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What do we do about climate change?

We are delighted to announce the publication of Feasta’s new book, Sharing for Survival, a 200-page collection of essays by nine Feasta Climate Group members. The book’s editor, ecological economist Brian Davey, is a long-time Feasta member and co-ordinator of the Cap and Share campaign for cutting carbon emissions. The following post is Chapter 1.

After Copenhagen it was by no means obvious that simply calling upon governments to act would achieve very much. Yet the situation is urgent – so what do we do? The aim of this chapter is to look at options for getting from where we are now to adequate climate mitigation. It starts by looking at all the obstacles to getting things done – but this is not so that we get discouraged and give up. It is so that we are realistic and can find our way around the obstacles.

A recent book by the Financial Times columnist and academic, John Kay, points out that the most successful ways of achieving policy, business or other goals in human affairs is not to approach our goals directly but indirectly. It is the oblique approach that often achieves most[1].

There is a very good case for approaching climate mitigation obliquely particularly as the task is huge and complex, because much of what needs to happen is unclear – and because the resistances to getting action put in place by vested interests are very powerful. At the same time there are powerful pressures to get something done about a growing crisis in the energy system and millions of people are having to adjust their lives to this energy and economic crisis. So how can an indirect response to the climate crisis be put in place as part of a general programme for the wider crisis? How can we enlist the active involvement of millions of people and win them over for adequate climate policies – for example those who have become involved in the Occupy movement that has sprung up the world over?

If it is not as easy as it is supposed to be to make the democratic process work for us perhaps this is because we have pinned our thinking too much to the head-on direct route. People are struggling to cope with lots of problems – how about ideas about how to help them and deal with the climate crisis too?

seaMost of us know the head-on direct route very well. It is the route of political common sense. We are supposed to put credible policy ideas into letters and articles for newspapers and in the letters that we write to our MPs. Having convinced our MPs what is supposed to happen is that our ideas are passed on to ministers and examined by officials. If enough members of the public want something the policy will eventually be enacted. What we are supposed to do is to lobby the politicians and officials with credible ideas. That is the theory and most of us know in our hearts that it doesn’t work – even if we do not acknowledge it yet in our heads and in what we do and say.

As if!

As is very clear the chances of getting adequate climate change mitigation in the current growth economy are very slim. The UK government’s former advisers, the Sustainable Development Commission, have published studies that say so. For example, “Prosperity without Growth” written by Professor Tim Jackson, showed how a growing economy could not possibly achieve the carbon emissions reductions required even to reach an inadequate 450ppm CO2 target by 2050. To achieve an average year on year reduction of emissions of 4.9% with 0.7% population growth and 1.4% income growth would require technological change to reduce emissions per unit of economic output at 7% per annum. That is ten times the current rate.[2]

Nevertheless the policy makers and business are locked into a commitment to growth. Growth is a central idea in what John Jopling and Roy Madron term “the elite consensus” in their book Gaian Democracy. [3] Those people who argue for non growth economics are ignored by policy makers, business and most journalists. The Sustainable Development Commission and Tim Jackson told the government that growth and sustainability were not compatible – and this probably helped to seal the fate of the SDC – it was abolished by the coalition government as one of the victims of the cuts.

If you follow the route of political common sense and lobby for ideas outside the elite consensus – ie the growth consensus – you get ignored. Although everyone says that they like thinking that is “outside the box”, they do not mean thinking outside the growing economy box.

Now there are systemic reasons for this addiction to growth. There are reasons as to why it is considered more important than dealing with climate change. For one thing growth has come to be seen as “the” answer for all political problems. Writer Clive Hamilton describes this as fetishistic:

“Growth alone will save the poor. If inequality causes concern, a rising tide lifts all boats. Growth will solve unemployment. If we want better schools and hospitals then economic growth will provide. And if the environment is in decline then higher growth will generate the means to fix it. Whatever the social problem, the answer is always more growth”
[4]

Over and above the fetishist mind set of the policy establishment there are deeper, structural reasons for their collective fixation. These reasons arise out of the nature of the money and financial system. The argument here is not new – green economists have called attention to this problem for decades and it is explored in the other chapters of this book at length.

Debt based money and growth

Since we all depend on the smooth functioning of the money and financial system, and since we all use it in our everyday life, the money system should be regarded as a commons resource. It should be managed in the interests of everyone. However, the financial system has been effectively privatised because almost all money comes into existence as bank deposits when banks lend money to their customers. The banks create the money that they lend and money is backed, not by gold as it used to be a long time ago, but by debt – by promises to repay loans to bankers with interest.

The important point here is that, while the banks create the money that they lend, they do not simultaneously create the money that their customers also need in order to pay the interest on their bank borrowings. The economy has to keep on growing in order for there to be a basis to motivate new lending. Without new lending, and hence new debt being created, there is no source for the next round of additional money needed to pay the interest on the previous debt.

This kind of economy does not have a reverse gear. Because of its debt based money arrangements the economy must keep growing or the banks get into trouble. If the economy does not grow then it needs something else to grow instead – like asset value bubbles, mainly in the real estate markets, so that banks have a basis to keep on inflating their lending.

