Finance Capitalism and Environmental Crisis

During the unusually hot summers of 2010, 2011, and 2012, capitalist society fell prey to two crises: an economic depression that states or markets could not end and a sequence of environmental tragedies brought on by global warming. Did the two crises coincide by mere chance? Or did they stem systematically from the same structural causes? The answer might seem obvious were it not for media that must confuse on causation as they inform on details. Both economic depression and environmental catastrophe result from the extreme risks that must be taken by prominent actors under finance capitalism—meaning that anyone who does not stake everything is eliminated from power. Crises that threaten humanity are structurally endemic to finance capitalism.

Financial and economic crisis lead to periodic recessions, depressions, and downturns punctuated by hopelessly optimistic upturns in the markets, bringing on the terrible social outcome of millions of people losing their jobs, homes, and dignity. But the worst is yet to come as the environment strikes back. The hazards endemic to finance capitalism extend to precarious environmental relations. The bearers of capitalist culture become risk-ridden, short-term in memory and anticipation, and careless about consequences. They live for the moment, without regard for the environmental future. Production, consumption, the economy in general, and the use of environments are subject to a remote, abstract calculus of power wherein the ability to promote short-term financial profit becomes primary and long-term impacts are not so much ignored as glossed over through sophisticated corporate advertising, think-tank excuses, and pseudogreen propaganda (“We, too, care about the environment”). By generating above-average profits, corporate leaders who make environmentally perilous decisions—to drill in deep water, for instance—win the investor confidence that enables them to borrow, invest, and expand and allows them to pay their upper management well. CEOs who demonstrate an environmental conscience do not win the market’s confidence. Environmental risk (mitigated by quality public relations to excuse the occasional mistakes) represents the frontier in profit-making and business success. Every time a disaster such as British Petroleum’s

2010 oil spill in the Gulf of Mexico is cleaned up, excused, and forgotten, the agents of the risk business just become more knowledgeable and slicker at its politicocul- tural operations. As BP was restoring investor confidence in the summer of 2010, the company announced that it was selling its onshore drilling operations to concentrate even more on deep-sea drilling. The danger that produces economic catastrophe also creates environmental crises.

The neoliberal globalization that has deindustrialized the First World and industrialized parts of the Third World—Brazil, South Korea, China, and India—has resulted in a spectacular globalization of environmental destruction. Globalization of this neoliberal, financial kind means that economic growth rates slow in the deindustrialized center but accelerate rapidly (rates of 8-10 % a year) in some peripheral industrializing countries. China’s economy grew 14-fold between 1980 and 2006 to the equivalent of a GDP of $4.4 trillion, and India’s economy grew sixfold, to $1.2 trillion, with carbon dioxide emissions increasing proportionately. China’s carbon dioxide emissions from burning fossil fuels amounted to 407 million metric tons in 1980 and nearly 2.25 billion in 2010; India’s went from 95 million metric tons in 1980 to 564 million in 2010 (Boden & Blasing, 2012).

Much of this production and pollution is connected to consumption in the First World. Some 40 % of China’s product is exported, as is 20 % of India’s, and both economies have become dramatically more export oriented. These statistics show the globalization of an economy still centered on consumption in the high-income countries. This fixation has led to an intensification of pollution’s globalization, as evidenced by carbon dioxide emissions. In 2010 global fossil-fuel carbon emissions amounted to 9.13 billion metric tons of carbon. In global terms, more than 500 billion metric tons of carbon have been released into the atmosphere from the burning of fossil fuels and cement production since 1750, and half of these emissions have happened since the mid-1970s, when it was already known that greenhouse gasses caused global warming—perverse environmental knowledge.

The point is that environmental pollution is driven by economic necessity under capitalism. It is necessary to pollute so that money can be made. Within the existing politicoeconomic context, only economic recession can bring about a drastic decrease in pollution. Indeed, global carbon dioxide emissions from burning fossil fuels temporarily declined by 5.9 % from 2008 through 2009. This reduction came about because of a 2.5 % fall in global GDP, a decrease of 11.5 % in the manufacturing production index, and a reduction of 40 % in raw steel production. Yet it is politically impossible for parties or governments to suggest, in effect, that the necessary price of ending environmental destruction is a declining economy. The solution is to elevate discussion from the national to the international scale. Upward displacement in the environmental discourse necessarily takes the form of UN conferences, Earth summits, and unenforceable protocols. Economic necessity produces endless political evasion of the environmental issue. Yet under Neoliberalism the significance of government regulation of development—and development’s relations with the envi- ronment—is diminishing because of the intensification of neoliberal and mass beliefs, including mass beliefs, about government, markets, and policies. Hence, the Tea Party movement in the United States is founded on the idea of reducing the size and interventional zeal of government at a time when state intervention through environmental regulation is all that exists in the way of collective response to the destruction of nature.

In brief, environmental knowledge has escalated as environmental destruction has intensified. It is a case of perverse knowledge.

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