MISSING the BEAR

I was horrified at Lib Dem shadow Chancellor Vince Cable’s attitude and behaviour at the Base Show Wednesday.

Vince Cable has a pretty good understanding of the imperative to address climate change but he’s shockingly still missing the bear on the interaction between the environment and climate change, and the economic crisis.

On Wednesday at the Base Show, Cable took a cheap shot at Tim Jackson and the decroissance or “degrowth” movement, showing he hasn’t got a clue!



Talking about the dual problems economic recession and climate change, he said:



“Now how do these two problems… interact? In the short term it’s been rather bad news for the environment. If you look at British opinion polls environment certainly climate change has dropped right off most people’s radar screens. They’ve got other things to worry about, they are more preoccupied with how they manage their jobs, about managing their household balance sheets, and a lot of anxiety about the economy dominates. Environmental issues, at least in the short term, have fallen down people’s list of priorities.

" And I think probably also, environmentalists who advocated zero growth , well, we’ve got zero growth in fact, we’ve got minus growth and it isn’t very nice. And I think people somehow wised up to this idea that all this puritanical non-consumption of resources we were being told was a good thing is actually really rather painful if you’re one of the people who was losing your job in the process. So recession has played very badly in terms of its environmental impact.

"Secondly, on the global scene there’s this lethal, what’s called this 10, 10 problem. 10% unemployment in the United States, 10% growth in China. So far the Chinese and the Americans have coordinated their activities relatively well in this recession but anybody who talks to anybody in American politics will tell you there is enormous tension building up in the system, resentments. The Obama administration has so far managed it well, clamor for action for protectionism, many ways return to atavistic prejudices of the 1930’s as this big new power growing up building a power station every week or every day I think. How do we cope with this?

"There’s a very strong resistance to people telling the Americans that they’ve got to calm down and deal with the climate….

[talks about science]

"The question now is how we bring together the concerns we have about the economy with the imperative dealing with the issues of climate change. I think they are compatible if the case is properly made… so how do we find a way out of this box.”


He then goes onto mention (ironically) restructuring British economy away from finance and dependence on London, and the need to concentrate on physical infrastructure projects for transport, new energy systems, a digital infrastructure, renewables infrastructure, etc, and the necessity to create growth.


“At the moment there is no mechanism for financing this because PFI has largely broken down, stock markets are unlikely to generate long term time horizons, private equity 5 year time horizons normally most companies will not embark on all this stuff because of political risk. There needs to be some mechanism that can bring in the enormous value of savings that we know is locked up in pension funds and insurance companies looking for a safe return with these very important needs for long term infrastructure much of which centers on low carbon future and long run environmental much more friendly economy. A lot of political will and a lot of imagination will be required to bring those things together. But I think the conclusion I have is that in both the short term and the long term there is a way in which economic recovery can be very firmly tied into an environmental agenda.”


During the Q&A I got lucky and was called on, I asked if the lack of financing for infrastructure and green projects couldn’t be resolved very simply by implementing what the Stiglitz Sarkozy report suggests (I didn’t even mention the New Economics Foundation because of his swipe at Jackson) and revaluing the economy, he replied:

“Well I obviously buy into that, to give the government credit they did produce a set of green accounts. They have done this technically but they haven’t made much use of it. It’s just sort of sitting there on our shelves. The technical side of the work has actually been done. It’s not easy-- there’s a lot of things you can’t quantify easily but the idea of getting parallel green accounts with the economy and what it tells you, which is not surprising, is that very often when we think we’re getting better off, we’re actually getting worse off if you factor in the environmental costs.”

(His equally uninformed answer to my second query, relating to personal carbon budgeting aside,)

Yes, Mr. Cable, it would show we are getting worse off. Then we would have something to change and work at wouldn’t we and wouldn’t that change make low-carbon, infrastructure projects more valuable?

If he buys into it, why isn’t he getting it?!

He has apparently never ever bothered to actually read anything about decroissance or flip through Jackson’s Prosperity Without Growth (Jackson who contributed to a study commissioned by parliament) because if he had he would see that the problems he’s talking about can be resolved by changing incentives in the economy in a way that will encourage long term investment and conservation.

The potential in a huge rallying campaign behind changing society’s outlook and getting everyone on board to improve not only our long run well-being and ensuring growth of our society (not in terms of GDP growth, but as a people) wouldn’t make people turn against a government. Come one dude! You could solve long-run infrastructure investment, encourage savings, and shift the view of economic markets away from short-run returns in one move (well, likely a series of coordinated moves, but still). Long-run investment is low-carbon economy is “degrowth.”

