Introducing climate capitalism

Never before has humanity as a whole embarked on a project to radically transform the way its societies work. Sure, there have been revolutionary projects, many national, some aiming at global transformation. Through empire and war, countries have sought to assert their view of the world in order to re-model it along new political lines. And revolutions have certainly happened, both political, and more importantly in the current context, social and technological. We can think of the inventions of agriculture, printing, the steam engine or the computer. All of these have wrought vast changes upon societies. But all of these were the result of initiatives by individuals, particular companies or countries. In responses to climate change, we have the first instance of societies collectively seeking a dramatic transformation of the entire global economy.

For that is the basic claim we want to make in this book. On the one hand, responding to climate change entails radical changes in how the global economy and daily life are organised. The term 'decar-bonisation of the economy' is increasingly in common use. It refers to the process of taking the carbon out of the energy we use to run the economy. But its implications for how the economy is organised are rarely drawn out or understood - it is rather seen as simply a technical question. The result of decarbonising the economy is what we call climate capitalism: a model which squares capitalism's need for continual economic growth with substantial shifts away from carbon-based industrial development.

On the other hand, we are not just making an idealist plea for this transformation, although we certainly believe it is necessary. We also claim that we are - at least potentially - currently in the early stages of this transformation. That is, the processes that might lead to decarbonisation, albeit still in their infancy, are being put in place. Often these processes are weakly understood, even by those participating in them. But the various elements we now see in climate policy, in particular the most innovative elements of the carbon economy, are those which might serve to effect the transformation most now recognise is necessary.

This is, however, where for many it gets scary. The world we are referring to is that of the financial markets (whose credibility is not currently at a historic highpoint) and large transnational corporations, who have been empowered to turn climate change into a question of trading and investment. This is the world of carbon trading and carbon offsets, about which many of us are confused and hold conflicting views, if we do not regard them with total hostility.

You may have thought that climate change was about sea-level rise, heatwaves, hurricanes and droughts, about scientific controversies and uncertainties, and perhaps about global inequalities and moral responsibility. So you can be forgiven for being confused when you see that major city banks are trading carbon just like dollars, oil, grain or sub-prime mortgages, and that this is seen as the cutting edge of responses to climate change.

How did we end up with this way of responding to climate change? And are efforts to buy and sell units of carbon little more than a scam, where business people and financiers get to make money without delivering real cuts on greenhouse gas (GHG) emissions? Or, do these new markets represent the start of the greening of the global economy, a serious attempt to mobilise those with power in the global economy to address perhaps the greatest challenge we have ever collectively faced? More specifically, can they lead to the decarbonisation we need?

CLIMATE CHANGE: FROM THREAT ...

Many people have increasingly come to realise that climate change is the issue of the age. It impinges on every aspect of the things that keep us alive - food and energy - as well as the ways we make money, such as trade, industry and transport. Whereas once climate change was a quirky subject discussed in obscure scientific journals or amongst people who get excited about technology, it is now part of everyday discourse. As these connections are understood, we recognise the need to mainstream action on climate change into policy on agriculture, transport, energy and trade. And we start to understand climate change not as a discrete environmental problem like forests

Climate change: from threat

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