Image: Emerging World Hands Dems A “$750 Billion Bill” For Climate Change Ahead Of Glasgow Summit
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Net zero – a stupid, irresponsible and expensive target. A target that will not be achieved, doesn’t deserve to be achieved and that nobody with an IQ over room temperature actually thinks is necessary (or possible without killing a lot of peole), it’s just an extreme argument in order to convinced people into accepting being robbed, which is the de facto what all the “green” taxes and fees are doing, it’s a robbery, nothing else! Has never been about saving the planet, if it was, nobody would hire criminal leftists for the job anyway and the stupid panick in the FAKE news media before the climate FRAUD summit in Glasgow, all their FAKE science and climate alarm is just a cover for the fact that the socialist, criminal governements of the west never actually asked the people for a mandate to send all those billions to “green” criminals via “green” certificates, CO2 fees, subzidies etc.
R. J. L.
By Tyler Durden – Zero Hedge
Last week, Bank of America sparked a firestorm of reaction amid both the pro and contra climate change camps, when it published one of its massive “Thematic Research” tomes, this time covering the “Transwarming” World, and which serves as a key primer to today’s Net Zero reality, if for no other reason than for being one of the first banks to quantify the cost of the biggest economic, ecologic and social overhaul in modern history.
The bottom line: no less than a stunning $150 trillion in new capital investment would be required to reach a “net zero” world over 30 years – equating to some $5 trillion in annual investments – and amounting to twice current global GDP.
Needless to say, the private sector has nowhere near the capital required to complete this investment which is why Bank of America generously estimate that all or parts of the bill would have to be footed by central banks in the form of tens of trillions in QE. And since QE is essentially debt monetization, and since $150 trillion in new debt would have devastating consequences on the economy, BofA was kind enough to share its calculation of just how inflationary this billionaire pet project would be: the “full monetization” scenario, where central banks inject $5 trillion in liquidity every year via QE for 30 years, would result in incremental 3% of inflation for a good decade. This is inflation over and above whatever is already coming down the pipeline.
Which is where we get to the punchline, because as BofA admits, the crusade against climate change, the ESG doctrine, the “Net Zero” world, whatever one wants to call it, it’s all about greenlighting the biggest QE episode in history, one wrapped in the “noble” veneer of fighting for the most important cause in the history of civilization, but in reality it’s just the biggest wealth transfer scheme in history:
We just see a peak of <1% additional inflation a year over a three decade horizon. Under more aggressive scenarios where central banks opt to absorb either half or the full decarbonization bills through quantitative easing, the risks of an inflation shock grow. Still, we think our third case is the most likely scenario, as it would be politically difficult to justify a much more expansive monetary impulse. True, while central bankers have expressed a desire to help green the economy, their corporate bond purchases have historically been restricted to crisis time policies through quantitative easing and remain well below purchases of sovereign debt. As such, any purchases of corporate green bonds would likely be limited both by the size of future purchase programs and their proportion relative to the overall corporate bond market, with slightly higher allocations under more progressive purchase policies that highlight environmental concerns
At this point alarm bells should be going off even among the most brain-dead progressives because for all its touted benefits, the costs are starting to emerge and – at least when it comes to the next two or three generations – they will be absolutely crushing for the middle class, while allowing the top 1% to plunder and pillage virtually all the world’s assets. Think of it as the biggest mandated theft in world history, and suddenly one can understand why every private-jet setting billionaire is oh so very vocally in support of a “net zero” world.
It gets worse.
Now that the genie is out of the bottle, and the hard questions like “who gets to pay for all this” are being asked, Bank of America had a follow up report in which it made it abundantly clear that “contrary to some arguments, we think climate mitigation efforts are likely to hurt growth in the next decade or so.”
In his note titled “A hot take on climate change” (once again available to professional subscribers in the usual place), Bank of America chief economist Ethan Harris first goes through all the familiar steps of just why it is so imperative – and noble – to do something to fight greenhouse gases (similar to what we have read for much of the early part of the 20th century, when article after article starting in 1912 lamented the catastrophe that is global warming, at least until the 1970s when the lack of actual global warming prompted “scientists” to suggest that global cooling and “a new ice age” is inevitable instead). At least the scientists could agree that it’s “global something” (turns out it would really mean “global money printing“), and as Harris laid it out, this is what “scientific consensus” appears to agree on now:
- Human behavior is having a significant impact on climate change and climate events.
- Even under optimistic assumptions—such as achieving net zero emissions by 2050—the impacts will likely grow over this century.
- Early action is much more effective than waiting until later.
- Uncertainty about the exact impact is not an excuse for inaction: a wide range of outcomes means more, not less urgency in acting.
None of the above is new as the mainstream media has been bombarding its audience for the past decade with emotional platitudes and qualitative appeals as to why something has to be done.
However, as we first touched upon last week, any discussion of the economics of climate change should start and end with the fact
that it is the ultimate example of “externalities”—private activities (usually for corporations who scions and shareholders are by now in the top 0.01% of global wealth) that create public costs. Indeed, as Harris writes, climate change is the ultimate externality because activity in one place impacts the whole world. The fact that climate change is global in nature and that so much of the benefit of actions accrues to everyone else has some powerful implications.
First, unlike other technology “races”, climate mitigation is more of a cooperative “game” than a competition. When countries like the US and China “compete” to develop new technologies, two points of conflict often tend to arise—a fight for market share and a fight for geopolitical superiority. By contrast, countries that develop efficient climate mitigation technologies have a strong incentive to share the benefits. If they hoard the technology, the impact on their own climate will be much smaller.
This is great… if only it weren’t a pipe dream. Why? Because as the recent refusal by China’s Xi Jinping – incidentally the world’s largest polluter – to join his fellow “climate change crusading” world leaders at the COP26 Net Zero summit in Italy later this month, it’s all one giant spectacle meant for the masses. Because if the world’s largest polluter is making it clear he has no interest in actually reducing his own CO emissions, then anyone preaching some bullshit about a “cooperative game” can shove it.
Still, where Harris is somewhat correct, is in pointing out the “depressing consensus out of the climate change literature” that even if everyone cooperates, the earth will continue to warm as there are lags in the link between GHG and global warming. Indeed, under the best of outcomes—with every country hitting aggressive mid-century goals—the policy shift will mitigate, not stop the problem. Hence in BofA’s view, “climate events will be a rising downside risk—of varying intensity—under almost any plausible scenario.”
In other words, the net zero theater of the absurd is one where the actors’ motives clearly diverge – when only a convergence from the start could make it work – yet where even a best case scenario of complete cooperation has no chance of actually stopping the problem, just mitigating it. Oh, and meanwhile, the world is set to incur some $150 trillion in costs.
