‘Green Economic Growth’, Decoupling Is A Myth

Using Orwellian “double-speak”, green growth means economic contraction. Sustainable Development, aka Technocracy and the Great Reset will go down in history as the greatest plundering of global assets ever conducted.

This article is pro-green but points out that “the idea that we can do both [be “green” and grow at the same time is a persistent mythology, an article of  faithno less, that needs to be discarded.” –TN Editor

There are ‘no realistic scenarios’ to make the economic growth demanded by capitalism compatible with a safe climate, researchers who advised the United Nations found.

As societies get richer, they consume more resources. That also means they generate more pollution, driving climate change and destroying natural ecosystems.

We need to somehow break this link between material wealth and environmental catastrophe. That’s why financial institutions and governments have been focused on the idea of “decoupling” GDP growth from resource use.

The idea of “decoupling” is driven by the recognition that to stay within the ˜safe limit of 1.5 degrees Celsius, we have to dramatically reduce our material consumption of Earth’s resources.

The assumption is that it is possible to continue growing the global economy while reducing our actual resource use and material footprint, perhaps by shifting to renewable energy.

This notion has been most recently articulated in the book More From Less: The Surprising Story of How We Learned to Prosper Using Fewer Resources and What Happens Next, by Andrew McAfee, principal research scientist at the MIT Sloan School of Management. Financial and other data, McAfee argued, shows we can actually easily reduce our material footprint while continuing to grow our economies in a win-win scenario.

But new scientific analysis by a group of systems scientists and economists who have advised the United Nations seems to pull the rug out from under this entire enterprise. The new research indicates that the conventional approach is based on selective readings of statistical data.

McAfee argues, for instance, that as we are increasing wealth, the productivity motor of capitalism is driving us to greater heights of efficiency due to better technologies. This means we are able to make stuff faster and smaller using less materials and in some cases less energy. And that in turn implies we are causing less pollution. The problem is that this story, according to the new research, ignores how greater efficiency in certain regions or sectors is not slowing down the overall consumption machine. Within the wider system these efficiencies are enabling us to consume even greater quantities of resources overall.

That’s why decades of data on material flows confirm that there are “no realistic scenarios” for such decoupling of economic growth from resource use. Combing through 179 of the best studies of this issue from 1990 to 2019 further reveals “no evidence” that any meaningful decoupling has ever taken place.

“The goal of decoupling rests partly on faith,” conclude the team from the BIOS Research Institute in Finland, an independent multidisciplinary scientific organisation studying the effects of environmental and resource factors on economy, politics, and culture.

The BIOS team previously advised the UN Global Sustainable Development Report on the risk that endless economic growth under capitalism would be undermined due to intensifying “biophysical” limits. A combination of diminishing returns from energy extraction and increasing costs of environmental crises are already undermining growth, and require us to rewrite the global economic operating system, the scientists concluded in a powerful background report to the UN.

In two new, peer-reviewed research papers published in June, their analysis goes further. Capitalism’s drive for maximising profits means that the economy is structured around continued economic growth: if it doesn’t grow, it collapses. This means that huge technological efficiencies tend to empower capitalism to grow faster and bigger.

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Pandemic: Environmentalist’s Dream Come True

The Great Panic of 2020 was started by Technocrats to advance Technocracy, aka Sustainable Development, which is a resource-based economic system designed to replace free market economics. The pandemic was tailor-made. ⁃ TN Editor

Have you recently heard anything about the major existential threat to our lives? I don’t mean the exaggerated virality of the virus currently wreaking havoc with our globalized societies, but the endlessly dangerous impact of climate change? Of rising sea levels and volatile weather leading to crop failures and mass starvation and collapse of precious ecosystems?

You know, the imminent Sixth Mass Extinction? The “ecocide” that the French President Emmanuel Macron called the Amazon fires last year and that the British newspaper The Guardian routinely describes all kinds of things impacting nature?

I didn’t think so.

Nor should you have: as humans, we clearly had more urgent things to worry about than dying polar bears or cleared rainforests or other kinds of climate damages – real or imagined – accumulating centuries down the line. In the economist’s dry language, our time preferences spiked: we suddenly cared a lot more about the present compared to the future than we did until recently.

At the same time, strangely, the environmentalists had a field day during the corona pandemic. The anti-human policies they have called for, protested for, disrupted societies and other people’s lives for, were suddenly implemented en masse, albeit on a temporary basis. Think of it as a trial for green policies.

