Written by Güney Işikara and Ying Chen and first published at Developing Economics
This opens up space the left can use to address such issues in a
systematic way rather than being content with symptomal healing. In fact,
countless contributions have already been made on theoretical and tactical
grounds.1
In
this piece, we build on those contributions, and unpack the dynamics inherent
to the capitalist system that would need to be addressed in the ongoing
discussions. We also shed light on the limitations of a market-based and
growth-centered approach to tackling climate destabilization, while offering
other domains of political intervention such as property relations and
demarketization of subsistence.
A Big Step Forward:Contextualizing and
Re-Politicizing Climate Action
The
idea of a Green New Deal is not new. It goes back at least to 2008, when a
group of influential people who referred to themselves as The Green New Deal Group called on the
UK Government
to adopt a program of massive investment in renewable energy and provision of
the green economic transformation with low-cost capital, creation of green
jobs, and the like. In the same year, some economists in the U.S. published a report, outlining key strategies
to address global warming and transform the country into a green economy, while
creating jobs.
This was also around the same time that the United Nations
Environment Programme began to promote the idea of a Global Green New Deal. The
Green Party of the United States has also been campaigning for a long time for
a Green New Deal that links green transition to a broader social and economic
program.
However,
most of the approaches to the problem are rather disorienting and blurring. The
concept of the Anthropocene, for instance, paints a picture where
an undifferentiated humanity is responsible for climate change, and thereby
obscures the underlying specific relations, leaving the stage to a
depoliticized, technocratic debate between climatologists and economists.
What
is new about the recent Green New Deal resolution sponsored by Ocasio-Cortez
and Markey is that it puts climate action into the broader social context and
moves away from the prevalent depoliticized framings. It recognizes the great
inequality between the carbon footprint of the rich and the poor both globally
and in the U.S. context.
The resolution includes a job guarantee with a
family-sustaining wage, provision of high quality healthcare for all Americans,
affordable and safe housing, economic security, and access to clean water and
air, along with measures to dramatically expand and upgrade clean, renewable
power sources, build new capacities, increase energy efficiency, and make
public transportation a clean and affordable option.
It recognizes that such an
all-embracing transition is only possible through a deep and broad mobilization
where the public sector takes the leading role, committing to massive
infrastructure investments, providing the adequate capital at favorable
conditions, and supporting the vulnerable sections of society by creating
secure jobs and extending the realm of public goods and services.
However,
there is at least one further issue that deserves particular attention: the
systemic, global character of the problem, manifesting itself in asymmetric
historical responsibilities of different countries and classes, as well as
their current capacities to take action.
Limits of Market-Based Policies
According
to the latest IPCC (Intergovernmental Panel on Climate Change)
report,
the remaining global carbon budget for a scenario with a global warming limited
to a maximum of 1.5 degree Celsius above pre-industrial levels is 420 billion
tons of carbon dioxide, or, approximately eleven more years of emissions at
2018 rates. This implies that a drastic cut in global emissions is imperative
in the next decade.
The
temporal dimension of the problem is at least as important as its size and
complexity. A global strategy, even one that successfully reaches the goal of
extensive decarbonization, will not qualify as a solution to avoid moving
beyond 1.5 degree Celsius if it is implemented too late. This is a knife that
cuts both ways. Yes, whatever progress is made in the immediate short- to
medium-run is valuable.
But it is deficient. No reaction that falls short of
initiating a radical, all-embracing, and unprecedented transformation, which is
very likely to run counter to the very logic of commodification and
accumulation defining our capitalist economies, and hence disrupts them, will
not be anywhere close to sufficient. This implies that the problematization of
property relations and growth in the conventional economic sense must be part
of the discussion.
Market-
and incentive-based mechanisms have been among most popular measures proposed
by both the left and the right. An important part of what is meant in this
rubric is providing consumers and producers via the price mechanism with a set
of incentives to reduce their emissions, most notably a carbon tax.
The
logic that underlies a carbon tax scheme is the following: the unregulated
market fails to take into account the social cost of production. It cannot get
the prices correct and hence calls for an intervention to establish the latter.
Note the implicit approval of getting the correct social cost of emissions,
which are to be added to prices in the form of taxes.
