George Bernard Shaw said, “the optimist invents the airplane, the pessimist the parachute.” When it comes to combating the climate crisis, we must not be blindly optimistic, nor overtly pessimistic.

Instead, we ought be realistic and develop right solutions for battling an array of challenges witnessed at the moment. Portfolio of climate remedies approach.

The stream of bad news continues. Unprecedented wildfires, record heat, back-to-back hurricanes and typhoons, rapidly drying monsoon seasons yet excess out-of-season rainfalls and large-scale floods, shrinking glaciers and polar ice sheets, and on goes the list.

Our inaction won’t produce miracles to save this planet. Ex nihilo nihili fit, as pre-Socrates Greek philosopher, Parmendies, argued: nothing comes from nothing.

We got a breather, sort of, last December, which was the least hot month of the year in 2020, and eighth hottest December. But then 2020 was itself the second hottest year on record. The National Oceanic and Atmospheric Administration has declared July 2021 the Earth’s hottest month on record. No doubt, we are in calamity, not just crunch.

The capital deployed to reduce harmful emissions has not come close to the level that can move the needle. Some allocations by organizations ranging from institutional investors and family offices of high net-worth individuals, to large sovereign funds have gone into what is called “impact” funds. That’s not bad, but it is not enough for the monumental task of fixing the climate and environmental decay.

The initiatives to reduce materially the harmful emissions and to reverse the climate putrefaction can be categorized into two, as suggested by Bill Gates: easy and hard. For the easy ones, managed funds by impact investors can supply what is needed. The motivation for them centers around the thesis that valued, fundable proposals can be found that are simultaneously good for the environment and good investments, even yielding acceptable high returns for these sustainability investments.

Whereas that thinking has fueled capital pouring into impact funds, for the most part these funds operate disjointly with no set of collective priorities. Individually, each fund invests as it likes. Collectively, they have not been impactful.

The hard climate problems, on the other hand, require massive investments beyond impact investing. Solutions for those set of climate challenges have potential to reverse the current disastrous trajectory unequivocally in a short time that we have for that course change. Productions of cements and steels with zero harmful emission are hard problems, as is capturing carbon dioxide in the air, solidifying and then pushing it in the ground for storage. The good news is that with disciplined research, inspired innovation and determined industrial-scale development, chances are good to solve the hard climate problems. The bad news is that it requires lots of money, and only the government can supply that.

Before the alarms go off that this is yet another ploy to increase taxes, particularly for the working middle class, rest assured that it is not. We cannot solve the climate catastrophe on the broken back of labor.

In 2019, Robert Crandall, the legendary former chairman and CEO of American Airlines that The Wall Street Journal has called “the man who changed the way the world flies,” delivered a remarkable speech at the Hope Global Forum. He started by affirming the rapid climate change, then dissected the apparent inability to combat it.

Crandall correctly reasoned that because of significant societal inequities, the government’s intake was not near where it should be. Consequently, the government cannot allocate enough capital for large-scale investments to lower emissions that damage the environment. The much-hyped zero emission targets remain elusive. The recently-passed infrastructure bill is a good start, but not enough to tackle the climate calamity simultaneously, as its main target is another set of challenges.

What Crandall proposed made much sense. First, the industrial complexes need to work with labor unions to prevent loss of decent blue-color jobs, and those with little or no higher education. Even though we appear to be in a labor shortage at the moment, the unemployment is still at 4.6%, and the crunch is mostly in the low-paying service sector. The practice of outsourcing, even domestically, to reduce pay and benefits destroys the tax base, hence shrinks government revenue.

As the pay inequality eases, a fairer society emerges, while the tax revenue of the government increase, making possible major investments by the government to battle the climate deterioration.

Let’s cheer for the health of the Earth and for it to remain as beautiful as it is.

Jahan Alamzad is a management consultant. He lives in San Carlos, California, and can be followed on Twitter @jahan_alamzad.

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(1) comment

Terence Y

Mr. Alamzad – perhaps you could provide information on what the other elephants in the room, China, India, and other growing economies, such as Brazil, Mexico, and South Africa are doing to control their increases in carbon emissions. Their emission increases in the last two decades are considerably dwarf US emissions. Until we get those countries on board, any efforts to soak the rich, and poor, and everyone in between to support this supposed global warming thing will fall among deaf ears.

Maybe you could also weigh in on the carbon emissions due to 30,000+ people flying into Scotland for COP26 - an estimated 400 aircraft and over 50 private jets. What about the 100+ container ships hanging out off the coast of Los Angeles, idling away? And CA forest fires due to mismanagement of forests? All of these issues were easily prevented, yet there they are, adding carbon emissions and worse, being excused by the global warming crowd. Hypocrisy is not a good look.

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