THE FUTURIAN #4
This winter we saw the first energy shock in the transition to a greener future. Over the course of the autumn of 2020, the cost of a basket of coal, oil, and natural gas rose by 95%. There are a variety of factors that contributed to that increase in energy prices, some of which are one-offs, some of which are on-going. However, the point is well made that the transition to a low carbon economy is going to hurt, and it will hurt a great deal more before carbon dioxide emissions head even remotely towards their targets.
The method of rationing carbon use, in many western economies, is through the price mechanism. The use of low carbon sources of energy is subsidised — both directly and indirectly - while at the same time the use of high carbon energy sources is taxed more highly, both directly and through the cost base of that source (e.g. tighter regulation). These fiscal interventions have a distributional impact that has yet to be fully teased out and which has yet to make a significant impact in domestic politics.
The distributional impact tends to have a greater effect upon those at the lower end of the income scale. Low income households tend to have older, less fuel efficient, cars. They tend to live in housing where the installation of an electric car charging point is impractical because it is either high density housing or they simply don’t have a drive on which to park the car. Low income households tend to live in housing stock that has greater disrepair, that is poorly insulated, and has greater energy intensity than more eco-efficient housing. It is upon this section of society that the green transition will place the highest burden.
In the grumblings of discontent witnessed so far, it has tended to be the poorer sections of society that have protested against the imposition of what they see as an elitist concern upon their lifestyles. For example, the Gilets Jaunes are characterised as ordinary French people who needed their cars to get to work. The imposition of a green petrol tax as part of a climate transition programme was seen by them as an assault upon their way of life by a remote and uncaring elite. However, the French government did pay attention because these people have a vote. And therein lies the rub. In a liberal democracy, underlying currents of discontent eventually become expressed in the ballot box.
We have seen this process at work in recent times over the issue of globalisation and the people left behind. The process of globalisation created a situation where the benefits of integration flowed to a narrow section of society, but the costs were borne by a wider part of society in terms of jobs lost and communities impaired. The anger and disenchantment of these communities left behind were ignored by credentialed, liberal, metropolitan elites until they found voice in the ballot box. A variety of populist politicians gave form to these grievances and their supporters eventually voiced themselves in the manifestation of President Trump in the US and Brexit in the UK. It is possible to see the start of the same process in the case of the green energy transition.
That gives rise to a really interesting future. What would be the impact of climate nationalism on the green energy transition? And, more importantly, how can the worst manifestations be avoided? Let’s start with the first question because that is, possibly, the easier to answer. President Trump gave us an insight into how green nationalism would manifest itself. We can easily envisage the failure of many international agreements concerning the climate, key nations withdrawing from collective bodies, and we can imagine climate mitigation strategies not receiving sufficient funding or political support. Green nationalism could well manifest itself as a half hearted approach to climate mitigation. This is roughly where we are today and it is not hard to see a future where not much changes. That would be a problem for the climate.
A particularly weak point for the environmental cause is the proliferation of acronyms and confusing jargon. This serves to give the climate forecasts (here we should read: best guesses) a degree of scientific credibility, whereas a more scientific approach would be one that is hedged in uncertainty and outlines a range of possibilities. This has the effect of exacerbating a general distrust of ‘experts’, who are seen as charlatans trying to bamboozle the public with their jargon based mumbo jumbo underpinning their special pleading. It just feeds scepticism towards the warnings coming out of the scientific community. Pointing to the evidence, such as there is, will cut as much ice with the green nationalists as the warnings from the Remain community over the cost of Brexit. Which is none at all.
Green nationalism is a strong hand to play, but what happens if the green nationalists get what they want? We have to first consider what the green nationalists would want. This is relatively simple — an absence of change that will disrupt their lives. Of course, we could be smug and note that disruptive change is coming in any case, but this level of condescension doesn’t really help matters because it avoids the question of agency in that change. The green nationalists want to determine where the changes are to be effected, when they are to be made, and by what degree the change should be imposed upon them.
At present, the whole issue of climate adaptation and mitigation is more of a middle class concern. The more pressing concerns for those on lower incomes are earning a living, gaining access to public services, and dealing with the prospect of a rising cost of living. The climate is something they would like addressed, but not before the other, more pressing, concerns are addressed. A raft of policies that are designed to add expense to their lives is likely to be largely unwelcome. And yet, that provides a hint of the solution to the problem.
One of the causes of discontent over globalisation was that those who gained from it left to their own devices those who suffered from it. Green nationalism could be countered if those for whom it is a pressing issue were to compensate those who will suffer from climate adaptation and mitigation. A good example of a compensatory policy would be the ‘cash for clunkers’ programme, whereby the owners of older, more polluting cars, were given a cash inducement to trade up to a more fuel efficient car. This could be financed by the higher taxation of larger cars, especially those in an urban built environment. However, this would disproportionately hit the more articulate sections of society, which calls into question its viability.
At present it is hard to see how Greenlash would play out. Just like globalisation, it is an issue that has a long and slow fuse. However, the green nationalists are already organised and the whole issue of climate adaptation and mitigation could act to breathe life into a fairly disaffected community. If it were to manifest itself at any significant level, then it would seriously impair attempts to manage the temperature increases to between 1.5° C and 2.0°C. If that were to happen, we would be in serious trouble. That is why Greenlash is a blind side risk that we cannot ignore.
© Stephen Aguilar-Millan 2021