If the banks stop lending and people repay their debts the money supply and liquidity starts to dry up, people get into trouble repaying debts and the banks get into problems too. Remember – since almost all money is backed by debt, then in those times when the main dynamic in the economy is that debts are being repaid the money in circulation starts to fall and demand starts to shrink. Horror of horrors the process becomes a vicious deflationary cycle. The economy goes into a downward spiral. Confidence in the banks begins to wobble and people want to take the money out of the machines in the wall.

This explains at a deeper structural level why growth is the taken for granted and self evident goal that few politicians, economists or journalists dare question. It enables us to understand the toxic group-think of the political economic elite – I write ‘toxic’ because, as argued earlier, it is impossible to reduce carbon emissions sufficiently if the economy does keep on growing…. which means, conversely that, at least when growth does stall, so too do carbon emissions….

…it also gives us an important topic for dialogue with the movement for deep change that has suddenly emerged in tents in cities all over the world, a movement focused on seeking to challenge a crisis of injustice whose roots are the banking system.

Policy making as an in club… of addicts

So problem number one is that, if you argue the case for policies that would cut emissions adequately, you will be arguing for the ultimate heresy, no-growth economics, and you will get ignored by the growth junkies – at the same time however we have something important to say to the movement in the street.

That’s not all either. Most kinds of addicts share their lifestyle with others – it is so hard to give up their addiction not only because of a brain-chemical dependency but because it means giving up on a social network. That’s partly why groups like Alcoholics Anonymous work so well – AA gives another social network based on staying off the drink.

Money and energy junkies are not that different. Inside the addiction circle of very important people it is difficult to get a look-in for other ideas anyway. Policy is largely formulated by officials in a dialogue with vested interests or ‘stakeholders’. Some lobbyists are much more influential than others. These are the ones well connected to people who own newspapers or other mass media and the journalists working for them. To a large extent public relation companies set the agenda. People of influence have been to the same public schools as the politicians, meet regularly in the same clubs, set up their own think tanks, set up foundations to fund pet causes and operate both behind-the-scenes – or in front of the cameras – all in a way that people without money and time are unable to do. It is in this way that the 1% consolidate their position in the corridors of power.

Regulatory Capture

This helps explain what is called “regulatory capture”. The officials working for ministries and public departments which are supposed to regulate private interests instead develop a cosy relationship with those same interests. It seems quite natural for people in a particular economic sector, who have some knowledge of it, to apply for jobs in the regulatory agencies. Likewise people in government, and in the regulatory agencies, regularly take jobs in the very same sectors which they previously had a role in regulating. It is true in the banking sector, which, as an increasing number of people are aware, has taken over and neutralised state regulation. It is also, to a very large degree, true in the energy sector.

Nobody likes to maintain stressful confrontational relationships with others over long periods. It is more congenial when relationships between regulators and regulated are cosy. Then poachers and gamekeepers can switch roles from time to time too. People outside the comfortable clubs, who are losing out, may try to rock the boat to get a problem dealt with – but will often need considerable resources and endurance to maintain pressure to get anything done, particularly if it involves bad vibes.

If they have that endurance, the resources and a good case, outsiders like critical NGOs may, in some cases, be an embarrassment – so they may then be co-opted. Concessions may be made and the critics are allowed to join the club and become instead a force for inertia. Their radical rhetoric gives the appearance that the democratic and consultative system is working.

In the relationship between governments and commercial interests there are few businesses more powerful than the fossil energy companies and the industries closely connected to them – e.g pharmaceuticals. Wherever one looks in the world fossil energy companies and states exist in a symbiotic relationship. Political economic power goes with the deployment of technologies, infrastructures and armaments that use huge quantities of fossil energy. The companies that deliver that energy are therefore of strategic importance and are tightly bound into governments. It is not exaggerating too much to say that either energy companies own the state or, in some cases, are owned by the state. A revolving door relationship exists at the highest level between the personnel of the energy companies and those of governments. What’s more, support for democracy takes second place when it comes to securing fossil energy – one has only to point to the cosy relationship between western governments and the autocrats in oil producing countries like Saudi Arabia. Perhaps only the banks have more influence than the energy corporations.

It is against this huge inertia that climate policy in general, and cap and share in particular, have to be developed. The capacity of the political system and vested interests to fundamentally reform themselves is very limited.

On first impressions, given this context, the situation appears to be pretty hopeless. It is certainly an illusion to imagine that a clearly articulated argument about the survival of life on Earth, and social justice, is enough to make a difference in the policy arena as thus described. Even brilliantly expressed arguments can be ignored and they are ignored. One can even define power as ‘the ability to ignore’. The higher up the political hierarchy one goes the better at ignoring other ideas and agendas the post holders become. Indeed they have to ignore others because the number of issues that they have to deal with becomes too great. Power holders choose their agendas for focus and ignore the rest. In this regard the whole purpose of seeking power is to pursue one’s own agenda choices.