Despite the common faith
in the accumulation-driven market mechanism, the relevant literature offers a
spectrum of from below $1 to around $230 per metric ton of carbon, revealing a
severe lack of convention as a result of uncertainty regarding the rate of
innovations in the energy sector, the speed of the movement away from fossil
fuels, the change in energy demand in response to increasing energy prices, not
to mention all the epistemological and technical discussions about the
so-called social discount rate.
The
German case best exemplifies the inadequacy of a purely market-based response
to climate destabilization. In 2007, the German government launched the Climate
Change Action Program – 2020 with the target of cutting greenhouse gas
emissions by 2020 by 40% relative to 1990 levels, a less ambitious goal than
what we need to according to the (usually optimistic) IPCC. It was one of the
most comprehensive national plans making use of diverse, mostly market-based
mechanisms.
Moreover, it was accompanied by the National Action Plan on Energy
Efficiency,
which, covering the same period, clinched Germany’s title as the world’s most
energy efficient country. In terms of climate change targets, the result is
impressive and disappointing, motivating and alarming at the same time. By
2017, greenhouse gas emissions were only reduced by less than 30%. Consequently, the target
was dropped in 2018.
This
demonstrates that incentive-based mechanisms – even on a national scale – are
not good enough, let alone sufficient. However, this does not mean to dismiss
the need for massive reforms (including a heavy carbon tax) in the immediate
short-run, but to recognize and confront that remaining within the structural
limits of the current social, institutional, and economic context is itself
paving the road to hell.
To be a realist today does not mean to only seek for
what can be done under political constraints, but to exploit existing
opportunities to start to immediately mitigate climate change and at the same
time push for radical social change. Putting the Green New Deal discussions
into the context of our socioeconomic system and its power relations is hence
vital.
Decoupling of GDP Growth from Carbon
Emissions?
In
order to achieve a one percent growth in global income, a near-one-percent increase in energy use is required. Currently,
about 90% of global primary energy supply still relies on CO2-intensive fossil
and biofuels, suggesting that economic growth still translates into increasing
global emissions into the atmosphere.
Although one of the crucial components of
GND is to rapidly decarbonize the economy through investment in renewable
energy, studies show that even an unprecedented wave of technological
innovation would not suffice to globally decouple economic growth
from carbon in such a short period of time.
The
fact that the U.S. economy has been recently growing with relatively stagnant
carbon emissions makes some people, including Barack Obama, believe that a decoupling
has already occurred. The International Energy Agency was even keen to announce that the “[d]ecoupling of
global emissions and economic growth [is] confirmed” following two years of
stagnation in global emissions.
This
is misleading on several grounds. First, the early celebration was based on the
temporary stagnation in emissions in 2015 and 2016, which did not persist into
2017 and 2018 where global emissions increased by 1.6 and 2.7 per cent,
respectively. Second, in the national context, inferences usually rely on
territorial emissions related to domestic production. The U.S. is the largest
net importer in the world, suggesting that the emissions associated with
consumption in the U.S. are significantly greater than its territorial emissions
associated with domestic production.
Such nation-state perspective on carbon
emissions is common, yet it conceals the global nature of the problem. In fact,
an important part of the carbon reduction achieved in the Global North in the
last two decades can be explained by the offshoring of polluting activities
toward the Global South. Even within the Global South, much of the carbon
reduction in China, for example, can be explained by offshoring activities to Vietnam and
Bangladesh.
Two
important respects should be emphasized here. First, global emissions keep
increasing with global economic growth. And second, without a global
coordination that challenges growth in the form of endless capital accumulation
and dismantles the hierarchical division of labour, conclusions based on carbon
reduction in individual countries are distorting the dismal truth.
To Grow or Degrow? Or Is There a Third
Way?
While
the world economy as a whole cannot keep growing in the next decade and at the
same time dramatically cut its CO2 emissions, this need not mean to dispense
with growth altogether and embrace degrowth. The problem asserts itself as a
political question insofar as both growth and degrowth are necessary for
different domains, industries, social classes, and countries in a
differentiated and selective way.
Instead
of recognizing growth as the crux of the debate, however, one must ask what
growth means. There is no inherent connection between the growth of marketized
output and an increasing living standard for working people. In fact, one of
the best established facts in studies on inequality is that the working classes
got very little from growth of the pie in the last few
decades.
Another example would be Cuba, which ranks among the top countries according to the human
development index as calculated by the UN, mostly contributed by high life
expectancy and literacy rate rather than GDP per capita, and still has one of
the lowest per-capita ecological footprints globally.
