Author: Milan

UBC’s financial analysis of divestment

During the U of T campaign, a validating source like this memo from the University of British Columbia’s Vice-President Finance and Operations would have been amazing for responding to the argument that divestment is financially irresponsible:

Results of Mantle’s analysis (full report attached as Appendix A) indicate that the link between climate change and the financial viability of investment assets is clear. Carbon intensive companies will be exposed to climate related financial risk as the world commits to reduce carbon emissions through regulatory, legal, market or technology shifts away from fossil fuels. Rapidly evolving trends – such as greater corporate disclosure of climate risk, commitment to a “Paris Aligned” future, the acceptance of a “carbon budget” – are greatly increasing the risk in holding shares of companies whose value is derived from the continued growth and expansion of global fossil fuel use.

Seeing the arguments about the carbon bubble from Bill McKibben’s movement-instigating article and our own divestment brief affirmed by university executives and their consultants demonstrates the degree to which the argument against continued investment in fossil fuels is sound, as well as how it has diffused beyond activists into the thinking of decision makers.

Tonight’s thesis reading will be more than unusually encouraging, between this and today’s Supreme Court of Canada ruling on the carbon tax.

Obama’s third book

Having just finished Barack Obama’s A Promised Land, I appreciated the chance to get his perspective on the years of his first administration. Perhaps the most consistent substantive point that struck me is the difficult and ambiguous balance between pressing a decision maker to go further on an issue like climate change and hampering that person by fracturing their support or rejecting the best available compromise. As Obama himself points out several times, it isn’t a question with a single straightforward answer. He both expresses his frustration with people who sapped support for his best efforts by demanding more and acknowledged that the science of climate change demanded more than he was able to do. He certainly provides a great deal of insight into the practical and political constraints, including the major barriers that climate change has been of lower priority to almost everybody than more immediate and practical issues like economic performance, and the difficulty in getting people to see effort and resources expended to avoid a bad outcome when compared with efforts to achieve short-term and immediate purposes.

The book documents with dismay the breakdown between verifiable facts and both public opinion and political reporting, without suggesting much about what could be done about it. Ominously, he quotes Indian prime minister Manmohan Singh saying: “In uncertain times, Mr. President, the call of religious and ethnic solidarity can be intoxicating. And it’s not so hard for politicians to exploit that, in India or anywhere else.” In a century where our destabilized climate is sure to produce more and more instability, we need to find a way to cooperate and take the long view.

Canada and Toronto’s housing markets

Perhaps the hardest thing about doing a PhD in Toronto is finding decent housing and paying for it with the kind of income the university’s funding package and TA work provides. Since the 2008 financial crisis, governments around the world have undertaken exceptional monetary and fiscal stimulus to try to sustain employment and economic growth. Those ultra-low interest rates, however, have affected asset prices in at least two ways. First, since they cannot even earn the rate of inflation from savings accounts, people have been prompted to invest in all manner of speculative assets, from frothy tech stocks to bitcoin to the housing bubbles inflating around the world. At the same time, low interest rates have facilitated massive borrowing for house purchases, also helping to drive up the level of house prices.

Those dynamics have several unwanted current and future impacts. For one thing, I worry that the sense of affluence it fosters among house owners is contributing to an erosion of empathy. It is also worsening the intergenerational inequalities between people who bought houses decades ago and have experienced a huge jump in wealth as a result and the younger people who in past generations would have been entering the housing market now. When interest rates do finally need to rise (once inflation rises above target levels) many home owners risk being in the unfortunate position that the 2008 crisis caused for so many: being ‘underwater’ with a mortgage now larger than the market price of their home.

I think it would be prudent for governments to pay more attention to asset price levels alongside the inflation and employment rates when setting policy. Their efforts to juice their way out of the last crisis seem to be setting up the next one. It would also be desirable for countries to start requiring comprehensive disclosure of wealth as a prelude to wealth taxation.

Related:

Cultivating a conservative climate movement

Let’s begin with two simple premises:

  1. The amount of climate change the world experiences depends on the total quantity of fossil fuels that get burned. As such, there is little value in avoiding burning particular coal, oil, and gas reserves in one time period if we then burn them in another
  2. In Canada, the US, and the UK the electoral pattern for a century or more has been alternating between relatively left-wing and relatively right-wing governments

I think it follows from this that for climate change mitigation policy to succeed, it cannot only be supported by progressives or supporters of left-of-centre parties.

It’s true that the most prehistoric form of climate change denial (saying there is no problem, or it’s a problem too small to require action) is concentrated among political conservatives. It’s also true that the fossil fuel industry has outsize influence over conservative politics, parties, and politicians. To me — however — these observations are akin to the argument that since 85% of the world’s energy currently comes from fossil fuels it is imposible or unrealistic to try to replace them. In both cases, the depth of the current dependency demonstrates the need for change, rather than its impossibility.

Recently, UK Conservative MP Alicia Kearns and U.S. Republican congressperson John Curtis co-authored an article in the Times of London: The left should not dominate the conversation on climate change.

