‘Show me the money’: a new slogan for the climate movement
When climate activists make generic statements like, “It’s time for climate action” or “Governments need to act like it’s a climate crisis”, what specifically do they mean? At this stage of the game, with the UN proclaiming a “Code Red for Humanity,” shouldn’t we have better talking points by now?
I’ve been writing for the past few months about the many challenges facing the global climate movement — from attempts to dismiss the 1.5°C goal and confusion around the concept of net zero to hype about misguided tech bro solutions and growing nihilism caused by the steady drip of ruin porn.
It’s not surprising that we don’t have a coherent message to guide the movement and steer the public in a unified call-to-action. Climate change is just so damn complicated, filled with dozens of wonky rabbit holes to fall down — global vs. regional average temperature rise, anthropogenic emissions, carbon budgets, net zero, parts per million, deglaciation, sea level rise, ocean acidification, and on and on — a sea of difficult concepts and terms.
If we are to succeed as a movement, we must find a way to uncomplicate climate change. This is the heavy burden that climate campaigners currently face. We must get our heads above the alphabet soup of UN terminology and deliver a clear and coherent message to the public. But right now, we seem to be failing at that task.
Ask yourself this question: If your aunt or grandparent came over for dinner and wanted you to tell them how we’re going to solve climate change, what would you say? You’ve got less than 60 seconds to capture their attention, so how in the world do you answer this question concisely, coherently, and effectively? (If you have a good zinger response to this question, please drop it in the comments below).
My guess is that the more educated you are, the more likely your answer will involve some really complex topics — UN targets, energy decarbonization, peak emissions, mitigation pathways, adaptation finance, divestment, 100% clean, carbon dioxide removal. Or perhaps you’ll pivot to one of the many battleground issues we’re perpetually fighting — keeping oil in the ground, shutting down coal, stopping gas pipelines, preventing old-growth logging. Either approach, as I’m sure you’ve found, almost assuredly will leave your relative desperate to change the subject.
I’ve been talking to many climate experts, communications gurus, and campaign leaders about how to answer this question. Combined, civil society groups have tried almost every imaginable angle of the 11-dimensional chess game of climate narratives, except for one. For some reason, we’ve shied away from one of the most obvious, and potentially most powerful, demands out there…
Show. Me. The. Money.
Think about it for a minute. Climate insiders know exactly how to solve climate change, and we also know that it’s surprisingly affordable. But the general public has not yet been informed.. In fact, they’ve been misinformed. Contrary to John Kerry’s recent statements, we do not need to invent any novel technologies to rid the world of the scourge of fossil fuels. Even the conservative International Energy Agency said in their latest report that.. “all the technologies needed to achieve the necessary deep cuts in global emissions by 2030 already exist.” Yet the public keeps getting duped by the subterfuge — the ruse that climate change is too difficult to solve and will require expensive new technologies. We need to make it clear that this is not true. The problem is not a lack of innovation; it’s a lack of funding. And we are now able to get quite specific about what we mean.
Based on the latest IPCC cost models and the global energy transition model developed by German Aerospace and University Technology Sydney (funded by One Earth), we need to be spending about $1.5 trillion per year to achieve the 1.5°C goal of the Paris Climate Agreement. Easy to remember! We’re currently only spending about one-third of that figure. Many had hoped that the trillions secured for COVID-19 recovery packages would help build resilient energy infrastructure, but so far only 2% has gone to clean energy.
We have a massive shortfall between what we need to be spending to solve climate change and what we are spending today. So why are we not campaigning on this shortfall? Why isn’t every other word out of the mouths of every campaigner about money? Money is something everyone can understand, and we now have a reference point that everyone can relate to: Globally, governments have spent a whopping $16 trillion on the COVID-19 crisis. This has saved millions of lives, but a comparable investment to combat the climate crisis could limit warming to 1.5°C, saving hundreds of millions of lives. Good bargain!
