I’m Jonathan Burbaum, and this is Healing Earth with Technology: a weekly, Science-based, subscriber-supported serial. In previous installments of this serial, I have offered a peek behind the headlines of science, focusing on climate change/global warming/decarbonization. I have welcomed comments, contributions, and discussions, particularly those that follow Deming’s caveat, “In God we trust. All others, bring data.” Recently, I’ve pivoted to a more direct approach.

COP26 is behind us, and, like its 25 predecessor “Conferences of Parties”, it’s produced a series of toothless political commitments that are loosely based on recommendations given by large teams of scientists. Sadly, such approaches, while intellectually honest, are seriously limited in scope, and thus doomed to failure in the long run. Given the continued naive commitments of our leaders, I must now propose a more aggressive pitch:

One planet. One solution. Now.

That’s intentionally provocative, but not prescriptive. No treatment has all the answers. But we must prepare to act with clear-headed decisions—any partial solution should be required to bring the rest of the solution to the table as well, and to specify what the tradeoffs are. We won’t get too many chances to get it right.

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Today’s read: 7 minutes.

An opener to stimulate your logic center:

“So the farmer needs blacksmiths and carpenters, and they in turn need farmers. Naturally, each will want to satisfy his needs by giving up in exchange a portion of what he possesses. But, it is also possible that when the carpenter wants food in exchange for tools, the farmer does not need the tools. Or, when the farmer needs tools, the carpenter does not need food. So such situations create problems. Therefore, pressures emerge leading to the creation of trading places where various tools can be kept for exchange and also warehouses where farmers' produce can be stored. Then, customers bring produce to the markets and if they cannot readily sell or exchange what they possess, they sell them at a lower rate to the traders who in turn store the produce  and sell to the buyers at a profit. That is true for all kinds of goods. Then, such practices extend to various cities and countries. People travel to different places to obtain tools and food and transport them. People's economic affairs become organized into cities which may not have all the tools needed and into villages which may not have all the food­ stuffs needed. People's needs and interests necessitates transportation. Then, a class of traders who carry goods from one place to another emerges. The motives behind all of these activities is the accumulation of profits.”

Abū Ḥāmid Muḥammad ibn Muḥammad al-Ghazali, from (Iḥyā′ ‘Ulūm al-Dīn; The Revival of the Religious Sciences) ca. 1105 AD, as translated by Hamid Hosseini, “Understanding the Market Mechanism before Adam Smith: Economic Thought in Medieval Islam”, History of Political Economy (1995) 27 (3): 539–561

It may seem surprising that I begin this one with a quote from a medieval Islamic philosopher, one described as “one of the most prominent and influential philosophers, theologians, jurists, and mystics of Sunni Islam.” My point in choosing this quote, of many options, is that economic concepts are self-evident and cross-cultural, even if some might consider them religious. Like Jefferson’s “truths we hold to be self-evident”, so, too, are the unwritten human rules that govern trade.

While contemplating the New Year, I realized that I am gradually being sucked into the same fearmongering vernacular of climate alarmists. It’s an easy topic to write about because there’s no shortage of sensational predictions from credentialed scientists. But it’s a slippery slope, and I intend to keep this from becoming just another Chicken Little rag. The sky is not falling yet, and I firmly believe that we still have time to do something about it.

I’ve been struggling with making this installment concise while retaining completeness, so I’ve decided to spread it over a few weeks. I’ve also been forced to coin a new word, “holoeconomics”, which may offend actual economists, but I think it’s necessary.

But, what do I mean by “holoeconomics”?

Economic factors will limit practical solutions to “climate change”. But it’s not what you might think at first glance: The main economic factors are not related to affordability, as in “It’s a possible solution, but can we afford it?” Instead, the economic factors involve tradeoffs at a global scale. Climate change is a problem that affects both sides of all transactions. So solutions must be global, and individuals, businesses, and regulators must participate. But, in the case of energy, it’s not just about individual transactions, and it’s not just about government policies. Those who seek solutions must take both macroeconomics and microeconomics into account simultaneously. For the uninitiated,

Microeconomics is the study of individuals and business decisions, while macroeconomics looks at the decisions of countries and governments.

