Saving the Climate in a Triple Crisis | The New Republic

Source: Saving the Climate in a Triple Crisis | The New Republic

A moon shot model for the transformation of capitalism By Mariana Mazzucato

PHOTOGRAPHS BY JEFF FROST

Capitalism is facing three major crises. A pandemic-induced health crisis has rapidly ignited an economic crisis with yet unknown consequences for financial stability, and all of this is playing out against the backdrop of a climate crisis that cannot be addressed under the rubric of business as usual. It may be hard to cast your mind back, but in January 2020, the news media were full of frightening images of overwhelmed firefighters in Australia, and flood workers in Venice—not overwhelmed health care providers all over the world. Indeed, a 2020 outlook published in The Economist had not one word on Covid-19.

This triple crisis has revealed just how unprepared we continue to be—and how our model for sustainable capitalism must change. Our health systems have been underfinanced, gig workers suffer from instability, and the public and private sectors seem unable to do even the most basic of tasks: organize personal protective equipment to be available to all frontline workers.

Critically, the health crisis, the climate crisis, and the economic crisis must be viewed together. Otherwise, we will simply be solving problems in one place while creating others elsewhere. That is what happened with the 2008 financial crisis. Policymakers flooded the world with liquidity without directing it toward good investment opportunities. As a result, the money ended up back in a financial sector that was (and remains) unfit for the purpose of directing truly productive investment. Indeed, much of that liquidity is fueling the financialization of the economy, with the ratio of private debt to disposable income at unsustainable levels. Thus, this time around the liquidity and recovery funds (including bailouts) must not only find their way to the real economy, but also solve problems there.

Starting from the system we have already built, we need to rethink capitalism, combat negative public-private relationships, and direct finance toward the world’s overlapping crises—and particularly the longer-term challenge of climate change. The destruction of biodiversity (as witnessed in the Amazon), the cruel treatment of animals (in settings like the Wuhan market and the American meatpacking industry), and the melting of the permafrost all contribute to the arrival of new viruses humanity is not used to. To rescue the planet from the threat of global warming, we must also address the acute deficits of economic justice and democratic participation that helped create and perpetuate the West’s destructive and myopic addiction to fossil fuels in the first place.

It’s only by understanding the structures that have allowed us to think so mistakenly about our relation to the planet that we can fully face up to the mandates of green innovation and restorative stewardship that we must urgently adopt today. While there is no silver bullet, it is crucial to resist the false trade-off: Either we face the immediate emergency, or we address climate change. By focusing on the structural characteristics behind the triple crisis, we can tackle them together. For example, the help now provided to businesses can be conditional on those businesses changing their way of doing business as usual. Stipulations that relate recovery funds to the improvement of working conditions, lowering carbon emissions in production, and paying their fair share of tax are examples of what it could really mean to “build back better,” to borrow Joe Biden’s campaign slogan.