By Robert Pollin (guest post)
Second in a series of posts on neoliberalism and what might come next, organized to celebrate the 45th anniversary of Dollars & Sense, which publishes Triple Crisis.
In 2007, Nicholas Stern, the prominent mainstream British economist and former chief economist at the World Bank, wrote that “Climate change is a result of the greatest market failure the world has seen.” Stern’s assessment was extreme, but not hyperbolic. This is for the simple reason that, if we take climate science at all seriously, we cannot avoid the conclusion that we are courting ecological disaster by not stabilizing the climate.
Neoliberalism is a driving force causing the climate crisis. This is because neoliberalism is a variant of classical liberalism, and classical liberalism builds from the idea that everyone should be granted maximum freedom to pursue their self-interest within capitalist market settings. But neoliberalism also diverges substantially from classical liberalism: What really occurs in practice under neoliberalism is that governments allow giant corporations to freely pursue profit opportunities to the maximum extent, and governments even intervene on corporations’ behalf when their profits might be threatened. How the oil companies reacted to clear evidence of climate change represents a dramatic case study of neoliberalism in practice. In 1982, researchers working at the then Exxon Corporation (now Exxon Mobil) estimated that by about 2060, burning oil, coal, and natural gas to produce energy would elevate the planet’s average temperatures by about 2° Celsius. This, in turn, would generate exactly the types of massive climate disruptions that we have increasingly experienced since the 1980s—i.e., heat extremes, heavy precipitation, droughts, rising sea levels, and biodiversity losses, with corresponding impacts on health, livelihoods, food security, water supply, and human security. In 1988, researchers at the Shell Corporation reached similar conclusions. We now know what Exxon and Shell did with this information: They buried it. They did so for the obvious reason that, if the information were then known, it might have threatened their prospects for receiving massive profits from producing and selling oil.