The world is going to fry – unless there is change soon. There is weakening political will to make national and international targets for carbon reduction stick, no strong business and financial coalition prepared to lead and a weakening groundswell of public opinion prepared to foot the bill.
Instead, the international consensus of 25 years ago – that the world must act to challenge climate change – is dissolving. Individual countries are trying to steal a march on each other in a race to the bottom, dropping whatever scant penalties there have been for burning fossil fuels.
This new political geography has been obvious ever since the Copenhagen talks collapsed in 2009, but last week the speed with which ground is being lost became sickeningly obvious. The European parliament refused to back a stop-gap measure to save the European carbon emissions trading scheme. This allows EU companies economising on carbon to sell an allowance to those who are less efficient.
The theory is that the higher the price, the greater the incentive to economise on carbon use and the greater the value in being carbon efficient. But overloaded with sellers and too few buyers, because policing the use of carbon is completely ineffective, the European carbon price has collapsed. The European Commission proposed to clear away the backlog of sellers with a one-off buyout of the overhang of carbon permits and so support the price, but parliament was not prepared to back the cost. The scheme is as good as dead.
Contemporary capitalism faces both a crisis of legitimacy and effectiveness. We have been told for a generation that self-organising markets and business, with minimal public intervention and oversight, are the route to wealth generation, prosperity and jobs – justifying the self-serving extravagant rewards for those at the top. Bankers claimed that their actions as debt levels reached irrational levels were sound. We know differently. Now fossil fuel companies and business are saying the same about burning oil, coal and gas.
Western people will sooner or later agitate for change, as will China's millions as pollution makes its cities unbearable. Nobody wants a return to the command and control economies that failed. What is needed is a new vision of how to do capitalism in which enlightened self-interest is hard-wired into its operation, saving us from decades of austerity and environmental disaster. There are instruments at hand – the Unburnable Carbon report sets some of them out – and they mesh with larger arguments for stakeholder capitalism. The political task is to bind them together to underpin a new consensus and a new narrative. There is no time to lose.
guardian