To most naive environmentalists, this was a hugely successful experiment. We could and did shut down the modern industrialized society they frantically detest. Factories across many provinces of China, the workshop of the world, shut down for months; Italy paused its market society while their dead piled up, and most other countries followed suit: malls closed, downtowns were eerily empty, supermarkets rationed both goods and customers. Airports and planes, those busy places usually at any given time housing over a million people – a Dallas-sized city in the skies – all but closed.

And the environment did improve a little. Air quality in many Chinese cities improved, almost overnight. CO2 emissions for the first quarter of 2020 fell by a full 5% as opposed to growing steadily at 2-3% a year – “one of the biggest reductions in CO2 emissions on record,” as the World Economic Forum described the news. The reduction of emissions were even seen from space, almost instantaneously.

Intellectually consistent greens should be celebrating in the streets.

Yet, they’re fairly quiet. And most scientists are not so happy. Even though we stopped air travel, mostly stopped eating out and reduced our consumption, some 80% of emissions went unaffected – think heating, electricity, food consumption, and the many disposables we now – reasonably – started using. The coronavirus shutdown shows that we can do a lot to change our societies and it still wouldn’t make more than a dent in the global emissions. Extrapolating the 5%-first quarter reduction in emissions for the rest of the year puts us back roughly to emission levels of 2012, not exactly a year celebrated for its climate achievements.

Was it Worth It?

Asking this annoying economist’s question is the attempt to be balanced in a world gone mad. Answer it requires us to hold more than one value in our minds at the same time, trading off one for the other – an attribute that our political friends on the left and right don’t like doing. The world is not, contrary to most everyone’s illusions, one-dimensional; there is no one thing that overwhelmingly matters. Instead, careful trade-offs between health, financial and economic well-being, and climate impact do.

Most people do want to preserve nature and minimize our climate impact – but not “at the expense of their children going cold or hungry.”

With 13% unemployment in the U.S. and reports of all kinds of ills increasing – ranging from poverty, to domestic violence and suicides – whether some percentage points off global emissions were worth it is highly doubtful. Even setting aside the pandemic for a moment, one has to place a very large value on polar bears and trees, and a very small value on human flourishing to rationalize that trade-off. You can, in principle, have whichever valuations of those things that you want, but very few people would share them – and I wager that most environmentalists themselves won’t.

Andy Kessler at the Wall Street Journal nailed it when he, in April, wrote:

“Today we have 17 million freshly unemployed, but . . . carbon emissions have plummeted, dolphins returned to Venice, wolves walk the streets of San Francisco and pot use is at an all-time high. Unicorns and equality everywhere? Not quite. Pollution and crime are down because we’re all basically in prison. It’s awful. Set us free.”

For some people, somewhere, spending unanticipated time with loved ones has been a blessing. For others, this family love has been mediated through phones or hospital windows. Don’t visit your elders. Don’t see your friends. If you do, stay far away from them. Carnal desires or intimacy outside of cohabitation is clearly not essential. In every conceivable way, life has been worse. Travels for leisure, pleasure, or business have ceased. Incomes for insanely large chunks of American society has dwindled, if not stopped entirely. That’s not great.

Of the dystopia the green left idealizes, the Spring of 2020 was but a taste. A taste that we endured, survived, hankered along because of extreme measures by businesses and governments designed to hibernate commercial and civic life – and save our vulnerable elderly population. Fiscal deficits and money-printing of astronomical magnitudes. It could only last so long, which is why many countries are eager to open their societies before the still-meagre tourist season of 2020.

The green new deal of anti-human, anti-capitalist harmony would run this route all the way, with no end in sight, no wealth or saving to draw from, no fantastically productive supply chains left over from a prosperous and globalized economy temporarily put on hold.

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Big Three Bankers Predict Depressionary Economic Crash

As news filters out describing the economic carnage from the coronavirus contagion and panic, the one thing that nobody dares to address is potential collapse of the entire global financial system.

The rapid decline is global stocks now exceeds the Crash of 1929 and has liquidated at least $30 trillion or more in equity. A bear market loss of 20% or more in a few short weeks is unprecedented in U.S. history. This is a ‘poof’-it’s-gone moment and it puts banks and financial companies under panic management. Bank stress tests have not yet emerged, but it is inconceivable that some large banks are not technically bankrupt and will be the first ones to start the collapse.

