When the price of natural gas increases it makes the cost of climate action cheaper. So a more pessimistic assessment of the cost of climate action during a gas crisis is all the more surprising. Or am I missing something?
Yes, it is doubly bizarre that changes in views correlated in the way they did post-2022. You wouldn’t expected it all else equal, but all else wasn’t even equal, as you point out.
"Policies aimed at net-zero targets and other climate initiatives are often framed as necessities – things we must do, rather than opportunities or things we want to do. But what if climate action could drive innovation, boost productivity and, rather than proving a cost to society, bring about decades of prosperity and with it, greater opportunity for all?" In hindsight, there's much that Boris Johnson got wrong. So it's effective to cite him as a strawman. But he did not invent the have-your-cake-and-eat-it narrative. He drew on intellectual frameworks that academics and policy advisors provide.
From the same article: "[The UK] has cut emissions strongly since 1990, whilst achieving growth."
Which is not exactly accurate. UK Growth, everyone seems to agree, has been dismal since 2008. Real wages are roughly where they were fifteen years ago. So, it's difficult to take political leadership on climate in the global sphere when the home economy looks like an example of how not to do things. Economists are still blaming low productivity for the UK’s sluggish growth post-2008 (which is tautological, growth is low because output per hour worked hasn't risen nearly fast enough, that's not an insight), but few offer a compelling explanation as to why the sudden change in growth occurred.
Why did energy cost more than double? An ageing nuclear fleet, mostly, so that gas set the marginal price. This showed when gas prices started to rise. Sadly, no one ever addressed the problem. No new nuclear power plants were built under New Labour and the Conservative-LibDem government. This cost the UK dearly.
Consider that in 2008 the pound devalued permanently from 1.9 to 1.6 against the dollar. Yet manufactured exports didn't expand. Why? This makes sense only considering that energy input costs doubled just as currency fell 25%—the gains cancel, especially for energy-intensive industry. So, in a way, lack of sensible energy policy left the UK dependent on services in the golden triangle (banking, insurance, HE, consulting). Those industries can impossibly replace the value-added through chemistry, production of pharmaceuticals or car manufacturing as they take place in different localities and require vastly different skillsets. Eventually, one must also wonder: who is left to be consulted, to receive financing, be educated, once traditional industry with needs of consulting, credit and skilled graduates has disappeared? For a while, the Europeans filled that gap. Then came 2016. Oh well.
All said, I fully agree with your argument that politicians do not speak openly about trade-offs (if they register them at all). But academics are not always posterchildren for talking honestly about trade-offs either. We also love the win-wins promised by the green agenda. It's easy to blame the politicians, but sometimes they're just repeating wishful thinking that originated from within the academy. Possibly you may thus wish to expand the methodology and follow up on the studies cited by the politicians in their speeches. Were those any better?
When people complain about the costs / trade offs of action I do think it’s worth pointing out the costs of inaction, like the costs of rebuilding after hurricanes, floods and wildfires, increased insurance costs, or no insurance at all, the health costs associated with poor air quality
The Boris Johnson's quote looks different in full. He's not saying there will be no tradeoffs, he's saying that in 2050 everything will be better. That whatever costs the transition has will be temporary.
When the price of natural gas increases it makes the cost of climate action cheaper. So a more pessimistic assessment of the cost of climate action during a gas crisis is all the more surprising. Or am I missing something?
Yes, it is doubly bizarre that changes in views correlated in the way they did post-2022. You wouldn’t expected it all else equal, but all else wasn’t even equal, as you point out.
"My policy on cake is pro having it and pro eating it".
Boris Johnson
On Politics without trade-offs: It's not just politics. It's also us researchers. This is from two weeks ago from an esteemed academic, (not a politician!): https://www.lse.ac.uk/research/research-for-the-world/sustainability/climate-growth-story The opening paragraph says:
"Policies aimed at net-zero targets and other climate initiatives are often framed as necessities – things we must do, rather than opportunities or things we want to do. But what if climate action could drive innovation, boost productivity and, rather than proving a cost to society, bring about decades of prosperity and with it, greater opportunity for all?" In hindsight, there's much that Boris Johnson got wrong. So it's effective to cite him as a strawman. But he did not invent the have-your-cake-and-eat-it narrative. He drew on intellectual frameworks that academics and policy advisors provide.
From the same article: "[The UK] has cut emissions strongly since 1990, whilst achieving growth."
Which is not exactly accurate. UK Growth, everyone seems to agree, has been dismal since 2008. Real wages are roughly where they were fifteen years ago. So, it's difficult to take political leadership on climate in the global sphere when the home economy looks like an example of how not to do things. Economists are still blaming low productivity for the UK’s sluggish growth post-2008 (which is tautological, growth is low because output per hour worked hasn't risen nearly fast enough, that's not an insight), but few offer a compelling explanation as to why the sudden change in growth occurred.
I think there is now some pointed evidence of how high energy costs have badly hurt the UK over the past 20 years. Some data on this: UK wholesale electricity prices more than doubled between 2003 and 2008—from £19/MWh to £70/MWh—before settling at a new floor of £40-50/MWh that persists today. (See here for the data: https://www.ice.org.uk/areas-of-interest/energy/the-changing-price-of-wholesale-uk-electricity-over-more-than-a-decade)
Why did energy cost more than double? An ageing nuclear fleet, mostly, so that gas set the marginal price. This showed when gas prices started to rise. Sadly, no one ever addressed the problem. No new nuclear power plants were built under New Labour and the Conservative-LibDem government. This cost the UK dearly.
Consider that in 2008 the pound devalued permanently from 1.9 to 1.6 against the dollar. Yet manufactured exports didn't expand. Why? This makes sense only considering that energy input costs doubled just as currency fell 25%—the gains cancel, especially for energy-intensive industry. So, in a way, lack of sensible energy policy left the UK dependent on services in the golden triangle (banking, insurance, HE, consulting). Those industries can impossibly replace the value-added through chemistry, production of pharmaceuticals or car manufacturing as they take place in different localities and require vastly different skillsets. Eventually, one must also wonder: who is left to be consulted, to receive financing, be educated, once traditional industry with needs of consulting, credit and skilled graduates has disappeared? For a while, the Europeans filled that gap. Then came 2016. Oh well.
All said, I fully agree with your argument that politicians do not speak openly about trade-offs (if they register them at all). But academics are not always posterchildren for talking honestly about trade-offs either. We also love the win-wins promised by the green agenda. It's easy to blame the politicians, but sometimes they're just repeating wishful thinking that originated from within the academy. Possibly you may thus wish to expand the methodology and follow up on the studies cited by the politicians in their speeches. Were those any better?
When people complain about the costs / trade offs of action I do think it’s worth pointing out the costs of inaction, like the costs of rebuilding after hurricanes, floods and wildfires, increased insurance costs, or no insurance at all, the health costs associated with poor air quality
The Boris Johnson's quote looks different in full. He's not saying there will be no tradeoffs, he's saying that in 2050 everything will be better. That whatever costs the transition has will be temporary.
This
"When you sell a difficult transition as a free lunch, support collapses the moment the bill arrives."
All my colleagues of profession (sustainability and impact investment) should read it.
There are win wins, of course. But if everything would be win win, why should we talk about this? why should this be a problem?
Love this!