Growth isn’t possible (GiP) does raise profoundly serious issues about the limits to economic growth and the need for urgent decarbonisation of energy systems. But part 1 argued that NEF’s approach is seriously weakened by the fudging of energy consumption and carbon emissions in the report, its thin understanding economic growth and its dismissal of innovation.
Environmentalists have always had a problem with economic growth. In the crisis ridden 1970s, the narrative was about the Limits to Growth set by natural resources. In 1980, ecologist Paul Ehrlich made (and lost) a bet with economist Julian Simon that supplies of a number of different metals used in industry would run out and their prices would skyrocket.
There are now similar strands of thought in the peak oil movement. However, this time round the green critique of growth looks a bit more compelling, partly because of the step change in pressure on biodiversity, but of course most of all because of climate change. We all know that carbon emissions are at one level driven by economic growth. Human development is currently abutting a range of biological limits not least the atmosphere’s carbon carrying capacity, which is seriously overstretched. So maybe this time the environmentalists really are right.
As if responding to yesterday’s post here on Political Climate, chief negotiator Su Wei (pictured) has confirmed that China will not accept emissions caps in the foreseeable future. He restated China’s commitment to its pre-Copenhagen pledge to reduce emissions intensity.
It really doesn’t matter whether you support or are critical of China’s position. You may think China can do more and should at least sign up to a global halving of emissions by 2050. China has weighed up its options, looked at the liabilities, costs and pitfalls of being bound into emissions targets – because that’s how emissions reduction is judged – and has decided for now to stay out of the game. Continue reading →
There will not be a global climate deal this year, there may, however be US climate legislation. A bet on the first rather than on the second of these statements would be more likely to trouble the cashier at William Hill. However, neither is going to have the bookmakers quaking in their boots.
In a meeting of EU foreign ministers, Connie Hedegaard has acknowledged the difficulties of getting a binding agreement before the South African climate summit in December 2011. Judging by the pugnacious determination of many to stick to the Bali negotiating modus operandi – see Martin Khor’s article in the Malaysian Star as an example – even this would seem optimistic. Khor advises developing world negotiators and is keen to see the Accord killed in favour of the UN twin track negotiations. Continue reading →
WRI has just put together this useful table of the fast start finance commitments made so far by developed countries. It tells a familiar tale, with much of what seemed fresh in the glare of Copenhagen, now appearing old and rehashed.
What can we take away from these intractable discussions on international financing of climate change actions? Principally that if our focus is to campaign solely for ‘public finance’ from funds that pass through national treasuries we may be some time. Continue reading →
Yvo de Boer has announced that he is to step down as head of the UNFCCC’s secretariat. One quick thought: Appoint a successor from a developing country!
Just as the WTO’s secretariat has always been seen as close to the European Commission, so the UNFCCC is increasingly perceived as a Eurocentric administration, not least because it’s based in Europe.
If the geo-politics of climate change are to be transformed, then as well as paying more attention to the debate at the domestic level – the mantra of this blog – there also needs to be more trust in the negotiations.
On Friday 12 February, the UN’s Secretary General announced the formation of a high-level advisory group on climate financing. It will be co-chaired by Gordon Brown – although for how long who knows – and Meles Zenawi of Ethiopia. The assumption is that this is the same high-level group mentioned in paragraph 9 of the Copenhagen Accord.
It is ‘tasked with creating practical proposals to boost both short- and long-term financing for mitigation and adaptation strategies in developing countries’ and is expected to report before COP 16 in Mexico in December. With wider negotiations moribund and the debate on emissions reduction targets seemingly going nowhere the group may have its work cut out as it is likely to be the sole focus of those doggedly pursuing a global climate deal. Continue reading →
Let’s start with my original post. I didn’t actually say that an increase in taxes on wealth would be “more progressive and transparent” than an FTT. I said that it keyed more directly into a deeper logic. You can dismiss this as an “academic exercise” if you want to; I see the notion that there is a link between historical carbon emissions, the contemporary distribution of wealth and the need to finance adaptation in poor countries not as a “first best solution” to be pronounced in “lofty tones”, but rather as an important broad principle, from which could be developed some powerful political narratives. Historical responsibility is almost always framed in terms of nations, provoking a defensive response, and surely a new perspective that recognises and uses that fact that not everyone in the North has done equally well out of the history of energy intensive capitalist growth could be useful.