Small businesses are being crushed and will soon fill the courts with bankruptcy filings. With unemployment headed toward 30% or more, individuals will also end up in bankruptcy court.

Forget the coronavirus for a moment. Who is the only sworn enemy of Capitalism and Free Enterprise that swears it will be destroyed and replaced with another economic system? Yes, the ONLY one – Technocracy, aka the UN’s Sustainable Development. Call it the Green New Deal, Green Economy, Natural Capitalism, it doesn’t matter. It’s all the same twisted plan to flip the world upside down for their own benefit.

Now, remember the coronavirus for a moment. It the UN can wag-the-dog on coronavirus and bring the world to its knees, it can declare a similar emergency for anything it wants – how about global warming, the seas are rising, polar bears are disappearing, ice caps are melting, “we only have 12 years left before we all die”?

Don’t worry about that yet, because if these global Technocrats achieve what they need during the great coronavirus panic, there won’t be a need for another emergency. ⁃ TN Editor

First it was Goldman cutting its Q2 GDP to -5% just one week ago; then JPM quickly upstaged Goldman by slashing its own Q2 GDP forecast to -14%. Then Goldman, which just last December said the US economy is “nearly recession-proof” decided to really show JPM who is boss and nearly doubled this dismal prediction, and on Friday predicted a great depression-like -24% crash in Q2 GDP. And now, in this race to come up with the most apocalyptic GDP number imaginable, here comes Morgan Stanley which expanded its former Q2 GDP -4% prediction nearly 8x to -30%, a number that would have seemed almost insane in isolation… if only it wasn’t for St. Louis Fed president James Bullard coming up with an absolutely staggering -50% worst case scenario earlier today.

Here are the highlights from the report which we expect, just like all other bank forecasts, will be revised to an even more cataclysmic number in days if not hours:

We now see 1Q GDP dropping by 2.4% as economic activity has come to a near standstill in March, followed by a record-breaking drop of 30.1% in 2Q. We estimate that March will also mark the first drop in nonfarm payrolls, down 700k. We expect a record-high unemployment rate, averaging 12.8% in 2Q.

We assume sharp declines in areas of consumer discretionary spending like travel, dining out, other services and motor vehicle spending among others. This will leave a large hole in consumer spending in 2Q, when we expect real personal consumption expenditures to contract at a 31% annualized pace.

While ready to upstage both Goldman and JPM’s pessimism, Morgan Stanley was unwilling to break the mold with the other banks, and just like them sees a sharp V-shaped rebound in Q3, even though as Goldman warned a V-shaped recovery is certainly not to be taken for granted:

We expect that 3Q will look somewhat better as consumption climbs back to around its pre-virus level.

On the other hand:

The outlook for business investment is likely to look more U-shaped, and residential investment should follow a similar pattern.

How about US unemployment? Nothing good. With both Goldman and JPM expecting tremendous surged in joblessness in the coming weeks, Morgan Stanley has outdone them both and writes that “on April 3 we expect the Bureau of Labor Statistics to report that total nonfarm payrolls declined by a net 700,000 in March.” Some more details:

The bulk of the weakness in March payrolls likely comes from a decline in hiring as opposed to firing. However,as we move into April, it will be both a surge in layoffs as well as a shutdown in hiring that will bring about the darkest days for the labor market since the financial crisis.

A corresponding 700,000 decline in household survey employment in March would raise the unemployment rate by 70bp from 3.5% to 4.2%. As we move into 2Q, we forecast the unemployment rate to surge, averaging 12.8% in the quarter (Exhibit 8) – the highest among records dating back to the 1940s.

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Amidst Crisis, Green New Deal Is Claimed To Be The Answer

Whatever crisis might present itself, the solution will always be Sustainable Development, aka Technocracy, which proves that Technocracy is the endgame after the demise of Capitalism and Free Enterprise. ⁃ TN Editor

If you’re feeling a mounting sense of apocalyptic unease as you wash your hands and sing “Happy Birthday” for the eighth time this morning, you are not alone.

It is perfectly possible that before 2020 is half over, we will be in a global recession exacerbated by a pandemic and an oil price crash. And it is all playing out against the backdrop of a climate emergency that is proceeding at terrifying speed whether it is on the front pages or not.

But while stock markets veer between fear and greed, some of us find ourselves ricocheting from fear to hope. (And back again.)

Beyond this week’s initial economic package, it is entirely possible that the Trudeau government will soon have to step up with a massive economic stimulus, perhaps one even bigger than a decade ago.

