Save capitalism and ditch the planet or save the planet and ditch capitalism

The third World Climate Summit in Doha, Qatar, takes place at a time when planet earth is facing a double whammy: an environmental meltdown and an economic crisis.  Is this a mere coincidence or are the two crises connected?  By Fawzi Ibrahim

Owen Kellie-Smith and Peter Cox of Exeter University think there is a connection: “An increase in human wealth causes an increase in emission and global warming, but the warming damages human wealth, slowing its rise or even making it fall.i

If this is so, then the favoured solution to the crisis – economic stimulation and growth – can only exacerbate environmental damage, which in turn slows the rate of growth, which in turn requires greater measures to stimulate the economy, and so on.  Where does this leave those gathering in Doha?  And where does it leave the green movement?

Back in 2002, scientists Paul Crutzen and Eugene Stoermer challenged the world to face up to the transformation of the planet by human activity, arguing that we now live in a new geological epoch. They traced the start of the new epoch to the Industrial Revolution and called it the Anthropocene, or new era of man, in which our activity has determined the geological future of our planet.

However, it is not “human activity” per se that is responsible for the these ecological changes; after all, human activity before the Industrial Revolution did not have anything like the impact it had once the market economy was in full swing.  Neither is it the much-warned about “population explosion”.

As Erle Ellis of the University of Maryland so succinctly put it: “Even with a population of seven billion, Homo sapiens is not an entirely novel force. But human systems are.”ii It is “human systems” that change the environment, and the overriding human system of the Anthropocene is the market economy.

Apart from the damaging effect on the environment, the Anthropocene is characterised by another unique phenomenon – the creation of vast amounts of wealth through exceptional economic growth and its associated new phenomenon, consumerism, to gobble up the commodities thus produced. 

In the 200 years between 1800 and 2000, the economies of the western world grew 50-fold and energy consumption 40-fold.iii Not surprisingly, CO2 concentration grew by a staggering 37% over the same period and it continues to rise unabated. Still, attempts to reduce greenhouse gas emissions have consistently fallen far short of what is necessary.

Over the 20 years since the first Earth Summit, only four of 90 goals have seen major progress. Carbon trading, the market system designed to channel money to the developing world and give poor countries access to green technologies, now lies in tatters as a result of market forces. The prospect of a new climate change treaty by 2015 with tough emission targets is fast disappearing.

On the face of it, the answer presenting itself to policy makers is obvious. If economic growth is the culprit then the solution is no-growth, or at least low growth. This is easier said than done – and not because of unwillingness on the part of world leaders or because increased GDP is a sacred policy objective of all governments. Rather, it is because growth is something the market economy cannot do without.

Capitalist investment is directed towards making a profit, and once profit is made it is re-invested, in whole or in part, in an ever-expanding spiral. But if there is no growth, there can be no additional capital investment and corporations and anyone in receipt of returns on their investment have no means of deploying their profits.

As Keynes explained, this is a recipe for economic slump, writing that “at the outset of the slump there is probably much capital of which the marginal efficiency has become negligible or even negative”. So when George Osborne told the Conservative conference in 2011 “we’re not going to save the planet by putting our country out of business”, he was echoing the thoughts of all governments.

The concept of the Anthropocene poses a challenge to long-established beliefs in the market, making difficult not to be driven to the conclusion that capitalism is incompatible with saving the environment. This is where the green movement must be most circumspect. The crisis will not be averted through such schemes as the UN Green Economy Initiative. Green technology may provide more efficient ways of using energy but it does not halt economic expansion. Its very selling point is precisely that it provides, in the UN’s words, “real economic growth”.

Today, humanity faces a stark choice: save the planet and ditch capitalism, or save capitalism and ditch the planet. While notions of a post-capitalist economy invariably conjure up visions of Armageddon and bloody revolution, elements of a post-capitalist society are present in the old society – they do not have to be imposed. This is nowhere more evident than in Britain and specifically in the NHS.

In spite of relentless attempts by successive governments to incorporate the NHS within the market, it remains unique. Its uniqueness stems not from the way it is funded or the way health care is free at the point of delivery: the NHS is not BUPA writ large. When you go to your GP you get a prescription, not a bill; and if you have a stay in hospital you get a discharge report, not an itemised invoice as you would receive through private health care insurance.

This is because health care under the NHS is a service and not a commodity – that is its distinguishing feature. And that is also the distinguishing feature of a post-capitalist economy: a non-commodity economy in which the concept of profit all but disappears.

4 December 2012

Fawzi Ibrahim is author of Capitalism versus Planet Earth, an irreconcilable conflict. Published by Miswell Press, London, 2012

i Emergent dynamics of the climate-economy system in the anthropocene, The Royal Society, 2011

ii Anthropogenic transformation of terrestrial biosphere, The Royal Society, 2011

iii Will Steffen et al, The anthropocene: conceptual and historic perspectives, The Royal Society, 2011

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