The Value of a Whale On the Illusions of Green Capitalism

In an attempt to address climate change and other environmental problems, governments are increasingly turning. The underlying message is clear: capitalism might have created the problem, but capitalism can solve it. Adrienne Buller, a Senior Fellow with progressive think tank Common Wealth, is, to put it mildly, sceptical of this. From carbon credits to biodiversity offsets, she unmasks these policies for the greenwashing that they are. The Value of a Whale is a necessary corrective that is as eye-opening as it is shocking.

As Buller defines it here, green capitalism sees governments and corporations pursue ideas and policies that use the logic and force of economic markets to address environmental problems. It has two defining characteristics that she returns to throughout the book (and I am paraphrasing here): whatever you do, do not disrupt the existing economy, and while we are at it, let us turn crises into new opportunities to get filthy rich. The book roughly breaks down into two halves: the odd chapters provide background information on how the global economy works while the even chapters critically evaluate several green capitalist solutions. Before I discuss some notable examples, it is useful to mention what is not in the book. This is not an account of the people undermining the scientific consensus. As she points out, those merchants of doubt have been covered at length elsewhere. Nor is this a manifesto of solutions, though in the process of exposing our failures, she outlines some of the necessary changes.

Let me first highlight the background chapters as they give a useful indication of the kinds of people and ideas that are coming to the table when it comes to formulating "solutions". There were various things here that I found eye-opening and even shocking, though I will gladly concede my ignorance of economics and the inner workings of the global financial system. Readers more familiar with these topics might not be as surprised as I was.

For example, you would think that the idea of limiting global warming to 2°C above pre-industrial levels is based on the best available science. Instead, Buller traces it back to a 1975 thought experiment by the influential economist William Nordhaus. Despite some very questionable assumptions, the idea has become a central pillar of climate change policy. Nordhaus is representative of a large group of well-meaning economists who look at climate change strictly through the lens of economics. Their flawed models "that collapse the complexity of our globalised economy, climate and biosphere into improbably simple predictions" (p. 43) are legitimising inaction by politicians. We should call them out for what they are: false prophets. Similarly, why do we seem powerless to hold companies accountable? Because we are. Buller explains how neoliberal reforms from the 1970s onwards were explicitly framed in terms of reigning in democracy and insulating the financial world from popular demands. After all, such interference only stifles economic progress. She discusses other facets of the global financial system, but this should give you a taste of the background against which climate change policy is being formulated.

Let me discuss one example that Buller examines in detail: putting a price on carbon emissions, whether through a tax or a carbon market where companies can buy credits to continue emissions. Superficially it sounds fair (the polluter pays) and prominent economists adamantly assert that it is the only way to combat climate change. But does it work? Shockingly, despite over a decade of policies, very few studies have assessed the results and those that did found almost no emission reductions. Why can it not work? For one, our society is completely built around fossil fuels and cannot be changed overnight, thus carbon pricing should come not at the start, but at the end of this process when we have alternative infrastructure to switch to. Another reason is that pricing mechanisms do not care whether results stem from fundamental changes or easy efficiency gains (e.g. burning gas instead of coal). Furthermore, attempts to offset continued emissions by, say, tree planting initiatives come with their own suite of problems. At its most obscene, continued emissions are accompanied by promises of unproven technofixes that will mop up all this excess carbon in the near future. Why is this still being promoted? It is wonderful PR for companies, while for politicians it is a solution that avoids difficult confrontations with the industry. Also, when market approaches do fail, "the sheer volume of actors involved distributes accountability by design" (p. 75), so nobody needs to take any blame.

Despite The Value of a Whale being an exposé that skewers green capitalism, it is refreshing to see that Buller remains reasonable. She will happily concede where mainstream economists have a point and she admits that, in principle, there is nothing wrong with using economic insights to inform our response to climate change. However, upon closer inspection almost all ideas are "thwarted by the messiness of reality [and] the physical constraints of nature" (p. 58). Buller's overarching conclusion is not just that green capitalist solutions do not work, but that they cannot work. Why? Because they perpetuate the fallacies of mainstream economics; that we behave as rational economic actors (we do not) who come to the market with equal power (we do not, companies constantly overrule whole segments of the population). Because capitalism proceeds by externalising costs; internalising the cost of climate change while making a profit from it necessarily generates new externalities. Because financial markets optimize for efficient rather than effective solutions; as long as it makes money it does not matter to financiers that it does not work. Because economic models usually consider climate and ecological changes as gradual and predictable processes; climate scientists instead warn of unpredictable interactions, positive feedback loops, and tipping points.

Should we nevertheless accept green capitalist solutions? Is something better than nothing? For Buller, acceptable solutions should have an actual material impact, i.e. slow or reverse emissions or biodiversity loss. But they should also redistribute wealth and power more fairly. In her view, unequal affluence stimulates more consumption across the board. The green capitalist solutions discussed here fail on both accounts. We are wasting time on solutions that are a distraction at best and a fatal deception at worst.

Though I found it technical in a few places, The Value of a Whale is an eye-opening critique that I expect to be recommending frequently in the future.