The source of change lies outside the mainstream

However, this is to misunderstand the sources of change, which lie outside the mainstream. The physicist Max Planck described how change occurs in science – and his words also give us a clue as to how it might possibly change in society and in the economy too:

“An important scientific innovation rarely makes its way rapidly winning over and converting its opponents: it rarely happens that Saul becomes Paul. What does happen is that its opponents gradually die out and that the growing generation is familiarised with the idea from the beginning” [5]

The alternatives to the present log jam have to be constructed outside the political and economic mainstream. Preparations are needed for a rapid transfer over to a new system that is running in embryo when things begin to breakdown, when an older generation flounder and prove quite unable to understand what is going on and quite incapable of coping.

How that might happen has been explored in various writings by different authors and activists who have looked for concept systems that put their local and limited activities in a broader context. The slogan “Think global and act local” is now well known and much recent thought has gone into working out, more exactly, what the phrase, “think global” actually means and how it touches on local practice. In cities all over the world an active movement for change is seeking for how this be done – refusing to prematurely focus on demands, because there is a realisation that this is a complex task and if you are going a long way you need to travel slowly.

Big Ideas and Grand Narratives – for inspirational intrinsic motivations

We are entering a period of great economic and social turmoil and millions of people are showing clearly that they are yearning for a clear way forward out of the chaos. This will be a time when people will be looking for big picture explanations as to what is happening and big picture credible ideas as to the way out. Policies and ideas for climate change mitigation must become an integral part of these big picture narratives. It is important that our ideas are there otherwise the mass movements will be in danger of over-simplifying, thinking that if only we get rid of the bankers then all our problems will be solved.

New arrangements and new thinking about the management of commons is part of the big picture for a future transformation. People are much more prepared to do “their bit” when they feel that what they are doing is part of a larger whole. This gives greater meaning to lives which would otherwise be small because lived in the pursuit of trivial purposes.

In times of turmoil people struggle to understand the bigger picture and embrace new purposes which provide a focus for new intrinsic motivations. As they struggle to understand, to orientate themselves, and to find a way forward that makes sense, they discover causes for themselves in the sense explained by Arnold Bennett. (“A cause may be inconvenient, but it’s magnificent. It’s like champagne or high heels, and one must be prepared to suffer for it”).

This should be compared to the approach of mainstream economics to climate change which proposes that we be nudged towards climate mitigation by changes in prices. It suggests that we need to be “incentivised” – and that we will make money or save money by doing climate mitigation – an approach that relies on extrinsic motivations.

In complete contrast to solving the climate crisis through cash based incentives we need a “Big Idea” which will provide a focus for intrinsic motivations – creating a movement of people working to protect and share common resources. That “Big Idea” is a programme for commons management arising out of a convergence of thinking from different places and requiring new structures and processes based on collaborative networks.

It is beginning to happen. In the years and months before the camps of tents people and movements who have seen their role as protecting common natural resources (the oceans, the atmosphere, fresh water resources) are coming together in a dialogue with those who have realised that they are creating and seeking to defend an “information commons”. In the internet, resources like linux, wikipedia and other design processes are effectively creating resources for free in peer to peer work relationships – which corporations try to recapture and enclose to privatise the value created by others for themselves.

“The commons” is therefore a key “big idea” for a policy and ideological platform. Cap and share, as well as our other climate policy approaches, needs to be clearly contextualised as an approach that fits best with the management of the earth’s atmosphere and climate as a common resource, co-managed and shared by all for the benefit of all, including future generations.

It should be acknowledged here that there is a point of view that big idea explanations which a signpost the future, ‘grand narratives’ as they are called, are unwanted and dangerous. The fear is that signposting “inevitable and necessary futures” for billions of people to march towards would bring new tyrannies into being. This implies that if we develop global policies like cap and share to deal with global problems then inevitably we need global bureaucratic hierarchies with immense power. The worry is that these bureaucracies will, in turn, morph into new top down regimes. Such tyrannies will have great power because, in the face of the big picture which underpins them ideologically, the grandeur and importance of the end – preventing runaway climate change and ecological collapse – would justify any means.

But the point here is that cap and share does not require a big bureaucracy. It is appealing because of its very simplicity.

It is certainly true that a great deal would need to be done to adjust to, and cope with, a rapidly tightening cap. A lot of things will have to be done at the level of households, communities, and in each locality. In each case there will be a need for a unique and location-specific transformation of energy technologies, buildings, production systems, as well as cultivational landscapes and transport configurations.

The Great Transition

Another way of thinking about the tasks at hand is to use the ideas of the “Great Transition”. [6] The authors and activists who are developing this overarching framework describe the economy and society as existing in three zones or spheres: a cultural landscape, the dominant economic and political regime and a realm of niche alternatives.
The “cultural landscape” consists of the common motivations of the people in a society and the narratives that the people use to understand the way the world works and their place in it – this is dominant culture of that society.

The culture is embedded and embodied in a second sphere – the economic and political “regimes”. These are the powerful institutions that take decisions and allocate resources that have already been described as tightly integrated together. Most of the effort of NGOs and civil society organisations is currently focused on trying to influence these regimes. But as we have seen, these efforts are often too weak and are frequently ignored – or where they do have an impact they tend to be co-opted and then neutralised.

