Note: The full text of this work is free to read online or download: https://press.lse.ac.uk/books/m/10.31389/lsepress.tgs
In 2006, adviser to the UK Government on the economics of climate change and development, Nicholas Stern, wrote The Economics of Climate Change: The Stern Review. This major work clearly influenced successive governments in various iterations of UK climate change policies.
The main conclusion of this report was that early action to address climate change would be cheaper than delay. In his successor Growth Story volume, it is clear that Stern does not see sufficient UK action on climate change from 2006 to the present.
Consequently, he presents a highly comprehensive assessment of what is needed from now onwards, relevant to the UK and the planet as a whole. This is worth reading even if one disagrees with parts of it, as a considerable amount of carefully qualified language conditions (and arguably improves) what Stern is presenting. This has the effect of making the book more perceptive and thoughtful than its predecessor.
Who benefits from growth and can this be changed?
Stern makes clear that growth should be about all aspects of wellbeing, and of use decades into the future. He sets aside a “vague notion of the indefinite future” (p.XXII).
However, which sectors grow now and in the next few decades may set pathways, or path dependencies, towards futures best avoided, such as a car-dependent UK.
This may well require longer-term thinking than Stern is offering. For example, growth may remain only partially modified by his suggestions and greenhouse gas emissions and temperatures may continue to grow for many decades. In this case, the failure to have really long-term, effective policies impacting on these trends will lead to a failure to achieve the heavily-modified, more sustainable forms of growth he seeks.
It is worth considering how continuation of austerity in many countries, including the UK, in sectors such as local government and state capacity to protect and restore the environment, is preventing the type of growth Stern wants to see.
Biodiversity and unsustainable growth
Stern is unambiguous about the scope of what he wants to see. He thinks we need “systemic and structural change” (p.2). Whether this is going to be offered by market institutions is questionable. His new growth story requires lower costs; learning by doing; induced innovation; increasing returns to scale in new technologies; improved resource efficiency; stronger system productivity; improved health outcomes; and increased share of investment with strong emphasis on infrastructure.
To examine these in turn, let us recognise that already low pay and benefits are too often a target of market actors and governments for further cuts in real terms. This undermines households, education opportunities, and health.
Arguably, UK university tuition fee rates are a driver of UK skills shortages, as is the absence of freedom of movement with Europe after Brexit.
Innovation should be constrained by environmental impacts: new data centres with exceptional water and energy use require planning constraints rather than relying on the curious idea that ‘something will turn up’ which characterises UK planning practice.
New technologies may be dead ends – like supersonic airliners or new nuclear power stations. Given the exceptional risks presented by worsening climate and ecological emergencies, selection of technologies needs to favour those of lasting use capable of being scaled up quickly.
Productivity and health are tied together and demand an NHS better protected from higher costs resulting from excessive involvement of market actors. Infrastructure development can often be damaging to climate and environment. We need far more legislative restraint to weed out what we, and the planet, do not need.
Instability and migration
Displacement of hundreds of millions of people, or even billions Stern suggests, is possible as climate and political instability progress. Stern notes the risks of more people being on the move, which has implications for food security and may prompt conflict over resources in some places (pp7-8).
The existing features of the climate emergency such as droughts, inundations, and floods could also be joined by: increasing movements of people away from coastal areas as sea levels rise; more extreme storms; and the continued sinking of cities due to groundwater abstraction and the weight of skyscrapers.
Technological solutions
Stern condemns anti-science thinking and excuses for delaying action. He correctly identifies these problems as particularly features of the political right. But he makes clear that his 2006 review actually under-stated the risks of climate change (pp-17-18).
Whilst new technologies and climate measures may increase economic growth, how anti-climate and anti-environment forms of growth are to be effectively resisted remains unclear in this new book. Having a successful, growing renewable energy sector and more electric vehicles should not mean climate-damaging aviation, shipping, and agricultural practices. The global fleet of all types of polluting transport technologies are changing quite slowly, perpetuating dependence on fossil fuels.
If we don’t restrict some forms of growth, and cut back on flying and shipping as examples, then planet-destroying forms of growth may continue alongside more sustainable sectors for many decades to come.
Stern does emphasise natural capital and biodiversity in a sustainable future in several parts of the book. He also says that the “new growth story” is about sustainable development (p.21), although many sectors are dominated by unsustainable activities at present.
The failure of growth as a single indicator
Public perception of growth may well be over-influenced by the single indicator of GDP being emphasised uncritically in media reporting. We need media use of a much wider range of reliable indicators in as many countries as possible to help support just transitions into sustainable futures.
This would happen more quickly if wealth were taxed much more strongly as growth benefits those already rich and globally does not distribute wealth to those actually in need of it.
Urgent transformation to achieve sustainability
Market actors – fossil fuel corporations, aviation, shipping, the conventional energy sector, motor vehicle manufacturers, food processing corporations, and others – create global climate and ecological decline. Given this, Stern needed to demonstrate how this could be radically changed by political leadership.
One might conclude that Stern’s extremely strongly evidenced and qualified arguments for change actually require a ‘1945 moment’ in most countries. In the current context, this would mean the reconstruction of a ‘mixed economy’ in which state, regional, and local institutions have enough resources and powers to face the climate and ecological emergencies. They could then ensure market actors are driven to end polluting, inequalities, and resource wastage on things of peripheral value. Consequently, societies would develop public and private sectors with far, far more useful jobs.
Failed growth and lingering austerity
It is difficult to see how Stern’s vision of a different form of growth will emerge without a predominance of green values throughout party politics, international, national, and local governance, and societies. Many political parties simply do not deliver sustainability, whatever they may say of climate or environment.
Urgency that displaces ‘climate complacency’ appears to be in short supply at present. Stern offers hope of a future which could be delivered but does appear to require remarkable changes in urgency within existing human-created institutions. Let’s hope with him, and consider his new book carefully, as an excess of pessimism could prove catastrophic.
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