10 October, 2008
The energy-and-climate-crisis deniers are having a hell of a party these days. The financial crash has raised their hopes that global warming, peak oil and all the other “humbug” will finally be kicked off the political agenda. One climate policy “monitor” even served us the ludicrous title: “EU: saving the economy or saving green dreams?”
Unfortunately, the sceptics are correct in their analysis that the economic recession will seriously slow down the transition to the necessary energy system revolution, but, in the long run, the sustainability crisis will hit back with a vengeance, because “nature cannot be fooled” (Richard Feyman).
How hard this vengeance will be and how painful the costs of this slowdown, depends on the lessons we learn from this financial meltdown. If we can see beyond the current market panic, the shock could actually have a long-term beneficial effect for the climate-energy revolution.
So what are the lessons to be learned?
1. What we are experiencing is not just a “financial” or banking crisis. It is the final judgement on 30 years of unbridled free market fundamentalism which started with the Reagan-Thatcher revolution and which gave us the illusion that we could live way beyond our means (also the real cause behind the sustainability crisis). It is only one of the “converging catastrophes” of James Howard Kunstler’s “Long Emergency”. You could call it the “end of casino capitalism” or in the words of Kunstler the end of “funny money”. Former Senior World Bank economist Herman Daly describes it as “a crisis of overgrowth of financial assets relative to growth of real wealth” in his excellent analysis on the Oil Drum website. If we can learn the lesson that there is no such thing as a free lunch, that we cannot live beyond our means, and that it is the “real wealth” which counts, we might develop a better understanding of the sustainability (climate-energy) crisis.
2. It is also high time to learn to listen to the early “alarm bells” and to stop ridiculing anyone who dares to tell the “inconvenient truths” as a “Doctor Doom and Gloom”. Several financial commentators such as Nouriel Roubini have been warning for years that this market exuberance would end in a financial collapse while the high priest of free market spin and reality denial continued to sell their “buy-now, buy-more” stories (for which they are highly paid, of course). Related to this is the fact that the traditional media have failed to look beyond this spin and that it has been the blogosphere where some of the best forward-looking analysis has been published.
3. Another lesson to be learned is that in this globalised world, national solutions no longer work. We are all in the same boat and when the Titanic starts sinking, it is time for globalised solutions. This financial collapse and the climate/energy collapse will only be prevented when we develop new global governance structures which go far beyond the current deficient UN and G-8 processes. If we manage to use this financial crisis to get new thinking on global cooperation, this would help enormously to deal with the sustainability crisis later.
4. Last but not least, even with the loss of billions in the stock market crash now, this world is still a rich place (in terms of money as well as natural resources). The real doom and gloom stories are the myths that the solutions to the climate/energy crisis would be too expensive. If trillions of dollars and euros can be found to save the financial markets, I am sure these trillions can also be mobilised once the political will can be found to also save the planet.Author : Willy De Backer