A Green Future

“How many planets will a country like India require?” Mahatma Gandhi once posed this question with regard to India’s use of resources. Elon Musk or Jeff Bezos see the solution in discovering new planets. Bill Gates believes in planet Earth. Our economy and our life need to achieve climate neutrality by 2050.

We summarized the ideas of Convoco’s thinkers under the central question:

How can we work towards a green future?

Using Market Mechanisms to achieve Climate Neutrality

The goal of  climate neutrality means that we need to de-carbonize, that is, de-fossilize our entire economy. We need to use renewable energy to provide electricity for the heating and transport sectors, as well as in industry. Where this is not possible, synthetic energy sources based on sustainably generated hydrogen will help us to achieve climate neutrality. – Veronika Grimm – 

The transition of global value chains towards climate-neutral products and applications confronts us with a huge coordination challenge. If we want to manage this transition within an ambitious timeframe, it is best to address this challenge through the coordinating functions of market mechanisms. – Veronika Grimm – 

CO2-Pricing and Clear Conditions for Investments instead of Subsidies

Having a big ecological footprint entails a bigger responsibility. Nevertheless, we have to keep things in perspective. First of all, it is necessary for Western democracies to remain strong. We shouldn’t “repent” to the extent that it decreases our economies’ competitiveness. It does not help the climate or make the world a safer place if the democratic systems of all actors are weakened. We need to protect the climate through technological offensives and smart policy changes, so that our competitiveness might even end up stronger. – Udo Di Fabio – 

I am worried about the tendency to increasingly subsidize non-pollution. Instead, we should increase the costs of pollution and apply the polluter-pays-principle—especially through CO2 pricing. Of course, we also need investment in order to adapt to climate change and we need to promote research into green technologies. However, the state should set the framework rather than investing itself or actively directing investments. – Clemens Fuest – 

We need a CO2-price signal, since in some sectors renewable energies are not cost-competitive by comparison with coal, for instance. A second important effect of such a CO2 price is that it will direct investment towards low-CO2 technologies. The third advantage is the resulting tax income through which private households and poorer countries can be compensated in order to achieve a socially just transformation. – Brigitte Knopf –

Such a transformation requires high investments. The European Commission estimates that we need 2.6 trillion Euros in private and public investment by 2030. This is a huge amount, which is why we need to successfully mobilize private capital on a large scale. – Veronika Grimm – 

Recognizing Market Limitations

For the last 20 or 30 years, we have been a bit naive in thinking that the market will solve any type of problem. It doesn’t. – Philipp Pattberg –

Market-based systems have proven incredibly successful at the accumulation of physical capital but they cannot be used to properly allocate attention because the most important things to pay attention to are things that don’t have a price. – Albert Wenger – 

What we need now is more regulation in terms of the environment and protecting parts of the community. It is not going to come from the market. – David Chipperfield – 

Taking Responsibility

Seeing individual sacrifice as a political strategy is very problematic as it passes the responsibility of what should be a political undertaking on to the individual. – Brigitte Knopf – 

There’s a real problem in thinking that we have to give something up. You don’t drive a car and that’s a loss, but you also live longer because there is no air pollution and that’s a win. We never discuss it that way. – Philipp Pattberg – 

The economy needs to change, our behaviour needs to change, the way we do many things needs to change, and that’s why these problems are so complex and so difficult to address. – Philipp Pattberg – 

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