Wednesday, 3 March 2010

CCS is okay but it's not a silver bullet

Life is full of difficult decisions. Idealism has it's place but on its own it cannot save the world.
As much as I would always want to see a shift to renewable energy as the preferred approach to solving our climate change problems I also acknowledge that we need to consider all the solutions we have at our disposal.


Carbon Capture & Storage
In the past I have thought of Carbon Capture and Storage (CCS) as a false solution that does nothing more than kick the problem under the bed in an attempt to make the room look clean. This is not necessarily the case. If we treated CCS as our only 'solution' and did nothing else then that analogy would ring true. In looking for a 'solution' half the battle lies in understanding and defining the 'problem' in the first place.

However, if CCS is used as a way of temporarily solving an atmospheric emissions problem and buying us the time to step back from a precipice so that we can address the issues that need our attention then avoiding CCS would be irresponsible. Applying CCS and doing nothing else is equally irresponsible.

Sustainability as a form of emergence
Using CCS in the long run is not sustainable and is therefore not a solution to our sustainability challenges. It is, however, a way of managing the sustainability challenge in the short term. It raises the theoretical possibility that sustainable management requires a sequence of activities, which when considered as discrete stand alone actions are fundamentally unsustainable on their own, but when aggregated together result in a sustainable continuum over time. In this way sustainability emerges as an effect from a system of unsustainable parts.

Getting the balance right
The risk of thinking this way is that one may be tempted to believe that short-term unsustainability is tolerable and that there is no need to work at developing more sustainable solutions. What we actually need are two groups who think differently and have the freedom to work on their own approach. We need the person who is developing the next sustainable solution, but we also need the person who is making the current interim solution work despite the fact that it is not the ultimate solution. This balance between idealism and pragmatism is essential for the longer term sustainability effect to have a chance to emerge from the combined effort.

Homogeneity invites risk while diversity fosters balance
We need diversity of thought to be able to give us a point of balance. We need the conflict of ideologies to explore new solutions that enable us to adapt to change. If everyone thinks the same way and behaves the same way then we loose that balance. If we are all clones then we will allow our social system to gravitate towards a survival boundary and burst with traumatic consequences. Our financial systems have taught us these lessons. Take the property market as an example. If we all think that property is the best investment for spare cash then everyone invests in property, we get inflated property prices and we end up with a bubble in the property market. So it seems as though diversity is the key to maintaining a healthy balance.

No silver bullet
Ironically it appears that Silver bullets have a higher probability of killing you than they do of saving you. This makes me think there is no such thing as a silver bullet solution. On the contrary, if something looks like a silver bullet solution it should be a warning.

Heisenberg uncertainty Not knowing exactly what the "right" solution is appears to be a blessing in disguise. It gives us the necessary space we need within which to move. It gives us the freedom to adopt different positions, which are essential to establish some sort of balance. Whether that balance can be maintained and whether it is stable is a different matter. Uncertainty, however uncomfortable it may be, appears to be good and healthy for us.

Thursday, 11 February 2010

Debt is not sustainable

The Party is nearly over.

Economic bubbles seem to be normal and some hurt more than others. The banking crisis was a nasty one but there are more out there lurking in the back waters of the board rooms. Occasionally they raise their dorsal fins in the press.

Bailing out banks is one thing. Bailing out entire countries is entirely different. The very nature of the way we do things on a large scale is that these things operate as highly integrated and interconnected systems. We know from systems theory that co-systems co-create other systems and that one system collapse can precipitate another.

I ask myself: can governments collapse financially? The answer is simply "yes". Can it happen again? Yes. Will it happen soon? Well as a futurist we look for early warning signs, trend breaks and things we call "weak signals". So here's a weak signal to consider:

"The markets remain sceptical that Greece will be able to pay its debts, and speculation is rife that the EU is preparing to bail the country out."

It's a weak signal because it only refers to one country and creates the impression that it is an isolated problem and the big boys and girls in Europe will be able to manage. Looking at it systemically it is a symptom of a much problem that is much more widely manifested.

People have been warning about the dangers of operating large deficits and there seems to be lots of it around: The deterioration in UK public finances is unprecedented, US deficit hits record since world war II, EU deficits, Japan's worst deficit on record, IMF has been concerned about the India deficit for several years, while China seems to be running a small deficit, but this is set to grow a lot in 2010. Everyone seems to be borrowing from everyone else - and just how stable is that after we saw what happened to the banks?

This could potentially lead to a shift in economic power or global melt down. Things an economist should be able to tell us: Who has deficits. How do they compare historically (E.g. The US deficit history)? Can the books be balanced by those who don't have deficits? If not then a global "market correction" is in store.

If it does all come down like a pack of cards or a string of dominoes then it's going to get dark. It may be possible to plug the holes on the leaking ship and coast a little while longer but the resource shortage that will hit us around 2020 is probably going to be the final straw before a real back to basics correction steps in. That's when several places will feel the pinch because of a shortage of water (which indirectly means food) and the world's oil supply would have peaked. There will be absolutely no reason to believe in any growth after that and the economic paradigm of today will collapse. It won't be the end of the world because people are incredibly resilient. It will however be very different to the place we know now.

The party is nearly over... should we enjoy it while we can, or start putting some stratgeically important sustainable investments? I wonder how bad the hang-over is going to be?