Living in the 21st century means holding two truths at once: knowing the world is in crisis and feeling powerless to do anything about it. As a distant observer of climate change, the looming reality is becoming blindingly real to me. The catastrophic events seem impending and inevitable. However, part of me also feels a sliver of necessary hope in the presumption that things will work out. There is no other option but to find a solution to the problem that threatens us. I wonder if the economic system that has transformed humankind and our planet, and these climate woes, can instead lead us to the future. While this can be an overly optimistic take, I think that there is an economic principle somewhere in this sense of hope worth exploring.
My take goes something like this: Under the current system, market incentives and the costs of inaction will eventually force the U.S. (and the world) to decarbonize and to adapt. I believe with the rising costs of fossil fuels as well as the effects of climate change, at some point it will make more sense from a capitalist, profit-seeking perspective to solve the climate change crisis.
Supporting argument one is the fact that relying on fossil fuels is simply becoming too expensive. Not only is there a finite amount of fossil fuels, but the costs of using this fuel are rising to a level that might be too much to afford. Secondly, with geopolitical tensions as high as they are, a more volatile market means higher and more unstable prices. Then with more implementation of carbon taxes and other pollution-based policies, the era for fossil fuels might soon be over.
The other side of this high price problem is rebuilding after extreme climate events. Each year, billions of dollars are spent on the repairs and damages of more frequent natural disasters. You can look at the costs of repairs from the destructive hurricanes that are tearing up southern states of the United States, the fires of the west, and the flooding of coastal towns and European cities. And not to mention, the insurance crisis for these high-risk areas is starting to directly impact millions more. It is easier to think everything is fine when the bad stuff only happens on newspaper headlines, but these headlines are now realities for many of us. So, I believe, with this apocalyptic feeling comes a necessary awakening that will spur us into action.
This awakening should force us to look into new courses of actions. The cost of clean energy is going down, so more wind turbines, solar panels and other clean sources are made and installed every year. The market for renewable energy is growing with more investment every year. Investors like the ethical upside of clean investing as well as the potential payoffs. More and more people want to hop on the bandwagon of clean energy because there is real potential to make money. So maybe, the same system that caused us to industrialize and change the planet might be the same system that saves us.
The question is: are we too late? For a while, the line of 1.5° C has been the marker threshold for what we say is irreversible. Have we missed our shot at preventing the catastrophic outcome? Ice sheets melting at accelerating rates and arctic permafrost that stores vast amounts of methane and carbon releases when thawed, will intensify and add to the feedback loop. Ecosystems are collapsing, species are going extinct, crops are failing and all is mounting to what feels like something too big to tackle.
We should have acted earlier, but we might not be too late. Natural systems are resilient and will fight to stay alive. The ozone layer over Australia, which healed faster than expected in response to the Montreal accords, was a remarkable example of surprising success. If regeneration is possible there, then maybe there is hope in other places. Scientific breakthroughs in clean energy systems are accelerating and, maybe with the aid of AI, new solutions could emerge faster than ever.
In the end, I don’t think we will either save the planet or go extinct. I’m sure it is more dynamic than that. There will likely be immense and irreparable damage, causing the death and suffering of millions, along with the countless animals and ecosystems that keep our planet in balance. But we will endure. Change will not come immediately, and perhaps it will be too little, too late, but our market systems will eventually shift and lead us towards what is most economically desirable.