Paying for adaptation is going to be a long term issue, and having a campaign that (rightfully) grabs an opportunity (although more on that below) should not be a reason for banning an exploration of wider ideas. OK, so I used the Robin Hood Tax launch as a peg to hang my post on – but, hey, that’s blogging. If a campaign supported by everyone from Bill Nighy to Angela Merkel can be so threatened by some thinking around the issues from an ultimately sympathetic viewpoint, it’s not very robust is it?
Now let’s talk about the politics. You say you see a window for the FTT which isn’t there for a more direct tax on the wealthy. You could be right, but I think there are good counter-arguments. First, in the wake of the financial crisis, people hate bankers, not financial transactions. They want the bankers’ wealth taken away from them. They want financial markets regulated.
Second, and within that mood, increases in taxes on wealth are a real proposition. Despite his embattled political position, Obama is putting forward his proposal to reverse the Bush tax cuts for the wealthy in his Budget.
On the other side of the equation, the incidence issue of a FTT is not just a nerdy debating point for pointy-fingered people, but a potential political weakness. Its opponents could try to make much of the likelihood that the tax will be passed through to ordinary people. Don’t forget that, in addition to the speculators and the banks, a huge range of major companies rely on futures and options to hedge currency risk in international business and trade transactions – the hedgies will pass the tax on to them, and they’ll pass it on to us. Think what the Daily Mail could do with that if it wanted to.
Lastly, however the money is raised, I also think you shouldn’t underestimate the importance of the politics of spending it – the last bone picked with Owen Barder in your post. Last September, we polled over 3,000 people in marginal constituencies to test views on various climate-related policies. Sadly, financial transfers to fund adaptation and mitigation in developing countries had little strong support, which also appeared vulnerable to arguments that corruption will prevent money from reaching the people it should. As you say, Oxfam and others continue to work on the “quality of aid” (as you put it), but I wouldn’t see that as something you should do separately from making the case for a FTT.
I’d like to think that being in favour of an FTT and wanting to develop a wider narrative and additional policy ideas weren’t mutually exclusive. For the record I am happy to get on board the FTT campaign bus. I just don’t want to leave my brain behind.
To avoid a brawl breaking out, we’re drawing a line under this issue now, and moving on to other themes.
Oxfam’s Duncan Green has responded to Matthew’s Tobin tax posts of yesterday and also to Owen Barder’s post, which raised concerns about whether financial transactions taxes might have a regressive impact. Duncan’s argument is that a narrow window of opportunity for a Robin Hood Tax on financial transactions has been opened by the financial crisis which could raise cash for good causes. He urges Matthew and Owen to get behind the Robin Hood Tax campaign rather than proposing alternatives.
‘There’s usually a reason why the first best ones [solutions – a wealth tax, as Matthew proposes, for instance] are not already in place – it’s called politics,’ says Duncan. I feel sure Matthew will want to respond, but briefly – in my lunch break – my view is that arguing for a limited tax on wholesale currency transactions, which the literature seems to suggest would be transparent and probably not passed through to the banks’ customers, does not exclude arguing for other progressive climate and development taxes. Continue reading →
My Tobin Tax post yesterday about a wealth tax for adaptation has attracted quite a lot of discussion, which is great. Much of it is along the lines of “interesting idea in theory, but it will never work in practice, unlike the Tobin tax”. The view seems to be that campaigners have been working on the Tobin tax idea for so long, all the angles have been worked out, so the “due diligence” has been done, as Andrew Simms of the New Economics Foundation put it in an e-mail (or at least, that’s what I think he meant….). Not everyone seems convinced – Owen Barder raises problems about tax incidence, and some right wing economists think the whole idea is impracticable and wrong. I guess they would say that wouldn’t they…?
As I said in the post, I’m not against the Tobin Tax, rather, mainly interested in exploring some of the deeper ideas about intergenerational justice and climate change. However, I do take issue Continue reading →