Adam Tooze's Blog, page 33

Was ist die grüne Erzählung von Politik und Emotionen?

Das große Rad drehen: Ökonomie und Psychologie der ökologisch-sozialen Transformation Moderiert von Ellen Ueberschär (Heinrich-Böll-Stiftung) entwickeln Adam Tooze (Columbia University NY), Robert Habeck (Bündnis 90/Die Grünen), Maren Urner (HMKW Köln) und Jens Südekum (HHU Düsseldorf) finanzökonomische sowie sozialpsychologische Strategien, um die ökologisch-soziale Transformation in der Breite der Gesellschaft zu verankern. Welche gesellschaftlichen Räder müssen gedreht, welche staatlichen Maßnahme ergriffen und welche Gefühlslagen geweckt werden, um große Veränderungen anzustoßen und langfristig tragfähig zu machen?

Bitcoin ist ein Krisensymptom

Gerade erst hatte die Kryptowährung Bitcoin einen Rekordwert von über 60.000 Dollar erreicht, inzwischen hat sich aber im Vergleich dazu ihr Wert in etwa halbiert. Auslöser dafür ist unter anderem der Tesla-Chef Elon Musk. Darüber spricht Lisa Splanemann mit Wirtschaftshistoriker Adam Tooze.

Can Elites Start the Climate Revolution?

Financial capital and the courts are quietly creating the conditions to stop global warming—if politics does its part, too.

Will the spring of 2021 prove to be a pivotal moment in the climate crisis? Last week, the management of both Exxon Mobil and Chevron lost battles with green activist shareholders. A third oil major, Shell, was ordered by a Dutch court to dramatically step up its climate effort. This followed a damning judgment in April by the German supreme court on Berlin’s plan for decarbonization. The International Energy Agency (IEA), formerly a bastion of the fossil fuel industry, laid out a demanding path to net-zero greenhouse gas emissions. And to cap it all off, Ford launched its F-150 electric truck.

It is hard to exaggerate the symbolic significance of these events. The F-150 is the most widely used vehicle in the United States. Eight percent of American workers are thought to use an F-series vehicle at their job every day. Making it electric doesn’t make this behemoth any less dangerous to pedestrians. Its huge electric engines still suck vast amounts of energy. The batteries that drive the F-150 Lightning electric truck are large enough to power a house for three days. This is not what the future of sustainable mobility looks like. We need to get smarter in the way we use power, not find new “green” ways to do the same dumb things. Nevertheless, with its brutish appeal, the new F-150 might just transform the electric-vehicle market in the United States.

Read the full article at Foreign Policy

On climate, jobs and financial stability: Towards a new mandate for central banks?

There was a time when the world still seemed a good – and above all simple – place for monetary authorities. Every few weeks, they had to decide whether, in view of the latest price developments, it would be better to raise the key interest rates by a quarter point – or not. That was a long time ago. Today, central bankers are in demand whenever banks are in crisis or investors flee government bonds. What’s more, they could even help save the climate, ECB chief Christine Lagarde admits.
Don’t the monetary guardians need a new mandate right away? This highly sensitive question was the subject of day 3 of the VIII. New Paradigm Workshop.

ECB Director Isabel Schnabel gave a keynote speech on the extent to which central banks can (co-)bear social responsibility – without losing their independence. You can reread the whole speech here.

Afterwards, Adam Tooze raised the question of whether the ECB might not be best served with a new mandate – because it has no choice but to worry about the stability of financial markets, the drifting apart of wealth, or saving the climate. In the Forum study he presented, Moritz Schularick described how the guiding principles and paradigms of central banks can change. Both studies will soon be published on our website. The discussion was moderated by Laurence Tubiana, professor of economics and CEO of the European Climate Foundation.

More information at Forum for a New Economy.

Europe needs to go big

Call to Europe with FEPS – Europe needs to go big!

What can the EU learn from the US and Biden experience in this recovery and reconstruction phase? What is the basis for a successful relaunch of European integration that goes beyond the temporary ‘Next Generation’ instruments? Amid one of the most serious crises and an internal reflection process on its own future, Europe has very few options besides going big.

