It’s time to follow the green money

Opinion

Hey there, time traveller!
This article was published 28/06/2022 (814 days ago), so information in it may no longer be current.

Blunt, direct and consistent are not words that leap to mind when describing politicians these days.

“Be all things to all people” seems to be conventional wisdom for dealing with the voting public. If this means throwing future generations under the bus, well, alienating them doesn’t cost anyone votes or popularity today. Telling the truth, on the other hand, is bound to tick off somebody important.

So, United Nations Secretary General Antonio Guterres must be really irritating governments with his increasingly pointed commentary on the disastrous state of the Earth.

Normally, whatever is said behind closed UN doors stays there. Guterres has changed that situation, with more public displays of what he really thinks than any of his (officially bland) predecessors dared to offer.

His messaging (especially tweets) is terse and pungent: “We have no more time for empty promises. I call on all investors to align their entire lending portfolio with the #ParisAgreement at the latest by 2024, ending all high-emissions finance. Every country, city, citizen, financial institution and company has a role to play.”

No doubt, all around the world, bankers choked on their croissants and morning espresso when they read this.

High finance depends upon the fig leaf of investor confidence, that delusional belief (at least in a climate-changing world) that you can expect a substantial return on a 20-year investment. In reality, it is nothing more than a global Ponzi scheme, bringing in new money to pay off the old investors, who then effectively stash the cash under their mattresses — knowing full well the world ahead will bear little resemblance to what we have today.

So, while the bankers might fume that Guterres was way out of line with his comments, he was entirely correct. In these next few years, money and what it buys will determine how the world will spin into the future. Finance is therefore one of the levers of change — and while we tend to focus on top-down financial decisions, that economic leverage can also come from the ground up.

Thanks to the efforts of organizations such as Bill McKibben’s 350.org — started out of a small class of his students at Middlebury College in Vermont — 1,500 institutions worldwide with holdings of more than US$40 trillion have divested from the fossil fuel industry so far.

Ouch. From a fossil fuel industry perspective, that hurts — but it also means there are potentially 1,500 institutions out there searching for sustainable energy opportunities in which to invest US$40 trillion.

If a primary barrier to a green future is the lack of green money, this is certainly a start. Governments have lots to spend on all sort of things, but — despite its urgency — only nickels for sustainable development. This is why the carbon tax is so infuriatingly stupid — not the tax itself, but how it is being spent.

Any carbon levy should be directed to the transition we need to make toward a no-to-low fossil fuel future. Public transit here is inadequate (love those electric buses everyone else buys from Manitoba!), we have no light rail transit system, and outside the city limits, you can whistle if you don’t want to drive.

And while there are various “2050” plans floating around in Manitoba, we need to do something to slash greenhouse-gas emissions and provide practical alternatives right now — or these futuristic plans will be nothing more than lame examples of civic science fiction.

As Guterres says, money matters — especially, how you spend it. Or loan it.

By increasing its base lending rate rapidly, up from 0.25 per cent to 1.5 per cent, the Bank of Canada claims to be restraining inflation. Yet efforts like this always come at the expense of the average taxpayer. Inflation for most of us is driven by higher costs, not by opportunities to borrow cheap cash for investments.

We can’t pay off that mortgage, so we just pay more to the bank for the same place to live. We can’t pay down that credit card bill, because the interest rates are at loansharking levels, so we beg for a credit extension and hope someday to pay it off.

The only beneficiaries of these BoC rate hikes are the banks, which continue to post record profits on the backs of working Canadians, just as they did throughout the pandemic. To add further injury, they are also heavily invested in the fossil fuel industry, instead of investing in a sustainable future for all Canadians.

They are profiting from destroying the ecosystems we need to survive, by what they lend, to whom, and for what purpose.

There are no profits on a dead planet, even for banks, however. Former BoC governor Mark Carney claims in his book Value(s) that we need to rethink what is important if we want to change course toward a future in which people can still live.

When will Canadian banks (and the politicians who cater to them) stop plundering our future and perhaps listen to Guterres instead?

Peter Denton’s latest book is The End of Technology.