Wednesday, May 23, 2012

On Germany and the Ecological Crisis

Der Spiegel's report on the stalled energy revolution in Germany gives rise to a question the authors almost ask outright.

I'll ask: is there a capitalist solution to the ecological crisis?

Can such an ambitious and necessary target as Germany's -- 80% to 100% renewable energy by 2050, by far the most ambitious energy conversion plan I know of  -- be reconciled with the profit motive? 

Germany's ambitious energy goals are running into predictable problems.  Some of them are technological and political: transmission lines and batteries, coordinating a new power grid with the phase-out of nuclear energy.  The article cites repeated examples of a basic economic problem: many of the required steps are not profitable.

The logic of a sustainable civilization using renewable energy goes against the economic logic of endless growth and accumulation.  Germany might well turn out to be a case study against the premise of "green capitalism," the idea that this kind of system can be reconciled with the need to radically (and quickly) reduce greenhouse emissions, reduce consumerism and consumption, and base civilizations on renewable energy sources.

It is unrealistic and even unfair, as we have stated before in this blog, to expect for-profit entities to invest heavily in purely altruistic enterprises.  (One would become uncompetitive and disintegrate as a business.)  There is an inescapable role for public investment, an investment without expectation of profit (although a profit could result).

Much of the investment needs to be public, and the resulting infrastructure must remain publicly accountable.  Delivering energy back into the logic of profit motive, of endless growth and expansion -- privatization -- would lead to the profit motive overruling ecological balance.

Public investment could come in part from a carbon tax on the consumer end, which would also incentivize reduced consumption.  But you don't want to overtax consumers without asking accumulated capital to contribute what is in its means.  And thus we arrive at Germany's problem, where a celebrated energy plan is already way behind schedule and energy policy is a confused tangle, as Chancellor Merkel -- a dedicated pro-business conservative -- is struggling to figure out incentives that will induce private investment in a 100% renewable energy grid.

I'm not sure that dog will hunt.  These energy goals can only be realized within an even greater transformation.  It's a bigger and more comprehensive revolution than Merkel bargained for.

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