They also appeared in a recent panel hosted by the Hudson Institute:

Progressives tend to be very opposed to the argument or idea that conservatives need to be won over to climate change mitigation through fossil fuel abolition. The intersectional climate justice analysis holds that climate change is a symptom of systemic injustice and cannot be corrected through narrow solutions which do not eliminate colonialism or capitalism or patriarchy. It is a joined-together worldview that clearly motivates a lot of people, but I don’t think it’s a sound strategy for avoiding catastrophic climate change. Furthermore, I challenge the claim that only systematic change in our political or economic system can solve the problem. Progressives also tend to assert that renewable energy is cheaper and better in every way than fossil fuel, implicitly acknowledging that it could be possible to replace where our energy comes from without fundamentally changing much more about society.

I can see at least a couple of routes for moving forward with cultivating a conservative commitment to climate change mitigation.

Thinking about the span of the next couple of decades, I think conservatism in the English-speaking democracies may be posed for a huge splitting apart between comparative pragmatists who are willing to accept what science has unambiguously shown and pure ideologues whose policy preferences do not relate to what is really happening in the world. If that split can be enlarged to the point of crisis — when those on the empiricist side will no longer tolerate supporting the same candidates and parties as those on the fantasist side — those willing to consider evidence will likely have a long-term electoral advantage as those most implacably opposed to climate action die off, young people with a better understanding of climate change become politically dominant, and as the undeniable effects of climate change become even plainer.

Another plausible route to cultivating conservative support for climate change mitigation is through faith communities. The Catholic Church, United Church, Anglican Church, and others have been outspoken from the centre of their institutions about the need to control climate change. It’s true that there are some whose theology sees the Earth exclusively as a set of resources to be exploited, or who believe that a religious apocalypse will soon bring an end to the material world making long-term problems irrelevant, but I suspect there are many more in all faiths and denominations who can be won over to the view that we have a duty to care for creation and not to pass on a degraded world to our successors.

I think part of the progressive wariness about outreach to conservatives arises from how the intersectional view ties climate change into the social justice and economic redistribution agendas which animated the left long before climate change became a mainstream concern. Cooperating with conservatives on the narrow issue of replacing fossil fuels would not advance the general project of abolishing capitalism or re-ordering the global system. Some see climate change as a crisis which would be ‘wasted’ if our response only sustains planetary stability. Others convincingly point out that even without climate change as a problem the idea that resource use and waste production can increase indefinitely is fundamentally at odds with a finite planet. All that said, climate change seems to be the most pressing and serious societal problem facing humanity, and resolving it would give us more time and a more stable global environment in which to pursue other aims of justice.

I don’t believe either progressives or conservatives can or should win one another over to their entire worldview. The progressive climate change movement is an enormous success and source of hope, and I am not calling for it to be dismantled or fundamentally altered, though they ought to give more consideration to cross-ideological alliances on certain vital issues. As long as effective climate change policies are something which one side assembles and the other dismantles we cannot succeed, and so winning over conservatives to climate action is an indispensable condition of success.

Related:

Canada and a just transition off fossil fuels

At a town hall tonight on a just transition away from fossil fuels — organized by 350.org and attended by Green Party parliamentary leader Elizabeth May and NDP climate change critic Laurel Collins, but which environment minister Jonathan Wilkinson declined to attend — May repeatedly brought up the Task Force on Just Transition for Canadian Coal Power Workers and Communities as a model. In particular, she emphasized the importance of countering the narrative that escaping our fossil fuel dependence will be bad for jobs, and of respectfully consulting with the most affected communities when making policy.

The central nonsense of Justin Trudeau’s climate change policy is his unwillingness to accept that only fossil fuel abolition will let us avoid catastrophic climate change. Canada has already more than used up our fair share of the global carbon budget, and building new long-lived fossil fuel infrastructure will only increase the costs of our transition when we need to scrap them early and scramble even faster to build climate-safe replacements. Canada’s assertion that we can keep expanding bitumen sands and LNG production and exports is also entirely at odds with what fairness and pragmatism demand globally. The richest and dirtiest states need to lead the way, not keep making excuses, or the global logjam against sufficient action will be impossible to overcome.

In some ways, I am happier not going outside

Perhaps surprisingly, I haven’t really been feeling too confined my by self-isolation so far. I think a big part of that has been losing the two overwhelming sources of stress on my walks: unstable men who seem to be in the midst of a psychological crisis and/or under the influence of a powerful stimulant, who I encounter on the sidewalks during many walks, and people with off-leash dogs that come running at me, giving me two big scares in succession from the dog itself and then from the nearly-always entitled and irate owner who wants to pick a fight about how friendly their dog is and how legitimate it is for them to have it off-leash on a sidewalk, trail, or park.

Even before the potential COVID exposure I had been refocusing my walks on the U of T campus, where I don’t think I have ever encountered one of those scary men or an off-leash dog of such a size as to pose a threat. On streets like Bloor and College, as well as the trails I have been exploring, almost every walk involves me changing course to take a wide circle around someone who seems unstable and dangerous or to avoid having to deal with double aggressions from dogs and their owners.

Recent incidents of dog owners getting aggressive with me when I have explained that strange dogs often come running at me when unleashed have even made me question whether I want to stay in Toronto. They seem to embody how affluence and entitlement have superseded empathy and courtesy in much of the population. Rather than maintaining a determination to live together in a way that respects the safety of all, many of my co-residents seem to be mega-libertarians whose ideology is that they can do whatever they want and everyone else can go hang.

On day six of post-exposure isolation, the avoided stress from these encounters seems to be more than counterbalancing the cessation of all exercise and limited access to food.