With all the public support Cable has, I’m frightened.

And this is the man people want to be the next Chancellor under a hung parliament? CRINGE. I take back everything I ever said about the British public being generally better educated than the American public.


Though I won’t fault Cable entirely, the folks at NEF need to realize that the general public is (sadly) swayed by pretty language. Simply joking that ‘yeah, we should’ve thought about the “degrowth” title a little more carefully’ isn’t going to cut it. They’re spending too much time locked up in their tank rethinking the economy, they’ve forgotten that the use of language is as important as using language to begin with. I don't mean to be too hard on NEF, but I'd like to see a little more of the "do" bit in their motto.

Update 1: Read Andy Wimbush's (blogmaster at NEF) much more eloquent response to Cable.

I want to call out Julian Wong (@GreenLeapFwd) on something he said recently that bothered me. He was on the Mid-Morning Report, Minnesota public radio, on 8 February talking about China’s cleantech revolution:

Wong: That’s certainly an angle that my centre, the centre for american progress is pushing, the national security angle. Perhaps it’s just a sign of the times, a sign of the current political situation where we’re in the throws of one of the worst economic recessions ever and what’s present on voters minds are the economic woes and how we get ourselves out of this an create new jobs.

He went on to imply, throughout the interview, that the national security, energy security angle was both more useful for understanding China’s cleantech push, but also for making the American public more accepting of China’s cleantech push, rather than seeing it as threatening. He then (ineffectively, and I’ll explain below) went on to draw a parallel between energy security and an improved discourse on cleantech and China.

I want to say that I’ve often asked Mr. Wong for comment on articles, he’s been very helpful and responsive to me, for which I am very appreciative and I respect him and his opinion very much, and much of the time he’s spot on. While he is correct that much of the time pundits unhelpfully frame cleantech in a US versus China, realpolitik, zero-sum game kind of way, Wong said that it’s more helpful to frame it in an energy security issue. This doesn’t seem much of a distinction to me however-- we’re still competing over resources.



The language we use when establishing relationships is very important, as are the cultural values that drive how we do so. By nature, American culture is competitive and because of economic theories like comparative advantage that stem from capitalism’s evolution in the West, competition has become the motivator, the way Americans relate to the world. Without digressing into a discussion of economic revaluation, we need to think about what competition implies: zero sum, real politik, winner take all, survival of the fittest, games, versus; dichotomies inherent in the term are winner and loser, benefits and costs, acquisition and sale, abundance and scarcity, positive and negative.

China cannot win the cleantech revolution because that implies that the US will lose: money, jobs, and resources to China. Energy security as a cleantech discourse is not much different in that it implies a certain selfishness, not needing to be dependent upon others and is abrasively independent-- things that are also implied in competition. To me, the word “security” twinges my neck with fear, it smacks of war (on terror) and threat.

Mr. Wong and others are correct in asserting that the cleantech revolution needn’t be a competition between China and the US and that it would be beneficial to both parties as well as to the global spread of cleantech that the relationship be more of a partnership, a shared development. The competitive mindset will hold back innovation and best practice in production techniques, will likely slow the overall rate cleantech development and implementation, and may even encourage devolution into petty trade wars.

But shared development and partnerships implies dependency-- “national security” implies the opposite. How is it possible that it’s more useful to frame cleantech in China and the US in “national security” rhetoric than competition?

The financial crisis and the climate change issue overlap in that they both demand a revaluation of resources, economically and sociologically, of the same nature. A “green new deal” deals with issues of sustainability in lending practices and wealth creation the same way sustainability necessarily implies more efficient use and distribution of scarce resources. Inherent in the sustainability discourse are these notions of efficiency and distribution which in turn imply the necessity for collectivity and cooperation. But national security is very isolating.

I’m sorry Mr. Wong, but it appears you’ve missed the bear.

The Monocle reports in its November edition that Saudi Arabia has 66.5 years of oil left. Their answer: go nuclear. From the Monocle November issue:


"You know the world is changing when Saudi Arabia, the number one exporter
of oil and gas, is toying with the idea of building its first civilian
nuclear power plant."
(issue 28 (2009), p 74)

Let me get this straight: the "world is changing"?! The world will be changing when Saudi invests in purely renewable energy technologies. Going nuclear isn't changing the world, it's running home to what's close and familiar.

