Tuesday, May 05, 2015

Capitalism vs. The Climate?

Has capitalism caused the climate change that threatens to destroy civilization?  Does slowing or reversing that climate change require that we move away from unregulated capitalism towards a socialist society that restricts economic consumption and production?

Naomi Klein answers yes to both questions in her book This Changes Everything: Capitalism vs. The Climate (Simon and Schuster, 2014).  Climate change changes everything, she argues, because it provides progressives with the best argument against the ideology of capitalism.  Surely, no one can justify unregulated capitalism if it is changing our global climate in ways that must make the earth uninhabitable. 

Capitalist economic growth over the past 200 years has been fueled by the energy coming from the burning of carbon-based fossil fuels--coal, oil, and natural gas.  As a consequence of that, global carbon dioxide emissions into the atmosphere have created a greenhouse effect that has been raising global temperatures.  If this continues, and temperatures increase 2-4 degrees Celsius over the next few decades, scientists predict that this will raise sea levels by 1-2 meters, which will flood many coastal areas, and this is also likely to create severe weather events--hurricanes, storms, heat waves, flooding, and droughts--that will threaten the very existence of civilization.

Klein sees a fundamental connection between modern capitalism, the Industrial Revolution, and the burning of fossil fuels that has created global warming.  Like Matt Ridley, Klein sees that the history of human life on earth, like the history of all life, has been a evolutionary history of transforming the energy of the sun into useful work that can sustain living beings.  The most successful species of plants and animals have been those that have found ever more efficient ways to transform solar energy into offspring.  Through photosynthesis, plants turn solar energy into chemical energy that can drive organic activity.  Animals capture that energy by consuming plants.

Our hunting-gathering human ancestors captured that energy by gathering wild plants and hunting wild animals.  During the Neolithic revolution, 5,000 to 10,000 years ago, some of our ancestors became farmers, and they became more efficient in using the Sun's energy by cultivating domesticated plants and herding domesticated animals.  As indicated by Ridley and others, the story of energy then became a story of moving from one source of energy to another.  First, all work was done by people using their own muscles.  Then, some people forced other people to work for them as slaves or peasants.  Over time, people replaced human muscle power with animal muscles--as in oxen and horses.  Eventually, human and animal muscles could be replaced by machines driven by the energy of water, wind, and fossil fuel. 

Using fossil fuel, which holds solar energy captured hundreds of millions of years ago, was crucial for sustaining the Industrial Revolution.  There wasn't enough wind, water, or wood in England to power the factories being built in the 19th century.  British coal fields were close to the surface of ground and close to waterways on which the coal could be transported.  The development of a railway system made the overland transportation of coal cheaper.  The harnessing of this energy from coal--and then from oil and natural gas--made possible an explosive increase in the standard of living over the last two centuries in Great Britain, the United States, and other developed economies.  85 percent of that energy that supports this high standard of living comes from burning coal, oil, and gas.

And yet, the burning of these fossil fuels has released greenhouse gases into the atmosphere that have raised global temperatures and thus changed the climate of the earth in ways that could be harmful for human life.  So far, temperatures have increased by just .8 degree Celsius, but that has been enough to bring the melting of the Greenland ice sheet and the acidification of the oceans.  As average temperatures increase more than that over the rest of the 21st century, more drastic changes can be expected.

To slow or even reverse this trend in climate change, Klein argues, we will need global policies of "managed degrowth"--that is, a drastic reduction in our standard of living, so that we use less energy from fossil fuels, and can rely more on energy from renewable sources (wind, water, and solar resources).  How exactly would that work?  And would this really improve human life on earth?

Some of Klein's critics have complained that she is vague about exactly how this "managed degrowth" would work.  Writing in The New York Review of Books, Elizabeth Kolbert agreed with Klein that drastic measures are required to save the Earth from the climate change created by capitalism; but Kolbert observed that Klein refused to confront the fundamental problem--that most human beings will not accept the drastic reduction in their standard of living that would be required to slow climate change.  In fact, even Klein herself sometimes pulls back from "managed degrowth," when she writes that stressing the need for "shrinking humanity's impact or 'footprint'" is "simply not an option today, not without genocidal implications" (447).

In a letter in The New York Review responding to Kolbert's criticism, Klein insisted that she was very clear about how to achieve low-emission living.  She noted that in her book she had cited the proposal from Mark Jacobson and Mark Delucchi who provided "a groundbreaking, detailed road map for how 100 percent of the world's energy, for all purposes, could be supplied by wind, water, and solar resources, by as early as 2030" (101).

But neither in her book nor in her letter did Klein tell her readers what the "detailed road map" from Jacobson and Delucchi required.  If one looks at their article, one sees that what their plan requires is the building of 3.8 million 5-megawatt wind turbines, 5,350 100-megawatt geothermal plants, 500,000 1-megawatt tidal turbines, 720,000 .75-megawatt wave power generators, 1.7 billion 3-kilowatt rooftop solar panel farms, 49,000 300-megawatt concentrated solar power plants, and 270 new 1300-megawatt hydroelectric power plants.

