Reframing the Climate Crisis As A Money Crisis
The Logic of the Markets Is Not the Logic of Prudent Stewardship
In a recent article in The New Yorker, famed climate activist Bill McKibben challenges us to “reframe the fight”. 1
Let’s accept that challenge, but take things in a different direction than Bill is.
First, let’s reframe the “fight” as a crisis in social decision making.
Then, let’s reframe the crisis as a Money Crisis.
This is a crisis that we are creating because Society is using the wrong Money to make our energy choices for us.
Climate Science is teaching us that there is a direct connection between the energy that Nature is using to hold hydrocarbons together and the security and sustainability of human-prosperity-friendly habitats on earth. That connection, however, runs through a rather lengthy chain of cause-and-consequence sequences.
And here’s the crisis. By choosing to extract the energy that Nature is using to hold hydrocarbons together in order to power our prosperity, we are breaking that chain of cause-and-consequence sequences, triggering a sequence of reactions (chain reactions) that will result in changes to earth’s habitats that will be decidedly less friendly to our ongoing prosperity.
The root of that crisis is this. We are using Market Money to make our energy choices and Market Money is too short-term to see that chain of reactions stretching out into an intergenerational future. Market Money lives in a perpetual present of market clearing prices, as those prices move up or down in the moment, from moment to moment, with each moment presenting new possibilities for different movements.
Very exciting!
Not particularly prudent.
Market Money is choosing to finance the extraction of energy from hydrocarbons, because the price/performance profile in the moment is pretty compelling, and Market Money cannot see the adverse consequences for climate (and geopolitical) security and habitat (and Rule of Law) sustainability in an intergenerational future that Science can see will flow from that choice.
The solution to this crisis is not to get Science into a fight with Market Money, battling to make the Markets see consequences that that they are ontologically incapable of seeing, in order to make Market Money make a different energy choice.
There is a certain moral satisfaction in engaging in such a fight, but social science tells us it is a fight we are doomed to lose.
The better choice is to choose a different kind of Money through which to make our energy choices, a kind of Money that can see the chain reactions that Climate Science is showing us, in order to choose energy technologies that will not break the chain of cause and consequence that links energy in hydrocarbons to the security and sustainability of people-friendly habitats on earth.
The Money we need to be choosing through which to make our energy choices is Fiduciary Money, because Fiduciary Money is created by design to provide security into an intergenerational future, and so can make energy choices that also provide security into an intergenerational future.
Fiduciary Money can see the Science, and act on it.
And this brings us to the real crisis.
We currently have Fiduciary Money speculating in the Markets, where its vision is being truncated to the short term. Just like Market Money. From inside the Markets, Fiduciary Money cannot see the Science any more than Market Money can. They are both blind to impacts of present choices on an intergenerational future.
It’s not so much that we are using the wrong Money, as that we are using the right Money the wrong way.
There is a laundry list of adverse consequences to human prosperity security into an intergenerational future that flow from this misplacement of Fiduciary Money into the Markets.
One of them is energy, and climate and habitat.
As long as Fiduciary Money remains in the Markets it will make the same energy choices that Market Money is making.
To change our energy choices, we have to pull Fiduciary Money out of the Markets, and direct it into the economy, directly, in prudent loyalty to its design purpose, which is to finance security into an intergenerational future.
If there is a fight in the climate crisis, that’s it: a fight to pull Fiduciary Money out of the Markets.
Once we win that fight, everything else becomes collaboration.
https://www.newyorker.com/news/essay/in-a-world-on-fire-stop-burning-things