Apparently some mass of investors is demanding that something be done about climate change. See, says The Guardian, even the capitalists are arguing we must do something! The truth being that this is some trivial portion of the fund managers, responsible for some trivial portion of total investment, making the demands. And of course such people at one remove from dealing with their own money are far more likely to fall prey to fashionable nostrums about how to lose money than are actual investors.
But, you know, the demand is being made:[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]Global investors managing $32tn issued a stark warning to governments at the UN climate summit on Monday, demanding urgent cuts in carbon emissions and the phasing out of all coal burning. Without these, the world faces a financial crash several times worse than the 2008 crisis, they said.[/perfectpullquote]
Well, no, there won’t be anything like a 2008 crash. Simply because chronic problems, which is what climate change is, don’t cause crashes. But yes, OK, what is it in detail that they’re asking for?[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]The investors include some of the world’s biggest pension funds, insurers and asset managers and marks the largest such intervention to date. They say fossil fuel subsidies must end and substantial taxes on carbon be introduced.[/perfectpullquote]
Well, take the underlying climate change thing as read – no not the wilder civilisation dies tomorrow guff, but the basic thought that emissions might cause the future to be poorer than it need be – and yes, we should stop subsidising emissions. And a carbon tax is a great idea. Substantial though?[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]Investment firm Schroders said there could be $23tn of global economic losses a year in the long term without rapid action.[/perfectpullquote]
True in one sense, nonsense in another. Climate change might mean that the future world is $23 trillion poorer than it would be without climate change. No, it doesn’t mean that the world will be $23 trillion poorer than it is now.[perfectpullquote align=”full” bordertop=”false” cite=”” link=”” color=”” class=”” size=””]A key demand of the Global Investor Statement is to phase out coal-fired power stations across the world. Peter Damgaard Jensen, the CEO of Danish pension fund PKA, said: “Investors, including PKA, are moving out of coal in their droves given its devastating effects on the climate and public health, compounded by its poor financial performance.”[/perfectpullquote]
And that’s where the problem is of course. If everyone’s already moving out of coal then we don’t need to take any further actions to get people out of coal, do we? We’ve already done whatever it is to make people get out of coal.
Which is the climate change problem writ small, isn’t it? Absolutely no one demanding action ever does look to see what we’ve already done to fight climate change. All the calls to action are based upon our having done nothing instead of the great deal – like making Solar PV cheap – that we’ve already done. Thus all the demands for current action are wrong. Hey, maybe we still need to do some stuff but the current calls to action are still wrong.