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Why Climate Change Means Higher Taxes |
"So you think you can tell heaven from hell, blue skies from pain… Hot ashes for trees? Hot air for a cool breeze?" Pink Floyd could have been writing about the Stern report, as described by The Times earlier this week. Pain, hot ashes, hot air – Sir Nicholas Stern’s vision of the future sounded like hell.
The theory is simple enough. It took the earth millions of years to lay down a stock of carbon-based energy reserves – oil, gas, coal. In just a few decades, these resources are being used up. Burning fossil fuels puts greenhouse gases into the atmosphere. Before the Industrial Revolution, such gases were found at the rate of 280 parts per million (ppm); now there are 430ppm. By 2025, that’s set to hit 550ppm. What do these gases do? They seem to make the earth warmer.
Our standard of living depends on cheap fossil fuels
The world as we know it – its standard of living as well as its geopolitical arrangements – depends on burning cheap fossil fuels. People live in houses heated by oil and gas. They drive cars that burn gasoline. They use products made from petroleum derivatives, fashioned by tools made from white-hot steel and delivered thousands of miles on diesel-fuelled transport.
When they go to the grocery store, they find vegetables raised and delivered with the help of the petroleum industry – from the tractors that work the soil, to the chemical fertilisers and pesticides that are put on it, to the refrigerated ships that carry it to market. And at the office, heated and cooled by natural gas, they are surrounded by electricity – often generated at oil-burning plants – to power their computers, their handtools, their presses and machinery. And they do all this under the protective cover of the great Anglo-American, oil-gulping empire.
And now we discover – if you bend under the weight of prevailing scientific reports – that this carbon-based energy dependence is destroying the planet we all live on. The blessing of cheap energy has turned into a curse. Bummer.
“The five months from May to September this year were the hottest since records began,” wrote Merryn Somerset Webb in MoneyWeek just last week. (We always try to be ahead of the news, rather than behind it. Those who missed the piece can read it in full – with Merryn’s tips on how to profit from climate change – here: How to profit from carbon trading.)
Why there's money in climate change
The ice caps are melting, the seas are rising, millions of people in Africa will die from hunger or malaria, and the Pentagon says climate change is likely to lead to more war. But thank god for the global bureaucratic elite! Sir Nicholas, for example, is former chief economist for the World Bank. He suggests that if the world would just slather some honey on the right pieces of toast the whole problem might not seem so bad. Invest 1% of world GDP in various program¬mes and you’ll save a lot more later on, says Sir Nicholas, seconded by America’s Al Gore, and a whole host of tax-and-spend politicians and world improvers.
Even the Bush Administration is said to be warming to the issue. And why not? There’s money in it – for research grants, for the nuclear power industry, for alternative energy; the Bush boys never miss an opportunity to spend money that doesn’t belong to them on things no one really needs. And if the ‘war on terror’ peters out… well, there’s always a ‘war on greenhouse gases’.
Certainly, British politicians see global warming as a promised land. Environment secretary David Miliband told the House of Commons that “climate change is the greatest long-term threat faced by humanity… it could cause more human and financial suffering than the two world wars and Great Depression put together.”
To make matters worse, the experts are now saying that a ‘tipping point’ is coming soon. Unless we take action right away, they say, we’re doomed. Faced with imminent environmental Armageddon, what is a responsible citizen to do? Does he dare strike a match to light his cigarette… knowing that the molecule of CO2 he releases could be the one that tips the whole earth into irreversible calamity?
Neither heaven nor hell are on the MoneyWeek beat. Money is our métier. As to the climatic disaster facing the planet, we are as ignorant as the man on the street. But as for the financial and political motivations of those who would save us, we are keenly alert. There is nothing like the threat of hell or the hope of heaven to pry open a wallet; ‘green taxes’ will be a cinch to sell to taxpayers.
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