No 2071 Posted by fw, October 9, 2017
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When I saw the word ‘arithmetic’ in the title of Jackson’s section 4, Chapter 5, I thought immediately of the quip by the Woody Allan character in his movie Manhattan – “My accountant says I did this at a very bad time. My stocks are down. I’m cash poor or something. I got no cash flow. I’m not liquid, something’s not flowing. They got a language all their own.”
I may as well admit it at the outset: the prospect of trying to make rational sense out of economist Tim Jackson’s quantitative analysis of the relationship between economic growth and its ecological harmful impacts terrifies me. I’m not on good speaking terms with his sometimes obscure (to me) economic jargon: I have to keep going back to re-read what I have just read to confirm my understanding of his words.
So, reader beware! Below, is my best guess interpretation of Section 4, titled, “The arithmetic of growth”. It’s too long to be called a “synopsis. And, lengthy though it is, I’m not al all convinced that I have captured the essence of the author’s meaning.
But first, to put Section 4 in context, I begin with a definition of the key term ‘decoupling’ followed by a summary recap of the first three sections of Chapter 5.
The title of Chapter 5 is The Myth of Decoupling. The dilemma of continued economic growth is that it’s ecologically unsustainable versus it’s essential for prosperity. The conventional response to it is decoupling. To ‘decouple’ means to ‘separate’, ‘disengage’, ‘dissociate’ economic activity from its harmful effects. The harmful effects include: extraction of earth’s finite, scarce resources and/or burning of fossil fuels, releasing carbon emissions into the atmosphere, warming the planet, triggering a climate crisis.
In Section 1, the Introduction, Jackson focuses attention on the crucial difference between relative and absolute decoupling. The former refers to an improvement in the efficiency of the economy, but it doesn’t necessarily mean using fewer materials or emitting fewer pollutants overall. The latter refers to an outcome where resource and/or emissions decline absolutely over and above any accompanying rise in economic output. Thus, only absolute decoupling provides an escape from the dilemma of economic growth.
In section 2, Relative decoupling in historical perspective, although Jackson finds some supportive historical evidence for relative decoupling, the gains have not been uniform across countries and regions. Moreover, during the last decade, the overall measure of the energy efficiency of a nation’s economy has dropped because the world’s economic growth has shifted to countries that are using more energy to produce each unit of the world’s economic output. Bottom line, Jackson declared that the world’s input amount of material and energy resources used in production is not declining as fast as the increase in global growth of the economy.
In Section 3, Absolute decoupling in historical perspective, Jackson found that globalization has contributed to carbon emission “accounting errors”. Newer accounting models use ‘footprint’ accounting, which captures all emissions from the consumption of goods and services within a given country or region, including emissions that have taken place elsewhere, that is, from production in the original source country or region. Previous accounting systems did not include emissions that were emitted in the production of goods and services imported from foreign countries. The difference between the two accounting measures calls into question the reliability of claims of reduced carbon emissions and lower materials resource consumption figures. Jackson concludes there has been no absolute decoupling of GDP from resource use during the period 1990-2008.
At the very end of Section 3, Chapter 5, Jackson asked: “With the right political will, could relative decoupling really proceed fast enough to achieve real reductions in emissions and throughput [resources and materials], and allow for continued economic growth?”
At the very beginning of this section, Jackson signals that “arithmetic is key’ to answering this question:
“Arithmetic is key here. A simple mathematical identity* governs the relationship between relative and absolute decoupling. This identity was put forward almost 40 years ago by Paul Ehrlich and John Holdren.” (*identity — an equation that is true no matter what values are chosen. Example: a/2 = a × 0.5 is true, no matter what value is chosen for “a”).
Ehrlich’s and Holdren’s equation relates the impact of human activity to the product of three factors: the size of the population; its level of affluence expressed as per capita income in $; and a technology intensity factor, which measures the impact associated with each dollar spent.
This equation provides a ‘rule of thumb’ enabling us to figure out when relative decoupling will lead to absolute decoupling, which occurs when the rate of growth of overall impact, e.g., carbon emissions, is approximately equal to the sum of the growth rates of population, per capita income and carbon intensity.
Therefore, if the carbon intensity declines faster than the sum of the growth rates of population and income, then relative decoupling will lead to absolute decoupling. If it declines more slowly, we’ll still have relative decoupling, but not absolute. Thus, at the global level, emissions will continue to rise.
To further illustrate:
In a similar arithmetic calculation, the feasibility of decoupling carbon dioxide emissions from growth in the future can also be calculated.
Though useful, Ehrlich’s and Holdren’s equation to figure out when relative decoupling will lead to absolute decoupling,” failed to “pick up some of the complexities associated with different stages of global development” encountered in a regionalized analysis.
For example, income grows faster in middle income countries than in other regions. And population grows faster in low income countries than elsewhere. However, the carbon intensity of output is typically higher and has historically fallen more slowly in both regions. These kinds of regional differences can have a big impact on the global picture.
Jackson walks us through seven quantitative scenarios, the first of which forecasts disastrous outcomes if we continue on our current path. Other scenarios consider outcomes based on different intervention strategies, all of which, in Jackson’s words end with “stark choices” the title of his next and final section of Chapter 5.“
Scenario 1 — Using UN population estimate of 9.7 billion people by 2050 —
Scenario 2 — To achieve a ten-fold reduction in carbon emissions would require —
What matters for climate change is the cumulative burden of carbon dioxide in the atmosphere. So everything depends on how quickly emissions can be brought down.
Scenario 3 — Assuming we started straight away and achieved a more or less linear reduction in emissions towards 3.6 gigatons of CO2 by 2050 –
Regarding technologies and strategies to take carbon emissions out of the atmosphere, (referred to as “negative emissions”), the rate at which cumulative emissions would have to be removed to stay within the carbon budget would have to be around 25 gigatons of CO2 a year. Of this daunting challenge, Jackson writes: “The potential to achieve this level of negative emissions on that timescale is highly speculative at the very least.”
Scenario 4 — One option would be to aim for a deeper carbon emission reduction target, say a 95% reduction instead of a 90% reduction by 2050, which would require –
This scenario would lower the requirement for negative emissions in the second half of this century, but by the late 2020s the need for negative emissions would peak at around 25 gigatons of CO2.
Scenario 5 — A pathway that would set 2035 as the year by which we would reach our reduction target, not 2050.
Consider the “divided nature of the world” described in Scenario 5. In the most developed parts of the world, economic growth is taken to mean a steady 2% growth in incomes, with China and India leaping ahead at 5 to 10% per year at present. Poorer part of the world such as Africa, South America, and parts of Asia will be playing catch up for years to come.
Which brings us to –
Scenario 6 — This scenario describes what it would take for us to be living in an equitable world by 2050
Scenario 7 — Beyond 2050, with incomes in the rich countries still growing at 2% per year
In his penultimate paragraph of Section 4, Jackson asks: “What kind of economy is that?” presumably referring to Scenario 7, the economy in 2100,
“One thing is clear. This is a completely different kind of economy than the one we have at the moment, which drives itself forward by using up more and more materials and emitting more and more carbon into the atmosphere.”
But, will the economy of 2100 be “completely different” in a good or bad way?