‘Runaway Collapse’ of Environment Could Cause the Next Great Recession
“Mainstream political and policy debates have failed to recognize that human impacts on the environment have reached a critical stage.”
People's Climate March 2017, Washington DC. Image: Mark Dixon
Human pressures on Earth have introduced “a new domain of risk” for global civilization comparable to the 2008 recession, warns a report published Tuesday.
Climate change, biodiversity loss, soil infertility, deforestation, and ocean acidification are among the manmade threats that affect agriculture, energy, public health, economic growth, and immigration. Current disruptions to the environment could seriously destabilize those sectors—which would likely amplify social conflicts and spark widespread civic unrest, the report says.
These new findings from the Institute for Public Policy Research (IPPR), a UK-based think tank, suggest that any one of these risks is poised to set off a chain reaction that could create a global crisis that is greater than the sum of each individual problem.
Authored by IPPR researchers Laurie Laybourn-Langton, Lesley Rankin, and Darren Baxter, the paper likened the potential risk to the 2008 Great Recession, which was caused when the American subprime mortgage crisis snowballed into a worldwide financial disaster.
One potential example of a trigger is a sudden crash in carbon assets due to their role in greenhouse gas emissions. If carbon prices rapidly drop to keep pace with carbon budget limits, it could have ripple effects throughout the global economy.
The insurance industry and financial institutions could also become volatile. Insurers are already struggling to adapt to the increase in property and casualty losses from extreme weather events. Climate-related natural disasters are expected to intensify, potentially exposing companies to tanking from a surplus of claims.
“In the extreme, environmental breakdown could trigger catastrophic breakdown of human systems, driving a rapid process of ‘runaway collapse’ in which economic, social, and political shocks cascade through the globally linked system—in much the same way as occurred in the wake of the global financial crisis of 2007/08,” said the authors.
The report referenced troubling global trends, such as a 15-fold increase in floods since 1950, the substantial degradation of three quarters of Earth’s land, and the fact that 20 of the 22 past years have been the warmest on record.
The authors called for a “Green New Deal,” which they described as “a major economic stimulus program” to reduce greenhouse gas emissions while addressing social and economic issues such as poverty and public health.
This echoes the major arc of the Green New Deal resolution proposed last week by US Congresswoman Alexandria Ocasio-Cortez and Senator Ed Markey.
Both the IPPR report and the GND resolution frame progressive social and economic goals as an essential part of environmental policy. They also reverse a long tradition of shaping environmental policy to reflect what is feasible for the economy by instead suggesting that economic policy should be shaped based on what is feasible for the environment.
This argument is premised on the unprecedented changes Earth is experiencing due to human activity, which could destabilize both the environmental and economic sectors.
“Mainstream political and policy debates have failed to recognize that human impacts on the environment have reached a critical stage, potentially eroding the conditions upon which socio-economic stability is possible,” the IPPR report said. “The historical disregard of environmental considerations in most areas of policy has been a catastrophic mistake.”
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