Below, I present 5 approaches to answering your hangry aunt (or a pushy journalist) next time you get put on the spot about solving climate change, crafted in the universal language of “dollars and sense.” To solve climate change, we need to…
1. Triple investments
Yes, there are many facets of the climate problem, including industry, agriculture, and deforestation. But just for a minute let’s not get distracted. 73% of the problem is energy:
According to the Climate Policy Initiative, we’re spending roughly $500B per year on the energy transition. We need to be spending about $1.5 trillion per year ($22.5 trillion this decade, from which we can subtract $7.5 trillion in avoided fossil fuel consumption). So basically, we need to triple investments globally. (Note: we also need a significant investment in protecting and conserving nature, which is the subject for another post).
State and city governments could fast track the wave of climate finance needed by issuing bonds or underwriting private investments in the form of guarantees. The Public-Private Infrastructure Advisory Facility has a great new report (PDF) on how easy it is to structure these deals, allowing for a surge of private investment without taxpayers having to foot the bill. The $1.5 trillion talking point can be divided into regional spending goals. Based on advanced energy modeling we know, for example, that Western Europe should be spending about $200B per year on direct investments in renewable energy (APCAG, Fig. 8.38). These talking points can be scaled down further to the national, state, or municipal levels. We also need to ensure that finance is distributed equitably. Recent studies show that developing countries pay an unfair premium on clean energy investments. They should be paying less, not more, to develop clean energy projects.
2. Tax the rich
The wealthy, which I define here as individuals with a net worth greater than $10 million, have never been wealthier. They also bear an outsized responsibility for climate change, not just because of their lavish lifestyles but because of their continued investment in and profiteering from fossil fuels. It’s a cruel reality that during the COVID-19 pandemic as so many were suffering, the rich became fabulously richer, with billionaires worldwide seeing their net worth skyrocket by 27% or more. According to the 2021 Credit Suisse Wealth Report, the richest 2.5 million individuals on Earth (the top .03%) hold a staggering $100 trillion in assets ($55 trillion in financial assets).
A 1.5% wealth tax on this select group of individuals could fund the entire transition to limit warming to 1.5°C — a tiny (almost imperceptible) sacrifice on their part that would create a livable future for all of humanity.
This concept is gaining steam, with campaigns in Canada and the U.S. calling for an increase in taxation on the wealthy. Jessica F. Green, a professor of political science at the University of Toronto, recently published a brilliant paper arguing for a wealth tax as the most straightforward way to raise the capital needed to get on a 1.5°C trajectory. Market-based mechanisms have required an enormous amount of policy maneuvering that to date has yielded insufficient results. And consumer carbon taxes, like the petrol tax in France that sparked the Yellow Vest movement, are not only unpopular but also unjust. Why should the consumer pay for a polluting system they did not create? Wealth taxes, on the other hand, are incredibly popular — 89% approval in Canada and 74% approval in the U.S. and UK — and relatively easy to implement.
It may take a while to implement a climate wealth tax at scale, so in the meantime we can pressure high net worth (HNW) individuals to join 1% for the Planet. Think of it as a “voluntary tax.” A person with a net worth of $10 million makes an average of $40,000 per month solely on passive income from their financial investments. Meanwhile climate change organizations receive next to nothing in charitable giving (only 2% of global philanthropy). Would these wealthy individuals really miss that $400 off their monthly income? If all HNWs joined the 1% challenge, this would theoretically generate $50B in climate philanthropy per year (assuming 9% annual revenue on financial assets)— 5 times the current level of charitable funding — which could be used to support communities and NGOs on the frontlines of the climate crisis.
3. Defund the Polluters
While there certainly has been an outcry from civil society around fossil fuel subsidies in the past, there has never been a unified global campaign to end them. The same 191 countries that pledged under the Paris Climate Agreement to reduce fossil fuel emissions to zero, are continuing to pour fuel on the fire through annual subsidies totaling about $5 trillion per year, according to the International Monetary Fund (IMF). Without these subsidies fossil fuel companies would no longer be profitable, as they would be unable to compete with cheaper, cleaner renewables. So effectively taxpayer dollars are funding the climate crisis by keeping a dying industry alive.
