Economic Growth Tension
A clear tension exists between carbon emissions and economic growth since the latter depended on cheap fossil fuels for the past two centuries - with low-cost energy fundamental to growth. The challenge then is to 'decouple' effectively growth from carbon emissions and so guarantee a clean energy future.
Integrated Assessment Models would argue here that we need optimal carbon taxes to effect this but these, in turn, would increase the costs of travel, food, and goods at least in the short run. Two fundamental problems that would need to be addressed here are 1) international cooperation and 2) internal wealth transfers to the poor in society. Of course, if we can access cheaper renewable energy then this, too, could be a driver of economic growth.
Economic Growth
In the last version of this book, this current chapter focuses on Economic Growth and agrees with Lord Stern (2009) that growth of the 'right kind' is needed, i.e. a move away from consumerism towards manufacture. He wrote:
"This is not to claim that the world can continue to grow indefinitely. It is not even clear what such a claim would involve: societies, living standards, and ways of producing and consuming all develop and change. A picture of indefinite expansion is an implausible story of the future, but two things are key: first, to find a way of increasing living standards (including health, education, and freedoms) so that world poverty can be overcome, and second, to discover ways of living that can be sustained over time, particularly concerning the environment. Strong growth, of the right kind, will be both necessary and feasible for many decades (Stern, 2009, A Blueprint for a Safer Planet, Random House, London).
Limits and Beyond
However, before we can predict decades ahead, we need to address the present malaise in The West where growth is stalling, and, according to The Club of Rome, societal collapse is due about now as was predicted in their landmark report in 1972. I am currently reading the 2022 book entitled "Limits and Beyond", reflecting on the past 50 years since the 1972 Report and computer model. Although this book is already 3 years old, it holds value for 2025 as we witness, in particular, a looming recession in the US - the biggest economy in the world.
I will update this blog once I have read the book! One thing is certain: BP's current "reset strategy" begun on 25 February 2025, is wrong in that it focuses almost exclusively on fossil fuels. Too little capital is allocated to the transition which, as I have mentioned already, we have little time to bring about.
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