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October 12 2011


US Denial versus European and Asian Sustainable Growth

The US continues to bury their head in the sand about climate changeWhile much of the rest of the world seems to see the dangers of climate change, many Americans appear to be woefully oblivious. Embracing a green, low-carbon economy is a sustainable way of dealing with the problems of resource depletion, economic uncertainty and climate change.

Europeans understand the severity of the threat posed by climate change far better than Americans. An October 2011, Eurobarometer poll found that Europeans consider global warming to be one of the world’s most serious problems. According to this poll, 68% of Europeans rate climate change as a “very serious” problem. One-fifth of Europeans indicated that climate change is the single most serious problem. Only poverty is considered a more serious problem than climate change, followed by the current economic crisis. (In fact the poor are the ones who will be most affected by climate change and the overwhelming costs of climate change make it a pressing economic issue).

As reviewed in an Eco-Business article, the Green Growth Forum, held in Ha Noi on October 4, 2011, was part of an Asia-Europe Meeting (ASEM) initiative where 180 European and Asian delegates shared their experiences on incorporating green growth models.Speaking at the forum, the Vietnamese Deputy Prime Minister Vu Van Ninh said that green growth not only served as a vehicle to foster global economic growth and recovery, but also as a tool to implement sustainable development based on social and environmental protection.

Miyon Lee, director general of the International Co-operation Team of the Presidential Committee on Green Growth in South Korea, said that all countries had a responsibility to develop green growth policies before it is too late.

The Eurozone has their green priorities in order, and increasingly, so does Asia, but America remains woefully behind in sustainability. European and Asian nations understand that economic concerns do not trump environmental concerns. However, in America, economic growth takes precedence over climate change. Climate change consistently ranks near the bottom on the list of Americans’ concerns. As stated in Roger Pielke Jr.’s “Iron Law” of climate policy, “When policies on emissions reductions collide with policies focused on economic growth, economic growth will win out every time.”

If we do not change our ways, economic growth will evaporate, taking jobs with it. Yet somehow, a small group of corporate interests have managed to introduce an element of doubt into the debate causing many Americans to buy into misinformation rather than subscribe to the scientific evidence. This is a travesty, not just of science, but of common sense.

Economic growth is not incompatible with managing climate change. As stated in a Treehugger article, “Europeans understand this better than Americans, and have managed to not only recognize the threat, but to reduce emissions while growing their economy.”

All around the world, people are beginning to develop national and regional strategies to minimize their impact on the earth. In the U.S., corporate interests beholden to the old energy economy have successfully resisted efforts to save the economy, the planet and its inhabitants.

If senior Asian and European officials can work on ways of transitioning economies from a ‘grow first, clean up later’ approach toward a greener development path, why can’t America?

It is a miscarriage of reason that in the U.S., short term economic issues are being used to justify ongoing environmental genocide.


Richard Matthews is a consultant, eco-entrepreneur, green investor and author of numerous articles on sustainable positioning, eco-economics and enviro-politics. He is the owner of THE GREEN MARKET, a leading sustainable business blog and one of the Web’s most comprehensive resources on the business of the environment. Find The Green Market on Facebook and follow The Green Market’s twitter feed.

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August 10 2011


In the Wake of the US Credit Downgrade Cuts to Entitlements may be the Key for the Green Economy

Now is the time to begin developing the green ecomomyA truly balanced approach to managing America’s debt involves reduced mandatory spending while at the same time, investing in the green economy. Despite the doom associated with Standard & Poor’s downgrading of U.S. treasury debt, a political window may have opened that could see entitlement reform as a means of advancing the low carbon economy.

Sustainability is the biggest opportunity of the century, and an extraordinary jobs creator, however this is a global competition which America cannot win without government support. With governments like the UK and China investing in sustainability, the global competition for green leadership is a powerful incentive for Congress to act. Growing the green economy will also provide significant additional government revenues.

Some resist the green economy by pointing to the costs associated with combating global warming, but what they ignore is that this is a fraction of the costs if we continue with business as usual. According to an analysis by Google, failure to move aggressively to implement a clean energy economy will cost the US GDP “trillions” over just the next five years. In 2009, the International Institute for Environment and Development (IIED) published a report authored by the co-chair of the IPCC and other climate science experts, revealing that the net present value of climate change impacts, i.e. the costs to civilization, are US$1,240 trillion under our current emission path and $410 trillion if we manage to stabilize atmospheric carbon at 450ppm. Most climate scientists would like to see that number at 350ppm or less.

