[ The Note for October 2014 ]
For most of the history of our species, we were hunter-gatherers. We could not store large stocks of resources. Social groups were small, defined by the range individuals within that small group were able to cover, in search of sustenance. We formed microcultures that left little in the way of permanent record. Knowledge expanded slowly. Scarcity remained the rule for human societies, even as agriculture took over, and cities grew, and urban civilization spread across the world. The few that were able to control the structures that establish and reinforce what we call society have been able to enjoy abundance, without allowing everyone else into that enjoyment. Perpetual scarcity, then, appeared to be an organizing principle, though it was more an illusion than a fact of life on Earth.
A simple message on climate: We are facing unaffordable costs. We know how to reverse course. Not only is the solution affordable; it pays dividends.
In this short talk, delivered at TEDxOrangeCoast, venture capitalist Dan Miller explains the imminence of the climate threat, the impacts we are already facing, and how we can act to stop making matters worse.
Citing the findings of REMI’s June 2014 study, Miller notes the plan would not only cut CO2 emissions by 52% in 20 years but also save 227,000 lives during that same time, while creating 2.8 million new jobs and adding $1.4 trillion to GDP. His summary of that outcome: “That’s better than free.”
Report from the World Bank / IMF Civil Society Forum
In the years I have been attending and contributing to the World Bank / IMF Civil Society Policy Forum, I have witnessed a distinct and ongoing evolution. Multilateral institutions like the World Bank and IMF, which are funded by and directed by governments, and which do business with governments, have direct impacts on elements of society that are not in the room when decisions are made. So civil society organizations have an important role to play in highlighting and reducing major risk areas, and in shaping policies that lead to better outcomes.
[ The Note for September 2014 ]
The Cafe Cash Register Standard
There is a cafe I like to visit whenever I am near Villanova University, where I studied and taught for many years. A few years ago, someone staged an informal experiment, putting a stamp on a dollar bill to make it easily identifiable. Staff at this cafe reported receiving the bill in payment no less than 30 times in a 60-day period. That one dollar bill became $30 in gross domestic product (GDP). In this sense, the local economy of the cafe is a phenomenally efficient engine of economic productivity.
A Clear Price Signal to Visualize the Optimal Energy Investment Shift
[The Note for July 2014]
The single most significant obstacle to moving major investment capital into clean energy is uncertainty about the future market value of doing so. Will such a move put a business at a competitive advantage or at a relative disadvantage, if everyone else is buying cheap fuel that fits seamlessly into the prevailing infrastructure? What has long been missing is a way to move market-dominant private-sector capital into clean alternatives. In a sense, the biggest challenge everyone is facing, when thinking about the future, is how to visualize the future itself, and how to trust that one’s visualization is reliable. The most cost-effective and practically efficient way to do this is with a clear, decisive price signal that allows market players to more clearly visualize an optimal investment-transition trajectory.
[ The Note for June 2014 ]
The transition to a clean energy economy requires a number of significant changes to the status quo. Most central to motivating the transition is the project of revealing the hidden costs associated with how we get energy from carbon-based fuels. As it stands, the whole of civilization and a vast web of natural systems are financing the business model that makes lots of money for a few people and provides us with what appears, due to pervasive market distortions, to be cheap energy. The market fails in this way, because costs remain hidden from view. Consumers, businesses, investors and public policy planners cannot make appropriate decisions about cost efficiency, because they cannot see the costs in dollar amounts.
Regional Economic Models, Inc. (REMI), one of the most respected economic modeling firms in the world, has produced a new study, using proven and reliable models, which shows that a steadily rising carbon fee returning 100% of revenues to households would create millions of new jobs, expand GDP and save hundreds of thousands of lives. In the first 10 years alone, the plan would generate 2.1 million net new jobs, across the entire US economy.
It is commonly thought that putting any kind of price on carbon emissions would cause costs to rise unbearably and the economy to slow disruptively. REMI’s new study The Economic, Climate, Fiscal, Power and Demographic Impact of a National Fee-and-Dividend Carbon Tax [pdf] shows that the manner in which the price is applied is what matters, and that getting it right can relieve and even reverse grave inefficiencies in our current market dynamic.
The Environmental Protection Agency has announced new rules to curb carbon emissions, under the Clean Air Act. The program is called the Clean Power Program and aims to reduce emissions from coal-fired power plants by more than 30% within 20 years. It is the single most significant step toward reducing power plant greenhouse gas emissions ever taken by the US government.
Many environmental activists are celebrating; predictably, opponents of climate action are warning of grave economic costs. The real impact is less, and less immediate, than many suspect. If the targeted emissions are reduced by the target percentage, then overall US greenhouse gas emissions from industrial, household and transportation sources, will decline by roughly 10% over 20 years.
[ The Note for May 2014 ]
When we try to judge what comes next, economically, scientifically, politically and culturally, we have some very specific and significant limitations. We can only use past experience and our perceptions about our current situation to make judgments about what has not yet happened. We can only quantify what is quantifiable, and what is not observable can hardly be quantified. When we think about future roads, we tend to look at roads we have now; when we think about future energy, we tend to look at combustible fuels as the most commonplace and naturally occurring way of harvesting energy for human uses. When we think about economic behavior, we tend to assume that all future values will be related to what we are already observing now. The intangible element of human thought, innovation, collaboration and discovery, is generally left out, leaving us looking through a very problematic blind spot.
We are now living in the beginning of a period of global transition. Over the next two decades we will be rebuilding the infrastructure of our civilization. We could choose to replace existing infrastructure with something similar, but slightly newer and more expensive… or we could choose to build the economy of the future. There’s no question about which is a better investment.
As we come to grips with the mounting costs of inefficient outdated technologies, we are beginning to see the unprecedented economic incentive for moving swiftly to redesign the built environment that we inhabit. The amount of energy trapped in hydrocarbon molecules deep underground is minuscule in comparison to the amount of solar energy that lands on the surface of the Earth and the resulting kinetic energy that moves around our planet all day, every day.