if it is to be paid for, and its proprietors will lobby for the continuation of dirty energy and transport for the same period.
And all that is leaving aside the conscious exploitation of other complexities such as 'informational asymmetry' (i.e., they're lyng to you). All in all, the case for the ‘rationality’ of markets, or for the so-called ‘efficient markets hypothesis’, is not strong. As far as the environment is concerned, it is pretty disastrously flawed.
Firstly, sometimes people just aren’t rational by any standard. However, this is not all innocent folly or individual caprice. Not only are individuals open to irrational behaviour on their own account, but they can often be manipulated, stampeded and panicked into actions that are, from their own point of view, profoundly irrational, but that are very much in the economic interests of others.
This possibility is routinely exploited through (and often by) the mass media, of course. In the absence of a systemic account of the ways in which individuals in the economy are behaving irrationally, it is hard to say just what that means, or what it does to conventional economic theory apart from render it more or less fuzzy. But whatever the answer is, it is unlikely to figure in conventional economic theory, as it my suggest that the power to exploit and control is fundamental to our economic system, yet decidedly not the benign (or at least neutral) thing markets are supposed to be.
Secondly, if by ‘rational’ we mean, ‘pursuing economic self-interest’, it is obvious that a great deal of human behaviour can’t be forced into this particular (indeed, peculiar) mould. That does not mean that we are irrational – only that the rationality according to which we operate is not narrowly economic. I doubt that a committed church-goer tithes a significant fraction of their income out of reasons of economic self-interest, and the idea that people contribute to charities out of a very indirect calculation that they may need that charity’s services one day is surreal, to say the least. It would be doubtful to propose that a person on the streets of Manchester or San Francisco contributes to Oxfam because they expect to need Oxfam’s support any time soon. People have values, goals, interests, relationships, and any number of other motives that affect their behaviour, all of which can be pursued rationality without ever reflecting economic rationality.
This can be extremely fortunate for the environment, because it means that people are willing to pay for environmental management even when it ‘harms’ their economic self-interest. Unfortunately there are quite a few ways in which the same ability to rise above economic self-interest is likely to harm the environment – as when a certain kind of fundamentalist is persuaded that environmental problems are signs of Last Days, or that any kind of collective action is ‘communism’.
Thirdly, when we hand over the direct management of our economic interests to others (typically investment professionals, the senior management of the firms by which we are employed, our government’s treasury department, and quite a few others), this creates a dilemma for the theory of economic rationality. Either they pursue our interests on our behalf, and not their own, in which case they are not being rational from their own perspective, or they do the reverse – in which case they aren’t being rational from our perspective.
This is the problem of ‘agency’, as economists like to call it, and it had a major impact on creating the recent global economic crisis. Investment banks hotly pursuing their own interests netted themselves billions in fees for investment advice and dubious sales, not to mention outright fraud, but added little value as far as the rest of us – including their immediate customers – were concerned.
From an environmental point of view this could prove to be a serious issue, as it is crucial that environmental problems are seen as affecting all of us equally, and, conversely, that one group cannot evade the consequences by exploiting another. Unfortunately, although this may be true in the long run, especially if the problems turn out to be still more severe than most people expect, it is unlikely that such a long-term perspective will be the rule. Indeed, we can certainly expect some groups – from privileged individuals up to corporations and national governments – to do their utmost to exploit the weaknesses of others.
Fourthly, there is the more profound kind of irrationality that follows from the fact that what is rational for an individual can be counterproductive, or even outright destructive, when replicated all across a market.
From an environmental perspective this is all too common, as can be seen from the ratchet effect of many investments. To take a very parochial example, right now the London underground train system (the Tube) is being blighted with hundreds of screens that show dynamic advertisements in place of the old posters. This raises the impact of these advertisements, but they probably also represent only the thin end of the wedge, and we can certainly expect these deeply annoying devices to become the norm. But with that, all advertisements will be restored to an equal footing, so no advantage will be gained by using electronic screens. But no one will be able to go backwards either, to old fashioned paper posters. From an environmental point of view, these necessarily lead to more material resources – electronics, energy, and so on - being invested to achieve absolutely no net material benefit (as opposed to monetary) value.
Finally, there are situations – some extremely widespread – in which the economically ‘rational’ option simply isn’t available. In any market that is dominated by large-scale capital (which is to say, any area of heavy industry, any long-term commitment, and so on), rapid movements to reflect a sudden change of circumstance are simply not options.
For example, if a lower-cost operator suddenly enters the market – as often as not taking advantage of the most recent methods, processes, technologies, etc. – they can price their goods and services below more established operators, who are still committed to the old approach. The latter may have the option of moving to a lower-cost operation too – but the long-term nature of many financial commitments may mean that the old investments still have to be paid off, and the arrival of a radically new operating model may mean that the systems and resources by which they currently operate simply cannot be sold off, because no one want them.
From an environmental perspective, this is almost invariably disastrous, as it obliges the owners of that capital to carry on using it, regardless of the environmental consequences. A power station or car plant built today must be operated for decades to come if it is to be paid for, and its proprietors will lobby for the continuation of dirty energy and transport for the same period.
And all that is leaving aside the conscious exploitation of other complexities such as 'informational asymmetry' (i.e., they're lyng to you). All in all, the case for the ‘rationality’ of markets, or for the so-called ‘efficient markets hypothesis’, is not strong. As far as the environment is concerned, it is pretty disastrously flawed.
Tuesday, 25 August 2009
Paying India and China to do what, exactly?
Anyone with a sense of decency and proportion about humanity’s current environmental predicament understands and sympathises with the claim by developing countries that the developed countries should actively support their contribution to controlling global warming by technology transfers, improved terms of trade and direct funding. Conversely, as India and China’s own governments have pointed out, the attitude of the governments of developed countries to their position is hypocritical at best and shameless at worst.