Nevertheless a third zone does exist as a potential source of change. It is not currently very large but it can be found as a place of niche experiments, of small scale developmental projects. In the theory of the “Great Transition” these niche experiments are described as “seed projects”. They are run on motivations and narratives which do not fit into the cultural mainstream. If you talk to people in Transition Initiatives, in community gardens, or urban farms, or community energy projects you will typically find that they share a similar story about how the future is likely to look, or how they would like it to look. You will find too that they are much more committed to helping vulnerable people and not in it primarily to make money for themselves. [7]

“Seed projects” like this are embodied and embedded in different motivations and narratives and represent an alternative culture. It is by these projects developing further, networking together, becoming stronger that they might start to look more credible as the embryonic basis of new regime, a new economy that is more appropriate to the troubled times.

Since climate change is a system problem, rooted in the use of fossil energy to power a “consume more – bigger – faster” economy, an economy that is getting more unequal all the time, it follows that a lot more than a single policy will be required to get to deal with it. A system change is needed – but how does one achieve system change? It is one thing to explain how the current system works, it is quite another to explain how a transition is to be made from this system to another one that is non destructive. Agreeing what the transition will look like, and then making it happen, in a collective social process is the task at hand. And it is a very challenging task. Nor are we likely to find many mainstream businesses lending a hand as they have an inbuilt growth imperative. This is a task for people – not people playing roles in institutions.

Variants of the Great Transition

The commons and the Great Transition are just two of a growing number of ‘bigger picture’ approaches to what we have to do. There are many different people around the world attempting to envisage what a new system would be like and how it might emerge as the further development of current projects and practices. Despite superficial differences of approach the different eco-social “visions of the future” have a lot in common. These different approaches are mostly compatible and can converge with one another.

For example, from Germany there are ideas being developed about how to develop a “solidarity economy” – which is forseen as emerging from the development and networking of co-operatives, social and community enterprises focused on ecological and energy goals, community energy companies, community gardens, community supported agriculture and the like.[8]

Then there are the ideas of the Transition Movement, originated in the UK and Ireland and now globally spread – a town and city based mixture of practical projects and reskilling activities which bring communities together around a positive vision of energy descent.[9]

There are ideas too developed by the Decroissance (Degrowth) Movement in France and the Post Wachstum (Post Growth) Movement in Germany, as well as the “Steady State Economy” thinkers in the UK and USA. [10] [11] [12] Under these ‘umbrellas’ thinkers and practitioners of alternative economics have come together. They seek to counterpose different lifestyles, economic arrangements and the projects associated with them to the growth fetishism in the economic and cultural mainstream. Major conferences on the theme of post growth economics have occurred in Barcelona, Paris and Berlin over the last few years. The conference in Berlin in May 2011 was attended by 2,500 people, many of them young. This is an up and coming generation who will make the future. When we write about the reduction of carbon emissions up to 2050 we are talking about the bulk of their working lives. What they think and the ideas they share will be the future “Zeitgeist”.

As is obvious these movements are best visualised as overlapping networks of smaller groups, either of campaigners and/or of project activities – whose ideas are mostly either very similar, or at least mutually compatible and non competitive.

Thus what seems to be emerging is not an “alternative system” like “socialism” and/or “communism” was envisaged to be – a centralised, pre-conceived system created and driven through top down hierarchical relationships and established through a violent seizure of state power. Rather this is a gradual ‘bottom upwards’ process of local level projects and groups that are networking and cross fertilising in a variety of local, national and international forums. Nor is this an internationalisation that is merely between the rich countries. There has been participation by groups and communities from countries of the south in these discussions which have been more than formal and tokenistic. For example, the ideas of ‘Buen Vivir’ from indigenous communities in Bolivia and Ecuador, pre-colonial ideas of a good life with harmony between peoples and with nature, have been important in shaping the understanding how to motivate and guide a good life beyond growth.[13]

In his book Sacred Unrest Paul Hawken suggests that there are perhaps a half million organisations around the world focused on local economic development, environmental and social justice, and the rights of indigenous people.[14] The characteristics of all these organisations are their huge diversity. Yet they can evolve together in a coherent way. As Elinor Ostrom has argued, it will require a poly centric and multi level approach if the variety of each group, appropriate to the place it operates, is to be recognised and continued and yet, at the same time, the very different groups are to operate together coherently. [15] What is required here is not a top-down bureaucracy which would be incapable of coping with the variety. We need, instead, a network of active groups in which each node has a high level of autonomy and in which overall coherence is created by mutually adaptive arrangements, activated horizontally only as and when needed. Such mutual adaptation between autonomous nodes of activity would be organised to minimise conflicts, maximise synergy, to create and share information about evolving operating environments and to share and create joint value systems to facilitate the common sense of purpose. The ideas here parallel those of the late Stafford Beer and his Viable Systems Model, with its approach to networked management and nested organisations. [16]

This kind of networked coming together is the best hope for the world. It is out of this coming together that we can see how climate action and policy can be shaped in the future. In the meta systems that then emerge to link local level responses we will find ourselves creating a new operating environment in which firstly local government and then national governments will find themselves operating – having a powerful influence on their policy making process. The only sustainable and resilient world economy, an economy which is not climate destructive, is based on a re-localisation of economies. So it is through the networking of local initiatives to grow a greater power that a coherent response to climate change can be developed.[17]

It is processes like these which make it credible to believe that in the future a Climate Trust of the type envisaged by John Jopling in his chapter will emerge (see chapter 5).
This, in turn, might then provide a different kind of future as the carbon intensive regime of the old men looks less and less credible and has more and more trouble sustaining itself.

