CARBON CREDITS-A DIRTY TRADE
Despite recent condemnation of the carbon credits scheme, especially with hypocritical grandstanding by Al Gore, I can understand how its structural nature is borne out of contemporary corporate globalization and how it may be the best short-term solution targeted at industries and the minority ultra-rich consumers like Al Gore.
Carbon credits were originally mooted as a way for Kyoto Protocol signatories to gradually reduce their carbon emissions. It allowed for heavily polluting industries to green their operations over time and in the meanwhile buy extra carbon credits from other Kyoto Protocol partners to compensate for exceeding its cap. This was viewed as mutually beneficial as developed nations could pay while taking time to clean up their industries, which takes time and political will, while developing nations received funds for modernizing their industries and silenced their complaints about the developed world contributing much more to accumulated and present pollution.
Although this cap-and-trade has not worked entirely due to lax controls and even its essence receives much flak for allowing rich nations to continue polluting with a clear conscience, we have to acknowledge this as a step forward in engaging industries and avoid a strictly moralistic stand that will get us nowhere in this corporate globalizing world. We have to come to the cruel understanding that only when the environment is regarded and traded as a commodity, will it figure as a commercial consideration. Before this development, environmental costs only appeared in a small section of economic textbooks under the sub-section of externalities, largely ignored by corporations. Only when there was money to be made in turning green (or at least appearing so), or potential costs incurred when not turning green did it figure in corporations’ business at all.
COMMODIFYING THE ENVIRONMENT
Just like labour and raw material, only when the environment is commoditized and politicized, will it receive serious attention from industries, a dominant player in determining the future of the environment, along with governments and the consumer. Recently carbon credits have received additional flak due to new variants like individual carbon offsetting, where individuals voluntarily pay an extra cost for their goods and services to a carbon trader who pledges to convert that sum to maintain a neutral carbon footprint. Indeed the lack of transparency is a cause for concern, but more importantly it allows ultra-rich consumers like Al Gore to continue with their lavish lifestyles of pollutive consumption without guilt. This effectively creates a huge barrier to reaching out to these rich consumers, who are the guiltiest of creating pollution but also the most capable of making a change, not by paying for their guilt but by actually changing their excessive lifestyles.
THE HAZE CASE STUDY
Indeed the environment has become heavily politicized in recent years, with many governments realizing that pollution knows no borders. However, the form of politicization has sometimes also revealed the tacit alliance between governments and industries. The haze affecting Singapore is a good case in point. Along with neighbours like Malaysia and Thailand, Singapore has faced serious air pollution problems which results in an annual haze for more than a decade. While Singapore has always been quick to put the blame on widespread slash-and-burn farming techniques in Indonesia, it has been remarkably silent on the heavily polluting major oil operations that are also sited in neigbouring Indonesian islands.
A scrutiny on Singapore as a major oil re-processing hub reveals that the same oil MNCs that operate on Indonesia also have hug investments and installations in Singapore. Thus it is not surprising that the Singapore government cannot afford to criticize its strategic crude oil corporate partners who also own polluting operations in Indonesia. Using the state-dominated media, the Singaporean government has been able to frame the blame for the haze solely on Indonesian slash-and-burn farmers who usually have no alternative cost-effective methods.
Despite recent condemnation of the carbon credits scheme, especially with hypocritical grandstanding by Al Gore, I can understand how its structural nature is borne out of contemporary corporate globalization and how it may be the best short-term solution targeted at industries and the minority ultra-rich consumers like Al Gore.
Carbon credits were originally mooted as a way for Kyoto Protocol signatories to gradually reduce their carbon emissions. It allowed for heavily polluting industries to green their operations over time and in the meanwhile buy extra carbon credits from other Kyoto Protocol partners to compensate for exceeding its cap. This was viewed as mutually beneficial as developed nations could pay while taking time to clean up their industries, which takes time and political will, while developing nations received funds for modernizing their industries and silenced their complaints about the developed world contributing much more to accumulated and present pollution.
Although this cap-and-trade has not worked entirely due to lax controls and even its essence receives much flak for allowing rich nations to continue polluting with a clear conscience, we have to acknowledge this as a step forward in engaging industries and avoid a strictly moralistic stand that will get us nowhere in this corporate globalizing world. We have to come to the cruel understanding that only when the environment is regarded and traded as a commodity, will it figure as a commercial consideration. Before this development, environmental costs only appeared in a small section of economic textbooks under the sub-section of externalities, largely ignored by corporations. Only when there was money to be made in turning green (or at least appearing so), or potential costs incurred when not turning green did it figure in corporations’ business at all.
COMMODIFYING THE ENVIRONMENT
Just like labour and raw material, only when the environment is commoditized and politicized, will it receive serious attention from industries, a dominant player in determining the future of the environment, along with governments and the consumer. Recently carbon credits have received additional flak due to new variants like individual carbon offsetting, where individuals voluntarily pay an extra cost for their goods and services to a carbon trader who pledges to convert that sum to maintain a neutral carbon footprint. Indeed the lack of transparency is a cause for concern, but more importantly it allows ultra-rich consumers like Al Gore to continue with their lavish lifestyles of pollutive consumption without guilt. This effectively creates a huge barrier to reaching out to these rich consumers, who are the guiltiest of creating pollution but also the most capable of making a change, not by paying for their guilt but by actually changing their excessive lifestyles.
THE HAZE CASE STUDY
Indeed the environment has become heavily politicized in recent years, with many governments realizing that pollution knows no borders. However, the form of politicization has sometimes also revealed the tacit alliance between governments and industries. The haze affecting Singapore is a good case in point. Along with neighbours like Malaysia and Thailand, Singapore has faced serious air pollution problems which results in an annual haze for more than a decade. While Singapore has always been quick to put the blame on widespread slash-and-burn farming techniques in Indonesia, it has been remarkably silent on the heavily polluting major oil operations that are also sited in neigbouring Indonesian islands.
