Episode one - Show notes & transcript
This podcast is about wicked problems, problems so complex that to solve them means we’ll have to change the very way we look at the world. Over the next six episodes we’ll be trying to unpick some of these wicked problems, by looking at the social, cultural and political transformations that are needed to achieve a carbon neutral economy by the year 2050.
This task is huge, and needs a massive effort by every sector of society, above all it means breaking our dependency on fossil fuels. But to do this effectively there needs to be viable alternatives and this alternative economy will need to be scaled-up and fast. That’s why we’re taking a close look at carbon tax.
The idea is that putting a price put on carbon dioxide emissions will gradually steer society away from its dependency on fossil fuels. Carbon tax acts as a disincentive. Emitting carbon dioxide becomes more expensive making the greener alternatives more attractive. The money raised from carbon tax can then be invested in the new economy. The kind of economy that we will need by the year 2050.
And that’s why climate change is a wicked problem. Yes, It’s about overcoming technological barriers, but it’s also about politics. There are complex ideological and social barriers that need to be overcome. And then there’s the time factor. Add it all together and you have a super wicked problem. So can carbon tax save the world? This is episode 1: You break it, you bought it.
“What we really need is an energy revolution.”
I’m at Greenpeace headquarters here in Amsterdam to talk to campaigner Eefje de Kroon.
“It’s not just minor changes and adjustments here and there, and in an energy revolution entails a few things: firstly we need to end the age of fossil fuels, so that means stopping to use coal, oil and gas, but we also need to mainstream and upscale readily available solutions, which we have already, such as sun and wind energy but also upscaling new technologies such as green hydrogen.”
The speed at which these technologies need to be scaled-up was brought into focus with the publication of Special Report Global Warming one point five degrees C. It was published last year by the Intergovernmental Panel on Climate Change.
“So the significance of the IPCC report was firstly that is showed an extreme urgency but also that it showed a scientific consensus. So thousands of scientists were involved and they all agree that climate change is real, its caused by humans and also that there is a massive difference between a rise of one and a half degrees celsius global temperature and 2 degrees, and that half a percentage sounds small but it’s actually disastrous.”
“With a two degree rise tens of millions more people face life threatening heat waves, water shortages and coastal flooding and particularly in countries which are least responsible for the situation and also have the least resources to protect themselves from these climate disasters.”
“That half a degree can mean the difference between a world with coral reefs and without coral reefs, a world with arctic summer sea ice and without it. So it’s big, it’s a very important report and it also makes clear that we have a very short period of time to act, which is basically ten years.”
The IPCC report lays out in clear terms that we need to half all carbon dioxide emissions by twenty thirty in order to have a fighting chance of limiting global warming to one point five degrees C.”
“What we also find very important in this energy revolution is that it needs to be just and fair and that means that who emits carbon should also be paying for their pollution and that means don’t let households pay. It also means that western countries which have the biggest historical responsibility also have the broadest shoulders so most money and need to take even bolder steps in the energy transition.”
“And for that carbon pricing is an effective way to propel that energy revolution. We’ve done extensive research and found that economists and scientists agree that carbon pricing simply works, its effective. It’s a very basic economic rule: put a price on damaging acts and you will change behaviour.”
Carbon pricing has been in use since 1990 when Finland became the first country in the world to implement a carbon tax. At the moment there Forty governments around the world currently use some kind of carbon pricing to regulate emissions.
“The technologies and the policy instruments that we need are available. They are there. But we do see politicians and industries in this case delaying or resisting the implementation of solutions and as such they are taking a mortgage on our children's future. So, I mewan the IPCC report showed us that there is no time to waste and the only thing we really need right now is a coalition of the willing, preferably internationally, preferably the whole world should become a coalition of the willing, because we need governments and industries to stop looking at each other for a collective action which is not happening, they've been calling for it forever, but it's not happening and we really need to tackle climate change right now so, the Netherlands can take that bold and effective step and now introduce a carbon tax on its own and have the whole world follow.”
A few months ago the dutch government published a draft Climate and Energy Agreement. The goal is to reduce dutch carbon emissions by 49% by the year 2030. But the draft agreement failed to include sufficient measures to reach these goals. Since then the dutch government has said it is open to including some form of carbon tax on heavy industry but no concrete plans have yet been published. Politicians tread very carefully when it comes to tax.