And while U.S. President Donald Trump seizes this crisis moment to bail out his billionaire friends in unsustainable industries, Prime Minister Justin Trudeau – preparing a budget and searching for a unifying second-term mission – could and should bail out people and the planet instead.

In fact, the response to this period of converging crises is a once-in-a-lifetime opportunity for the federal government to initiate a reset of our economy and society, putting Canada on a path toward zero emissions, and bringing immediate material benefits and enhanced, 21st century universal public services to everyone – prioritizing Indigenous, racialized and working class communities – that is, the people who need them most.

In other words, this is the ideal moment for Canada to launch the decade of the Green New Deal, a sweeping vision launched nationally last spring by more than 150 climate and social justice organizations, building on momentum south of the border from U.S. congresswoman Alexandria Ocasio-Cortez and the Sunrise climate movement. Essentially, it recommends an unprecedented public investment in a justice-based transition that creates a vast number of well-paying (preferably unionized) jobs, solves our crises in housing, crumbling infrastructure, health and education, inadequate transit, and deep inequality. This kind of public investment would vastly expand the tax base and stabilize the economy at the same time.

We know this can be done in Canada. During the Second World War, under the leadership of none other than “minister of everything” C.D. Howe, this country created 28 new crown corporations to manage every aspect of the war effort. That’s the level of commitment we need for a rapid shift to a climate-safe and more equal economy.

And we certainly have the resources to do it.

As a Globe and Mail editorial said recently, Canada “can deploy fiscal stimulus worth tens or even hundreds of billions of dollars, if necessary. And it can borrow at the lowest interest rates in human history, which it can lock in for decades.”

In the midst of all these terrifying and converging disasters, this is perhaps the greatest opportunity – to shatter the shackles of austerity thinking and see the potential for government to do big things, like actually lead a democratic and inclusive response to the climate emergency at the speed and scale that science and justice require.

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WEF: Satisfaction With ‘Democracy At 25-Year Low’

The World Economic Forum continues to bash democracy as being rejected by developed nations, in particular in the U.S. and Brazil where citizens are generally the most anti-technocratic. By comparison, Denmark, Switzerland and Norway are elevated as wonderful democratic states, which are already operating as Technocratic states. Expect a continuing propaganda push to bash democracy while leaving the door wide open for the only solution offered: Sustainable Development, aka Technocracy. ⁃ TN Editor

  • Dissatisfaction with democracy is at its highest since records began.
  • United States and Brazil show the highest levels of dissatisfaction.
  • Small, high-income nations eg. Luxembourg, Denmark have lowest levels.
  • Dissatisfaction often linked to economic shocks and scandals.
  • Dissatisfaction with democracy in developed nations is at a record high

Since 1995, the University of Cambridge’s Centre for the Future of Democracy has gauged people’s views on democracy. Their most recent report, spanning 154 nations, reveals some of the highest levels of discontent since records began.

“We find that dissatisfaction with democracy has risen over time and is reaching an all-time global high, in particular in developed countries,” said the report’s author, Dr Roberto Foa.

Global democratic malaise

In the mid-nineties, countries in Europe, Africa, the Middle East, Asia and Australia seemed to be relatively satisfied with their democracies. Since then, the proportion of people expressing dissatisfaction has risen from 47.9% to 57.5%.

Some of the world’s largest democratic countries, such as the United States and Brazil, are experiencing the highest levels of dissatisfaction, with Mexico, Australia and the United Kingdom seeing their highest level of dissatisfaction on record. Japan, Greece and Spain are also inching closer to all-time highs.

‘Islands of contentment’

However, not all hope is lost. People in some countries – primarily small, high-income democracies like Denmark, Switzerland and Norway – are showing great confidence in their democratic institutions.

These countries form part of the so-called “Island of Contentment” – a small subset of nations, accounting for just 2% of the world’s population, where less than a quarter of the citizenry express dissatisfaction with democracy.

Shock and awe

While the report demonstrates a marked increase in dissatisfaction, it doesn’t conclude why. However, 25 years of data does point to a correlation between levels of dissatisfaction and large-scale events such as economic shocks and political scandals.

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green bonds

Virtue Signaling With Long-Term ‘Green Bonds’

‘Green Bonds’ are the increasingly popular instruments to finance Sustainable Development, Green Economy and Green New Deal, aka Technocracy, but wrongly-diverted money only causes greater economic dislocation. ⁃ TN Editor
 

While still small, sustainable financing is growing. There’s been $165 billion of so-called “green”-bond issuance from companies and countries this year – more than double 2016’s total – according to data compiled by Bloomberg.