A scrutiny on Singapore as a major oil re-processing hub reveals that the same oil MNCs that operate on Indonesia also have hug investments and installations in Singapore. Thus it is not surprising that the Singapore government cannot afford to criticize its strategic crude oil corporate partners who also own polluting operations in Indonesia. Using the state-dominated media, the Singaporean government has been able to frame the blame for the haze solely on Indonesian slash-and-burn farmers who usually have no alternative cost-effective methods.
This case study reveals how when huge capital investments are concerned, governments may not be willing to comment or act on environmentally harmful operations of MNCs. This tacit alliance between governments and industries is something we have to be critically aware of instead of hypocritically pointing the blame for the haze at Indonesian farmers and government just by reading the local tabloid. Indeed the Singaporean government has been successful in creating an informational and geopoltical haze that allows only a narrow non-critical perspective if one is careless when reading state material.
MAJOR STAKEHOLDERS
In the politics of a globalized environment, it is almost senseless to continue this finger-pointing that both developed and developing nations are both guilty of. What is more important is recognizing the major stakeholders, which are the governments, industries and the individual consumer, and formulating ways to actively engage them by convincing them of the mutual benefits.
Corporations being businesses that are strictly profit-oriented would see no need to incur extra costs by going green or appearing to do so. However, an emerging global civil society that feels the environmental costs like global warming and actively urges for green industry might induce corporations to at least profess its desire to go green or donate sums toward environmental efforts. In light of today’s globalized world where nation-states are limited in their ability to influence either corporations or consumers, an emerging global civil society that is environmentally conscious is more important than ever.
A more concrete way of really cranking up and greening the corporate machinery is when consumers actually desire and purchase green products. An example would be the Toyota Prius which has helped Toyota secure its market dominance. The Toyota Prius has proved to be the most commercially successful hybrid automobile that promises the individual’s ability to maintain a mobile lifestyle which is easy on the pocket while being environmentally friendly too. Indeed the initial costs of hybrid cars remain high due to the pioneering technology and the lack of competition, yet Toyota has identified that there is money to be made in this venture and has created a viable product, testimony of the possibility of greening consumerism.
MAJOR STAKEHOLDERS
In the politics of a globalized environment, it is almost senseless to continue this finger-pointing that both developed and developing nations are both guilty of. What is more important is recognizing the major stakeholders, which are the governments, industries and the individual consumer, and formulating ways to actively engage them by convincing them of the mutual benefits.
Corporations being businesses that are strictly profit-oriented would see no need to incur extra costs by going green or appearing to do so. However, an emerging global civil society that feels the environmental costs like global warming and actively urges for green industry might induce corporations to at least profess its desire to go green or donate sums toward environmental efforts. In light of today’s globalized world where nation-states are limited in their ability to influence either corporations or consumers, an emerging global civil society that is environmentally conscious is more important than ever.
A more concrete way of really cranking up and greening the corporate machinery is when consumers actually desire and purchase green products. An example would be the Toyota Prius which has helped Toyota secure its market dominance. The Toyota Prius has proved to be the most commercially successful hybrid automobile that promises the individual’s ability to maintain a mobile lifestyle which is easy on the pocket while being environmentally friendly too. Indeed the initial costs of hybrid cars remain high due to the pioneering technology and the lack of competition, yet Toyota has identified that there is money to be made in this venture and has created a viable product, testimony of the possibility of greening consumerism.
RETREAT OF THE NATION-STATE IN GLOBALIZED WORLD?
Despite the popular notion that nation-states have receded in importance and relevance in today’s globalized world, governments actually have a prime role to play, especially in providing incentives to attract green industries to set up their firms and research & development in their countries. Without these subsidies and provision of an encouraging and suitable infrastructure, most firms would not invest in high-risk, low-gain green business ventures at all. Governments can also strive to slap conservation taxes on water, power utilities, as has been done in Singapore. Although utilities are free to pass on the additional costs to consumers (and usually do so), indirectly a clear message is also sent to consumers; that excessive use of water and electricity carries increasing externalities and punitive costs. Taxes collected from such sources can also be re-channeled into national research & development into costly green technologies that may otherwise not be attempted due to the cost.
CONSUMER IS KING
At the core of the solution still lies the consumer, which has a much greater say in what and how a product is produced than he/she is made to believe. Individual consumers can so much more than the oft-cited mantra of Reduce, Reuse and Recycle. Individual consumers can make a huge difference by just saying no to certain products which are produced inefficiently or have been identified with a heavily-polluting manufacturing process. For example, the apparel industry is one area where almost all consumers can act to make a considerable difference. Rejecting crude-derived fabrics like Rayon and Lycra and other carbon-constituent artificial fabrics can help to reduce demand for crude oil to a certain extent. While it may be argued that our modern oil-guzzling transportation system will still consume oil as usual, lack of demand for its by-products may make it more expensive overall to process and sell oil.
Governments like the US may still myopically isolate themselves from the Kyoto Protocol, even Kyoto signatories themselves have at times failed to live up to their promises. Such globalization-from-above and formal politics of a globalized environment seem to have limited use and relevance to practical realities on the ground. An emerging global civil society that starts with concerned and aware individual consumers constantly urging industries and governments to clean up their act may be more useful in the short term. Such globalization-from-below forming a pragmatic politics of a globalized environment may better serve the needs of our ailing environment that requires urgent effort and cannot wait for inter-governmental sophistry and rhetoric to resolve their differences.
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