Generation change and Zeitgeist

There are good reasons to believe that we are entering a period in which the economy developed and managed by baby boomers on the brink of retirement will find sustaining itself very difficult. Much has been written about the impending peak of world oil production and a peak in world gas production to soon follow. Many argue that we are already at the oil peak and, in fact, on a plateau, so that the decline is soon to come. What is less well known is that this is occurring at a time of generation change in the oil and gas industry itself.

Almost exactly at the time predicted by the IEA for an energy crunch, there is a retirement peak in the oil and gas industry – and this is an international phenomenon. At the time of writing roughly half of the overall professional workforce in production and exploration are aged between 40 and 50 while barely 15% are in their early 20s to mid 30s. According to Booz Allen Research about 33% of those employed in the industry will retire by 2012. It is against this background that we should assess the oil and gas industries’ ability to rise to the technological challenges like that of successfully and safely tapping ultra deep water oil. [18] [19]

A similar phenomena can be found in the nuclear industry. There have been serious problems, delays and major cost overruns in the attempts to build a nuclear reactor in Finland. An article in Der Spiegel drew attention to no less than 3,000 construction faults at Olkiluoto. In large part this is because the expertise is not there and this problem is due to get worse. 40% of the personnel in US nuclear plants are due to retire soon and the industry will have to recruit 26,000 over the next decade even if it does not build a single new reactor. In 2008 however US universities turned out 841 graduates. The situation in Germany is even more alarming where between 1998 and 2002 only two students graduated in nuclear engineering prompting Areva to fund a training facility in Karlsruhe.[20]

At the same time any young person with an ability to read who is interested in technology and engineering and who is starting their careers are bound to have noticed that “green jobs” are being touted as much more recession proof and also that employment in “green jobs” – or in “cleantech” – are growing fast – albeit starting from a very low point. The idea that these jobs are more in tune with the future is a plausible one because, while the fossil fuel and nuclear sectors are running down with their engineers and their personnel are retiring, over the very same period “clean energy” employment is growing rapidly. This is especially the case in countries like Germany and China but it is even the case in the USA where employment in this sector grew by 9.1% per annum between 1998 and 2007. [21]

The point is that employment changes in terms of training and new job entry at one pole and retirement at the other pole are lagging indicators of a trend that is occurring now anyway. The twin process can be seen as a powerful reinforcing feedback in a transition that is and will occur consisting of an acceleration of the decline of traditional carbon based energy sectors and creating an upward dynamic in those replacing them.

A contested and confusing transition

Notwithstanding, caution is needed. The employment and generational transition is not occurring, and will not occur, without conflicts and considerable contestation. There is obviously a battle opening up around what the future energy system will be like – gas, nuclear or renewables. These are alternatives and it is not easy for governments to have a mixture.

The crisis at the nuclear reactor at Fukushima after the earthquake and the Tsunami, a crisis which will clearly not go away and which will run for months and months, perhaps year after year, has been a serious blow to the nuclear sector. It has had its greatest effect in Germany where the country appears to have decided to stake its future much more on renewable energy. At the time of writing Germany is looking at how it will upgrade and change its grid to make this possible – perhaps by adapting and upgrading the electric power lines of the railways, thus minimising the nimby backlash. [22]

Simultaneously the oil and gas industry are contesting moves towards a future based on renewable energy. They want political backing for the further development of fossil fuels and, in particular, supporting for so called “unconventional gas” – by technologies which drill into and shatter shale rock formations to release the gas trapped in them.

In the USA shale gas development has become hugely controversial. There are environmental and health effects from the toxic materials that have been used and released into surrounding rocks, water, the atmosphere and soils. In the UK shale gas has been associated with an earthquake near Blackpool. Shale gas is controversial too because the fracking production process, as well as pumping gas from production source to its place of combustion, has been found to entail significant leakage. The natural gas thus leaked, mainly methane, is itself a powerful source of global warming. These facts are undermining the claim that natural gas a source of relatively climate friendly energy. Fracking has been banned in France – but it looks as if it will go ahead in the UK.[23] [24] [25]

The change in energy system is thus contested and its outcome unclear. Nevertheless the fall in oil production after peak is likely to be fast and we are witnessing processes that will progressively change the conditions in which all governments operate. If governments fail to recognise what is going on at this point in time it is because they are still operating under the influence of old men and old financial institutions. The new networks of groups that were described earlier are not strong enough to impose their ideas and will on the state. Will this change soon?