“We thought that carbon tax is a very technical term, and everyone has an idea about what that means, what taxes feel like for a person, but what we found was that a carbon tax was actually a measure that a lot of people felt was just, because it actually puts the bill where it belongs, with the polluter.
I think in that general framework the idea of a carbon tax just works. It makes sense to people and they feel that it is unfair that they should be paying the bill while they are not responsible for the damages.
So in that regard, I don’t think that it is as polarizing as it might be in other contexts, its fair…”
You can find a link to the IPCC report and other relevant documents for this episode in the show notes at cancarbontaxsavetheworld.com.
To better understand the lack of political will in implementing carbon tax I come to see Sven Jense of Climate Cleanup.
“It’s in a different realm than most other concepts we see and one of the key aspects has to do with our psychology, mainly because of course the concept of climate change is something we constructed upon a notion that temperatures are rising because of certain things we have done with the biosphere, and the psychological working of this idea is actually very interesting because it leads to blocking and apathy and non-engagement while it also connects on a very deep level, I think to various aspects of out identity, so I’m not at all surprised, and it’s also very interesting to hear that carbon tax actually if you look in the social media realm, doesn't connect to either carbon, climate or taxes which comes to the conclusion that opinions on climate change are driven by identity aspects and not by knowledge.”
The Pew Research Group have done extensive work on this topic and the results are quite revealing.
“In the US the group that is more into climate denial, so the Republican Party group you might say, on average, they know more about climate change than Democrat[ic] voters, which is so interesting. So the more you know about it the less you want to do about it. How is that for an existential problem? It’s a super interesting puzzle.”
Talking to Sven I start getting an idea of the complexity of the problem. I ask him what role he thinks carbon tax can play in solving this puzzle.
“So there are two aspects to this, the first is very simple, if you’ve got something you don’t want you put a higher price on it, or a disincentive to use it and you would see the emissions reduced because it’s more expensive to emit greenhouse gases.”
“Gradually my ideas shifted to the notion that its actually underlying the transition away from fossil fuels, which is not happening by the way, so the non-existent transition or the idea of wanting to transition away [from fossil fuels] is a power struggle.”
“It's a big power struggle, between the poor and the rich in the world, the biggest industries and everyone who benefits from that, including many people who are just pension holders who don’t even realize they are stakeholders in this power struggle. So the forces around carbon tax are just another power struggle, so can taxing carbon reduce emissions? Well it seems if we look at the very simple examples there’s been a carbon tax imposed in the UK, on energy production and within years the emissions went down to below end of the 19th century levels. So when imposed well, when there are strategically or tactically savvy politicians and policy makers around who can really leverage the kind of support they have in the best ways then it can be super efficient.”
But politicians can also be very adept at capilizing on the uncertainty of new ideas to draw support away from a more forward-thinking agenda.
“It’s not about whether the rich or the poor should pay its about what kind of activities will carry the highest taxes. Well, of course, the activities with most carbon emissions. So it’s not about travelling being expensive, it’s about certain modes of travelling being expensive and others that will be cheap. It’s not about food or even meat being expensive, it’s about certain types of meat with high impact that will be more expensive than other types of meat and other types of foods, like plant based foods. It’s not about certain computers or IT equipment that as a category will be expensive, it’s about certain parts that have a high carbon impact that will be more expensive.”
“So there will be an incentive on all those examples to just go for the lower carbon alternatives, so it’s not about who should pay but what kind of economic activity will be expensive.”
“I think carbon taxing might help all those changes to better the business models, so it’s a good idea because it imposes a kind of new mechanism for the ordering of things that automatically puts the most efficient measures first. This is where this ideology of neoliberalism vis-a-vis the kind of left who say this neoliberal idea is bad because the free market economy is way too much, well markets do work actually, and the markets are never just something that appears out of thin air, markets have always been structured from the beginning, there are rules in the market, there is a market master.”
Through his organisation Climate Cleanup Sven has built-up a network of entrepreneurs. By working together on a common goal they are finding new ways to bring climate solutions to market.
