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Climate Capitalism: Global Warming and the Transformation of the Global Economy
Confronting climate change is now understood as a problem of ‘decarbonising' the global economy: ending our dependence on carbon-based fossil fuels. This book explores whether such a transformation is underway, how it might be accelerated, and the complex politics of this process. Given the dominance of global capitalism and free-market ideologies, decarbonisation is dependent on creating carbon markets and engaging powerful actors in the world of business and finance. Climate Capitalism assesses the huge political dilemmas this poses, and the need to challenge the entrenched power of many corporations, the culture of energy use, and global inequalities in energy consumption. Climate Capitalism is essential reading for anyone wanting to better understand the challenge we face. It will also inform a range of student courses in environmental studies, development studies, international relations, and business programmes.
- GenresClimate Change
218 pages, Paperback
First published May 27, 2010
5 people are currently reading
43 people want to read
About the author
Peter Newell
14 books1 followerLibrarian Note: There is more than one author with this name in the Goodreads database.
Peter Newell is Professor of Development Studies, University of East Anglia.
Curriculum Vitae:
http://www.uea.ac.uk/polopoly_fs/1.11...
Peter Newell is Professor of Development Studies, University of East Anglia.
Curriculum Vitae:
http://www.uea.ac.uk/polopoly_fs/1.11...
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Displaying 1 - 4 of 4 reviews
February 18, 2013
“Climate capitalism or why we should sign up Goldman Sachs in the fight against climate change”
If we accept the premise that climate change entails clear and present dangers that we humans can prevent, should we proceed by giving up on our current economic model and choose a new direction, or join forces with the leaders of our capitalist economy to reform the model and help them make money on the way? This question is not just theoretical; it has a fundamental impact on the best strategy. If you take climate change seriously, should you join an anti-capitalist group and organize a protest at the next G8 meeting, or join forces with Goldman Sachs? For Peter Newell and Matthew Patterson, the latter is a necessary step.
As the title suggest, this book is about market-based policies (essentially, cap and trade systems and carbon taxes) meant to “decarbonise” our economy; their roots in neoliberalism, their development in the 90’s and 00’s, and their potential and limits to reduce carbon emissions and save the planet. For the authors, these mechanisms are appealing for essentially political reasons: the alliance between environmentalists and financiers has the potential to create a powerful constituency that benefits from market-based climate change policies. They argue that in the context of a capitalistic society, this is the only viable option to make the urgent changes quick enough to avoid the worst effects of climate change. Abandoning our capitalistic ways is simply not realistic at the moment, so we must find a way to grow our economies while replacing coal, oil and gas. Turning our climate into a commodity for financiers to trade is the way to go.
For everyone but a Stephen Harper Conservative, this approach is not new. Businesses currently treat the environment as if it is worth nothing. Pricing nature and incorporating that price into the cost of production creates an economic incentive for its protection. Of course, the process doesn’t end there. Once the commodity is created, bankers, traders and speculators step in, and nature goes through the securitization food chain. Imagination is the only limit to the many financial products that can be created and traded, as the recent financial crisis has revealed. But this is the ideal scenario. We’re not quite there yet, especially in North America. The novelty of their argument is mostly in the subtext and aimed at the academic/lefty type: financiers are unavoidable actors of our society, so we should try to harness their power to create a low-carbon economy.
The authors are careful, and repeatedly point out that by themselves, market-based mechanism will not be enough to “decarbonise” the economy. Left to their own device, the good people at Goldman Sachs will not save the planet. We need the protesters to pressure businesses and governments to set ambitious targets and act with transparency. We need governments to set high standards and efficient regulations, and to enforce the rules. All these actors have a role to play in the governance of climate capitalism, and should not be seen as “outside” the dynamic of carbon markets. This is a clear and refreshing denunciation of the naive neoliberal faith in the efficiency of markets. But even then, many things could go wrong warn the authors. The first experiment with a large-scale emissions trading scheme in Europe is a case in point. Too many emissions permits were initially allocated, so the price of carbon collapsed and did not create the desired incentive on polluters.
Some of what I found most interesting is when the authors explore in details the mechanics of emissions trading. Neoliberals beware: more markets do not mean less government here. Emissions trading require heavy regulatory infrastructure and the development of considerably more complex rules than a carbon tax or a simple cap on emissions. These are good lessons for policymakers. Sadly, were not even at the point of having the cap and trade v. carbon tax debate in Canada.
What I found disappointing is that the more fundamental criticism to market-based mechanisms is mentioned, but not developed. It’s clear that the roots of climate change are found in the development of industrial capitalism. Turning nature into a commodity can be seen as a new stage of financial capitalism, where capital is colonizing and transforming every aspect of our life and nature for its benefit. Everything must be aligned with the goal of capital accumulation nowadays, even our education. I cringe every time I hear a politician say that we must “train our brains for the needs of the market”. Karl Marx would say that we are completing our alienation process, alienating ourselves from our fundamental human nature, and Mother Nature itself. He’s not far off base. To me, the book does not capture how truly extreme and radical turning our climate into a commodity is as a “solution”.
People are right to ask if all these fancy “cap and trade” systems and financial abstractions are in reality counter-productive. Isn't this just feeding the process that’s driving the crisis, and distracting our attention from the profound changes that are necessary to create a truly sustainable and fairer society? Perhaps, would answer the authors. But we’re in damage control mode, so we must act quickly. Neoliberalism is the lingua franca of our age and will inevitably shape our response to climate change. People in the Marxist tradition, such as David Harvey, and proponents of “décroissance”, of moving away from the imperative of economic growth, will not like the arguments at the heart of this book.
