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Why “Green Growth” Is an Illusion

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Power Lines

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Again, found in my in box but intriguing enough for me to go and find out something about the people who sent it to me

Changing the Conversation

Economists and finance professionals still promote free market fundamentalism, shrinking from drawing even obvious conclusions about the dangers of unfettered markets. Fiscal austerity and deficit reduction continue to be watchwords of both policymakers and theorists, even as global inequality increases exponentially and unemployment equals or exceeds levels of the Great Depression in many countries. Politics chokes reforms that could bring growth and relief to millions, while the many challenges of sustainable development and environmentally friendly innovation are brushed aside.

Neoclassical economics fails to address these challenges, but the resistance to change is substantial — both inside the discipline and in the world at large.

So that in itself recommended the article to me, but there are other things right now that need my attention. So I am going to simply cut and paste the text (with the links) from the email – and expect to get some reaction in the comments below.

I will say this. During my career there was initially a sort of consensus (known as “Butskellism“) about the need for public sector investment and social programs. That was overturned by the arrival of Thatcher – and a lot of people I found myself working for, who were genuinely convinced of the integrity of the intellectual underpinnings of neoclassical economic theory. I was at best skeptical, but over time became convinced that it was simply the same old reactionary attitudes of the privileged. Yes communism collapsed, but that does not mean that Marx was entirely wrong, and anyway Leninism – and later Stalinism and Maoism – were some distance away from Marxism. Not only that but I was sure Keynes was right since I had grown up during the period when people from my background were at last seeing some benefit from his policies. At least, once we had paid off the huge US dollar loan, which the rest of Europe had escaped due to the Marshall plan. What I also saw was the sheer greed of the people who always yacked on about the Dutch “problem” (of gas revenue being spent on social welfare programs) while they gleefully stuffed their own pockets with the profits from oil and gas drilling in the North Sea and the increasingly dodgy Private Finance Initiative.

In the wake of this fall’s IPCC report on the growing dangers of climate change—including to the economy—a new paper and supplementary analysis from the Institute for New Economic Thinking (INET) find that the conventional wisdom of the dynamics between climate change and the economy actually understates these dangers. It finds that, contrary to popular belief, we cannot have it both ways: We cannot have carbon emissions reduction while also maintaining current levels of economic growth. There is instead an inexorable tradeoff between economic growth and preventing climate catastrophe. The paper is from leading economists on climate change, Enno Schröder and Servaas Storm.

Among its highlights, based on original research and a new set of data regressions:

  • “Green growth” is an illusion: Contrary to optimistic claims by Barack Obama and a host of others, you can’t grow your way to a better climate; consumption growth necessarily drives increasing CO2 emissions. The research finds that outsourcing production to other countries may hide this relationship between economic growth and emissions, but it’s not possible to de-link the consumption that accompanies rising living standards with rising emissions.
  • To stabilize the climate, future economic growth must be well below the historical income growth rate of 1.93% (1971-2015)—even with unprecedented reductions in carbon and energy intensity. The hard truth is that, based on even optimistic assumptions concerning future reductions in energy and carbon intensities, future global growth will be compromised by such climate constraint.
  • The present fossil fuel-based socioeconomic system, which was built over two-and-a-half centuries, now must be comprehensively overhauled in just 30 years, and not in a few countries, but globally.
  • To avoid a climate catastrophe, a radically different strategy—a concerted policy shift to deep de-carbonization—is needed. That means a dramatic shift from current practices: a fundamental disruption of hydrocarbon energy, production, and transportation infrastructures, a massive upsetting of vested interests in fossil-fuel energy and industry, and large-scale public investment.

The supplementary analysis I mentioned is the full debate INET is hosting on the topic. It includes analysis by Gregor Semieniuk, Lance Taylor, and Armon Rezai that reinforces many of Schröder and Storm’s findings, as well as a comment from Michael Grubb, professor of energy and climate change at University College London, who offers a more optimistic view of growth during decarbonization, and subsequent response by the aforementioned scholars.