As Ron Bailey noted, this would mean erecting 250,000 wind turbines each year for the next 15 years.  As of the end of 2012, there were a total of 225,000 wind turbines around the world.  Similarly, we would have to install 113 million 3-kilowatt rooftop solar panel systems per year.  In 2013, the U.S. installed a record 4,751 megawatts of solar panels, which would be roughly equivalent to 1.6 million 3-kilowatt rooftop panels.

Bailey also noted that Delucchi and Jacobson estimate that the total cost of their plan would be over $100 trillion.  The total economic output of the world in 2013 was about $75 trillion.  So, to pay for their plan, the world would have to spend about 11 percent of the entire world's economic output ($6.6 trillion) every year for the next 15 years.

Klein is silent about all of this.  She is also silent about how destructive this would be to the environment.  For example, wind turbines require five to ten times as much concrete and steel per watt as nuclear power plants.

If Klein's proposal for "managed degrowth" seems too unrealistic and too costly, what's the alternative?  Can we continue to allow unregulated capitalism to bring climate change?

Matt Ridley points out that the projections of the Intergovernmental Panel on Climate Change for global warming assume a high rate of economic growth over the next century.  "The reason for these rosy assumptions about wealth," Ridley observes, "is that the only way the world can get that hot is by getting very rich through emitting lots of carbon dioxide" (The Rational Optimist, 332).  So the real choice here is between a world that is warmer and richer and a world that is cooler and poorer.  Ridley thinks a warmer and richer world is clearly better, because a richer world is a world that can afford to protect itself against global warming and to develop new energy technologies that reduce global warming.  The most obvious way to go low-carbon is nuclear energy, because nuclear power plants produce more power with less pollution and greater safety than any other energy technology.

The key point for Ridley is that capitalism allows for the bottom-up spontaneous generation of innovation through the evolution of specialization and the division of labor.  In such an evolving spontaneous order, we cannot predict the future, because we cannot know what new ideas and new inventions might be discovered by the human mind.  So we cannot know how human beings will solve their problems in the future, including the problem of global warming.

This is what Klein calls "magical thinking"--the assumption that capitalist markets will always create unimaginable technological solutions to our problems.  Her alternative is to argue that the only solution to a problem like global warming is a top-down, centrally-planned policy for slowing down economic production and consumption and investing over 10 percent of the world's yearly economic output to build renewable sources of energy to replace high-carbon sources.


W. Bond said...

You suggest the illogic of her proposed solution compared to Ridley’s: how will massive central planning of the (in this case energy) economy now suddenly work, when it has never in any place in fact worked?

Famously for Hayek (and others), this is a knowledge problem - the “economic calculation problem.” His famous quote aimed at the ever present Ms. Kleins of the world: “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.”

However, even if one wanted to return to a pre-industrial life, and force others to as well, let’s first be honest about the massive loss of human life and untold human suffering that that would entail, not to mention going forward without indoor plumbing, clean water, vaccines, antibiotics, etc. resulting in a halving of life expectancies, and on and on.

Secondly one cannot in practice go back or even “manage degrowth” for another very basic reason: military defense. The history of human warfare since at least the dawn of agriculture is the history of innovation and new weaponry and tactics. Not every people in every place will opt for “managed degrowth,” and eventually, assuming you have something worth taking, the countries in decline won’t get to choose their own paths any longer, it will be chosen for them.

Ken Willis said...

You forgot to mention that all the hype about global warming and climate change may be, probably is, wrong.

Larry Arnhart said...

Since 1998, there has been a slowdown in global warming that was not predicted by the climate model projections of future global warming. There have been various explanations for this 17-year long pause, including natural variations in the temperature of the oceans. But there is no general consensus on these explanations.

If this pause in global warming continues for a few more years, the theory of global warming as caused by the human emission of greenhouse gases will lose credibility.

In my comments on Klein's argument, I chose not to question her acceptance of anthropogenic global warming. Even if she is right about this, it is not clear that her drastic proposal for slowing global warming is defensible.

Ken Willis said...

There will never be a consensus because climate change is about the politics of power and money, having little to do with science. Because the premise is so flawed I believe it is folly to take Naomi Klein’s book seriously. Some day in the future this stuff will be looked back on as farce or tragedy, much like prohibition is now.

Troy Camplin said...

So Klein calls a truly scientific approach to economics, seeing the economy as a social ecosystem with similar rules to natural ecosystems, driven by similar Darwinian mechanisms in technological innovation, "magical thinking", but favors an approach to economics that, if applied to biology, we would correctly identify as creationism. It is Klein who engages in magical thinking.

Troy Camplin said...

Also, complex adaptive systems like the climate do not demonstrate endless log growth. Rather, they engage in s-cruve growth. If things flattened out, we shouldn't be surprised, since s-curves are found in complex adaptive systems all the time. Further, such a system dominated by positive feedback will not engage in pure log growth, but rather will result in boom-bust cycles. So, depending on the nature of the system, we will either see a continuation of the flattening out (top of the s-curve) or a temperature downturn as the system adapts (we are at the top of the hill).