“We’ve been talking about individual responsibilities, and especially the climate problem. It’s not an individual problem, it’s a collective problem, its a global collective problem, so of course an individual will feel really powerless if you ask someone to wear a warm sweater to solve the climate problem, I’m not against wearing warm sweaters, I love warm sweaters, it’s just a collective problem, and please don’t make the individual powerless by imposing individual measures, make it collective and this is about collective redistribution of wealth, or a combination of wealth and bearing the burden. So the interesting thing is if you I think the really successful climate policies in this time-frame are policies that really have many many positive benefits, side effects, so you might say multipotent measures, solutions, and these kind of carbon pricing schemes that involve the redistribution of wealth to over society have positive benefits.”
Both Greenpeace and Climate Cleanup are in favor of a ‘polluter pays’ type of carbon tax. Today I’m in Utrecht to ask carbon specialist Jos Cozjinsen of Climate Neutral Group what that means for businesses.
“So years ago it was a licence to operate, then it was climate neutral, but that’s not enough anymore, companies should have no negative impact, but should have a positive impact. If you earn some money you have to give something back, something extra, so that’s a new connotation I think. Positive impact, with planting trees, schools, cookstoves, so no impact from your company and give something back. And also the key is shared values, companies want to survive, they want to exist in 10 years, so they need to have a survival strategy, otherwise you are out of business. I’m not looking for morality, there’s not a good company or a bad company, good people, bad people, they want to survive and that’s fine, but now we are also asking them, consumers will no longer buy your stuff if you don’t add something positive.”
Jos advises companies on how to reduce their carbon footprint. He also helps them to adapt for a future where pollution will have a rising cost.
“Some say the CO2 price should be really high for compliance, I often debate with students in the future planet studies, should the price be high or low, what does it mean, does it mean you have ambition? The price is 100 euro, a very ambitious system or does it mean you don’t do your job really well? Because if you invest in innovation and reductions they become cheaper and the end result is a low price of course, if you end up in a society with a very high price it shows you don’t do a good job.”
Carbon tax isn’t one single policy. Its a group of policies that defines who gets taxed, how much they will pay and where these revenues get used.
“I don’t think companies need so much subsidies, I don’t really believe it, because you know you have to get to zero so its better to invest now then later lose your job. So I would prefer that the money goes to citizens,the cost in the other sectors are higher, so we have a tax and it gets recycled if you do good projects, I don’t think we need so much, there is already this price, it’s a signal if you don’t like the price it means your target isn’t high enough. So increase your target then. So don’t focus on the price, focus on the target.
Public support for carbon tax depends greatly on policy design. The benefits need to be clear and the tax has to be seen as fair.
“Symbols are very important at the moment, In the netherlands the tax if for the general chequer, generally the dutch don’t want to earmark taxes. But citizens won’t accept that anymore. Because they want to see symbols, where does the money come from? Where will it end up?”
“So for example the cap and trade system, where auctioning is part of is also not earmarked, that should be earmarked, its now 1 billion euro per year, so that’s worthwhile, to give it in a heat fund for citizens for example. On the other hand you could say the netherlands is still investing a lot of money on climate policies from other sources like cigarettes or road traffic or whatever, but it’s better to earmark more and more, its a social issue, people want to see what’s happening, and the companies already have a lot of subsidies the fossil fuel industry has subsidies and they can change it into more innovation and the cap and trade system has a price that should be enough, otherwise you have to pick technologies, which is a good technology, nobody knows that. You could actually link the cap and trade system with reforestation, it’s cheaper, it has to be done, we have delayed it for a long while, and I know the European union doesn't like that, because suppose there are a lot of credits flooding the market, then the price drops, I say ‘So what?’, imagine that we save the climate by planting a lot of forest and the price is 5 euros and we meet the paris agreement target, but we want investment in europe, green jobs, green growth, that's fine but its not very solidarity with the developing countries who are just waiting for investment there.
“If you only put companies here, NGO’s here and the government in the netherlands or europe, it’s not enough. So we need a global perspective, because cash flow needs to go there as well, especially because if we have in europe zero emissions, it’s not enough, we don’t meet the target globally, so we need to invest there. A broader view.”
Wicked problems can seem impossible to solve. That’s partly what makes them wicked. I ask Jos how he feels about the challenges that lie ahead.
