A tale of two movements
People were in the streets on Sunday in Toronto and in Athens. The former were marching with the greying generals of the green movement, Jane Fonda and David Suzuki, in favour of a new economy powered by renewable energy. The latter were celebrating the victory of Greece’s young prime minister, Alexis Tsipras, who won a thumping rejection of further austerity measures in a snap referendum. Greece’s debt remains, the banks are closed, and the people are back in the streets lining up at bank machines to withdraw what little the emergency regulations allow.
The similarities and differences are striking. Both crowds are fed up with what is nebulously called the global economy. The greens because it uses fossil fuels, which will bring catastrophic climate change. As billions of poor people have ceased being destitute these past decades, and hope for continued development, their demands for energy increase. So either the rich countries will have cut back significantly on fossil fuels, the poor countries will have to remain poor or by some combination of technological advancement and staggering state subsidies, renewable energy will have to replace fossil fuels. The greens are marching for austerity — higher taxes and lower standards of living — to repay what recently Pope Francis has been pleased to call an “ecological debt.” It is a moral argument, advocating present sacrifice for the sake of future generations.
The Greeks, meanwhile, a half-decade into their sovereign debt crisis, have had it with austerity. They have rejected higher taxes and a lower standard of living to repay their debt — actually, to simply slow its growth. They protest mightily that the rules of the global economy are rigged against them. A currency controlled by others prevents them from devaluing their currency to de facto default on their debts through rapid inflation and (potentially) increase export-driven employment. International creditors insist on higher taxes (both rates and rates of payment) and fewer services — crunching pain now for slightly less pain later. The Greeks protest that the rich are kicking the poor while they are down. It too is an argument made with moral intensity.
Debt is not only an economic matter. To what extent does one generation have a right to borrow against the distant future for current consumption? When Canada was a high-debt country in the 1990s, those calling for greater fiscal discipline argued that the sacrifice of paying down debt had to be borne, in part, by those who incurred it. That argument, it must be said, though morally appealing, is politically a bust. Only fiscal crises — remember the “Canadian peso”? — seem to provoke action. The proof is that America, protected from crisis by its status at the world’s reserve currency, has apparently no limit on its appetite for debt. The most indebted country in history is entirely unbothered by that status.
Greens are arguing for higher taxes and less energy consumption — the former a means to the latter. The only way such a combination can coexist with economic growth, especially for the world’s poorest, is with remarkable technological advances that produce clean and cheap energy. Green technologies are to date comparatively expensive. And what technology brings is unknown. The principal recent technological advance in energy production has been the fracking revolution, which has made natural gas, a fossil fuel, inexpensive and abundant. It is cleaner than other fossil fuels, but not the solution the greens advocate.
All of which has an impact on politics. The progressive left has historically preferred to make a moral case for its policies. Regarding austerity — or sacrificial policies, if you prefer — the global left now protests if it is in service of servicing debt. The same global left advocates austerity to pay ecological debts.
On the conservative side of the spectrum, there are also moral arguments to be engaged. Indeed, in economics, we speak of a “moral hazard” when the debts of those who cannot repay are cancelled. Hence conservatives insist on tough medicine for debtors. Yet, there is moral hazard, too, when financiers make dubious loans, especially to sovereign states, counting on the fact that the global financial system will have their back when the inevitable crisis comes. The conservative case is customarily made to insist that indebted states pay their debts. Yet there is also a conservative case to be made that the creditors have a moral obligation to face the full weight of the risks they willingly accepted.
According to the greens, the environmental crisis is urgent and enduring. The Greek financial crisis may only be the first of several to hit the eurozone, to say nothing of other sovereign defaults, such as the recent one in Argentina. Ecological and financial debts are reconfiguring our politics — as crises often do.
Environmentalists are marching for austerity — higher taxes and lower standards of living. The Greeks, meanwhile, have had it with austerity