Monday evening I attended London's Green Drinks 20th Anniversary where I'm pleased to say that I've had my opinion on nuclear power in developed countries reversed (thanks to a big ginger-haired fellow and an energy infrastructure geek, where I mean geek in the most affectionate way possible). I now understand that in order to achieve emissions reductions necessary to hold the world at a 2 degree Celsius average global temperature rise that developed countries need to utilize nuclear. But Saudi isn't a "developed" country, it's not even an Annex 1 country. It has got more leeway than that and because it has that extra time should devote itself to finishing the development process clean and green.

"World changing"? Sorry Monocle, you've missed the bear.

In a recent interview I did with a social networking site for b2b greening strategies, the CEO of the company said the company’s expansion depends on US demand for green energy (and the demand for US businesses to provide green technology). This b2b social networking site is particularly useful because one of its functions is to act as an enabler between businesses, creating a competition free space so that businesses can collectively and cooperatively find green solutions. But the CEO's missed the bear: It won’t be US green tech companies that will lead the world in green technology, they will be Chinese. If there’s any market that ready for green, clean business adjustment it’s China. He’s also betting on traditional growth and consumption models.

China recently abandoned it’s “buy Chinese” policy for wind turbines. In an era of increasing protectionism it seems odd that China would do this especially as it has been the target of protectionist policies itself lately. But it makes sense when we consider that China has the global market cornered in light weight wind turbines, according to a report by Climate Group (China’s Clean Revolution volume II). China will even be funding and supplying a wind turbine farm in Texas, to its advantage: 1700 net jobs created and 30% $1.5 billion financing is from US stimulus money. And while China is still heavily dependent upon fossil fuels for production, according to the Climate Group, its continued iterations of 5 year plans have placed a robust legal and regulatory infrastructure at the base of future green development.


Meanwhile (shocker!) the US lags behind: From businessgreen.asia: “Energy Secretary Steven Chu warned that without a robust climate bill the US was in danger of being eclipsed in the burgeoning market for clean technologies by Chinese and European firms - fears that already appear to be being borne out.”

Somehow I doubt the US’s climate bill will be robust enough to give US businesses the impetus they need to beat or match China in green energy R&D, if for no other reason than whatever version of the climate bill passes the US is only seeking to reduce gHg emissions by either 17% or 20% by 2020 (8.5% of which is negated on account of economic recession-- here’s a question: why not go further?!), well behind most industrialized countries (17% by the way is also behind China). Both the Senate and House bills give too many carbon credits away to business (complimentary permits will keep the price too low) and do little to nothing about agriculture subsidies that keep us eating unsustainably (how you ask? corn subsidies = corn syrup for starters). Neither bill is tough enough on methane (one requires capture the other makes it optional, where methane is arguably a more malicious gHg than CO2).

Vivek Wadhwa has written about the Brain Gain phenomenon beginning to occur in Asia: if we consider universities as the R&D base of the world, then this is going to bottom out. His recent studies of US Chinese (and Indian) graduates find that these students are more likely to go home to what they see as more sustainable economic futures and a more supportive family life style.

The Chinese government clearly “gets” climate change a lot better than its counterparts in most developed countries: it has devoted 40% (Climate Group, Reuters says 34%) of its stimulus package to green projects. The US, by comparison, 12% (hate to think what that looks like if you put it in per capita measure). Despite the fact that they haven’t explicitly made emissions reductions commitments, their commitment to green tech R&D, efficient cars, and greening their energy shows that they are in a race to the bottom (lowest emissions) and they’re playing to win.

Anybody who has studied development knows that top down models work as long as the private sector is on board too. So is it? Sort of: According to Tang Hao in a commentary on chinadialogue.net, “China’s local government officials are evaluated by their economic successes – and so powerful companies are often treated leniently. From the point of view of many firms, law enforcement is the exception rather than the rule; any official who does otherwise will be seen as a trouble-maker.” Hao explains that it is a misconception that multinational firms are attracted to China only because of cheap of labour: it’s their lax environmental law as well. But business will reform because the government says so, and there is a trend in banking and investment towards green business. If it’s true that pollution is the result of bad business practice, then China is ripe for the kind of corporate cultural transformation that this b2b social networking site can offer.

Beyond China, looking at the US domestic market, the b2b social network CEO has also missed the bear on demand and consumption. A key to moving green forward is revaluing the economy and refocusing growth away from demand and consumption. It’s not possible that the US will demand increasing amounts of energy, at least if all goes well. Green energy is meant to be efficient and in terms of absolute demand should decrease. As it becomes more efficient the US should demand less energy, consume less not more. What would increase is welfare as the US goes green, but the capacity to do this and the future market drivers for clean green tech will be in Asia.

