What climate strikers ought to know about our economic system

Dear participants of the climate strike and all the other friends of a livable future! First of all, I’d like to thank every single one of you for your work defending a future for all of us. In my eyes, all of you are heroes.

Practically all environmental researchers and those who understand the issues are on your side and support your demands. In Finland alone, 1228 university researchers signed a letter supporting the climate strike and other activism for a livable future, while a similar letter circulated in German-speaking Europe gathered over 12 000 signatures. As far as I know, the global scientific community has never before in human history supplied such a clear and unambiguous message in support of any demonstration or political action.

After all, research results are conclusive: there is a 99.9999 percent probability that climate change is happening, and it is likely the most serious threat the humanity has faced for at least the last 50 000 years. The seriousness of the threat is fully comparable to a threat posed by an incoming asteroid. Preventing dangerous levels of climate change is a precondition for the survival of our civilization at least, and possibly for our survival as a species.

Many of you have rightfully wondered why, despite all the research and warnings, humanity has done next to nothing to prevent this deadly serious threat. I shall now try to explain as briefly as possible just why this has happened.

In brief, the central problem is that our current socioeconomic system is built on plentiful fossil fuels, to produce increasing consumption, for the benefit of a small but powerful elite. During the last 30-40 years, wealth distribution has increasingly favored the rich in nearly all so-called western countries. In other words, an ever-smaller share of people owns or controls more of the world’s wealth. This concentration of wealth also means the concentration of political power. A billionaire can hire a veritable legion of communications experts, politicians and economists to influence public opinion, or own entire broadcasting networks to show the public a stream of news carefully selected and framed to make common people support policies that benefit only the richest. In this manner, this development is self-reinforcing: as wealth becomes more concentrated, so does political power, and therefore reversing the trend becomes increasingly difficult.

In Western democracies, the powers and privileges of this elite group are safeguarded most of all by practices which force people into working as unthinking cogs in the machine. For example, from the viewpoint of this elite, making the prospect of unemployment ever more terrible by constant cuts in unemployment benefits is beneficial not just because it means the rich have to pay less tax and can depress wages further, but it also serves to control the populace: those who have to fear for their employment has no time nor even inclination to think what long term impacts their work or the continuation of the current destructive economic system may have. Increased tuition fees and increasing student loans are another mechanism that produces similar results.

This principle is well known to all armies in the world, where the rule is that ordinary soldiers have to be kept busy at all times. This is to be done even if it means inventing meaningless things to do, because soldiers who have time to think may get second thoughts about why they are fighting in the first place. Similarly, I have no doubt that you too remember schooldays when teacher’s absence meant you would have to do some individual assignments just so that the class would stay in order.

In the end, it’s often easier for us humans to refuse to believe that those who criticise our way of life and our societies could be correct. When someone like you questions just how smart our system is in the first place, you also question and ridicule the life choices and values of those who have been living happily within the system. This is the reason why you and other defenders of our common environment are being attacked by a large group of climate deniers and those who question your intelligence and understanding merely because of your age.

Despite these blowhards, it is an unquestionable fact that our wealth-concentrating economic system is increasingly in debt to nature. A lifestyle that is funded by credit cannot last, however, and sooner or later the debt will have to be repaid. As things stand, you and your children will be those who have to foot the bill. Furthermore, nature is a cruel creditor that cannot be cheated, no matter how much we cheat ourselves. No matter how much we beat our chests and announce that our current socioeconomic system is the best possible one, nature will eventually come to collect its debts – from you.

In fact, if our debts to nature are accounted for, most “rich” countries have probably only gotten poorer since the 1990s. Although the “economy” has grown massively, economic accounting counts only those things that someone is willing to pay for. Because natural world was for a very long time assumed to be worth nothing, and it’s still massively undervalued, our common environment, the source of our common wealth and our only life support system, has been ravaged mercilessly.

But why don’t we change the accounting, then? This is a good question, the answer to which returns to the same problem as described earlier. The current bookkeeping standards benefit those who are the winners of our current economic game. Changing the rules would mean that their wealth and power would diminish. Therefore so many of the world’s richest people do so much to prevent or at least slow down any attempts to change the rules of the game to a more sustainable footing: for instance, full 90 percent of the world’s 200 largest companies are spending money to prevent and slow down climate legislation. This is exactly like when those who are winning a game of Monopoly do not want anyone changing the rules.

Furthermore, the richest have other reasons to oppose all actions that would safeguard our future. Our current unsustainable socioeconomic system rests on a fundamental assumption: that economic growth, which also in practice means resource consumption, will continue forever. Economic growth, in short, means that people can buy more products and services. The vast majority of private firms strive to constantly increase their production, because this means increasing profits. If the economy does not grow and people are not buying more, the firms who invested in increased production will be in trouble. These firms then cannot pay back the debts that were used to finance increases in productive capacity, many will go bankrupt, and their workers will lose their jobs. As people lose their jobs, they will buy less, and they also will find it difficult to survive their debts. If enough people and companies fail to honor their debts, the banks that issued the debt will be in trouble. The owners of both banks and most corporations are on average wealthy investors or powerful pension funds. In this manner the wealth and increase in wealth of the richest people is inevitably tied to continuing economic growth. If this leads to an uninhabitable planet some time in the future, after the individuals are dead, too bad! As long as the collapse is not obviously visible in the near future, the winners of our economic game will be opposing the majority of environmental protection. In this, they are helped by the common people who are afraid that their jobs or lifestyle are on the line if environmental protection is improved. This is an understandable, but nevertheless short-sighted position.