The political system – waking up a bit late to impending chaos

What we have been witnessing are the thrashing agonies of a dying energy system that is using its traditional links and grip on the political system to try to maintain its influence. This influence is, however, beginning to wane. The death agony is well covered up by PR and spin but it is a death agony without doubt.

The political establishment and vested interests have been very resistant to change. As a result we are entering a period of crisis with a woefully unprepared political system. Crises like this are periods of danger but they are also periods of opportunity – because it becomes clear to thinking people that things cannot go on in the same way. It is the preparation for such a generalised crisis that we must now apply ourselves to.

As is generally recognised, the full force of the climate crisis lies some way in the future. However, if not enough is done in the next few years then, by the time the terrifyingly destructive impacts are felt it will be too late to do anything meaningful. The effects will keep on rolling relentlessly for centuries. Nevertheless, here and now, the energy and economic system is about to enter a period of convulsion anyway. Cap and share and our climate policies thus need to be made fit for purpose as part of a package that millions of people identify with as being necessary to deal with the structural problems, not in the future but now.

An immediate future of great uncertainty

There are arguments that what we can still do will not be enough when measured against the huge necessities for change required for substantive climate mitigation. This is the argument of Clive Hamilton in his widely praised the book Requiem for a Species. However Hamilton assumes that the recession unleashed by the credit crisis which has stabilised global emissions is merely a temporary problem.

This is very unlikely to be the case. As argued it is very probable that we are now in a period of economic instability because of peak oil and peak debt which will continue. Although emissions bounced backed strikingly in 2010 after the recession, one must wonder how long the “recovery” will continue.

In important respects, the instability will not help. Worse case scenarios suggest that the interaction between declining oil supplies and the fragile financial system could cause huge dislocations and these, in turn, could undermine the basis for large scale engineering solutions to energy shortages and the carbon crisis. Under these worse case scenarios the deflationary collapse of the economic system, which at the time of writing seems very likely, would lead to a disintegration of the very fabric of complex economic organisation needed to deliver the components for a renewable based rebuild of the energy infrastructure.

Nevertheless one can turn the pessimistic argument on its head. In the face of floundering economic, industrial and ecological policy in the next few years the best thing to help would be to unify and mobilise all of society behind a major investment programme for energy and agricultural transformation – before it is too late. When societies are in chaos, malevolent elites pick a fight with neighbouring countries and an external enemy creates internal cohesion. An elite that finally realises it must fight to prevent a breakdown of the energy system instead of an external enemy might be able to pull things round.

Alternatively this idea of a global fight to renew the energy and the cultivation systems, particularly in a way that stresses commons can provide a large part of the unifying vision for the movements of the streets, offering work and justice at the same time. Once underway, the accumulation of renewable energy equipment and its infrastructure would create its own self feeding dynamic, delivering more energy than it costs to build up. In that kind of future context there is some kind of vision of hope against mass destitution which a collapsing finance sector is bringing down on our heads.

There do seem to be huge opportunities for renewable energy systems – in particular offshore wind energy around the UK and concentrated solar power in southern countries and deserts. There are also opportunities for considerable reductions in energy consumption. There are arguments that, for example, the energy return on energy invested in offshore wind are considerable and the scale of the engineering challenge is no greater than the previous construction of an offshore oil infrastructure.[26]

The open question – Chaos or Grand Transition?

It will be challenging. In some parts of the political system a few officials and politicians are just beginning to get a belated understanding of this. Although there is a great reluctance to transform the energy economy in face of climate change there is the first dawning of a recognition that the energy economy will have to be transformed because of peak oil. The code words for ‘peak oil’ in business and government are ‘energy security’. Some parts of the business establishment too have finally acknowledged the message of peak oil and are looking at what will be done about it. Although the peak oil and climate imperatives are not identical they do overlap.

With this growing awareness the danger is that politicians and business will take the wrong decisions. The peaking of conventional oil could worsen climate change by driving an increased use of more carbon intensive substitutes and biomass. In order to keep global temperatures within 2°C or preindustrial levels, cumulative CO2 emissions must be kept well below the amount per would be produced from burning the remaining proven economically recoverable fossil fuel reserves.

Nevertheless, there is an increasing recognition that if the energy system must be transformed it makes more sense to deal with climate change and peak oil at the same time. Some can see already that it is a dead-end to try to use the remaining fossil fuels and that it makes more sense to go directly over to renewables.

An example is the Centre for Alternative Technology’s second edition of Zero Carbon Britain – Zero Carbon Britain 2030 – in which cap and share is described as one of a number of possible policies in the framework that will be needed to drive decarbonisation. [27] Another example of cap and share in a general package of policies from our own ranks is the Holyrood 350 Programme for Scotland. [28]

Another example of a policy which connects action on energy security (peak oil) with action on climate change is a Lloyds/Chatham house report on sustainable energy security. This argues that:

“Energy security is now inseparable from the transition to a low carbon economy and business plans should prepare for this new reality. Security of supply and emissions reductions objectives should be addressed equally as prioritising one over the other will increase the risk of stranded investments or requirements for expensive retrofitting.” [29]

In summary we can expect to see energy transformation being pushed up the political agenda. In the best scenarios we would expect to see a search for new and more effective, policy mechanisms for carbon reduction occuring too. This is because, while it is becoming blindingly obvious that these are absolutely core issues, the global political establishment has clearly shunted itself into a dead end in trying to do something about these issues.