But at the same time, is it really clear exactly what would be accomplished by such support? Just as the justice of their cause is clear to anyone with half an eye, so the doubtfulness of their chosen route to development is clear to anyone with half an ear for the brilliant but discordant disharmonies of emerging capitalism. For both India and China (and most other developing countries) have certainly set themselves on a strictly capitalist road to industrialisation, and it is exactly this that undermines their claims to the sympathy and assistance of developed countries.
Not that the latter are any less culpable – after all, we invented capitalism, we made sure that most developing countries (with the notable exception of China itself) would adopt a capitalist strategy for economic development, and we have wilfully turned a blind eye to the environmental (not to mention social, cultural, political and psychological) consequences of our own road to wealth. But to support the industrialisation of any country on the same basis would only be more of the same problem we already have. Indeed, capitalism’s incessant demand for growth and more growth, coupled with the lower ‘carbon efficiency’ of less developed countries’ industries, would actually make the problem disproportionately worse. So even if the global environment could countenance the rapid doubling and trebling of the global economy, the environmental impact is actually likely to be much worse than that.
So what is the answer? Beats me. But it isn’t capitalist development, because that can only lock us – and in this case it really is us all – into a worse problem. Nor will it solve developing countries’ developmental problems, given that they are far more likely to suffer from the resulting climate chaos, resource depletion and ecosystems damage than their more developed neighbours.
But at the same time, is it really clear exactly what would be accomplished by such support? Just as the justice of their cause is clear to anyone with half an eye, so the doubtfulness of their chosen route to development is clear to anyone with half an ear for the brilliant but discordant disharmonies of emerging capitalism. For both India and China (and most other developing countries) have certainly set themselves on a strictly capitalist road to industrialisation, and it is exactly this that undermines their claims to the sympathy and assistance of developed countries.
Not that the latter are any less culpable – after all, we invented capitalism, we made sure that most developing countries (with the notable exception of China itself) would adopt a capitalist strategy for economic development, and we have wilfully turned a blind eye to the environmental (not to mention social, cultural, political and psychological) consequences of our own road to wealth. But to support the industrialisation of any country on the same basis would only be more of the same problem we already have. Indeed, capitalism’s incessant demand for growth and more growth, coupled with the lower ‘carbon efficiency’ of less developed countries’ industries, would actually make the problem disproportionately worse. So even if the global environment could countenance the rapid doubling and trebling of the global economy, the environmental impact is actually likely to be much worse than that.
So what is the answer? Beats me. But it isn’t capitalist development, because that can only lock us – and in this case it really is us all – into a worse problem. Nor will it solve developing countries’ developmental problems, given that they are far more likely to suffer from the resulting climate chaos, resource depletion and ecosystems damage than their more developed neighbours.
Wednesday, 19 August 2009
Should We Seek to Save Industrial Civilisation?
Yeasterday George Monbiot's website published a debate between George and Paul Kingsnorth on the question Should We Seek to Save Industrial Civilisation?
I commented on this rather abstract discussion, and here is what I said:
I commented on this rather abstract discussion, and here is what I said:
I find myself bemused by this debate. On the other hand, after reading
George’s Captive State, I would have expected a more specific focus on exactly
what it is about our economic system that drives its relentless growth, and on
the other I am sure I can’t be alone in finding any dispute that lays the blame
for environmental disaster at the door or either ‘founding myths’ or ‘humanity’
a bit abstract, to say the least.
Industry does not lead to environmental collapse. Firstly, any machine or
factory or oil well or fishing fleet can be shut down or made more
environmentally friendly any time its controllers want to do so, and secondly I
see no reason to believe that those who control these things are inherently
blind to the facts of climate chaos, peak oil and all the rest. Rather, the
issues are what it is that motivates whether or not we turn down industry and
who realistically exercises enough control to do so. These are matters of
society’s political and economic structure, not abstract speculation.
As far as motivation is concerned, our economic system is driven by profit,
and practically every sector of our global economy is committed to investments
that demand a return for decades to come. So although there is no technical
reason why the factories and power stations cannot be switched off, the economic
consequences would be disastrous. So cars keep roaring off the production lines
and the oil keeps gushing not because of Judaeo-Christian foundation myths about
control over nature or because we are too weak to give up foreign holidays, but
because if stopped buying, there would be no revenues to repay the bank loans
that fund all those hotels, aircraft, oil wells, and all the rest.
The same can be said of industry as a whole – the issue is not one of
industry as such but of the economic motivation that determines how industry is
used and developed. There the answer is simple: it is run and developed for
profit, and unless the state intervenes to impose specific environmental and
social obligations, nothing else. Nor, while those who control this whole cycle
limit their perspective to profitability, can things be otherwise. But at the
same time, they could not change this perspective to something more socially and
environmentally responsible even if they wanted too without markets and
investors simply demolishing them. That is only likely to change if there is a
truly vast realignment of our economic system, such that social and
environmental sustainability became our ultimate criterion for economic success
and profitability, if it remained at all, would become a secondary accounting
issue, not the be-all and end-all of industrial civilisation.
In short, it is capitalism that is the ‘fifth horseman’ who drives the four
horsemen of our impending environmental apocalypse – global warming, ecosystems
collapse, resource depletion and (the disastrously adverse effects of)
population growth. Conversely, it is wholly implausible that the motivation for
and control over our industrial civilisation will shift away from profitability
and radical unsustainability without equally radical political
intervention.
All in all, I don’t know how far capitalism can be adapted to social and
environmental sustainability – given its inherent drive for economic growth,
either it or civilisation itself will have to give – but I am quite certain that
capitalism is a much more realistic answer than Paul and George’s rather
speculative abstractions.
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