Can we have our cake and eat it too? Part 1

If one is to believe anything Kevin Rudd says, it is his proclamation that climate change is the greatest moral challenge of our time. Not only is it a moral challenge, it is also panning out to be the biggest ideological challenge of our time.

Whether we like it or not, we’ve mustered a general expectation that governments are responsible. Don’t worry; it is the pollies who save us from a potential ecological and humanitarian catastrophe! An act of faith, surely.

But where there’s smoke, there’s fire, and where there’s politics, there’s ideology. Capitalism is caught in the middle of this ideological struggle. Can the abundance and opportunity provided by Capitalism for the rich and poor of the world coexist with the need to mitigate climate change? According to an old Russian proverb, “If you chase two rabbits, you will catch neither”. If there is any truth in this, a resolution of this conflict would be insurmountable. In dealing with this issue, I will use the space of two articles to attempt to better explore the topic. This first article is just the overture, the vorspiel of an issue of Wagnerian proportions, which I do not expect to ever satisfactorily finish in a mere two articles.

Let’s start at the beginning by asking, “what is Capitalism?” Austerely defined, Capitalism is about free markets, free trade, the price mechanism, voluntary exchange, property rights and individual freedom. Capitalism has resulted in industrialization, mass abundance, and has been the most effective means of eradicating poverty and social ills in human history. We in the Western world have embraced many capitalist elements, but we don’t live in a truly capitalist economy. There are a number of violations to many fundamental capitalist tenets. We live in a mixed economy, where both governments and markets play a significant role.

Capitalism’s creation of abundance has meant the exponential exploitation of natural resources. Compared to a command economy however, these resources by and large are used more efficiently and distributed more optimally. Yet this still raises a number of problems, not least that in the short to medium term, producers focus on creating profit, much less their environmental footprint. Sketchy predictions of cataclysmic ecological holocausts have usually not been front and centre of business decisions in the here and now (understandably). This is where government can play a part, and this will be further discussed in my next article.

For a number of decades, the Green movement has raised awareness of environmental degradation and climate change, catapulting them to the centre of the international policy debate. The interesting thing about the development of the Green movement is that it has become a thoroughly ideological movement. Typically, “Green” parties around the world have radically Leftist views on many issues other than the environment. On the whole, they invoke somewhat an anti-capitalist mentality. This has given the impression that capitalism and action on climate change are totally incompatible.

The rise of the Green movement and the consequent ideological nature of the environmental debate has brought questions and concerns about Capitalism to the fore of political discussion. Such debate is healthy insofar as it induces looking at the way our industrial society works and whether or not it is sustainable. Being more introspective certainly has its merits. But with such an ideological streak through the climate change debate, it has meant that action to address dangerous climate change has become an issue of principle, not pragmatism. This perhaps explains in part why action on climate change has been slow.

In looking at whether capitalism and action on climate change are compatible, it is often overlooked that innovations in science and production have the potential to mitigate some of the social ills predicted as a result of climate change. Capitalism is characterized by growth and progress in all facets of society. Science is a classic demonstration of this. For example, the higher risk of dengue fever as a result of a warmer climate has impelled scientist to investigate into ways of eliminating the disease by means of injecting mosquitoes with bacteria that shortens their lifespan. Moreover, increasingly efficient means of producing food are being developed, such as being able to grow food indoors and in multi story buildings. Some have even managed to develop a test tube burger, i.e. a burger without using actual meat…. Apparently it tastes pretty good!

Although in their early stages, these kinds of developments are significant. They provide reassurance that we are already making developments to deal with the impacts of serious climate change. This is not to suggest that we do nothing about climate change and just put blind faith in the work of scientists to solve all our problems. Rather, the combination of gradually reducing carbon emissions and scientific and business innovations, indicate that action on climate change is possible without drastic controls throughout the economy at least. A key characteristic of Capitalism is that it allows freedom to innovate, and rewards successful innovation.

As producers and consumers become more conscious and concerned of the threat of climate change, changes could eventuate of their own accord. Of course, some people are reluctant to sacrifice their ways for Mother Nature’s sake. For example, I revel in my ability to have long hot showers, go through copious amounts of plastic water bottles, and use cleanly bleached, radiant white sheets of paper. God knows, I dread the day when I’ll be compelled to use 75% recycled sheets of paper…

The issue of who should do what will be discussed in the next article. Who should really carry the burden in combating climate change? What can be done to change the behavior of producers and consumers without assigning them to bondage in a command economy? How does this threat compare to that of dangerous climate change? Leaving it all to the politicians has its risks, both to our liberty and climate.