The two perspectives are, of course, conjoint since they ultimately describe the same thing, the global creation and distribution of wealth. Still, neither is adequate to describe the economic factors contributing to climate change. Microeconomics involves individual trades, while macroeconomics involves policies that affect the markets where exchange occurs.

Why does the world need a new word? The scale and uses of energy are global and pervasive, so the macro- micro- distinction is inadequate. For example, there are countries (OPEC members come to mind) where state-owned energy production, rather than taxation, is the dominant source of revenue. On the other side, if Walmart were a country, it would rank in the top 10% for GDP. So, the factors that influence decisions for organizations of similar sizes but in different realms of economics lie in a semantically gray area, between self-serving elements and societal considerations. But it is primarily at this scale that effects on climate change will be meaningful. In other words, “grassroots” efforts are doomed because they are limited in scope and long to mature. Thus:

Think global, act global.

It’s reasonably straightforward, as well, that energy is an alternative currency of holoeconomics—it is the single resource that, without which, economic transactions are virtually impossible. It is a currency because it’s limiting, and once it is used for a particular purpose, it cannot be used again until replenished. Further, it is directly relevant to climate change, as I’ve hammered home repeatedly. The energy we use is mainly stored in carbon-based form, whether as a natural resource or as food. Humanity’s use of geologic carbon and our industrialization are superimposable. Retrospectively, it would have been impossible to have one without the other.

So, as a first pass at a working definition, holoeconomics looks at decisions made by larger organizations as if they were individual actors, subject to the energy and mass constraints supplied by science. At this level, economic forces become the on-off switch we need: If an economic activity produces less value than its raw components, then it cannot survive in the long run.

Some may ask, “Isn’t holoeconomics a distinction without a difference?”

To address that question, let me tell you a personal story: In December 2021, I participated in a panel discussion on prospects for “Energy and Climate Technologies”. The moderators held it under the Chatham House Rule to foster candid conversation. Consequently, I cannot reveal the participants’ identity or affiliation, and you won’t find me listed. However, I can say that the other participants currently work in organizations that are actively investing other-people’s-money in energy-related enterprises that promise to reduce emissions. All of the panelists, myself included, are dedicated capitalists who align on the direct connection between economics and climate change. But, after reflection, I realized that my view differs from the others in a few critical ways.

The distinction is perspective and motivation: I do not hold any purse strings, I do not have to answer to investors, and I’m not seeking personal or professional returns. Instead, by looking at global warming/climate change holistically through an economic lens, I’m seeking strategies that will work technically without harming the world’s economy. Like Elon Musk in an earlier installment, my co-panelists emphasized the importance of policy approaches (like carbon taxes) that governments should implement to recover economic value from the externality of emissions. But that doesn’t solve the problem! Instead, it simply tilts the market toward renewables as replacements—admirable but ineffective in the long run.

But, in their defense, my colleagues’ perspective is understandable: If you’re an investor, success is earning the highest return while avoiding money-losing efforts—that’s the value the investment adds. If some of that is the avoidance of a government tax, that’s a bonus, and it can make the difference between a positive ROI and a loss.

As I’ve pointed out, if you have to pay for energy, direct air capture of carbon dioxide cannot lead to a positive return on investment without policies that force the activity to be economically valuable. And, as IPCC has documented in thousands of pages across a few decades, humans cannot control climate change without direct air capture! That’s the crux of the issue, and we must face it. Holoeconomically.

As a final note, after my section of the talk, I was asked a question from an attendee that highlighted another problem. The audience was eclectic, hyper-intelligent, and diverse, precisely the audience I’m looking to reach here. I don’t recall the specific wording, but after my section, I proposed “nuclear energy” to solve our climate dilemma. I was asked, “Why nuclear? What about solar?” The question reveals precisely the problem with energy. Everyone has a partial solution; It’s a circular firing squad of opinions and skeptical thought that leads inevitably to the outcome we’re seeing: Inaction.