And, under pressure from ‘the people’ demanding policymakers “do something” to save the world from almost certain climate-driven doom, Bloomberg reports that central banks are putting their money-printing malarkey to work in sustainable financing, opening up a new source of demand for the budding asset class.

Most major central banks have signed on to promote sustainable growth, offering incentives that encourage green financing.

“Central banks are important institutional investors, and the fact that they are participating in this market, it gives the market almost like a seal of reliability and maturity,” said Christian Deseglise, global head of central banks and global sponsor of sustainable finance at HSBC Holdings Plc, the biggest underwriter of the bonds this year.

“It’s not so much about adding demand, because we already have demand,” he said. “It’s the quality of that demand that’s really important.”

The European Central Bank has been buying the debt as part of its asset repurchase program.

Hungary and France’s central banks have each created funds dedicated to ecological investments.

Now Peru is considering buying green bonds, too.

While the Federal Reserve, with nearly $4 trillion on its balance sheet, is notably absent from the Network for Greening the Financial System, regional branches have published research on the topic, and Chairman Jerome Powell maintains that it’s a “longer-run issue.”

However, as Bloomberg notes, pricing and liquidity are still limiting factors. As green bonds become more mainstream, investors are offered little additional incentive to buy them as they price comparably to non-green debt.

“As soon as the green-bond market becomes sizable you’ll see central banks investing more in green bonds,” according to Massimiliano Castelli, head of sovereign strategy at UBS Asset Management.

Of course, as most are aware, “green”-bonds are largely a marketing gimmick, and if central banks really do escalate their buying, then you don’t need a crystal ball to forecast that there will be a rise in companies’ “Greenwashing” their issuance – using green labels to spend on not so green things!

Nevertheless, The San Francisco Fed is quick to explain the ‘benefits’ of these “Green bonds” – and

The Forest Resilience Bond (FRB) is a financial tool that enables private invest­ment in forest enhancements on public land. The FRB promises to accelerate the pace and scale at which critical work to restore the health and functioning of the nation’s forested landscapes is undertaken.

It does so by engaging private capital to cover the upfront cost of activities to improve forest health and by bringing together stakeholders that benefit from this work to share in the cost of reimbursing investors over time. These beneficiaries sign contracts that jointly cover the project cost plus a modest return to investors, meaning that no one stakeholder shoulders the burden of repayment alone. The result is a collaborative finance model that yields clear ecological, social, and financial returns.

While perhaps less obvious, the FRB model also unlocks opportunities for positive social impact in rural communities across the country. In addition to the direct impact of job creation, FRB projects can catalyze infusions of capital into rural areas by sending signals to the market that there is a steady supply of raw material to fuel forest-based industries. Against a backdrop of declining rural prosperity, this article envisions how the FRB could play a role in assisting rural areas – especially those with historically forest-based econo­mies – transition to a more resilient ecological and economic future.

What differentiates the Forest Resilience Bond (FRB) from other approaches is not only its use of investor capital to fund restoration quickly and at scale, but the collaborative model of cost sharing between beneficiaries.

This approach engages a range of stakeholders to split the cost of repaying investors and involves them in project development. As such, the FRB model encourages a collaborative systems-level response to forest health challenges that makes use of funds, experience, and expertise from a range of public, private, and civic stakeholders.

Or, put another way, it’s a public-private partnership that levers taxpayer funds to support ‘green’-led initiatives, without the need for voting (because the central banks are unelected!)

So, to summarize, the concept of “green”-bonds is becoming more and more mainstream – who cares if we don’t get any yield, at least we are signaling just how virtuous we are – and as various ‘wealthy’ western nations hit the monetary and fiscal policy wall, the rhetoric around “People’s QE” or a Modern-Monetary-Theory-driven (MMT) redistribution spreads positively among many (especially the socialism-supporting Millennials).

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UK Faces Huge Loss From Electric Vehicle Adoption

Climate change mania and the policies it generates will drive Britain into an oblivion of economic ruin unless it regains a bit of sanity to reject Green Economy thinking, which has caused the biggest global malinvestment scheme of all time. ⁃ TN Editor

If Great Britain keeps its commitment to switch over its vehicles to electric by 2050, the government will see a whopping loss of 28 billion pounds ($35 billion) paid by motorists driving traditional gasoline- and diesel-powered vehicles.