Third, the rich are against environmental measures because they are full well aware that the actions that are now required would be expensive and they’d need to be funded by increases in taxes. What is now needed is a mobilization akin to the one the world saw in response to the Second World War. The richest understand that this would mean heavy taxation for the richest: during the war, the highest income tax bracket in the US was 92 percent, while in the UK it was 99 percent. A proposal circulating in the United States at this point suggests that the highest tax bracket, for earnings exceeding $10 million, would be 70 percent – and the richest are among the most implacable opponents of the environmental movement.

Those who seek to belittle you and still have faith in the current system will claim that it is possible to “decouple” the economic growth from the growth in the use of resources. This is possible in theory, but empirical evidence suggests that such decoupling is not fast enough to prevent a serious crisis. Sustainable economic growth may be possible after our societies and economies have been practically rebuilt. As of now, however, we have dithered for too long, and we have lost our chance for a future where economic growth continues steadily. Economic growth will almost certainly level out and possibly stall. This will cause serious problems in our current socioeconomic system, for instance mass unemployment, but the only alternative to smooth leveling out is an eventual civilizational collapse and the end of global economy.

The situation we find ourselves in bears striking resemblance to a game of Monopoly where those who are winning can also alter the rules of the game and hire armed guards to force the losers to continue playing. The major difference between such a game and our reality is that playing our “real” economic game wrecks the natural world and pollutes our atmosphere with greenhouse gases. You should keep this in mind whenever anyone tries to talk down you or other environmental activism: the winners of our game have considerable resources at their disposal to produce convincing-sounding arguments and hire communications experts to spread them.

However, our socioeconomic system is fundamentally a social contract between humans, not some immutable natural law. Humans have lived happy lives in very different economic systems, and even in the capitalist West, the economic system of 1960s and 1970s bears little resemblance to current predatory capitalism. In other words, if we want we can change the functioning of the economic system and stop it from benefiting only the winners. On the other hand, there is nothing we can do about laws of nature. We cannot negotiate with them, and we cannot just decide that physics, for instance, shall operate differently from now on.

Therefore, we must change what can be changed. For example, we have to demand a system where humans can live happy and prosperous lives with less material and energy use, and with less need to continuously compete with other people in wealth and efficiency – in other words, in how much and how fast they are using up the world’s natural resources. The required changes will produce temper tantrums from those whose sense of self or wealth are tied to the current socioeconomic system, but the only alternative to change is the destruction of our civilization, possibly our species. There is absolutely nothing rational in propping up a system that is rushing towards its doom just in order to help the richest become a little bit richer before the inevitable.

Those who still support the current system will argue that there are no alternatives. Fortunately, they are wrong: no law of nature prevents us from living in a different economic system, for instance in a “doughnut economy” outlined by British economist Kate Raworth. In a doughnut economy, the objective of our society would not be centered in the continuous enrichment of the already wealthy, but in achieving a balance between the needs and wants of all living beings on this planet, humans included. Even a return to an economic system that prevailed until about 40 years ago would be an improvement: those days, when wealth and income disparities were significantly smaller in most Western countries, are generally remembered as the heyday of Western capitalism. The achievements of the West were, in fact, largely achieved or at least their foundations were laid during that era. However, we have no reason to only seek a return to that bygone era. Instead, we should be looking for genuine improvements: how would a three-day working week sound like, for instance? Reducing and sharing work would be an excellent method for dividing well-being more equally without causing a pressure to increase emissions.

If you want to learn more about how our socioeconomic system works and how it could be changed, don’t be afraid to ask. The vast majority of the world’s finest scientists and scholars are on your side and want to help. You can also discuss these issues among yourselves: one way I’ve been recommending is to play a game of Monopoly, preferably with eight or more players, and observe what tends to happen. A perceptive mind can pick up many valuable lessons about how our system works simply by observing such a game: for instance, a Monopoly game with eight or more players will make obvious how our economic system produces very unequal results even though the rules are supposedly equal for everyone. For more detailed but still very readable discussion, I can heartily recommend the following books, for example:

Raworth, Kate: Doughnut Economy.

Chang, Ha-Joong: Economics: an User’s Guide.

Chang, Ha-Joong: 23 Things They Don’t Tell You About Capitalism

Klein, Naomi: This changes everything: Capitalism versus the Climate.

I, alongside 1227 other Finnish researchers, over 12 000 German-speaking ones, and tens of thousands others worldwide, wish you the best of luck in all your efforts. You are the best hope for a decent future for us all, and heroes everyone.

Janne M. Korhonen

PhD, MSc

Turku School of Economics

Turku, Finland

About J. M. Korhonen

as himself
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