Why the climate crisis represents the biggest market failure in history. Why failure to effectively confront domestic inequalities could lead to global conflict and uncontrollable climate change. Higher levels of inflation are here to stay and require a concrete response from central banks. What is nature’s true value? Why putting a price on it matters. Why resisting the darker, dystopian side of technological progress matters and how to do so.
QUOTE OF THE WEEK
“The costs of inaction (on climate change) were very worrying 15 years ago – they are immensely worrying now.” Nicholas Stern in the article of the week
ARTICLE OF THE WEEK
Damian Carrington, Climate crisis: economists ‘grossly undervalue young lives’, warns Stern
(The Guardian, 26 October 2021)
The author of the famous Stern Report (2006) states that economists have failed to consider the “immense risks and potential loss of life” that could occur because of the climate crisis. They also severely underestimated the speed at which the costs of clean technologies, such as solar and wind energy, would fall. Stern explains that the costs of inaction on climate are far greater than the costs of action and that the climate crisis is the biggest market failure in history. He concludes: “The costs of inaction were very worrying 15 years ago – they are immensely worrying now” (free access – reads in 6-7 min).
Click here to read the full article
Andrew Sheng and Xiao Geng, The Tribalist Threat to Climate Action
(Project Syndicate, 27 October 2021)
This article begins with a warning that we are increasingly hearing from many of our Chinese friends: the two global struggles of “Cold War II” and the fight against climate change are colliding. Sheng and Geng argue that the rise of tribalism is threatening to lead the world to a future of great-power conflict and runaway climate change. In their opinion, the only way to mitigate this global risk is through new social contracts that address domestic inequalities head-on (metered paywall – reads in 6-7 min).
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Charles Goodhart, Manoj Pradhan, What may happen when central banks wake up to more persistent inflation?
(VOXeu, 25 October 2021)
Central banks assume that the current mini surge in inflation will return to target towards the end of 2022. However, the two (famous) authors are of the opinion that the inflation risk will remain persistently high for longer. They warn that sudden policy reversals could lead to severe downturns in financial markets and significantly damage public sector balance sheets. They also call on central banks to develop concrete plans for dealing with persistently higher inflation, with a particular focus on their balance sheet policies in a world of rising nominal interest rates. A must read for those who worry that moderate inflation becomes more persistent and increasingly engrained in the system, and for those who doubt it as well! (Metered paywall, reads in 7-8 min).
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Kelly Oakes, The great experiment to put a price on nature
(BBC, 22 October 2021)
We’ll keep posting articles on the vital issue of natural capital that is becoming a prominent consideration for investors and businesses alike. Nature through fresh water, clean air, and less tangible manifestations like peace of mind and beauty provides so-called “ecosystem services”. In the process they make life better for humans in a myriad of different ways. It is for this reason that why scientists are trying to put a monetary value on exactly how much nature is worth. Read-on to understand what this entails (free access – reads in 7-9 min).
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Courtney Coonrod, Dystopia Is Upon Us. Are You Ready?
(Wired, 24 October 2021)
Tech is a source of constant progress and innovation, but it also has its dark side, which this article makes plain. From constant surveillance to algorithms that decide what we read/buy/watch, society may be entering the domain of diverse dystopias (once the preserve of sci-fi narratives) of environmental destruction, technological control, and loss of human rights and freedoms. This article details various initiatives (in the US) on how people and organizations are pushing back (metered paywall, reads in 6-7 min).
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