That comes from a study released Friday by London-based Institute for Fiscal Studies examining the impact of the UK’s net-zero greenhouse gas emissions law adopted in June and signed by previous Prime Minister Theresa May. England became the first G7 country to set the goal of reaching zero net emissions by 2050.

Fuel duties on petrol-powered vehicles make up almost 4 percent of total government receipts — and all of that will disappear unless urgent action is taken, according to think tank IFS’ study. The government may need to take a new approach to taxing motorists as all-electric and plug-in hybrid vehicles become the norm, the study advises.

The UK’s mission to switch over to EVs and renewable energy by 2050 represents “a huge long-run fiscal challenge” for the government, according to the study.

The government faces other hits on tax revenue. The UK will be seeing a drop of about 20 billion pounds a year ($24.5 billion) from the government’s new policy of freezing tax duties to help people struggling with the cost of living, the IFS said. There’s also concern that another 1 billion pounds ($1.229 billion) could be lost if Prime Minister Boris Johnson follows through on his commitment to cut duties by 2 pence per liter of fuel.

“The government should set out its long-term plan for taxing driving, before it finds itself with virtually no revenues from driving and no way to correct for the costs -– most importantly congestion –- that driving imposes on others,” said Rebekah Stroud, an IFS economist who co-authored the report.

Duty on unleaded gasoline and diesel has remained frozen at 57.95 pence per liter since 2011, accounting for 1.3 percent of England’s GDP. The fuel recently has been costing 126.9 pence per liter, of which 57.95 pence is duty — about 45 percent of the total fuel cost.

The think tank recommends implementing taxes on EVs soon, as car owners are becoming used to avoiding these duties on their fuel. New motoring taxes should reflect distance driven and vary according to when and where the trips take place in the vehicle. A flat-rate tax per mile driven could be another taxation model used, according to the study.

Prime Minister Johnson used his platform at the Conservative Party conference last week to advocate for continuing support in the net-zero emissions mandate by mid-century. Johnson has a strategy to be put into place advocating investments made in EV production, energy reduction in all new homes, and the planting of one million trees to combat climate change.

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Goldman Sachs: Driving Globalization With Global Warming Fears

Goldman Sachs is pitching its own services as the report concludes, “urban adaptation will likely need to draw on innovative sources of financing.” The global elite see only green (pun intended) by rebuilding everything on earth.  ⁃ TN Editor
 

Goldman Sachs released a report on the effect of climate change on cities around the world and the results made for grim reading.

The bank’s Global Markets Institute, led by Amanda Hindlian, warned of “significant” potential risks to the world’s largest cities, which are especially vulnerable to more frequent storms, higher temperatures, rising sea levels, and storm surges.

Cities generate about 80% of global GDP and are home to more than half of the world’s population, a share that Goldman says, citing the United Nations, is projected to reach two-thirds by 2050. About 40% of the global population lives within 100 kilometers of a coast, it says, and 1 in 10 live in areas less than 10 meters above sea level.

Goldman highlighted three cities which would be subject to those storm surges and in the future could face harmful flooding — New York, Tokyo, and Lagos. Miami, Alexandria, Dhaka, and Shanghai face major flood risks due to being less than 11 meters above sea level.

Goldman’s researchers said that when starting the study they took a broad consensus that human activity, namely emission of greenhouse gasses “is causing the earth to warm in ways that are affecting the climate.”

Natural ecosystems would be damaged, and risks to human health would rise, as well as pressures on food and drinking water.

Agriculture would also be massively affected: “Warmer temperatures and shifting precipitation patterns could reduce yields and nutritional quality as well change growing seasons and agricultural zones around the world.”