Like I said I hope that others will take a hard look at this, particularly since I am immediately concerned about issues like climate justice – fair and equitable climate action. Plus, of course, reversing the recent rapid growth of inequality.

Written by Stephen Rees

December 6, 2018 at 3:19 pm

Book Review

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This review has been removed.

The representative of the PR firm pushing the publicity campaign for its publication  has a different view of the meaning of “Fair Use” which, if followed, would have made this review incoherent. I am not willing to do that.

 

 

 

 

 

 

 

 

 

 

 

 

 

Written by Stephen Rees

September 27, 2018 at 1:23 pm

BC Budget 2018

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You can read the whole thing on the BC Gov website or Justin McElroy on the CBC ‘s summary. Basically a commitment to increase necessary spending in the right areas which is being funded by increases in taxes on the corporations and the wealthy. So I am generally in favour.

But what is missing is a much needed correction of former BC Liberal policies which saw a giveaway of our natural resources. Once upon a time oil and gas revenues from leases and royalties made a significant contribution to our provincial budget. That is no longer the case, and ought to have been corrected by the new NDP (+ Green) government.

Two reasons leap out. Horgan retains Christy’s silly obsession with LNG, as well as Site C (which will increase GHG emissions) and, quite possibly, given the federal Liberals commitment the potential TMX pipeline expansion too. Our emissions are not going down even though it is quite clear from the state of the Arctic ice alone that this is a problem we are not tackling. Melting permafrost, with consequent releases of methane and mercury, are immediate threats, not something in the future.

But secondly the whole budget rests on a somewhat hopeful outcome of the ICBC debacle. I think the idea that somehow economic growth and a reasonable approach from personal injury lawyers is going to be enough is overly optimistic. We are going to need the revenues from oil and gas royalties and leases sooner rather than later.

But also, the whole fight with Alberta over the pipeline starts to look a bit different  when you consider how much diluting bitumen for pumping down the pipe depends on BC natural gas and its condensate. (For that thought I acknowledge the twitter feed of Eric Doherty.) The entire project is based on a falsehood, that there will be a market in Asia for dilbit at a higher price than the US refiners are currently willing to pay. It becomes less attractive to the US market (where nearly all of the exports go now) if the BC fuels it depends on have to pay some fairer share of the costs on our local environment and the fact that the resource is not renewable. There is a real reason to fear the loss of jobs at the Burnaby refinery if TMX is all about exports. We need to make sure that we are getting money for value. That isn’t case at the giveaway prices set by Clark.

AFTERTHOUGHT

Yeah, well there was something else that wasn’t in the budget. It would have been really welcome if the NDP had reversed some of Christy Clark cuts to the Public Service Pension. Of course, when these were announced they came with the message “these changes protect your pension” but what they actually meant was that the government was going to stop picking up the tab for some essential health services – so the pension paid out now has to pay for the things that are no longer covered. First up was MSP, of course, but at least that will be going if not immediately. Then there was extended health care, where coverage is now distinctly chintzy. A couple of fillings today cost me $200. And I will need either a denture (over $2,000 – some coverage) or an implant (near $7,000  – no coverage at all) soon. More of that would have been covered under the old plan.

And of course many Canadians have no dental coverage at all.


“As announced in September, starting on April 1 the carbon tax will rise by $5 per tonne of carbon dioxide equivalent emissions. It will be the first of four annual increases and will bring the price on carbon to $50 per tonne of emissions in 2021.”

source: The Tyee

Written by Stephen Rees

February 21, 2018 at 3:58 pm

Should the rich be taxed more? A new paper shows unequivocally yes

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This Guardian post from Sunday covers the ground that can’t be in a ten minute radio interview. The toll removal commitment made by the NDP was not accompanied by any discussion of how the required funds would be found. The money raised by bridge tolls will now come from the provincial budget – stayed tuned for that announcement.