More info & programme: https://www.calltoeurope.eu/en/

Adam Tooze on Climate Politics After COVID

Back in autumn 2019, when COVID was still just a twinkle in Satan’s eye, the world was already hurtling toward crisis. The Arctic Sea ice was historically minimal, and global temperatures historically high. “Once in a lifetime” storms were devastating the Caribbean every year, while wildfires gave the West Coast an annual taste of hell on Earth. The latest IPCC report read like extremely dry and dystopian work of hard sci-fi. The world’s most powerful nation appeared hell-bent on expediting the ecological eschaton. And Adam Tooze, the great historian of global calamities, was working on a book about how all this came to be.

Then, history intervened. Tooze turned his attention to the pandemic, embarking on an account of the COVID era’s economic upheavals. Meanwhile, in the United States, epidemiological and political crises took precedence over the climatic one.

But now, like a ne’er-do-well car-accident victim waking from a coma, America is emerging from an acute disaster, only to reenter the slow-motion catastrophe it calls normal life. Shots are in arms and a Democrat is in the White House — but the climate crisis is ever-deepening, and U.S. decarbonization efforts remain lacking.

Read the full interview at New York Magazine.

Investment and Decarbonization

A roundtable discussion with: Anusar Farooqui, Yakov Feygin, Daniela Gabor, Robert Hockett, JW Mason, Saule Omarova, and Tim Sahay, moderated by Adam Tooze.

Learning to Live with Debt

At the time of writing, the pandemic is continuing to take a heavy toll on the European economy, and even though an economic collapse has been prevented, Europe’s growth prospects are far from encouraging. Policy-makers across Europe have supported firms, workers and families through furlough schemes, income support and loans – often with remarkable pragmatism – and are continuing to provide new forms of aid. The European recovery fund offers €750 billion in grants and loans to poorer and harder-hit countries. But policy-makers in Europe are reluctant to use the full arsenal of the government balance sheet to spur a full and swift recovery in the way the new US administration is doing, as the fear of higher public debt starts to dominate the European debate (again).

In the aftermath of the Global Financial Crisis of 2008 and the ensuing crisis in the eurozone, those in favour of a swift end to fiscal support won the argument, causing widespread economic harm. This time, European policy-makers should act differently. Their foremost concern should not be public debt, but how to support a swift economic recovery, reach full employment, and bring inflation back to its target level of 2 per cent. This policy brief reviews the costs and benefits of higher public debt in Europe and how today’s world economy is very different from the one that inspired the old consensus.

Read the full policy brief at the Centre for European Reform

The debt hawks are flapping their wings

The question of public debt hangs over Europe’s future. Brussels prefers to talk about other things—the Green Deal or social Europe. The European public is more urgently interested in vaccines, lockdowns and immigration. But nothing is closer to the heart of power in the European Union than public debt.

To even mention it brings back painful memories of the eurozone crisis. After the shock of 2020, the debts are even bigger. And, like it or not, the debate is beginning again. More than any other issue it will decide the future of Europe.

The Stability and Growth Pact has undergone many stages of evolution since the Maastricht treaty was signed in 1992, but two fixed points remain. The ratio of public debt to gross domestic product of EU member states should not exceed 60 per cent and annual budget deficits should not exceed 3 per cent. Those who do not meet these criteria are expected to take measures to ensure compliance.

Read the full article at Social Europe.

Green mortgages: Homes need to catch up to climate change

When we think of tackling the problem of climate change we might think of smoke-belching power plants, or gas-guzzling trucks, or the guilty pleasure of a last-minute flight to Cancun.  

But a huge part of the climate problem is generated by us, simply living our daily lives, at home or at work. Twenty percent of total emissions in the U.S. originate in energy consumption in the home. No doubt, we could do better in turning off the lights and setting the thermostat to more moderate temperatures, but a big part of the problem is beyond our control. Most people don’t deliberately waste electricity. You can’t help it. America’s buildings; its homes, its offices, its stores and its warehouses, leak. They leak heat in the winter and cool in the summer. 

Bigger houses lived in by the most affluent, leak most. But it is those on low incomes, in poor quality housing who pay proportionally the highest bills. The pain is evident in the alarming figures for energy poverty amongst Black and Latinx Americans (more than one in three.) The energy crisis is wrapped up in a broader housing crisis. In Baltimore, 42 percent of the homes are so severely afflicted by mold and decay that they are unsafe for the basic insulation work needed to fix their energy leaks. In Atlanta the percentage may be as high as 64 percent.

Read the full article at The Hill.