Global Climate Deal and the Missing Link

The climate deal fleshed out in Lima, Peru, is that all countries can set their own climate goals [1,2,3]. But will this be effective in preventing dangerous greenhouse gas emissions? Very unlikely, writes Delton Chen (Geo-Hydrologist, Civil Engineer):


During the past 250 years of industrial and technological revolution, the primary catalyst for innovation and the fundamental driver of economic growth has been the availability of fossil fuels (i.e. coal, oil and gas). To avoid extremely dangerous climate change, the global economic system must be re-organised at a fundamental level, and the new order must include a social transformation that grows exponentially; otherwise the required mitigation of greenhouse gas (GHG) emissions will be too slow to avoid a climate catastrophe.

The United Nations Framework Convention on Climate Change (UNFCCC) was put into effect in 1994, and civilisation officially acknowledged that it was ‘addicted’ to fossil fuels. The ultimate aim of the UNFCCC is to prevent “…dangerous human interference with the climate system”[4]. The recent UNFCCC’s meeting in Lima, Peru, provides the latest update on civilisation’s de-carbonisation program, but the results of the Lima meeting signify global action will be further delayed given that nations are only obliged to make voluntary commitments. 

There are several dimensions to the climate problem. Foremost is understanding that there are two fundamental drivers for economic growth, and these are (1) energy availability and (2) human self-interest [5]. Economists refer to self-interest as ‘maximising utility’, and put simply it means that people generally act in ways that will immediately improve their quality of life. The current hope is that carbon taxes and carbon caps will provide a pathway to strong mitigation, but at the same time it is evident that this pathway is too slow to achieve rapid and transformative results because it does not appeal to ‘self interest’. Governments under the UNFCCC framework are also reluctant to acknowledge the scale of the problem: namely that avoiding 2ºC of global warming by 2100 (the Copenhagen Accord) is unattainable under current commitments, and that the Accord itself is insufficient to avoid dangerous climate change. Our understanding of climate change, including its consequences and its symptoms, are shifting, and the long-term ‘Earth system sensitivity‘ to greenhouse gases suggests that a planetary extinction event is likely within the next 250 years.

A major challenge is that people prefer to satisfy their short-term self interest, rather than practice self-restraint or self-discipline for mitigating climate change for the long-term. Humanity is therefore ‘at war with itself’, and the battle lines are drawn between the short-term and the long-term. The question is what policies can refocus our short-term self interest to include climate mitigation? How can we take full advantage of society and its dormant potential? An effective approach has yet to materialise, possibly because ‘standard economics’ has yet to integrate ideas from different disciplines. 

We know that carbon taxes and emissions caps are elusive and slow to implement at the global scale. The policies we need must include positive feedbacks that are powerful economically, socially and politically. Most importantly, the new policies must create emergent processes that can trigger exponential change in society. Exponential change is needed because time is limited for avoiding a climate catastrophe.

Could the answer be found in “The Missing Link” [6] of economics? Could the policy we need be laying dormant in the design of money? Money operates at the psychological level, and it also structures the entire global economy and has the power to influence the direction of civilisation. Climate change is telling us that it is time to reconsider our historical and social relationship to money, and to innovate a new type of money that is ‘fit for purpose’. 

As Jarod Diamond [7] tells us with solemn brevity: societies fail when the cultural, political, and economic systems prevent effective environmental solutions. In other words, strongly held systems and values that worked well in the past will not necessarily work in the future. A monetary policy framework that can strongly mitigate GHG emissions is likely our best chance of avoiding climate catastrophe. How exactly this can be achieved is a topic worthy of our attention. 


[1] [Vox / Brad Plumer]

[2] [NYT / Coral Davenport]

[3] [Vox / Brad Plumer]


[5] Garrett, T. J. (2012), No way out? The double-bind in seeking global prosperity alongside mitigated climate change, Earth’s Future, Vol 2, Issue 3, p 127–151, March 2014.



[8] Bay FM Radio Interview

[9] Cryptobiz Magazine

[10] YouTube (MIT Conference 2014)

About the Author

Delton Chen is lead author and coordinator of a proposal for a new global monetary policy, called Global 4C Mitigation (G4CM), and further information can be found in the links listed [8,9,10].

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