But we seem to be at a tipping point on this issue. Both the UK and the U.S. have pledged to wind down these toxic incentives . The Bookings Institution recently released a proposal to phase out subsidies through a G20 working group, and Human Rights Watch has now formally called upon G7 nations to end the $88 billion per year in direct payments to fossil fuel companies.
One key leverage point might be the international finance institutions (IFIs) like the World Bank and the IMF. The very same IMF that decries fossil fuel subsidies is concurrently facilitating, and in some cases guiding, developing countries to take investments that will lock in fossil fuel infrastructure for the next 30 years. Friends of the Earth did a powerful expose tracking these finance flows. It won’t be easy to end perverse fossil fuel incentives, as most subsidies are provided through the tax codes, which can take a long time to unwind. But unwind we must. It doesn’t matter what any politician says or what clean energy policies are passed, if we continue to spend $5 trillion per year destroying our planet, guess what will happen.
4. Swap the Debt
What if developing nations could become creditors of natural capital instead of debtors? Let’s take a look at the Amazon region. According to the Global Safety Net, a scientific study examining the natural lands that are essential both for biodiversity and carbon storage (funded by One Earth), we find that approximately 85% of the Amazonian region is in a natural condition. Using a comprehensive ecosystem model (Li & Fang 2014), we can estimate that the region provides approximately $9.3 trillion in ecosystem services to the world every year, free of charge:
In some ways, the carbon sequestration services provided by the Amazon forests are underwriting the egregious wealth accumulation of the Global North. Amazonian countries should be getting paid for these services, but instead they suffer under a crippling amount of debt — Brazil ($1.2T), Peru ($57B), Ecuador ($56B), Colombia ($154B), Bolivia ($24B) — which ironically creates an incentive for further exploitation of natural resources.
Debt-for-nature swaps are one way out of this quagmire. Two separate research teams from the U.S. and China have called for ramping up debt swaps in exchange for efforts by developing nations to increase nature conservation, as well as climate adaptation and mitigation. A corollary to this concept is the Carbon Removal Obligation (CRO) which treats emissions above a 1.5°C compliant limit as a carbon debt. In this scenario, the polluters become the debtors. This concept has social equity at its core and could unlock trillions in much-needed capital, but surprisingly climate campaigners have not made it a focus.
5. Boycott the Banks
In the 5 years since the Paris Agreement was signed, the world’s 60 biggest banks have financed fossil fuels to the tune of $3.8 trillion. And guess where they are getting all that money? From you! The five worst offenders, according to the 2021 Banking on Climate Chaos report (PDF), are JPMorgan Chase, Citi, Wells Fargo, Bank of America, and the Royal Bank of Canada which collectively spent more than $1.1 trillion:
All of these banks have perfected the art of greenwashing, promising their customers that they are being “socially responsible” with their deposits, while they continue to use their money to lock in fossil fuel infrastructure that will spew CO2 (and methane) into the atmosphere for the next 30 years.
Rainforest Action Network has a campaign to pressure the CEOs of these banks, but somehow I think a guy making a $32 million salary isn’t going to care much about a petition. Why not just pull your money out? Find a local credit union or join one of a number of new banking companies like Atmos or Ando, both of which offer FDIC-insured bank accounts and use customer deposits exclusively to fund community solar projects and climate-friendly businesses. Americans alone have more than $17 trillion in bank deposits. Imagine if half of us — everyone who cares about climate change — moved their money to a bank that aligns with our values. It would turn the world of fossil fuel finance upside down.
These are just five ideas on how the climate movement could shake things up over the next few years by focusing on what matters most: tripling spending to get the world on track to achieve the 1.5°C goal. The next few years are the last window we have. Let’s not get lost in the sea of little fights. Let’s focus on the big fight… money.