The Copenhagen Debacle

In this regard there is a most extraordinary situation opening up. For all the reasons explained at the beginning of this chapter the global political and economic elite have totally failed to provide anything at all credible in the way of a response to the climate crisis and energy crisis. The collapse of the UNFCCC process at Copenhagen and the collapse of Obama’s efforts to introduce climate legislation in the USA can be seen as a stalemate between an old energy order and political system and a new one that is not yet powerful enough to emerge and make its dynamic the dominating one. The energy system of the old men and old money is still too powerful. But, as we have seen most of these old men will have gone in a very few years – and the carbon energy that they supply, and which is their power basis will be in precipitate decline.

We are, in short, moving towards a situation where policies like cap and share and a carbon maintenance fund to prevent loss of soil carbon need to be argued for as part of packages of transformation in order to avert a generalised collapse caused by the wooden headedness of fixated old men. The support for the new developments will largely have to be found outside the political mainstream in the emerging new movements that were mentioned earlier in this chapter.

Through the projects and networks of these movements only so much can be done in energy efficiency and carbon reduction at the household community and local level if there is not some wider framework to “lock in” what is achieved. Without an adequate framework the improvements that are made would be immediately lost because of “rebound effects” of the type explored by Nick Bardsley in his chapter. Also, the energy and carbon saved in one place would be squandered by irresponsible people and companies in another place. These community-based activities will inevitably be driven by a stronger prioritisation for social justice issues and the share in cap and share will be more attractive and influential here.

The key idea here, to return to the idea of indirectness, is that climate policies need to be not just head on attempts to tackle climate change but ideas for society – for reconstructing energy systems, for maintaining macro economic activity and employment (if not growth), for expressing new ideas of social justice and also for making clear how we are going to look after each other. Let us now turn to these points.

The macro economics of climate policy and the politics of rent at the limits to growth

Given the wider picture we should not forget that cap and share can be promoted not only for driving decarbonisation but because of its effect on purchasing power as energy prices rise. Cap and share has more to offer than as a driver of climate mitigation alone. After peak oil each new impetus to economic recovery is likely to lead to a spike in oil prices that will, in turn, crash the world economy. This volatility will not help long run structural changes and nor give the security needed to encourage productive investment in new energy systems.

As fossil energy prices soar upwards many non-marginal energy producers will, for example, still be supplying from fields with low production costs. During the price spikes they will be raking in money way above their production costs and there will be a transfer of what economists call “scarcity rents” to these producers. (Rent is here the large amount of money made when there are high prices because of high demand and scarcity even though some producers are still able to pump oil and gas relatively cheaply). These “rents” will be taken from the pockets of everyone else. Rent transfers like this unbalance the economy, lead to unrest and bring on the next crash.

Beyond the “limits to growth” there is still room for money junkies to get rich if we let our unjust system continue – not because of their inventiveness, or their enterprise, or what they produce, but because they succeed in cornering the ownership of the scarce resources that everyone needs – energy, the atmosphere, fresh water, land, food commodities… and then are able to charge a high price, enriching themselves while the poor are driven into destitution. This threatens to be a 21st-century “politics of rent” and we have to find answers to it.

From this point of view, arrangements like cap and share have a wider relevance. It is necessary to manage the Earth’s atmosphere as a global commons for which we are all equally responsible, in a way that ensures that, when there are benefits to be had, we all get them – also ensuring that particular groups are not unfairly burdened. The energy transformation should be arranged in such a way as to ensure that the mass of the global population get a share from the sale of permits. This will balance purchasing power, moderate the contractionary process and part-provide some of the capital resources needed to help people transform their homes and gardens. At the same time it can help provide the incentives and stability for large investments, like offshore wind, where there are the resources, the capacity and will for these to be developed.

Similar principles need to be applied, adapted to context, across other natural and human commons – including in the monetary system regarded as a Commons. Earlier we explained that the debt based money system is a major part of the problem. It has no reverse gear and is implicated in the growth fixation of mainstream politics. That’s because the money commons has been privatised in the interests of the moneylenders and a major part of the overhaul that is needed is to transform the money system too – to manage it in the interests of everyone.

Commons resources should be managed in the interests of all – including future generations who should inherit them intact and healthy – the oceans, fresh water supplies, land rent and the like. That means not only policies but appropriate institutional architectures. These are major agenda items but it seems unlikely that top down policies from governments will emerge until a lot of bottom upwards improvisation from grass roots movements of the type described earlier has been tried and been found to be practical and workable. [30]

Conclusion

To sum up, the existing economic and political system has proved incapable up to now of embracing anything like an adequate level of climate mitigation. It can be argued plausibly that it is already too late to prevent runaway climate change. It is certainly touch and go. There is nothing inevitable about the future. Nevertheless it is clear that we are entering a period of economic, social and political turmoil brought about by peak oil, peak debt and the decomposition of a political system that millions of people now regard as corrupt and not to be trusted. There is increasing recognition even in parts of the business elite that major changes in the transformation of the energy system are going to be needed and that it does not make sense to deal separately with peak oil and climate change. In this context the relevance of policy ideas like cap and share to these other problems must be made clear and such policies firmly located in packages for transformation.

