The Economy is the Pied Piper

Those who claim that our economy can't afford to replace fossil fuels with renewables are mesmerising us with lies and leading us to a wasteland, just as the Pied Piper led the children of Hamelin off into the wilderness.

For he led us, he said, to a joyous land,
Joining the town and just at hand,
Where waters gushed and fruit-trees grew,
And flowers put forth a fairer hue,
And everything was strange and new;
The sparrows were brighter than peacocks here,
And their dogs outran our fallow deer,
And honey-bees had lost their stings,
And horses were born with eagles' wings.

Robert Browning

The glittering promises of a joyous future based on coal, oil and natural gas are as real as the Piper's promise of sparrows as bright as peacocks.

Every credible economic advisor says that tip-toeing around carbon emission reduction will cost more in the long run. Here's what the very excellent Australian Treasury (the guys whose advice has made Australia the stand-out OECD economy) says. 

Early global action is cheaper than delayed action. For economies like Australia, deferring action on climate change will only lead to higher long-term costs as emission-intensive technology, processes and outputs are locked in.

Australian Treasury

Nevertheless, we have governments that seem to be mesmerised by a magical Piper as they continue to subsidise fossil fuel industries and give permits to new coal mines, oil wells, and gas wells as though fossil fuels are not destroying our future with their carbon emissions.

In Australia, we have a government that brought in a carbon price of $23/tonne based on a world where CO2-e emissions can rise to 550ppm. Yes, 550ppm, not the 450ppm that gives a 75% chance to keep average global warming within the 2°C guardrail, and not the 350ppm that many credible scientists recommend as the maximum for a safe climate.

When will they wake from sleep and understand that countries can't be run to the misbegotten tunes of economists? As we come ever closer to the absolute resource limits of a finite planet, some economists are beginning to realise that growth economics is a fantasy.

Tim Jackson, economics commissioner on the UK government's Sustainable Development Commission says,

The idea of a non-growing economy may be an anathema to an economist. But the idea of a continually growing economy is an anathema to an ecologist.

So, don't be taken in by those who say that the 'joyous land' of the future will be based on coal, oil and natural gas. Recognise them for what they are - persuasive folk who spin yarns about horses born with eagles' wings.

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In the Pied Piper of Hamelin, Browning describes how government officials responded when the Piper claimed his fee for ridding the town of rats.

A thousand guilders! The Mayor looked blue;
So did the Corporation too.
For council dinners made rare havoc
With Claret, Moselle, Vin-de-Grave, Hock;
And half the money would replenish
Their cellar's biggest butt with Rhenish.
To pay this sum to a wandering fellow
With a gipsy coat of red and yellow!

They refused to pay the thousand guilders and ended up paying a much higher price when the Piper led all their children away. Right now, we're acting like that Mayor and Corporation. We're not willing to pay the price of an immediate transition to a low-carbon economy. Our children and grandchildren will pay a very heavy price. As extreme weather events become daily fare, oceans acidify, and sea levels rise, many will pay with their lives.

We have to pay the piper, dance with the one who brought us.

We can't argue with Mother Nature, but we can, and must, side with ecologists against economists.

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H/T David Oertel for noting that the economy is the Pied Piper.

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Snippet from the Transformation tab.

China estimated it may spend $373 billion on projects for conserving energy and reducing emissions in the five years through 2015. The State Council announced a plan to reduce by 2015 the amount of energy it uses to produce every unit of gross domestic product by 16 percent from 2010 levels. In the five years through 2015, China is aiming for energy savings equal to 670 million tons of standard coal equivalent energy. Source: Bloomberg.

Mother nature does not negotiate

I didn't realise how much I try to negotiate my way through life until I had a baby. Babies do not negotiate. You feed them, or they cry. You walk them, or they cry. You keep them warm, or they cry.

My garden is like that too. If I don't water it, the plants die.

It's true for the whole biosphere. We live by nature's rules, she doesn't live by ours. The notion of 'conquering nature' is as ridiculous as an earth-centred solar system.

We have learnt to give up the idea that the sun goes around the earth, but we haven't given up the notion that our relationship with the earth is negotiable. We imagine we can 'conquer' nature with impunity. We act as though the earth's resources are endless.

Our economies are based on the false notion that we will never come to the end of the earth's resources. Our economies depend on growth. When they stagnate or shink a bit, people get unhappy and governments fall.

Right now, we're at a critical point in history where we are hitting some limits. One is the limit of oil production. World oil production plateaued around 2005 but demand keeps growing and this is sending prices up. By 2014, production is expected to fall short of demand. (Note: see update at end of this piece.)

The other is the limit on the amount of greenhouse gases we can pump into the atmosphere. Scientists say that 450ppm of CO2-e gases in the atmosphere will give us a 50% chance of keeping average global temperature increase down to 2C. Others argue that 450ppm is dangerously high.

Right now, we're at 396 ppm and increasing by almost 2 ppm each year. That gives us about 25 years to shrink our emissions to zero.

Paul Gilding describes our situation as one of unavoidable crisis where a long series of major economic shocks will gradually bring our consumption of resources into balance with the limited supply.

Just as a baby will cry when it is hungry, so these economic shocks signal that something is wrong. Each time we address one of the shocks, we get a clearer picture of another way we are out of step with nature.

For Gilding, the global financial crisis of 2008, the Arab Spring of 2011, and now the Greek debt crisis are evidence that we are in the midst of a system that is breaking down. He warns that we need to give up the idea that these are glitches that can be overcome. We need to start the transition to a different system.

We need to recognise that we can't negotiate with nature. 

Unlike human law, the laws of nature can be read, but not redrafted.

Professor Paul Raupach, Atmospheric Scientist

There's no borrowing from Nature without repayment. Greece has been negotiating with its banks and they have written off billions of dollars of debt, and still people are rioting in the streets because they don't want to pay.

Nature doesn't care if we riot. Riots are pointless tantrums.  We will have to repay our debts to Nature in full. We will have to live with the full extent of the damage our actions have caused. 

Paul Gilding describes these as apocalyptic times. He questions our childish wish to negotiate with Nature and asks:

What do we want to be when we grow up – when humans grow past adolescence? We'll be growing up in war. It's a war for civilisation itself.

Here is his inspiring 10-minute TED talk. 



Check out his book, The Great Disruption.

UPDATE: 30 July 2012. A report by by Harvard University’s Belfer Centre for Science and International Affairs concludes that oil supply capacity is growing worldwide and might outpace consumption, potentially leading to a glut of overproduction and a dip in oil prices. The report also notes that at prices of $US70/barrel major new oil reserves (like shale oil) have become economic and this is what has added to capacity. In effect, this puts a floor under the price of oil. If oversupply causes prices to drop below $70 a barrel, the more expensive wells will be mothballed till prices rise again.

As many have noted, 'peak oil' is best understood as a pointer to the limits on cheap oil. Oil supply won't suddenly fall of a cliff, instead it will be squeezed by ever-increasing prices as the easy to reach reserves are exhausted and only the more expensive supplies are left.

Those advocating for urgent reductions in greenhouse gas emissions hoped that high oil prices would drive the uptake of renewables. Many will be disappointed to read this report and its suggestion that instead of rapid price increases, the price of oil is likely to move around the $70-90 mark for the next decade.  Source: ClimateSpectator.