100months -the BBC Viewpoint version from N.E.F.
21/7/2008 We have just 100 months to act to prevent dangerous climate change, says Andrew
Simms. In this week’s Green Room, he outlines plans for a “Green New Deal” that could sort out the pressing problems we have with climate, energy and the financial system. No simple techno-fix exists that can reduce greenhouse gas emissions fast or far enough to solve the problem.
“Too important to fail” is the message heard repeatedly from governments stepping in and spending billions to prop up failing financial markets. But all the time, another system - an atmosphere convivial to human civilisation, that really is too important to fail - is being wrecked by political complacency and unrealistic economics.
Now, a unique new group of specialists in finance, energy and the environment are arguing for a Green New Deal that will deliver a comprehensive solution to the triple crunches of the credit crisis, high energy prices and climate change.
But time is short, very short. New and cautious calculations by the New Economics Foundation’s (nef) climate change programme suggest that we may have as little as 100 months starting from August 2008 to avert uncontrollable global warming. Nothing short of the rapid and wide-scale re-engineering of the economy will be sufficient. Radical change, though, is needed anyway because of the credit and energy crises; the latter driven significantly by the imminent peak and decline of global oil production.
No simple techno-fix exists that can reduce greenhouse gas emissions fast or far enough to solve the problem. The answers are going to be economic, political and behavioural. Many countries, not just the UK, are going to need to learn the art of rapid transition.
Lessons from history. The Green New Deal group formed in the summer of 2007 against this background,
but before the current full-blown economic crisis. It took inspiration from President Roosevelt’s response to the 1929 Wall Street financial crash. Back then, his plan was divided into an initial 100 days spent rapidly passing measures on poverty relief, financial reform and economic recovery, including the creation of the Civilian Conservation Corps. A later wave of law-making sought to deliver broader redistribution of power and resources.
Our modernised Green New Deal, published on the 75th anniversary of Roosevelt’s plan, is tailored to the threats and opportunities of today, but also designed to happen in two waves.
First, we outline a structural transformation of the regulation of the financial system, including major changes to taxation systems. Secondly, we call for a sustained programme to invest in, and deploy, energy
conservation and renewable energies, coupled with effective demand management. In place of Roosevelt’s politically clever 100 day programme - in which all of his measures were passed - we find ourselves with the very real timeframe of 100 months, imposed by the unthinkable prospect of runaway climate change.
The outcomes of our plan, though, are not to be feared. They will create countless green collar jobs, introduce greater economic stability, bring huge benefits to the real economy and establish prudent environmental policy.
Three interlocking elements make up the Green New Deal: Stabilising the financial system: A financial system built on speculation and the reckless accumulation of debt needs saving from itself with a thorough overhaul of regulation. This would include breaking up discredited financial
institutions that have only survived through the injection of vast sums of public money.
Instead of institutions that are “too big to fail”, we need institutions that are small enough to fail without creating problems for depositors and the wider public.
We also need to minimise corporate tax evasion by clamping down on tax havens and obfuscatory corporate financial reporting. Raise the resources to invest in change: The Green New Deal needs resourcing. As part of the financial reform described above, cheaper money is needed to invest
in the environmental transformation of our energy, transport and building infrastructure.
In parallel, to prevent inflation, we want to see much tighter regulation of the wider financial environment.
The UK and the global economies are entering uncharted waters, and the weather forecast is not just bad, but appalling. There are plenty of other ways of urgently freeing-up necessary finance.
As just one part of a wide-ranging package of financial innovations, the Deal calls for the establishment of an Oil Legacy Fund, similar to a highly successful Norwegian government initiative, paid for by a windfall tax on the profits of oil and gas companies.
More realistic fossil fuel prices, raised to include their cost to the environment, will generate further revenue and create economic incentives that drive efficiency and bring alternative fuels to market.
Importantly, this multiple approach will help pay for the safety nets needed for those vulnerable to higher food and fuel prices. Environmental transformation: The end game of the Green New Deal is to bring
about a low-carbon, high well-being economy. There are numerous benefits in shifting to a more efficient, decentralised energy system that uses a wide range of renewable energy technologies applied at
different scales, and in which demand is actively managed. With the right economic incentives, the foundations of a new energy system could be laid tomorrow.
Increasing our energy security and independence by making every building a power station and efficiency centre will create a “carbon army” of countless green collar workers. But that is only the beginning; re-engineering our food and transport systems would cut out unnecessary fossil-fuel use and increase our resilience and security.
Rethinking reality.
The project requires vision, boldness and a commitment to learning the art of rapid transition.
The Green New Deal calls on us to learn from history - not just what Roosevelt achieved from 1933 onwards, but from how Britain prepared for, fought and recovered from the Second World War.
Back then, in a few short years, we successfully re-tooled the economy for a new purpose, and achieved massive, supportive changes in behaviour. Also, many of those initiatives had unanticipated benefits for health and well-being, such as the growth of urban gardening. More recently, there were the responses to the oil crises of the 1970s, and Cuba’s astonishing avoidance of widespread starvation post-Cold War, when it lost access to affordable oil supplies and was placed in near total economic isolation.
Reckless and ultimately expensive lending, coupled with speculation, has brought the financial system to the brink of collapse and has funded environmentally damaging over-consumption.
That has also brought that more important system - the climate - literally to the edge. Politicians’ faith in markets’ ability to manage themselves now looks childishly naive.
Failure not an option.
Our challenge now is to make available the low-cost capital needed to fund the UK’s green economic shift whilst having controls in place to prevent inflation. To deliver the Green New Deal, we need a new alliance between environmentalists, industry, agriculture, government and the unions to put the interests of the
real economy ahead of those of footloose finance. As an even earlier US President, Thomas Jefferson, said: “I sincerely believe that banking establishments are more dangerous than standing armies, and that
the principle of spending money to be paid by posterity, under the name of funding, is but swindling futurity on a larger scale.” The UK and the global economies are entering uncharted waters, and the weather forecast is not just bad, but appalling.
The triple crisis of credit collapse, oil prices and climate change is conjuring a perfect storm. Instead of desperate baling out, and in the absence of a joined-up plan from government, the Green New Deal is the first attempt to outline a comprehensive plan and a new course to navigate each obstacle in our path.
If successful, we also believe that emerging on the other side of the storm, we will find the world to be a better place. It is, at the very least, too important to fail.