Room for optimism: review of Akshay Rathi’s Climate Capitalism

Modern economic growth and rising demand for goods at relatively lower prices have led to inevitable exploitation of nature, and consequent climate change. There is no denying that unfettered capitalism has contributed to over extraction of natural resources and increasing emission of greenhouse gases. Should uncontrolled capitalism persist till 2050, the aim of restricting average global temperature within 1.5 °C above pre-industrial levels may remain a pipe dream. Emitting billions of tonnes of carbon dioxide will see continued climate extremes leading to the loss of lives and livelihoods. No wonder, climate emergencies have become frequent.

Many environmentalists believe that the long-term solution to tackling climate crises is to uproot capitalism because “we cannot solve the problem by what caused it”. But with time short for averting catastrophic climate change, the possibility of putting a new economic system in place may seem improbable.

Transform, progress

In Climate Capitalism, Akshat Rathi explores how to transform the world’s dominant economic system while ensuring that the wheels of progress don’t come to a halt. From renewable power to green cement, electric cars to carbon capture, emission-reducing technologies have tossed new opportunities for private capital and government regulations to work in tandem. The process to harness the forces of capitalism to achieve zero emissions has already begun. Although these are still early days for capitalism to wear a natural look for addressing impending climatic concerns, a faint ray of optimism seems to have been generated.

It has been over two decades that industrial capitalism has been critiqued for neither pricing nor accounting its negative externalities. It liquidates natural capital and calls it profit, undervaluing both natural resources and living systems. Rathi chronicles the political manoeuvrings that made possible China’s lead in building fleets of electric cars, India’s success in promoting solar power, America’s success with reversing climate damages in the oil industry, and the Danish quest for pushing wind turbines. All such initiatives combined, it has been estimated that 2% of global GDP is enough to make the carbon dioxide problem go away. Far from being linear, however, there are disruptive elements that play upon power politics to sully the path to zero emissions. Politics, technology and finance must align in the right direction to bring about change, says Rathi.

To work as a unit

With climate emergencies threatening life, public perception on the global climatic accords and green initiatives remains grossly sceptical. Holding an optimist position, Rathi argues that we cannot insulate ourselves from the transformation coming our way. From bureaucrats to billionaires, doers to enforcers, there are multiple actors on the capitalist platform who would need to bridge differences to reform the economic system and help shape a climate-conducive capitalism.

Akshay Rathi

Passionate capitalists fear that policy reforms may kill the market. But policy shifts in favour of climate-oriented technologies and investments have created new business opportunities. Whether such efforts add up to make an impact at global scale is yet to be fully ascertained. Some trends are noticeable, the U.K. economy grew by 60% between 1990 and 2017 while its carbon emissions declined by 40%. The task lies in replicating and escalating such transformative processes and practices. Although climate financing may have been slow, the Paris Agreement has triggered a process of change.

Climate Capitalism conveys an optimistic narrative which contends that it’s cheaper to save the world than destroy it. What kindles a ray of hope is that capitalists themselves have woken up to both the cost of inaction and the opportunity of action.

The reviewer is an independent writer, researcher and academic.

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