But overall, the book provides an excellent review of the development and potential future of market-based climate change policies, a powerful argument in their favor given the political context, and good lessons for their governance. An excellent read so long as the reader accepts that what we should be doing is not designing the ideal sustainable and just society, but finding the right buttons to push given our current situation.
If we accept the premise that climate change entails clear and present dangers that we humans can prevent, should we proceed by giving up on our current economic model and choose a new direction, or join forces with the leaders of our capitalist economy to reform the model and help them make money on the way? This question is not just theoretical; it has a fundamental impact on the best strategy. If you take climate change seriously, should you join an anti-capitalist group and organize a protest at the next G8 meeting, or join forces with Goldman Sachs? For Peter Newell and Matthew Patterson, the latter is a necessary step.
As the title suggest, this book is about market-based policies (essentially, cap and trade systems and carbon taxes) meant to “decarbonise” our economy; their roots in neoliberalism, their development in the 90’s and 00’s, and their potential and limits to reduce carbon emissions and save the planet. For the authors, these mechanisms are appealing for essentially political reasons: the alliance between environmentalists and financiers has the potential to create a powerful constituency that benefits from market-based climate change policies. They argue that in the context of a capitalistic society, this is the only viable option to make the urgent changes quick enough to avoid the worst effects of climate change. Abandoning our capitalistic ways is simply not realistic at the moment, so we must find a way to grow our economies while replacing coal, oil and gas. Turning our climate into a commodity for financiers to trade is the way to go.
For everyone but a Stephen Harper Conservative, this approach is not new. Businesses currently treat the environment as if it is worth nothing. Pricing nature and incorporating that price into the cost of production creates an economic incentive for its protection. Of course, the process doesn’t end there. Once the commodity is created, bankers, traders and speculators step in, and nature goes through the securitization food chain. Imagination is the only limit to the many financial products that can be created and traded, as the recent financial crisis has revealed. But this is the ideal scenario. We’re not quite there yet, especially in North America. The novelty of their argument is mostly in the subtext and aimed at the academic/lefty type: financiers are unavoidable actors of our society, so we should try to harness their power to create a low-carbon economy.
The authors are careful, and repeatedly point out that by themselves, market-based mechanism will not be enough to “decarbonise” the economy. Left to their own device, the good people at Goldman Sachs will not save the planet. We need the protesters to pressure businesses and governments to set ambitious targets and act with transparency. We need governments to set high standards and efficient regulations, and to enforce the rules. All these actors have a role to play in the governance of climate capitalism, and should not be seen as “outside” the dynamic of carbon markets. This is a clear and refreshing denunciation of the naive neoliberal faith in the efficiency of markets. But even then, many things could go wrong warn the authors. The first experiment with a large-scale emissions trading scheme in Europe is a case in point. Too many emissions permits were initially allocated, so the price of carbon collapsed and did not create the desired incentive on polluters.
Some of what I found most interesting is when the authors explore in details the mechanics of emissions trading. Neoliberals beware: more markets do not mean less government here. Emissions trading require heavy regulatory infrastructure and the development of considerably more complex rules than a carbon tax or a simple cap on emissions. These are good lessons for policymakers. Sadly, were not even at the point of having the cap and trade v. carbon tax debate in Canada.
What I found disappointing is that the more fundamental criticism to market-based mechanisms is mentioned, but not developed. It’s clear that the roots of climate change are found in the development of industrial capitalism. Turning nature into a commodity can be seen as a new stage of financial capitalism, where capital is colonizing and transforming every aspect of our life and nature for its benefit. Everything must be aligned with the goal of capital accumulation nowadays, even our education. I cringe every time I hear a politician say that we must “train our brains for the needs of the market”. Karl Marx would say that we are completing our alienation process, alienating ourselves from our fundamental human nature, and Mother Nature itself. He’s not far off base. To me, the book does not capture how truly extreme and radical turning our climate into a commodity is as a “solution”.
People are right to ask if all these fancy “cap and trade” systems and financial abstractions are in reality counter-productive. Isn't this just feeding the process that’s driving the crisis, and distracting our attention from the profound changes that are necessary to create a truly sustainable and fairer society? Perhaps, would answer the authors. But we’re in damage control mode, so we must act quickly. Neoliberalism is the lingua franca of our age and will inevitably shape our response to climate change. People in the Marxist tradition, such as David Harvey, and proponents of “décroissance”, of moving away from the imperative of economic growth, will not like the arguments at the heart of this book.
But overall, the book provides an excellent review of the development and potential future of market-based climate change policies, a powerful argument in their favor given the political context, and good lessons for their governance. An excellent read so long as the reader accepts that what we should be doing is not designing the ideal sustainable and just society, but finding the right buttons to push given our current situation.
May 30, 2023
If you’re interested in topics like this, I’d recommend reading books on degrowth instead ;)
December 19, 2013
I read this for research paper, and while it was well-written,because it was published in 2011, the bulk of information in it was out-of-date. It did offer a wealth of information about the process of funding for projects and the flow of funding for alternate energy projects.
April 5, 2017
I used
Displaying 1 - 4 of 4 reviews