The problem revealed by the toll removal is that we still have not dealt effectively with how to pay for Translink. And the probability that the Mayors’ preferred alternative – road user pricing – is now hostage to the “Toll Free BC” slogan.

But there are people who have done very well indeed from the 16 years of BC Liberals. Not the general population, of course, just the privileged. The people who already had plenty have got much more. The inequity of the policies pursued by right wing governments, and vacuity of the “policy” framework based on falsehoods such as “trickle down theory” and ” the rich are job creators”, has been widely exposed but oddly not generally accepted. The fact that people still vote for these parties against their own interests has also been widely noted.

Is it actually likely that Mr Horgan will open the can of worms that is Translink funding? Will he really bring in more progressive taxation on the super rich? Or will he decided that the over heated property market in Vancouver allows him to rake in more from property tax which is always the favourite target for provincial politicians, as that is the one source of revenue that they don’t get the blame for?

While the article I am citing above does not mention Canada or BC the general principles do apply – which I why I am linking to it. Because I think you need to read that rather than whatever bright idea someone like me could come up with. Well researched, properly cited and evidence based policy recommendations – backed by hard data – is worth far more than just opinion.

If you would like to listen to me pontificating on Roundhouse Radio 98.3FM on this subject that is now online. Just make sure if you want to point other people to that link through social media you use  @Roundhouse983 and @mornings on twitter and Instagram and ‘Roundhouse Radio’ on Facebook.

Written by Stephen Rees

August 29, 2017 at 10:09 am

BC Natural Gas Revenues

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The graph comes from a tweet by Eric Neilson.

When you listen to Carole James present her interim budget in the fall this picture is what you need to bear in mind.

Written by Stephen Rees

August 22, 2017 at 10:59 am

Book Review: “Understanding Planned Obsolescence”

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There is something very post modern about this review. I was offered a copy of this new book (out 3 January 2017) to review, but what I got was an ebook hobbled by Digital Rights Management. It expires in a month and I am not allowed to cut and paste any quotations from it. Now I may not know much about copyright but I do understand the concept of “fair use”: which includes quotation!

I am going to cut and paste what I can from  the blurb on netgalley and the publisher’s press release. (see below the line)

The reason that I wanted to read the book was my irritation at getting this tweet

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The iPad mini in question is less than two years old. I have determined by reference to the book that I am not alone in this experience, and indeed it appears to be a long established policy of Apple. Indeed within the product cycle, the life of the hardware is prescribed – and there will inevitably come a day, long before the device in question is beyond repair, when its operating system will not get updated any more. There is a case in the book of the iPod whose battery life was designed to be 18 months, and the battery could not be replaced by the user. There is also a documented legal case of an iPod mini designed and sold as an adjunct to exercise which failed when it came into contact with human sweat. Apple’s advertising showed the device attached to human bodies under exertion!

There is nothing new about planned obsolescence.  I read Vance Packard’s The Wastemakers at East Ham Grammar School when I studied A Level Economics (1964-66). Everybody knows about GM’s policy of annual model changes based simply on design as opposed to technical innovation. And the cartel of lightbulb makers who made their products fail earlier so that they could sell more of them. My Dad told me about British carmaker Armstrong Siddeley that went bust because their cars were built to last – and no-one ever bought another one having no need since the first one they got was so well made and reliable. I fully expect my 2007 Toyota Yaris to see me out – unless there is a sea change at the strata council and I could install a charger for an electric car. Or Modo relents and puts a shared car in our neighbourhood.

If you are a student then you will be comfortable reading this book. It is remarkably short – I read it cover to cover in two hours or so – and is well annotated and referenced. It does acknowledge Brexit – which will probably remove British consumers from all the EU protection offered to consumers, which is remarkably advanced compared to North America. But was obviously written pre Trump. With leaders like Trudeau and Clark we cannot expect anything other than continuing adherence to the best interests of their funders. And just as the fossil fuel industries will ignore the carbon bubble for as long as possible, we can confidently expect the 0.01% and the corporations they control to continue to ignore both the pile up of garbage and pollution and the growing shortage of critical raw materials (like rare earths) as long as their profits increase and remain largely untaxed. So acquiring this book if you are an activist and wishing to bring about some change is likely to disappointing.

