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Musings on a Green Economy pt4: What Needs Fixing And How Do We Fix It?

Home UncategorizedMusings on a Green Economy pt4: What Needs Fixing And How Do We Fix It?

Musings on a Green Economy pt4: What Needs Fixing And How Do We Fix It?

30th August 2012 Uncategorized 5 Comments

This is the fourth and last part of my holiday musings on a Green Economy – looking at what’s stopping us achieve a sustainable economy and what I suggest needs doing to break down those barriers.

Last time we saw that the elements for a green economy are all available to us: radical ways of delivering experience without (so much) stuff, a shift to renewable energy, zero waste business models and the eradication of toxic materials.  However, unlike most technological advances, we can’t afford to be laissez-faire as time is not on our side. This week arctic ice coverage plummeted to an all time low, disrupting weather patterns across the Northern temperate zones (not to mention my holiday plans). What is required is vastly accelerated maturation of these elements so innovation, synergies and economies of scale all kick in to deliver rapid change.

So what is holding us back?

I often say that the barrier to sustainability is just 6 inches wide – the space between our ears. And unfortunately it is human nature to think incrementally – witness current calls for a plastic bag tax. But, as someone else said – man didn’t get to the moon by aiming half way – or 0.1% of the way in the case of the would-be scourges of carrier bags. We need to collectively raise our sights.

Politically, there is no doubt we need much stronger leadership across the board. The Rio+20 summit was conspicuously premier-free – with big names like Merkel, Cameron and Obama absent. This presents a big risk as political leadership gives the nascent technology developers confidence and bureaucrats direction. As the green economy requires creative destruction – we have to lose the old ways of doing things as fast as we gain the new ways – we need our leaders to be cheerleaders for the new. Otherwise the media will focus relentlessly on the loss of the old – we need that bright uplands vision thing desperately. Here in the UK, opposition Labour leader Ed Miliband, who has a decent record on green issues when in office but has been strangely silent on it since, could make much, much more of the green economy and force the Prime Minister to buck up his act.

On the global scale, a binding international agreement on climate change seems as far away as ever – and I find it hard to see how any agreement will satisfy Washington, London, Berlin, Beijing and New Dehli without being so weak as to be worthless. UK Chancellor of the Exchequer George Osborne has been widely condemned for saying there is nothing green about forcing polluting companies overseas, but actually he was quite right. Without an international agreement, such ‘carbon leakage’ will undermine moves in richer countries to cut their carbon. This is a classic ‘tragedy of the commons’ where it is in no-one’s self-interest to act, yet everyone suffers as a result.

So how do we square that circle? I can think of two ways. First, forget the binding carbon targets, but challenge each country to publish their own targets and report against them in real time, creating an element of competition. This has the benefits of being really easy, fast to implement and avoids the dreaded lowest common denominator. The only ‘penalty’ is loss of national pride which of course won’t have the oomph of binding targets, but this approach has the substantial advantage of being possible.

Secondly, big business controls global supply chains through buying power, irrespective of national boundaries. If countries, trading blocks and corporations co-operate to mandate whole-life cycle sustainability requirements on products and commodities (in a flexible way), then it won’t matter whether a product is produced in Leicester or Kuala Lumpur, it will be low carbon and sustainably sourced. Developing countries would strive to implement higher green standards to remain competitive, rather than the race to the bottom we currently have. And Mr Osborne would get to sleep easy.

On a more local basis, many of the moribund economies of the world are looking for infrastructure projects to stimulate growth. Well, here’s an idea. Instead of expanding roads and airports and all that old fashioned high carbon economy stuff, why not accelerate the development of smart grids. This hits so many buttons – high tech, long term, innovative, sustainable, and most importantly, it will unlock the long term uptake of renewables to the point where they can dominate electricity production driving down the country’s carbon footprint. You can have that one for free, Chancellor.

Despite the doom and gloom. I remain optimistic that we can fix these problems – but we do need to, as Apple put it so ungrammatically but effectively, think different.

OK, so that’s my view, what’s yours?

 

Tags: low carbon economysupply chainsustainable production and consumption
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  • Karen Johnson
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    September 4, 2012 at 11:11 AM

    Thanks for these blogs, I really enjoyed them and look forward to introducing my colleagues to them. I have two comments:

    1. I wonder if our Chancellor was to invest money into research and development of smart grids as you suggest then could it provide the leadership in our UK companies that helps drive worldwide interest? Research and development in the STEM (Science Technology Engineering and Maths) subjects seems to have been forgotten by this Govmt.

    2. On the chances of our economy being different (from boom and bust of past) in the long term…I feel that our attitude to debt has to radically altered if we are to achieve a sustainable economy. I am concerned that by the introduction of ‘tuition fee’s (which would have occurred under Labour too) instead of a ‘Graduate Tax’ (which is ostensibly what the tuition fees are) we have missed a trick. If we had been able to make the Graduate Tax’ system work I believe that students would not leave University with the damaging perception that DEBT IS OK. In my eyes, if they leave University with the perception that you have to pay more tax if you earn more then this has more positive implications for a self-sufficient economy.

    I know that in many ways both of my points are political point but since the economy as you rightly point out is so bound up with green issues I think they are relevant.

    Any comments anyone?

  • Gareth
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    September 4, 2012 at 12:05 PM

    Thanks for that Karen. One of the big benefits of the smart grid idea is that it promotes technical innovation, entrepreneurialism and therefore sustainable growth and this would feed into the Universities.

    I find it harder to link your point about tuition fees to a green economy – something for me to chew on!

  • Chris Milton
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    September 25, 2012 at 11:30 AM

    Thank you for this series Gareth… it’s taken me weeks to chew over and I’ve come to the conclusion I need to publish my own thoughts at length in a different place 🙂

    I agree very much with just about everything you’ve said, but I also agree with Karen’s comment about “debt is OK”.

    This is because I don’t really think about a “green” economy but more a sustainable one. Debt and its acceptance as part of everyday life is fundamentally unsustainable. If we’re thinking about the new economy, that needs to be challenged head on.

    This leads us to the whole “growth is good” ethos and wondering what manipulation of the economy is all about.

    Is it about wealth creation? If so, surely there’s no societal gain if everyone gains in wealth together? Wealth is a relative term not an absolute one.

    Is money what really matters? If not, then why do we measure our economy in terms of money? Why not in terms of … oh I don’t know, heart rate after 30 minutes rest? Surely a person’s physical fitness is more important than their potential to generate financial income?

    You’re right .. the greatest impediment to a green or sustainable economy is the six inches between our ears. And if we’re talking about hte economy then we need to get one thing straight from the start .. it’s not just about the money.

  • Gareth Kane
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    September 26, 2012 at 1:31 PM

    Thanks Chris!

    I can’t help thinking that as the economy is about money, we must measure it in economic terms, however there is scope for smarter measures than GDP. Society however is a different matter and this is where other metrics come in. But I’m a bit sceptical about using a single combined measure as transparency and analysis often suffer.

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