What is still not a clear is how far governments are capable of contributing to the new future. There is an argument that states are being increasingly hollowed out and incapable of real social and ecological leadership. It has been argued, for example by Naomi Klein, that states are led by parties functioning as brands, backed by PR machines, intent on organising society to whatever the financiers want. It is certainly this view that makes most sense of the utter failure of the state to control the financial markets and the financial sector. [31]

Of course, we want government support for what we are doing if they will give it – but meanwhile if there is indifference and hostility from governments then we must get on and set up the organisations that we need. We can do that by setting up organisations where we are and then networking them together. When we do this we do it in the hope that there will be a supportive government buy-in later, when pressured by our movements with their different commons based ideologies and their practical community relevance on the ground. If we cannot get governments to do the job we must move to set up the organisations that we need and then struggle to win them the power to do the job directly. At the current time governments will not go against the elite consensus – but in the profound turmoil ahead we should not underestimate the extent to which power relationships will change if we are well organised, with clear ideas that attract a mass following.

In this context it makes sense to evolve a package of economic energy and climate policies to address the different crises together – financial, energy, climate, cultivational. Such packages of policies which seek to reconfigure the world we live in have already begun to appear – like “Zero Carbon Britain 2030” and the programme of “Holyrood 350” in Scotland. These programmes will be immeasurably strengthened by being based in new forms of networked commons organisations operating with charters of rights and responsibilities that they win from the existing political system.

To fully complete the reconfiguration of our economy and society we need to connect with the emerging movements with new ideas that captures rights to defend the commons and new ways of managing them which do not rely on yet another top-heavy bureaucracy.

Endnotes

1. John Kay, Obliquity, Profile Books, 2010.
2. Tim Jackson, Prosperity without Growth?, Sustainable Development Commission, 2009
3. Roy Madron and John Jopling, Gaian Democracies, Schumacher Briefings/Green Books, 2003
4. Clive Hamilton, Requiem for a Species, Earthscan, 2010, p33.
5. Max Planck, The Philosophy Of Physics, W. W. Norton & Co. 1963
6. http://www.smart-csos.org/
7. See for example, Nadia Johanisova, Living in the Cracks, Feasta/Green Books, 2005
8. http://www.solidarische-oekonomie.de
9. www.transitionnetwork.org
10. www.decroissance.org
11. www.jenseits-des-wachstums.de
12. http://steadystate.org
13. Thomas Fatheuer, Buen Vivir, Hsg. Heinrich Boell Stiftung, Band 17, 2011
14. Paul Hawken, Blessed Unrest, Penguin Books, 2007
15. Elinor Ostrom, A Multiscale Approach to Coping with Climate Change and other collective action problems, http://www.thesolutionsjournal.com/node/565
16. Stafford Beer, Think before you Think, Wavestone Press, 2009, pp134-157. See also Jon Walker’s article at http://www.esrad.org.uk/resources/vsmg_3/screen.php?page=preface
17. Richard Douthwaite, Short Circuit: Strengthening Local Economies in an Unstable World, online edition, June 2003 downloadable at http://www.feasta.org/2003/06/16/short-circuit/
18. Jodie Humphries, Oil and gas workforce – a shortage in skilled labour, Jodie Humphries August 2010 at http://www.ngoilgasmena.com/article/oil-and-gas-workforce-a-shortage-in-skilled-labour/
19. www.cres.ch/Documents/SKILLS%20SHORTAGE%20PART%20I%20pdf.pdf
20. http://www.spiegel.de/international/europe/0,1518,655409-2,00.html
21. http://www.enn.com/top_stories/article/40051
22. “Germany explores using Train Lines as a Power Grid” http://www.spiegel.de/international/ germany/0,1518,758698,00.html
23. http://news.bbc.co.uk/1/hi/programmes/newsnight/9255520.stm
24. http://www.nytimes.com/2011/03/04/us/04gas.html?_r=2&hp
25. Robert W Howard, Renee Santoro, Antony Ingraffea, “Methane and the greenhouse gas footprint of natural gas from shale formations. A letter.” Climatic Change, Accepted March 2011
26. http://graphics8.nytimes.com/images/blogs/greeninc/Howarth2011.pdf
27. The Offshore Valuation Group, A Valuation of the UK’s offshore renewable energy resource,
published by the Public Interest Resource Centre
, 2010
28. www.zerocarbonbritain.com
29. http://holyrood350.org
30. Lloyds/Chatham House Report “White Paper. Sustainable energy security. Strategic risks and opportunities for business” www.chathamhouse.org.uk/files/16720_0610_froggatt_lahn.pdf
31. www.boell.de/economysocial/economy/economy-commons-10451.html
32. http://www.alternet.org/media/145218/naomi_klein:_how_corporate_branding_took_over_the_white_ house?page=entire

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