Finance Monthly - December 2021

19 Finance Monthly. Bus i ne s s & Economy There is a sixth danger from COVID, and that’s political. Look to the increasing impact of climate protests. COPwasnever going tobe the magic wand climate protestors demand. If the numbers continue to move against neutrality, there are the consequences of green politics to consider. Being green is no longer eccentric – it’s mainstream. Everyone will answer yes if asked about a better environment. That has moved the goalposts. Increasingly, extreme climate protestors are supporting “De-Growth” strategies – that it’s better to somehow switch off the world to avoid a catastrophic Malthusian disaster caused by too many people consuming too many resources and polluting our closed system spaceship earth. Malthus was wrong in the 18th century and is no doubt still wrong today! What COP26 protests and things like Insulate UK highlight is the potential for polarised green politics to collide with the economy and growth. It’s going to take years to wean the economy off fossil fuels, but protestors will demand it happens now! The current volatility of energy pricing demonstrates a massive underlying transition problem and political naivety. We can’t fundamentally change energy provision overnight. Climate protestors are furious this generation has “stolen” their futures will be even less happy if they succeed in reversing economic growth. The result will be to ensure billions of children as yet unborn don’t just face rising temperatures and sea levels, but also chronic poverty, unemployment, starvation, migration and rising conflict over the environment – water being the primary threat. The real failure of governments wasn’t ignoring Greta et al and the evidence of global warming, but not anticipating the need for an energy transition plan. In coming years, the noise between climate protests and the slow pace of the transition to clean energy will get louder and become ever more likely to dislocate politics. It sets up a political crisis within the next few years as empowered green campaigners garner more airtime. This has massive market implications. “What COP26 protests and things like Insulate UK highlight is the potential for polarised green politics to collide with the economy and growth.”