Goldman gave some fairly stark warnings about potential outcomes:

  • More frequent, more intense, and longer-lasting heatwaves. The consequences will affect human health, productivity, economic activity, and agriculture. “Higher surface temperatures could exacerbate the warming process by causing permafrost to melt, releasing further methane and CO2 into the atmosphere.”
  • Destructive weather events, including storms, winds, flooding and fires. It’s not just New York, Tokyo and Lagos. “Other major low-lying coastal or already flood-prone cities include Shanghai, Dhaka, Mumbai and Karachi – each of which has a population of 15 million people or more.”
  • Changing disease patterns. “Warmer temperatures could cause disease vectors to migrate from the tropics to regions where people have less immunity; this is true not only for viruses like malaria and dengue fever but also for water-borne and food-borne diseases.”
  • Shifting agricultural patterns and food shortages. “Livestock could be affected by higher temperatures and reduced water supplies. Ocean acidification is likely to put stress on aquatic populations and affect current fishing patterns. Some of these changes are already underway. Some climate scientists, for example, estimate that coral reefs will be all but extinct over the course of the century due to ocean acidification.”
  • Water. “Half of the world’s population will live in water-stressed areas as soon as 2025,” Goldman notes, citing the World Health Orgnization. “Even in non-stressed areas, the quality of surface water could deteriorate as more rain and storms drive erosion and the release of toxins. These dynamics could affect everything from the availability of drinking water for people to a shortage of water for livestock and crops (with negative effects for the food supply) to decreases in hydroelectric power generation.”

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Homelessness

Green Economy Turns Brown As Homelessness Surges In Bay Area

The applied policies of the UN’s Agenda 21 and the New Urban Agenda is wreaking havoc in American cities, but no one is admitting that the homeless crisis is a direct result of those policies. ⁃ TN Editor

San Francisco recently released the results of its 2019 point-in-time homeless census conducted in January, and the news appeared nothing less than disastrous, as SF’s homeless headcount increased by the hundreds despite the city’s seemingly ceaseless efforts to provide relief.

However, the San Francisco count alone does not provide the whole story. The 2019 homelessness spike in SF came amid a tide of similar baleful results across the Bay Area.

Five out of nine Bay Area Counties—i.e., all of those not located in the North Bay—saw their homeless counts spike during the same period, with each other county showing worse homelessness surges than SF:

  • To review, San Francisco’s report to the federal Department of Housing and Urban Development cited a count of 8,011 homeless persons, an increase of 6.8 percent from 7,499 in 2017. Note that the city’s own internal count is higher (at more than 9.700 persons) because SF uses a broader definition of who counts as homeless. Since that standard is unique to San Francisco, it’s hard to compare the figure with other counties. [Correction: The count submitted to HUD for 2017 count was 6,858, making for a 16.8 percent increase over two years. The 7,499 figure was the local count.]
  • San Mateo County’s homeless count spiked up to 1,512, more than 20 percent more than the 1,253 count from two years ago, and up from 1,483 in 2015.
  • Santa Clara County reported a count of 9,706 for 2019. In 2017, the count was 7,394, making for an increase of more than 31 percent. But in 2015, the homelessness estimate was 6,556. Note that although Santa Clara County has a higher homeless population than SF it also has about double the general population of SF County, at more than 1.9 million.
  • Alameda County’s figure came in at 8,022, up 42.5-plus percent from 2017’s figure of 5,629. On a slighter longer timeline, the increase is even worse, as this latest count is nearly double that of the 4,040 in 2015. Like Santa Clara County, Alameda has a larger homeless population but also more people in general, meaning that SF’s per capita homelessness rate remains the highest in the Bay Area.
  • Contra Costa County saw a similar surge, spiking up to 2,295. That’s 42.8 percent more than the previous count of 1,607, although that count was down significantly from 2,030 in 2015. Since Contra Costa County conducts its counts annually, we see from the 2018 report that almost all of that rise happened between 2017 and 2018 when the figure was 2,234.

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Economist: Modest Carbon Tax Would Hurt Future Generations

Famed economist, Dr. Laurence Kotlikoff, concludes that even a small carbon tax today will cause economic loss to at least two future generations, and possibly more. In short, carbon tax will do just the opposite of what climate alarmists claim. ⁃ TN Editor
 

One of the main themes of my writings on climate change at IER has been warning the public that the “consensus science” they are hearing from the media, pundits, and certain political figures is utterly divorced from the actual published literature, especially when it comes to the economic analysis of government policy. A new, cutting edge working paper from some big-name economists — including Laurence Kotlikoff and Jeffrey Sachs — confirms my point.

In this case, here is the shocking fact that their paper tries to grapple with: Even with a relatively modest carbon tax, the rise in energy prices is so painful that it swamps the benefits of slower climate change, and this is true for our kids and grandkids. It is only when we get to our great-grandchildren that humanity on net would start to actually benefit from even a modest carbon tax introduced today. So the next time you hear someone say, “We need to take vigorous action on the climate for future generations!” you can clarify, “Actually, your proposals would hurt the next two future generations. You want to hurt us, our kids, and our grandkids, in order to help our great-grandkids and beyond — who will all be fantastically rich compared to us, by the way.”