“Optimistic, its possible, as long as we don’t hate each other, don’t politicize too much come on we call it the ‘gouden middenweg’. The last election you could say that many people voted green left because they didn’t like the government, they say they want higher taxes, companies should pay, its dirty CO2, and the middle liberals also gained a lot of votes still because they wanted payable climate policies, but on the right people said we don’t want it its too expensive there’s no climate problem so ok we end up in the middle. And then it works, the EU is also somewhere in the middle, its not completely left, not completely right, but then you have a good atmosphere to multiplication. Middle road and good stories, research, also the study that you are doing, what is the atmosphere at the moment? It would be great if the outcome is: We are going in a positive direction, there’s so much acceptance of the issue already, less negativity, and if you tell that, people say wow we are getting somewhere. Hopefully that's true. If there’s too much skepticism still and we also have the idea we are too late yeah, then we are in deep shit.”
“So hopefully the results shows we gaining traction and that’s what you see in holland so maybe in more and more countries, the Paris agreement is global , the message came across to many people, normal citizens, small villages who want to be climate neutral, so there’s a lot of activity, not on the political level so much, because politicians want to have votes, but citizens want to have a cleaner house or a cheaper household, so in practice federal governments are stuck with the old myths, the old debates, old groups, but lower levels of society are more active. You see it in the united states, a lot of states are very active but at a federal level they can’t make any rule. The EU decided on a target but is already doing more, and that might be a new tendency that although it looks as though we didn’t agree on a tough goal, we do more, we are over complying.”
Jos helps companies plan and adapt for an uncertain future. And companies are going to need a lot of help to thrive in the new economy. I ask him what his clients are most worried about.
“That they lose competition. That’s the biggest thing, they can survive, they will survive , but they are looking, benchmarking, what are the other people doing, are they more ahead? I should be ahead. So it’s all about the messenger or the leaders the innovators, you like to follow them, so the fear is that you are suddenly behind. That young people are not going to work anymore for your company, that what you see in KLM, Shell, coal, young people don’t want to work there anymore, maybe it’s not fair, maybe they do there best but for young people ‘I have to explain stuff’ so they would rather work at a startup or a cleaner company at least I can do my work and build it up otherwise I need all my time to defend myself. So I think companies are getting wary about that, and it’s the shared value. You will need to survive, so what young people am I able to attract in 10 years? Be aware, maybe nobody is joining you.”
How can businesses prepare for a smoother transition to a carbon neutral economy?
“What is your emissions, the supply you buy, transportation, get the picture, what’s your carbon footprint, and also make a cost abatement curve, how much would it cost to reduce in my office in my transportation, in my supply, get a picture, get an idea, then you can compare with other companies, maybe they say ‘hey it’s much more expensive for you,so you can help another company to do work. Look for research in the areas, so prepare the work, start looking, then you will see results possible. Many companies say ‘It’s too expensive in my company, in m y industry’, that’s scope on e and scope 2, it’s too expensive to do more than the benchmark, that’s ok, to wait for new technologies, so look further in your scope. Maybe the people that work in your company, where do they come from, how do they travel? Can you support some cleaner transportation? The products you buy, you supply internationally, so there’s always some influence you have, its all about circle of influence, what can you influence, even a little bit further there’s always something you can influence.”
During this transition to a new economy we are all going to come up against our own wicked problems but we have a common goal, and as Jos says, symbols are increasingly important right now. The IPCC report is an important symbol, a government declaring a climate crisis is an important symbol. We need to create pathways for every sector to reach zero emissions by 2050. By making these pathways visible and sharing the problems that we face we can build better alternatives. Carbon tax is a complex and divisive issue but it is only the means to an end. The important thing is getting behind the common goal.
Can Carbon Tax save the world is a joint-production by Contenta and The Visual Methodologies Collective at the Amsterdam University of Applied Sciences.
It was written and presented by Andy Dockett Sound engineering is by Gonzalo Martinez, Data Visualizations by Carlo de Gaetano Music in this episode is by Joshua Alan Barlow and Andy Cooper (BMI) You can find the source materials used in this episode at cancarbontaxsavetheworld.com
Special thanks to our guests Eeje de kroon of greenpeace the netherlands, Sven jense of climate cleanup and Jos Cozijnsen at Climate Neutral group
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On next week’s show: local and national governments go head to head over carbon tax. “Well what’s going on a national level is absolutely infuriating, It’s a crime against humanity, and there’s no other way to put it. Here in Marin, here in California we are going to do it differently…”