- The climate crisis is wrecking the world and current solutions do not seem to offer a way out.
- Key research from ESSEC Business School shows what it would take to solve the climate crisis, but is the price too high?
- The study found that maintaining stable temperatures over a century would require an investment of around 75% of the world’s total economic output in 2008.
Today, with the climate crisis evident around us, from houses falling into the sea to fires ripping through the valleys of California to floods covering whole delta systems, the world is being battered, and current solutions do not seem to offer a way out: even the offramps look flooded.
We hear of ways to fix the crisis without disturbing current conditions, of Green New Deals and building a green economy and society which cohabits with flawless economic growth. We hear of reducing carbon, taxing emissions, sustainable growth, shifting (or, slouching) toward sustainable energy, but we see far less action.
We’re told that we have to halve current global carbon emissions by 2030 (at the best estimates) to prevent us from reaching a point-of-no-return 1.5C rise in global temperatures. This is looking increasingly like a pipe dream, or, given the fiery end to this if we fail to curb warming, a pipe bomb.
Can green growth exist?
There is another, deeper call being sounded, from activists to poets to even the pink pages of the FT. That green growth may not even exist; that we need to choose: “We can be green or we can have growth, but we can’t have both together.” That decarbonisation is not enough, we need more to stall the climate horrors ahead. In the pages of the respected journal Nature, ecologists call for “degrowth.”
Some philosophers argue that growth didn’t make us happy, perhaps degrowth will. Japanese philosopher Kohei Saito argues that Covid lockdowns showed that political will can lead to major changes, and “created a natural sympathy for the idea of degrowth”.
To secure a liveable planet into the future, it is argued, we would have to endure, though, a “long economic depression [which] might be enough to keep the planet habitable.” If Saito is right, we would find ourselves happier in other ways (and our countryside less fiery).
Many are concerned that degrowth would cripple the economies of those countries which took it up. To reduce GDP is sacrilege in most political and economic thought. Some argue that it’s a cute slogan, good for the ramparts, but of no use whatsoever when deciding actual policy. But is it possible? Is it plausible?
High costs to reverse climate change
New research out of ESSEC Business School and Kyoto Sangyo University has found the precise cost in terms of degrowth to have kept temperatures at 1900 levels for a century and demonstrates the actual costs to reverse climate change.
The study, undertaken by Professor Guillaume Chevillon, Academic Co-Director of the ESSEC Metalab for Data, Technology & Society, alongside Professor Takamitsu Kurita, from Kyoto Sangyo University, analysed a newly compiled dataset ranging between years A.D. 1000-2008 to evaluate the historical relationship between the climate and the economy.
Maintaining stable temperatures over a century would require an investment of around 75% of the world’s total economic output (GDP as of 2008), the study found. Therefore, any benefit to the climate would be paid for by a cost to economic growth, or very high investments on green technologies.The results therefore show the cost of the lack of investment in mitigating technologies.
The researchers wanted to ascertain if certain economic policies could realistically help keep global temperatures stable over a long time. They considered how combinations of green (carbon-free) investment and brown (carbon-intensive) growth could lead to temperature stability: offering an alternative to completely reducing all economic growth.
Chevillon’s research shows that it would be possible to keep climate change at bay without suffering total economic deprivation.
The cost of climate inaction
In their counterfactual scenario, the researchers could be seen to show that the prevention of global warming is at odds with economic growth. But, according to Professor Chevillon, while the cost of achieving temperature stability may seem steep to many, this figure should be seen as the cost of not doing more to prevent global warming sooner.
“We should treat this figure as a measure of the cost of climate inaction – the lack of investment in mitigating or carbon abatement technologies,” Chevillon says.
“This finding highlights a clear reality: massive carbon abatement policies need to be fully implemented today for the climate to benefit. With a need for climate preserving solutions, this research provides the first fully data-backed support for evaluating the cost of policies that governments can implement to protect our world.”
The huge future costs of the Climate Crisis have become evident and may come to dwarf the costs that would have kept climate change at bay. Developing countries alone face an estimated $400bn in losses per year due to extreme weather. The crisis is currently costing the world $16 million per hour. A single cyclone in Malawi in 2023 caused $680m worth of damage. These figures cannot take into account the associated and increasing human suffering and loss of life.
The climate crisis can be solved
Chevillon’s research may look deep into the past, but we had better heed his warnings today.
“Indeed, we see the collected data, model and results above as a toolbox for policy analysis where refinements on possible projected scenarios and abatement policies need to be assessed,” he says.
Importantly, the study shows that, with the right will, and a touch of degrowth, the climate crisis, can be solved.
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