The Kotlikoff et al. paper is quite technical, so I’ll just summarize the take-away points for a lay audience. I will also spend time at the end of the article explaining what their proposed solution is, for this thorny problem. To avoid confusion, I want to be clear: The authors of this new paper are for a (modest) carbon tax. But they are warning that the current discussion, even among economists, tends to look at “what’s best for humanity from now until the end of time,” rather than checking to make sure each generation gains from a new climate policy. As we’ll see, Kotlikoff et al. suggest a massive fiscal transfer that allows present generations to run up a huge (additional) government debt that our descendants must then effectively pay back with higher taxes, in order to compensate their forebears for suffering through higher energy prices due to a carbon tax.

The point of my article isn’t to endorse the overall recommendation of Kotlikoff et al.; along with climate scientists at Cato, I’ve published a comprehensive critique of the usual economist’s case for a carbon tax. Rather, by shining a spotlight on the cutting edge in the development of the literature on carbon taxation, I want readers to see just how detached the actual discussion among experts is from the breezy claims about “we have 12 years left to save our children” that we hear from pundits and political officials.

How An “Optimal” Carbon Tax Can Punish Into the Third Generation

To set the stage for my interpretation, let’s first quote from the authors’ own description of their results. (Note, readers who don’t have access through the NBER link above can also see a version of the paper posted at Kotlikoff’s website.) The title of the paper is, “MAKING CARBON TAXATION A GENERATIONAL WIN WIN.” Here’s an excerpt from the Abstract:

Carbon taxation has been studied primarily in social planner or infinitely lived agent models, which trade off the welfare of future and current generations.Such frameworks obscure the potential for carbon taxation to produce a generational win-win. This paper develops a large-scale, dynamic 55-period, OLG [Overlapping Generations — rpm] model to calculate the carbon tax policy delivering the highest uniform welfare gain to all generations. The OLG framework, with its selfish generations, seems far more natural for studying climate damage. Our model features coal, oil, and gas, each extracted subject to increasing costs, a clean energy sector, technical and demographic change, and Nordhaus (2017)’s temperature/damage functions. Our model’s optimal uniform welfare increasing (UWI) carbon tax starts at $30 tax, rises annually at 1.5 percent and raises the welfare of all current and future generations by 0.73 percent on a consumption-equivalent basis. Sharing efficiency gains evenly requires, however, taxing future generations by as much as 8.1 percent and subsidizing early generations by as much as 1.2 percent of lifetime consumption. Without such redistribution (the Nordhaus “optimum”), the carbon tax constitutes a win-lose policy with current generations experiencing an up to 0.84 percent welfare loss and future generations experiencing an up to 7.54 percent welfare gain. [Kotlikoff et al., bold added.]

Although I realize this is difficult technical language for the layperson to parse, here’s what the authors are saying: If we take the “gold standard” (their term later on) in this literature and use Nordhaus’s 2017 model calibration, it will recommend an “optimal carbon tax” that correctly — according to standard economic theory and the best estimates from the climate science research — balances the tradeoff between reducing emissions and harming economic growth.

However — and this is a huge caveat — Nordhaus’s approach assumes there is a benevolent, overarching “social planner” who lumps all of humanity together, and only makes a technical allowance for a (modest) discount on the happiness of future generations in accordance with standard economic theory.

In practice, the authors point out, Nordhaus’s “optimal carbon tax” would actually mean that people living or born today and in the near future will be harmed on net by the policy, because they will suffer worse economic harm from higher energy prices, than they will be spared in climate change damages from reduced emissions. It’s only when we get several generations into the future, that Nordhaus’s “optimal carbon tax” actually starts making human beings better off, compared to the status quo.

This is a critical point for Americans to realize. They are constantly being hectored that if they “cared for their children” they would support a large carbon tax and other aggressive interventions. But we see that this isn’t true: If we even adopt a modest carbon tax — one that still allows 4 degrees Celsius warming (over twice the 1.5 degree currently touted by climate activists as the necessary target), according to the authors (p. 22)1 — then we are harming ourselves, our children, and our grandchildren, relative to the “do nothing” baseline. It’s only our great-grandchildren, who (on average) are going to be fantastically wealthy compared to us, who will actually start reaping net benefits from even this modest reduction in the path of emissions.

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