But if you are really in need of an education in the theory of planned obsolescence this might be worth forty quid to you (CAN$66.45 at the time of writing). But as far as prescriptions go, there’s not much. The certainty that the “current hegemonic paradigm will not allow humans to remain on this planet much longer” – and therefore the need to “walk in search of new patterns, new models, new meanings to then build new paths, new paradigms”.

And that is about it.

 


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Written by Stephen Rees

December 19, 2016 at 3:38 pm

Canada (and BC) can grow GDP and cut GHG at the same time

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I came across this story by clicking on link bait “Something else Donald Trump is wrong about” on Vox. But I decided not to simply retweet that, firstly because we have all seen far too much about that fake tan monster and secondly this is important in both a Canadian and a BC context. (And I thought the people I wanted to reach might be less interested in that attention grabbing headline – “here’s some good news about the planet” seemed better to me!)

The Sarah Palin of BC politics currently occupying the premier’s chair is convinced that LNG is both an economic saviour and a way to reduce GHG emissions. It is, of course, neither.

Our newly elected  Liberal government in Ottawa – elected on promises to reduce GHG and committing in Paris to hold global warming below 1.5℃ – is now wavering. Not only because they allowed the Woodfibre LNG plant to go ahead, despite the very obvious shortcomings of the current (i.e. previous Conservative, Harper driven) EA process. But also because of the re-election of Brad Wall, which was obviously what Catherine McKenna must have been worried about when she started talking about national unity as being more important than the survival of life on earth.

So what Vox did was reprint a table from the World Resources Institute which shows that 21 countries have managed to reduce their GHG since 2000 while at the same time as increasing their GDP.

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By the way, the stated reduction in US emissions is has been shown to be wrong, mostly because of the way they have counted methane.

You will notice, of course, that Canada is not among them. BC, of course, had been following a somewhat different track thanks to its adoption of the carbon tax. But that progress has been slowing, as the carbon tax has been stalled, and so much attention is now devoted to exporting fracked gas. Not only is the market for LNG now swamped, so that finding a customer for BC LNG will not be easy despite our generous tax and royalty regimes, but the way that methane leakage from fracking and LNG processing is measured has been updated with better data to show that it has little advantage over coal in reducing GHG.

There is no one answer to how this decoupling has been achieved – but there are some useful pointers in the article you just have to scroll down below that big table. But also there is, in BC, at present, a really good analysis of just how BC can improve its performance. And if you suppose that it might just be possible that none of the proposed LNG plants actually get built, and we elect a government in BC that is actually serious about reducing both CO2 and CH4 emissions – as opposed to just taking credit for past success – then progress does actually seem possible. Although if we try to do both, it’s very unlikely.

At the time of writing, there is still time to make yourself heard as part of the consultation on the BC Climate Leadership Plan. But even so, the table above ought to enough to silence the people who keep talking about growing the economy and saving the environment as though they were at odds with each other.

UPDATE From The Tyee interview with Nancy Oreskes, Harvard climate professor and co-author of Merchants of Doubt

Oreskes said Canada cannot seriously address climate change while also building more giant pipelines to deliver Alberta’s oil sands bitumen or British Columbia’s fracked natural gas to proposed export terminals on both coasts.

“If Trudeau can say we’re going to do all these things,” she said, “that says to me that they have not truly assimilated what is at stake here.”

Trudeau raised eyebrows when he told a Vancouver sustainable business summit last month that “the choice between pipelines and wind turbines is a false one. We need both to reach our [climate] goal.”

B.C. Premier Christy Clark similarly promotes liquefied natural gas as a climate solution: a “bridge fuel” to help China get off dirty coal power.

Oreskes called their positions dangerously “wishful thinking.”

Written by Stephen Rees

April 5, 2016 at 4:58 pm