Why Copenhagen Is A Failure

Saturday, December 19, 2009

Executive Summary

• Carbon reduction and economic growth are mutually exclusive goals.
• Alternative energy sources and technologies are decades away from making a significant contribution.
• The core problem lies with our monetary system itself.
• Politicians are in a real bind.
• If we were really serious…
• The way forward.

Preamble: I normally avoid writing on Global Warming/Climate Change as a topic for discussion because it tends to be a heated topic for many people on both sides, which can work against collaborative solutions. This article is not about global warming and/or the science behind it, and it is not my intention to discuss those ideas here.

Copenhagen & Economic Growth – You Can’t Have Both

I want to point out that a massive discrepancy exists between the official pronouncements emerging from Copenhagen on carbon emissions and recent government actions to spur economic growth.

Before and during Copenhagen (and after, too, we can be sure), politicians and central bankers across the globe have worked tirelessly to return the global economy to a path of growth.  We need more jobs, we are told; we need economic growth, we need more people consuming more things.  Growth is the ever-constant word on politicians’ lips.  Official actions amounting to tens of trillions of dollars speak to the fact that this is, in fact, our number-one global priority.

But the consensus coming out of Copenhagen is that carbon emissions have to be reduced by a vast amount over the next few decades. 

These two ideas are mutually exclusive.  You can’t have both.

Economic growth requires energy, and most of our energy comes from hydrocarbons – coal, oil, and natural gas.  Burning those fuel sources releases carbon.  Therefore, increasing economic activity will release more carbon.  It is a very simple concept. 

Nobody has yet articulated how it is that we will reconcile both economic growth and reduced use of hydrocarbon energy.  And so the proposed actions coming out of Copenhagen are not grounded in reality, and they are set dead against trillions of dollars of spending.