Thursday, March 30, 2023
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Alberto Fraguas Herrero

​Ten years of economic crisis in 100 years of ecological crisis

Coordinator of the Observatory of Political Ecology of ATTAC Spain

Warren Buffet, that US super-millionaire with the face of a good old grandfather and pocket of a whale shark, a few years ago in an attack of self-satisfied cynicism, affirmed that "the class struggle continues to exist... and mine is winning". In a very Stanislao Figueras style ("I am up to my... with all of us") he accepted the criticism of the neoliberal model, based on huge imbalances in the payment of taxes in which he, with enormous income, paid the treasury less than 17% of his when his employees paid an average of 38% of theirs. Obviously this is because their income came (and comes from) income from capital invested in finance that paid much less to the treasury. This explains the enormous increase in inequalities in a global environment where large corporate corporations maintain profits that are reinvested in these financial markets, creating a growing social and economic gap (called "crisis") that is beginning to worry even those responsible for generating it (Buffet is a good example).

Capitalismo verde

The organization ATTAC, which fights against this financial capitalism and its pernicious effects, started together with other social organisations a campaign to remember and document that these 10 years of crisis are a scam to the public at large (#10AñosdeCrisisEstafa and #ControlemoslasFinanzas) with clear repercussions to the increase social inequalities and ecological imbalances.

But what is really this lack of environmental balance in what we call a crisis? Such imbalances are found not only in the economy, but also in another area linked to it (feedback I would say), which it depends on quite directly and often forgets: that it is ecology, the (unequal) use of natural resources.

There is a statistic that explains many things: as few as 90 companies in the world are responsible for as much as 60% of the emission of greenhouse gases (GHG).

Large corporations such as Chevron, Exxon Mobil, Saudi Aramco, BP, GazProm, Shell, National Iranian Oil, Pemex, Conocoo Phillips and Coal India generate 22% of GHG.

These large business corporations that also feeds speculative financial markets base their growth expectations on the permanent use of natural resources (oil, water, biodiversity...); although these resources belong to everyone and whose use ensure their permanence and sustainability due to their global importance as factors of social equity. However, this is not the case nor does neoliberalism suggest that it is so in its own doctrine, since it knows perfectly well that its action generates social inequalities and ecological imbalances.

Therefore the crisis does not refer only to social and economic aspects, but also to the environment, in a cycle of permanent and perverse feedback.

The discourse of large corporations and countries themselves is to maintain the economic model with slight corrective variations (purify air, water, treat waste...) confusing voluntary commitments with legal requirements and committing to the monetization of environmental impact; This "polluter pays" is so harmful that it does not define when and how much is paid and, above all, if the restitution of the environmental environment is appropriate.

It even raises the creation of "new business opportunities", in a perfect loop where the profit occurs in the problem, but also in the correction of damage. It tries to broadcast a reassuring message for the public at large who are ignorant of reality on too many occasions. This absolute confidence in the corrective technologies towards a "circular economy" makes the utopia conceal the dystopia which is that the physical, natural, thermodynamic reality is very different and highlights the fallacy of its account because the finite nature of the natural resources in that the model is based on a rate of renovation in its materials that is not fast enough to guarantee the economic benefits that the capitalist cycle requires. So the "collapse" is inevitable and is in process in ecological terms, because the changes in those natural cycles may be slower than in the social ones, but are almost immutable and difficult and costly in time and money to reverse. This fact, the appropriation of resources by capital for private use, obviously causes the rupture of equilibrium of ecosystems, many of which are the basis of social cohesion and equity.

In addition, in recent years (coinciding with the so-called economic crisis) markets have been created and promoted financialisation of environmental risks, transferring the speculative model to nature itself, by transforming those risks into credits or bonds that can be speculated with on special financial markets ("catastrophe" bonds, CO2 markets", Biodiversity banks"...). For example, the market for "green bonds" or indebtedness linked directly to environmentally-friendly development (market for credit instruments to finance projects against climate change or other "corrective" impact projects) involves long-term investments where 70% of the bonds are commercialized for more than ten years, they have issuers such as multilateral entities, international investment organisations, companies, financial entities or public administrations. This market of "green bonds" has gone from 2,600 million dollars (2,364 million Euros) in 2013 to 81,000 million in 2016 (almost 74,000 million Euros), with a growth forecast of up to 150,000 million dollars (136,400 million Euros). Euros) in 2017 and 60 thousand million in 2020, according to data from the Climate Bonds Initiative. This hegemony of financial power has caused short-term profitability to prevail, obviating environmental preventive and corrective measures and prioritizing the extraction of materials from natural cycles well above their capacity for regeneration. This reality has occurred with the hoarding of land by financial elites as if they were energy or food reserves.

For many years now, we collectively report shameful statistics on the right to water, with more than one thousand million people without a supply and more than two thousand million without sanitation.

In a nutshell, what we call crisis is simply one more contingency of the economic model and its evolution. In ecological terms (and with certain cynicism) these corrective, monetarising and financing actions could be regarded a priori as part of the game, as " hypothesis of jobs", but they are not at all, since stubborn reality cannot be more harmful in environmental matters, catalyzing the deterioration in recent years.

Despite all the international climate agreements, CO2 levels have never been as high as now, which in recent years has not stopped increasing along with the risks involved. However, there are more indicators. On November 13th, 2017, an article was published in the journal BioScience that updated the 'World Scientist Alert to Humanity', a manifesto signed twenty-five years ago by 1,700 scientists that included most of the living Nobel prizes. Today, the second warning has been signed by 15,364 scientists from 184 countries.

The warning is worrisome, because the trends revealed twenty-five years ago have not stopped, not even slowed down. The available fresh water per inhabitant reduced by 26.1%. The fish catch reduced by 6.4% (much more since its peak after 1992) not because of a conservation efforts, but rather because of the decline in availability of the resource. The number of "dead zones" in aquatic ecosystems has increased by 75.3% with a forest area that has decreased by 2.8%. The abundance of vertebrates has decreased by 28.9%.

There are instruments to change these tendencies, but all of them go require not resorting to slow band-aid palliatives, but firmly transforming the principles of the capitalist system.

The environment is an indicator, the best spokesperson to warn of stepping outside of the model of socio-ecological equilibrium margins. Step by step, the future of a new social and united economy model of greater proximity to the public at large has to be based on principles of cooperativism and self-management that lead to less negative ecological and energetic impacts. A new model in which the future is measured with more realistic parameters by integrals than a mere accounting indicator such as GDP. What is clear is that the alternative to capitalism is not a greener capitalism, because the one we have has already demonstrated its failure.

In a nutshell, these last 40 or 50 years of neoliberalism (and the past 10 years in which the crisis is uniformly distributed) reveal the cracks in a model that refuses to disappear. However, ecological systems have cried "enough". They have been in crisis for more than a century. Kio we might call the Anthropocene, Environmental collapse, Fourth Industrial Revolution, Sixth extinction... it does not matter. The trend is clear. Or we make changes in economic patterns and paradigms or this will not last long because the model is, structurally, in crisis (which etymologically means separate, I choose). A crisis that is not only economic, but ecological and therefore global.

Alberto Fragua is Coordinator of the Observatory of Political Ecology of ATTAC Spain. Biologist, specialized in Ecology, Zoology and Master in Environmental Management of Development, with more than 30 years of experience in management and environmental planning and specifically in Environmental Evaluation of Projects and Public Policies.
As an Environmental Consultant, he currently works as an Executive Director at the Instituto de Estudio de la Tierra S.L. (Institute for the Study of the Earth), collaborating in turn with different Public and Private Institutions. 



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