Covid19 has destroyed businesses all across the world. Banks have not let up and required governments to borrow and spend to keep people paying them, as if banks should somehow be invulnerable to the crisis. Even Shell is now saying it may not be able to come back as it had. What is bad for the economy is good for climate action however, and we have explained why this is the case in this blog many times : Money is carbon credit.
Our money still derives much of its value from its ability to buy fossil fuels. Especially in a globalized economy where logistics is a large part of serving consumers, fossil fuels have played a major part. This is the reason why the economy went global. To sell more fossil fuel, to increase cashflow for banks.
Now that we are going to allocate carboncredit, Euro’s Dollars to businesses, to groups of people working to make certain products or deliver services, we should look at the fossil efficiency of those operations. In some cases, like banks, you can hand them a billion Dollar or Euro and nothing really happens. It neutralizes a debt and poof! its gone! No climate damage there. In other cases the money funds logistics, to get stuff that can be made locally from China, for instance electronics. The resource fuel, which may be cheap now, but harms our climate future, is wasted for the largest part. If you had to choose between two companies, one local one in China when supplying financial aid it makes much more sense to support the local company, because it delivers more real world value per barrel of oil burned.
With current prices of renewables, and renewable factories, it would make a lot of sense to allocate part of the funds to building either solar panels or solar panel and wind turbine plants close to where production takes place. That way you multiply your fossil input (for solar panels by a factor of 6) and you drive down the price of those devices further. You may even go so far as to mandate ‘recovery’ panels, solar panels without glass or aluminum, both once a requirement to make them more expensive. 100% plastic panels are much lighter, les vulnerable and less energy intensive to make!
In general there is a dualistic attitude to businesses, on the one side they keep people happy and fed, and the logic is that they should therefore be supported. On the other hand there are essential businesses, big bakeries, farm related infrastructure, medical infrastructure, sometimes private (worst case) sometimes public, and their suppliers. We feel that each of them should report on their climate efficiency, say their CO2 emissions per true value delivered. True value should then be measured against the best in class benchmark for an average lifestyle.
It would make sense if we all did something for one another, this seems to be the original idea behind an economy, to have equitable exchanges between hard working participants. Fossil fuels and automation kind of screwed this up, and we got a lot of fossil fuel peddlers (airlines, shipping companies, bottled water companies etc.) and jobs that did not really produce much (BS jobs) as a result. To get back to the original idea we should make sure fossil fuels don’t play much of a role in the creation of products, or make sure they don’t by primarily funding companies that have a plan to remove fossil fuels from the equation.