www.zerohedge.com by TYLER DURDEN
While the EU’s leading unelected bureaucrats continue to play footsie with the Kremlin while energy prices soar and EU member states reckon with the prospect of a very cold winter, the Wall Street Journal has just taken the time to remind us why the far-left Democrats’ progressive “Green New Deal” climate rhetoric is all but destined to fail. And they did it with a portrayal of John Kerry’s uncomfortable silence after being confronted with the price tag for the Democrats’ green energy aspirations not at home, but abroad.
According to WSJ, the made-for-camera moment happened at a global climate summit in July, when there were no cameras around, when Kerry was handed what the paper described as “a bill” for aiding the developing world in its shift away from fossil fuels – enough to achieve the “green energy” to protect them, and the world, from Global Warming.
The figure: $750 billion. The number was “met with silence [Kerry] according to Zaheer Fakir, an adviser to Creecy [South African Environment Minister Barbara Creecy]” and Kerry wasn’t the only western official in the room wearing a long face.
Of course, that’s not even anywhere close to the real number. As we and Bank of America’s analysts have already explained, there’s a $150 trillion backing the global climate crusade via its most effective capitalist soldiers: the ESG-focused companies and investors who are raising trillions of dollars to “fix” this problem.
Yet, the most sober-minded analysts still believe that the cost of actually coming anywhere close to meeting the West’s commitments will spark levels of inflation that many American consumers (if you asked them) probably wouldn’t be too comfortable.
Even by the most optimistic projections for development and the advent of green technologies, there’s still no way of pulling this off without causing a great monetary disturbance. Some might call it “runaway inflation”…
…but don’t worry, whatever BofA calls it, it has a “cheat sheet” ready for its clients.
Ultimately, this is BofA’s admission taken from everything we have shared above.
Q:Â What is the economic impact of net zero?
A:Â The inflation impact of elevated net zero funding will not be insignificant but the impact looks manageable at 1% to 3% per annum depending on central bank monetization rates, particularly if government spending is targeted and contributes to accelerate the rate of global GDP growth. The IEA also has a productive outlook for their net zero scenario, where the change in the annual growth rate of GDP accelerates by somewhere between 0.3% and 0.5% on a sustained basis over the next 10 years as a result of a shift to a green economy.
But the sad reality is that the emerging world (ie China) isn’t willing (or, in fact, even able) to meet the west’s demands. They’re not going down with their use of fossil fuels, they’re actually going in the opposite direction – up – as they industrialize while “billions rise out of poverty” according to WSJ (nevermind what happens in the US while this process takes place).
At this point, it’s important to remember that it’s not so much a coalition of nations that the west needs to “convince” – it’s really just China. The US, Europe and a few other wealthy nations “committed” to providing $100 billion a year from 2020 through 2025. So far, they have fallen short every year (though that number spent annually is going up, not down).
Most western officials involved are saying that the west must focus first on the goals it met at the last great climate summit in Paris more than 5 years ago before it starts talking about new promises and projections after 2025.
“There isnât enough official development funds in the system to close the gap of climate finance,â said Gustavo Alberto Fonseca, director of programs at the U.N.âs Global Environment Facility, which funds climate infrastructure in the developing world. “There has to be a market-based solution.”
If we know that already, then why are we having another one of these big global pow wows again, right now, while the entire world is convalescing from COVID?
If the “price tag” for climate change is such an impediment, then why don’t the powers that be focus on more productive uses of their time –Â like minting the $1 trillion coin (which, given the rhetoric from the Fed and Treasury, seems to be exactly what the Dems are thinking of resorting to in the US).
The “emerging world” can undergo an abortion!