I’ve blogged before about China needing to step up and lead the world on climate change. Whatever agreement is reached at Copenhagen, by the time it needs to be implemented the Chinese will be the dominant world economy. Betting your company’s future on the UK and US green tech industries, Mr. CEO? Think you’ve missed the bear. Hire some Mandarin speakers and computer programmers, quick!

Obama’s on to something: No, actually, it isn’t America’s job to lead.

Bill McKibben at 350.org, David Waskow at the Guardian, Matthew McDermott at Treehugger.com, indeed a broad swath of the green media are Missing the Bear by criticizing Obama for “failing to step up and lead” at Climate Week at the UN. (Lord Stern, to his credit, has it right.) As an economic empire in sunset and politically limited in its domestic sphere with what it can do about climate change, Obama’s step away from leadership is (surprising from an American President) right and proper.


He said:

“But make no mistake: this cannot be solely America's endeavor. Those who used to chastise America for acting alone in the world cannot now stand by and wait for America to solve the world's problems alone. We have sought - in word and deed - a new era of engagement with the world. Now is the time for all of us to take our share of responsibility for a global response to global challenges.”

Full text from HuffPo

He also said:

“Those wealthy nations that did so much to damage the environment in the 20th century must accept our obligation to lead. But responsibility does not end there. While we must acknowledge the need for differentiated responses, any effort to curb carbon emissions must include the fast-growing carbon emitters who can do more to reduce their air pollution without inhibiting growth. And any effort that fails to help the poorest nations both adapt to the problems that climate change has already wrought - and travel a path of clean development - will not work.”

Full text from HuffPo

The “fast-growing carbon emitters” to which Obama is referring are China and India (and Brazil and South Africa). Helping the poorest nations that will suffer first and most quickly from climate change is a duty that will fall not only to “developed” countries but also to China as it innovates clean technology. Obama isn’t considering China like a developing country here, he’s calling China developed.

The pre-circulated draft text (from the NYT) supports this:

“We must also energize our efforts to put other developing nations – especially the poorest and most vulnerable – on a path to sustainable growth. These nations do not have the same resources to combat climate change as countries like the United States or China do, but they have the most immediate stake in a solution.”

Though this passage wasn’t used as such and any reference to China as a developed country was not made in the speech Obama actually gave at the UN, he knows what he’s on about. China will surpass the US as the global economic powerhouse by 2035. India will as well, by 2045.*

China is already leading the way on green technology according to a report by the Climate Group. President Hu Jintao has vowed that China will generate 15% of it’s power from renewable energy by 2020 and will plant a forest “the size of Norway.” Nicholas Stern recently said that China’s current carbon footprint is probably higher than estimated: the economically more productive provinces already have carbon footprints higher than France and Britain.

Rest assured if there is any country that “gets” climate change, it’s China. And any criticism leveled at China for not making exact commitments in the run up to Copenhagen is highly unfounded, as is any leveled at “uncooperative” India. (India is more likely being sly like a fox.) Both countries will need green technology intellectual property rights and trade negotiations to go their way. China and India have the wherewithal to dominate the global economy in the near future. This will happen. The question is how quickly-- this is what’s at risk in the Copenhagen negotiations.

What Obama has done is acknowledge the role the next economic superpowers will play on the world stage and the waning of American superspower. China already wields a great deal of soft power and is poised to wield a great deal more in the future. Like other global economic powers it has begun to guarantee its future food security by buying up land in Africa. Reforming the global financial system will be impossible without China, especially because global growth will be determined by consumption and savings in China and India (leaving the issue of growth as a strategy aside here). But China (likewise India) has a lot of soft power to gain by developing as cleanly as possible, soft power it will be able to wield in the future with both the old developed world (Europe and the US) and with the developing world. The period in which it will set the example is now until 2050 at the latest, when both economies will overtake the US as the global economic leader.

The upshots are these: The developing world can be pressed to cooperate on climate change based on the extent to which emerging markets cooperate. China and India have a real chance to set an example for developing countries to grow clean and green. And later, spread economic benefits through green tech proliferation.

China can hold the US to account for cutting its carbon intensity: The US is currently bogged down in the domestic politics of climate change. It’s doubtful legislation for adequate emissions cuts will pass the Senate. John Kerry said this summer that it’s doubtful any Cop15 agreement will be ratified by the Senate. Healthcare is easily perceived by both the public and the administration as a more pressing concern than climate change and odds are that ballsy climate change legislation is where the administration will sacrifice in favor of its health care plans. China can wield soft power in the future to pressure the US do what it should about climate change. Mentioning China the way the Obama administration did in the pre-circulated draft may indicate that the Obama administration is counting on this external pressure later to take a second run at stronger domestic climate change legislation and even make certain the Cop15 agreement is passed.

