Our planet in crisis: can we curb global warming and boost economic growth?

Is it possible to curb global warming while advancing economic growth? A shift to a low-carbon, service-led economy could offset the effects of a rising world population and increasing consumer production.

Aerial night view of the City of London on August 6, 2007 in London. Jason Hawkes / Getty Images
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The auspicious conclusion of the Paris Agreement on climate change last year – signed by 195 countries committed to checking global warming below 2°C – educed sighs of relief and good vibes around the world. But just half a year later, the bonhomie has vanished completely: US President Donald Trump’s decision to withdraw America from the pact makes Paris’s two-degree target almost certainly unattainable.

This body blow has hardly been softened by the dire new reports about the Arctic polar ice cap, now considered beyond saving – a fatality of rapidly warming currents of the Arctic Ocean. The ice cap has been dubbed Earth’s “natural air conditioner” for the way it reflects sunlight that would otherwise warm waters all the way to the Indian Ocean and trigger extreme weather around the globe. A decade ago, the spectacular loss of Arctic ice due to global warming – the region’s temperatures are at a 40,000-year high – sent tremors through the scientific community, which underscored how the thaw will wreak havoc, raising sea levels by as much as 20 feet and melting permafrost that contains high levels of methane, a potent greenhouse gas.

But a widely circulated report prepared for the intergovernmental Arctic Council by 90 international experts posts a yet gloomier forecast. The ice caps are now melting faster than ever, and it’s likely that the summer ice so critical to the world’s ecosystem will disappear completely by the late 2030s. The bill for the destruction in its wake will soar into tens of trillions of euros, claims the report; the cost in terms of human suffering and loss of biodiversity incalculable – and there’s no technological remedy in sight, no Plan B.

The stark news will amp up the debate about how to reshape our economy in ways that will curb and mitigate climate change, and focus attention on the minimal aims of the Paris Accord, which some observers claim isn’t nearly enough, fast enough – the melting ice caps just one piece of evidence.

Critical environmentalists such as Jonathan Dawson, an economist at Schumacher College, an environment-focused institution in South West England, argue that global warming can’t be stopped as long as the developed world’s nations insist upon economic growth, namely the ever-increasing production of goods and services. “At Paris and during all of the negotiations, the one non-negotiable on the table the whole time was economic growth,” explains Dawson.

Most of the experts involved in the negotiations, says Dawson, were aware that the sacred cow of growth would eventually have to be sacrificed to keep the Paris targets in range.

“Many of us thought that by embracing the Paris Accord, the process would in time snowball,” says Dawson, referring to more rigorous measures in the future. “There’s almost no evidence that we can reduce emissions while there’s economic growth and the current high consumption levels of the industrialised world. But the dominant narrative out there is still that technology will enable us to live as we always have.”

A profound difference between the discourse today and even just a decade ago is not just the international consensus on the threat of global warming, but there’s also broad concurrence that our existing neo-liberal economic models and energy usage are incompatible with mankind’s long-term welfare. In other words, we can’t hope to keep climate change at bay as long as our traditional, industrial economies themselves – modus vivendi for two centuries – aren’t transformed. Environmentalist-designed models for “green growth” (also known as “sustainable development”) are now the foundation of a worldwide discourse shared by the UN, the IMF and the World Bank, and, in principle at least, all of the signatories of the Paris Agreement.

Central to green growth is that energy generated by the sun, wind, water and organic solids can now start to replace fossil fuels. The technology of renewable energies is already here – solar panels, wind turbines, electric cars, smart grids – and prices are plunging so steadily that clean energy is cheaper than oil and gas in many places.

Countries such as Germany and Denmark, where renewables are integral to energy generation, illustrate that a shift to a low-carbon economy is doable without harming productivity. Moreover, our economies can decarbonise even faster by shifting from industrial production to a service economy, a trend which is already under way.

This transformation, say its advocates, will be greatly accelerated by energy efficiency measures, as well as the smarter use of other resources, which will shrink the quantity of energy needed in the first place, making the energy supply easier to cover with renewables.

Moreover, the green growth-ers believe firmly that advances in technology – be it in hydrogen power, carbon capture, biotechnology, geoengineering, or other options – will smooth the way, even in the context of a growing world population.