According to conventional logic, the credit downgrade makes it that much more likely that Congress will not get involved in efforts to combat climate change. Economic uncertainty has already taken a toll on the government’s environmental initiatives. The recession killed climate change legislation in 2008 with opposition coming from Republicans and Democrats from the Rust Belt and coal-friendly regions.

As Yvo de Boer, former director of the United Nations Framework Convention on Climate Change said, “If industry is in a difficult pass, most sensible governments will be reluctant to impose new costs on them in the form of carbon-emissions caps.”

In 2008, Rep. John Dingell, chairman of the House Energy and Commerce Committee said,”In times of economic downturns, members [of Congress] are extremely reluctant to add burdens to the economy.” In addition to the cap-and-trade bill that failed in the Senate in 2008, the financial crisis also helped to bury the Kyoto Protocol.

The credit downgrade further weakens America’s economy which is still struggling to recover from the recession. Ironically, a stronger-than-expected July jobs report helped steady global markets on Friday August 5, but hours after the close of U.S. stock markets, Standard & Poor’s downgraded the U.S. credit rating from AAA to AA+. The credit downgrade caused stock markets around the world to decline resulting in the loss of trillions of dollars.

Many stock market insiders are expressing concerns about another recession. In response to an informal Dow Jones questionnaire, two-thirds of 45 economists, portfolio managers and financial consultants surveyed gave a better than 50 percent chance of recession in the next year. About 25 percent put the odds of recession at better than 75 percent.

Even if the U.S. does not fall into another recession, S&P’s downgrade of America’s sovereign debt is a psychological blow that will have significant consequences. The credit downgrade will add $100 billion a year to government costs, it will also further weaken an already weak dollar, increase costs for US companies and undermine the economic recovery. Some investors and analysts are saying that over time, Standard & Poor’s downgrade may mark a moment in the decline of U.S. economic strength.

Despite accusations from both sides, Republicans must assume the bulk of the responsibility for the US credit downgrade. The credit downgrade could have been averted if Republicans would have accepted putting an end to Bush tax cuts for the wealthiest 2 percent. The GOP’s refusal to work with President Obama and the Democrats has hog-tied the US economy and undermined efforts to implement policies that spur job growth.

Standard & Poor’s said that GOP strategy had shaken its confidence. The agency explained its downgrade by citing heightened political risks:  “The political brinksmanship of recent months highlights what we see as America’s governance and policymaking becoming less stable, less effective, and less predictable than what we previously believed.”

The GOP has been hijacked by the Tea Party whose intransigence over the debt ceiling is responsible for the political deadlock that led to the downgrade. The Tea Party’s woeful ignorance on the role of government has fueled the political insanity that has created this economic uncertainty.

The downgrade prompted Gregory Ellena, chief executive of First National Bank of Santa Fe, to say, ”It’s very disappointing that the money markets have become hostage to political maneuvering.”

Sen. Mike Crapo (R., Idaho) said the credit downgrade will put pressure on the bipartisan commission to go beyond the minimum $1.2 trillion in savings threshold set in the debt ceiling agreement. In an interview with the Wall Street Journal, Mr Crapo said, “This decision focuses us on the scope of the issue we are facing. It increases the momentum for a much larger plan.” Sen. Mike Crapo is a member of the bipartisan group of six senators who sought to craft their own deficit reduction plan earlier this year.

S&P criticized the $2.4 trillion debt ceiling deal as too limited and singled out Republicans for failing to increase taxes on the wealthy and Democrats for refusing cuts to entitlements. With Standard & Poor’s warning of further downgrades, it will be hard to avoid deep cuts, including mandatory spending.

As his first term winds down, President Obama could yet show leadership on the politics of climate change. Republicans claim they want deeper cuts and economic growth. Entitlement reform provides a way of cutting spending while simultaneously investing in American competitiveness.

America is confronted with the need to make major budget cuts while finding funds to invest in the green economy. Both taxes and entitlement programs will be on the table as lawmakers seek a broader package of cuts.

Entitlements consume a large share of the U.S. government budget. According to Congressional Budget Office records, federal outlays for entitlement spending was 33.8% in 1965. According to a CF&P Foundation article “Prosperitas,” as of 2000, entitlement spending almost doubled, accounting for 62.6% of the U.S. budget.