For the future, the US isn’t the country that needs to lead the world on climate change. The West should stop looking to the US to lead and acknowledge, as Obama has done, that for a green clean future it’s up to China and India to show the way.

Update, 17.58pm 24 Sep, 2009: as it turns out I may not be very far off the mark on China's ability to help the Obama administration exert pressure on the Senate to pass climate legislation. I just read this article on Climateprogress.org.

"The bottom line, though, is that it is getting harder and harder for Senators to hide behind China as a reason for US inaction. Quite the reverse. It is increasingly clear that absent passage of the clean energy and climate bill, we have little chance of competing with China and, at the same time, we are pretty much the last hold out for serious global action. If we get a bill, we will get an international deal."


*Granted this estimate is from Goldman Sachs in 2007, pre-financial meltdown, but it’s reasonable to expect that all the crisis has done is put off Chinese and Indian global economic dominance by a few years.

According to Stewart Brand by 2050 80 percent of the world’s population will dwell in urban areas. By 2015 the developing world will have eight of ten of the biggest cities per capita. These cities will develop three times faster than cities in developed countries and on average will be nine times bigger. Urban areas consume massive amounts of resources. What’s missing from the climate change discourse is this: we cannot continue to consume the way that we have, in the West or as a species. And the trouble is the West is the paradigm. The Western model is what people in the developing world still aspire to. G8 leaders have declared that the answer to global recession is to hope that Chinese and Indian consumers pick up the slack in global demand by consuming more. Is this sound economic policy?


Consider: global economic growth is measured in terms of consumption (consumer demand and retail sales, especially for the model: Western economies) and moves in lock step with carbon emissions. Climate change experts from scientists, to economists, to politicians say that Western countries cannot continue to consume at the level that they have, that developing countries will have to pursue a different path to development that not only involves cleaner emissions but a different, ultimately lower consumption pattern. But global economic recovery is still talked about in terms of new car sales, retail earnings, new homes built. New, new, new, buy, buy, buy. Is your brain doing that thing where it feels fuzzy in the middle? Mine is.

This week there are several stories that tap into the miss-match in green economic recovery logic: First, a new study finds that warmer years see less economic progress in developing countries. Second, there is the revelation that credit markets are anti-green. Sustainable consumer behavior (say paying a cobbler to fix your favorite pair of shoes rather than buying a new one or a whole bunch of charges at a thrift store) is seen as a “warning sign” to credit card companies of declining card holder revenue. Third, corporate social responsibility (CSR) has become sustainabawashed (yes, I’ve just made up this word). For the most part, according to CSR expert Andrew Newton, the concept “has become shorthand way of saying a company’s ethical behavior is only useful if it preserves or enhances the company’s bottom line (paraphrase).” He is quoted in an article on the Corporate Eye explaining that the true spirit of CSR doesn’t go beyond charitable donations and that most companies could do more if they were willing to take a cut in profit.

Taking a cut in profit—like taking a cut in growth? China regularly sees annual GDP growth of around 10% (conservatively) give or take. That’s a lot of growth. There is also tacit understanding that these numbers are doctored. And thus the essence of the problem: developed countries for the last decade or so average around 1-2% annual economic growth, so China’s doctored average of 10% looks really huge and they want it to. The UN estimates that for African economies need to grow by an average annualize rate of 6% per year in order to maximize aid effectiveness. But how much of that growth is sufficient but not necessary? We are used to huge percentages 6-13% of GDP growth, and China isn’t even “developed” yet. How much growth is enough? Could we get used to smaller numbers if economic growth was valued properly like Andrew Simms, Aubrey Meyer, Ann Pettifor, Colin Challen, et al. suggest?

This economic revaluation should be part of the green recovery discourse. But so far most of what I’ve seen is green(washed) marketing, call it marketing and materializing climate change. For profit. The governments don’t get it, nobody involved in pre-Copenhagen negotiations is talking about it (at least not openly), and the economists are still talking about economic recovery in terms of retail sales and consumer demand. The mainstream press isn’t making any noise, having once again Missed the Bear. As the second world moves into the first, developing countries develop, they must do so on a better paradigm than the Western one. And Westerners will have to learn to consume differently.