A bonus of the green growth paradigms is that they promise more growth, which implies that the wealthy developed world won’t have to surrender its way of life for climate protection. Since a doubling of the world’s population makes growth inevitable anyway, they say, the trick is to focus on how it will grow. The creation of renewable-energy infrastructure will actually promote growth by creating millions of jobs in construction, the chemical industry, the digital sector and manufacturing.

They argue it’s a win-win deal. As Kofi Annan put it while UN secretary-general: “It is often said that protecting the environment would constrain or even undermine economic growth. In fact, the opposite is true. Unless we protect resources and Earth’s natural capital, we shall not be able to sustain economic growth.”

But proponents of “no growth” and “degrowth” economics, such as Dawson and others, claim that the world is deluding itself with green-growth fairytales that promise ever more expansion, minus the fossil fuels and exorbitant waste. While growth-critical economic models had circulated among environmentalists since the 1970s, they reappeared brightly on the radar in the aftermath of the 2008 financial crisis, when even many mainstream social scientists, environmental activists and politicians started to rethink the status quo. Since then, grassroots degrowth campaigns have cropped up, their numbers modest but growing, particularly with younger activists.

At the heart of no-growth thinking, says Niko Paech, a German economist and intellectual, is the conviction that “increases in gross domestic product [GDP], even so-called green growth, means increasing greenhouse gases”. Paech says that to meet the 2°C goal, humans have to bring their own average carbon footprint down to 2.5 tonnes of carbon dioxide a year. Because of the poor developing world’s low consumption, most of its inhabitants are below this figure already.

“The problem is affluent countries,” says Paech. Studies show, for example, that Germans emit an average 11 tonnes of carbon dioxide a year per person; in the United States the figure is 20 tonnes. “But politicians don’t dare tell their audience that they have to change their standard of living. We’ve got to start talking about our consumption, about eating meat, about driving cars and flying,” says Paech.

Growth critics recognise that changing behaviour and expectations, especially about consumption, is a formidable challenge. In Europe, Green Party politicians seeking to reduce meat consumption have been roundly criticised for authoritarian, “socialist” behaviour – for limiting personal liberty.

But André Reichel, a professor at Karlshochschule International University, Germany, and an economist at the forefront of the degrowth movement, says that the impetus for change must ultimately come from below.

“There are fundamental questions that we have to pose about our civilisation’s narrative,” he says, pointing out that every society enshrines its values in its legal and tax codes. “Carbon-intensive activities and products have to be taxed in order to shift consumption patterns. We have to change the story, separating ourselves from the dominant growth narrative and embracing one based on different kinds of well-being and happiness.”

Reichel and others point to an array of studies that show happiness and well-being aren’t in fact tied to economic growth. “We have to question the perceived benefits of growth itself, as it’s obviously terribly unhealthy and not just concerning climate change,” says Dawson. “The world’s most consumerist societies have very high levels of obesity, depression, drug addiction and suicide. There’s copious research tracking quality of life that shows that a shorter working week, more time with the family, less work contributes to well-being.”

Andreas Kraemer of the IASS Institute for Advanced Sustainability Studies, Potsdam, Germany, counters that the green growth consensus is a crucial foundation to work from, even if it’s not a silver bullet. Renewable energy expansion, he says, “if accelerated through a rapid abolition of all subsidies for fossil and nuclear energy, and deregulation to avoid unnecessary administrative hurdles for investment in renewables, would contribute significantly to halting global warming.”

The debate over growth aside, he says that transforming energy supply, mobility and global food chains are key to keeping below the 2°C target.

“Decarbonisation has to be seen as a big opportunity,” says Dimitri Zenghelis of the London School of Economics, a defender of green growth. “The move to low-carbon societies, in addition to addressing global warming, will spur innovation and entrepreneurship, reduce pollution and congestion in cities, and improve health. There’s a lot of self-interest here for many parties. This is how revolutions get started.”

Europe should lead the way, says Reichel. “It was Europe that introduced the industrial, growth-fixated economy to the world in the first place. So now it could be seen as Europe’s challenge to change it, to come up with another model and story that drives and motivates us like market capitalism once did.”

Paul Hockenos is the author of the forthcoming Berlin Calling: A Story of Anarchy, Music, the Wall and the Birth of the New Berlin.