1644. Provocations #11. Davos and hype for growth

I know we all watch Davos, the World Economic Forum, as if it is the super bowl  of economies. But what do we make of it? In my case, struck by how much the hype is around growth and the need for innovation, creating trillions of dollars of economic activity. Wow. Get in line to make your investment.   But why is the connection  not made between such growth and climate? The obvious logic,  that economic activity is likely to contribute to greenhouses gases and subsequent temperature rise, is not made.

 

Obviously trillions of dollars of new investment has several consequences.

  • Projects will be built using old technologies, mining raw materials, diesel trucks bringing materials to projects, and so on, increasing greenhouse gases.
  • Such investment is made in the search for profit,  and such profits will continue the trend of wealth concentration.
  • Such investment will be done with borrowed dollars and federal guarantees.

 

The announced title of this year’s WEF,  the 4th industrial revolution,  led speakers to drop lots of hints about lost jobs,  but the old meme, that such displaced people will be the source of new jobs in not yet predicted industries was the fig leaf on this meme. The argument that horse collars and buggy whips led to automobiles is true, but not necessarily going to repeat. The jobs lost now will lead to new economic activity, maybe even massive. Bu the very urgency of the new leads managers to seek for robots and algorithms to meet the new needs, and the more intense the need is, the stronger the incentive to digitalize production.  Worker costs more money but a robot is owned.

 

There is a system that includes at least

Climate

Inequality

Jobs lost to tech

War as hidden Keynesian stimulus

The collapse of the welfare state

Debt

 

To speak of one of these  while ignoring some of the others is not good science nor a  public policy of an optimistic government. If we are truly pessimists, believing that there is no way climate goals can be met (staying under + 2 C) then pretending might be good public policy – keep the titanic going as long as we can, because  calling for an alternative will hasten the problems, not solve them.

 

So what do we do?

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