More cuts are needed and the debt downgrade may present the right conditions for the President to propose cuts to entitlements. In exchange for reductions to mandatory spending, Republicans may even consider a compromise, if not, the GOP may risk being punished by voters in 2012.

Although many Americans many not see it, the US is at a crossroads that could very well determine its future prosperity or ongoing decline.


Richard Matthews is a consultant, eco-entrepreneur, green investor and author of numerous articles on sustainable positioning, eco-economics and enviro-politics. He is the owner of THE GREEN MARKET, a leading sustainable business blog and one of the Web’s most comprehensive resources on the business of the environment. Find The Green Market on Facebook and follow The Green Market’s twitter feed.

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March 26 2010


The language of sacrifice

Category: climate Posted on: March 24, 2010 10:00 AM, by James Hrynyshyn Fellow Scienceblogger Sharon “Casaubon’s Book” Astyk warns us that the latest thinking on proximity to climate tipping points supports the premise that we can’t make the transition to a post-carbon economy without surrendering some of that oh-so-sacred American way of life. At least, that the [...]

February 04 2010


An Open Letter to President Obama from the Post Carbon Institute

February 1, 2010

Dear President Obama,

Your State of the Union speech last week laudably referenced clean tech and renewable energy several times. We ask that you follow your words with action, by leading the transition to a post-carbon economy and a healthier world.

You also spoke of our need to face hard truths.

Hard truth: Our continued, willful reliance on fossil fuels is making our planet uninhabitable. We are evicting ourselves from the only paradise we’ve ever known.

Hard truth: No combination of current and anticipated renewable sources can maintain our profligate energy usage as the global supply of fossil fuels heads for terminal decline.
For the recently releasd Searching for a Miracle, Post Carbon Institute Senior Fellow Richard Heinberg conducted a “net energy” analysis of 18 different energy sources (including nuclear and “clean coal”). He concluded that the amount of energy available after accounting for the energy used in extraction and production of those sources is—at our current and anticipated rates of consumption—insufficient to get us “over the hump” to a post-carbon world.

Our 29 Post Carbon Institute Fellows—experts in the leading economic, energy, and environmental issues of the day—all agree that this "net energy" deficit is just one of many interrelated crises shaping the 21st century. Each crisis alone creates formidable challenges; in combination, their complexity admits no simple solution. But given their direness, inaction risks tragedy.

Mr. President, we respect you and your advisors and appreciate the enormity of the dilemmas you and all of us confront. When a great leader frames a great challenge, a resilient will people rise to meet the opportunity. And so we ask, Mr. President, that you tell the American people that we must:

  1. Face reality. In a carbon-constrained world, true prosperity comes not from heedless growth, but from shared security, community, and liberty.
  2. Prepare for the future. Conservation, with an emphasis on building a green economy and revitalizing struggling communities, offers cost-effective “found” energy, and the most immediate and long-term return on investment.
  3. Lead the way. A substantial investment in renewable energy, with an emphasis on distributed solar and wind, offers the best hope for moving to a sustainable economy and environment.

Mr. President, lead us in creating a future worth inheriting. Post Carbon Institute and our Fellows will support you and your team in whatever capacity we can. We believe that the American people, and the world’s people, will support you as well.
With hope,

Asher Miller
Executive Director
Post Carbon Institute

The Post Carbon Institute
The Post Carbon Institute was founded in 2003 with the mission of "leading the transition to a more resilient, equitable, and sustainable world." As this open letter states, the challenges facing our civilization in a new century do not stem from single isolated issues. It isn't climate, or biodiversity, or dependence on fossil fuels, or water and food, or over-consumption. It's about all these issues – and more – that integrate into how we choose to live our lives and provide future generations with a habitable and sustainable planet.

Post Carbon Institute provides all sectors of society, from individuals to business and government, with the resources needed to understand and respond to these interrelated challenges of economy, energy, and environment.

The vision of PCI is a world of sustainable, resilient communities based on "re-localized" economies thriving within ecological limits.

The Post Carbon Institute has gathered 28 world-renowned fellows to help light this path to a livable future led by Senior Fellow Richard Heinberg and including such figures as Bill McKibben, Wes Jackson, David Orr, and Tom Whipple.

"Like it or not we are here." We live in challenging, exciting, often frightening times. The issues we face are almost too much to fully digest and too easy to brush under the carpet and ignore – for now. PCI hopes to help lead the way out of comfortable complacency into a new world based an equality and sustainability.

The PCI Manifesto (pdf)

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