The
fact that the living standard of wage labourers has been delinked from GDP
growth has an important implication: their well-being can be substantially
increased under circumstances of a constant, or even shrinking GDP. We need not
be concerned with maintaining or boosting GDP growth while discussing climate
action. On the contrary, revealing and emphasizing the lack of connection
between growth and well-being is more fruitful insofar as it demystifies the
content of capitalist accumulation.
Obviously,
this implies the adoption of a clear class position instead of sticking with
green growth, presented as the only politically viable response. Yet the credo
of what seems to be politically viable is what brought us here. In addition,
not only concerns about well-being, but also the distribution of emissions
points to the necessity of a class-based approach: annual per-capita CO2
emissions of the richest 10% is around 5 times greater than that of the poorest
10% in the USA.
The extreme inequality of carbon footprint within and across
countries is not primarily a problem of morality and justice, but a political
question regarding the use of environmental commons, and as such, a question of
ownership.
What is to be done? Interrupting the
Logic of Capitalism
Now
we get down to the nitty-gritty. Production as directed by the market
mechanism, which puts profit above the satisfaction of human and social needs,
is barely compatible with the notion that the living standard of the working
classes is increased, while carbon emissions are drastically cut at the same
time.
If the economy is to be disrupted for the sake of a rapid and radical
transformation of the energy infrastructure, production structure as well as
consumption patterns, a demarketization of subsistence is indispensable. Both
political and economic mobilization is very likely to remain weak otherwise.
The
demarketization of subsistence can begin with the universal provision of
healthcare and education, affordable housing for everyone, universal access to
basic food items, and gradually be extended beyond this immediate realm. To be
clear, this is part and parcel of the Universal Declaration of Human Rights. As such, it is not even
utopian or too radical, but just incompatible with the drive of expansion
inherent to capital, which seeks to commodify all possible spheres of everyday
life.
Similarly,
pushing for certain changes in property relations is a must for climate action.
Fossil fuel companies declare that they will keep
extracting and burning all the reserves they own, precisely because they own
them! Climate deception dossiers clearly reveal that these
companies have been very well informed since the late 1980s about the
implications of their actions, and yet, they spent hundreds of millions dollars
to manufacture and disseminate misinformation about climate change.
The fossil
fuel industry must therefore be nationalized to be able to control emissions
through quantitative channels in the coming crossroad decade, which is the
safest way reaching mitigation targets.
Today,
the U.S. holds sufficient economic surplus to support a GND. The real problem
lies in that the surplus-owning class refusing to invest into the crucial
domain that helps sustain the very ecosystem we currently inhabit, which is as
essential as food, clothing, shelter and transportation, if not more so. Hence
the expenditure on its preservation, through the Green New Deal, falls within
the cost of necessary reproduction of human society.
If the surplus-owning
class refuses to recognize the priority of spending in climate change mitigation
to preserve the ecosystem, to maintain the reproduction of the human society,
this is because they are just acting as their landlord counterparts more than
four hundred years ago, who were content with idling on the surplus they owned
until they were replaced by the bourgeois class who redirected the surplus into
productive investment, and hence establishing capitalism as a politically
legitimate system.
The
public discourse, therefore, should be directed toward one that challenges the
political legitimacy of the capitalist system in its capability to tackle the
climate change crisis, rooted in its ownership structure and the consequent
allocation of resources by means of the relentless pursuit of profit.
Furthermore, not only capitalist relations that dominate the operation
domestically, but also capitalism as a world system, which imposes a global
division of labour and allows leakages of carbon emissions to the periphery,
should both be confronted as the lingering obstacle to any effective solutions to
the climate change crisis.
Doing
the same things as in the two decades following the Kyoto Protocol and
expecting a different outcome will flatly fail any meaningful climate action
and drag us into abyss. The Green New Deal is a good start for change.
The only
way to fulfill its promises is to take up a confrontational path, intensify
class struggle, spill the discussion of climate change beyond environmentalism
so as to challenge and interrupt the logic of capitalism, and move toward a
system where production of use-values overrides accumulation. •
Endnotes
Güney
Işıkara is a PhD Candidate in Economics, The New School for Social Research.
Ying
Chen joined the New School in the fall of 2016 as an assistant professor of
Economics. Her current research focuses on the sustainable development in
contemporary China from the perspective of social, economic and environmental
sustainability.
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