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Climate Change = Economic Change

Milan, 26/10/2018, Annual Conference for the Friends of Aspen

The problem of global warming can no longer be deferred if its catastrophic planet-wide consequences are to be avoided. That was the message of a special report issued in October by the Intergovernmental Panel on Climate Change (IPCC), the most authoritative scientific body dedicated to the study of climate change. According to the report, at the current rate, by 2030 the global temperature increase will surpass 1.5°C, which is considered the upper safety limit for containing and managing the fall-out, albeit at the cost of massive investments in financial, material and human resources.

Evidence of the effects of climate change on health is irrefutable. According to World Health Organization annual estimates, 1.2 million deaths can be attributed to pollution, 2.2 million to diarrhea associated with poor hygiene, 3.5 million to malnutrition and 60,000 to natural disasters. These numbers are destined to rise due to climate change-related events that will threaten the most basic necessities for healthful living: air and water, food and housing. The scenario is made more complicated by the additional effects of other megatrends such as the population explosion, urbanization, migration and ageing.

It is true, however, that the technological and scientific revolution is giving humanity new and potentially powerful tools with which to respond to this challenge, not only in terms of confronting and mitigating risks but also of transforming threats into drivers of change and growth. As Pope Frances asserted in his “Laudato si”, the threats associated with climate change can be an opportunity to embark upon a path of renewal that embraces the dimensions of the economy, solidarity, creativity and culture.

Today’s “trilemma” involving economic growth, environmental protection and social sustainability has earned top priority on the agendas of the advanced economies. Bearing witness to this, the 2018 Nobel Prize in Economics was awarded to William D. Nordhaus for his studies on the relationship between climate change, new technologies and macroeconomic trends.

Nordhaus’s research shows how one of the most effective ways to reduce air pollution is to levy a uniform tax on carbon dioxide emissions on a global scale. Possible problems in the implementation of such a plan are associated with the varying stages of development of the major world economies.

On the other hand, alternative (or complementary) efforts could begin with an information campaign that targets consumers, with a view to increasing the demand for low CO2-content products; the world of finance can also make an important contribution by directing investments toward companies with medium- to long-term development plans hinged on sustainability.

Cities too can play a key role in drafting climate change policies, and step in as leaders wherever central government action is lacking. An example of this can be found in the case of several US cities that have ignored the Trump administration’s stance and stuck to policies that address global warming, thereby making of the local urban community an alternative to the nation state.

Moreover, urban settings can offer themselves as testing grounds for the feasibility of innovative policies before they are launched on a national scale. The primary lines of intervention include compact urban development models; the energy efficiency of buildings; eco-sustainable transportation; the use of Big Data and digital instruments; and social transformation. Manchester, Paris and Melbourne are examples of innovative case studies that prove how it is possible to form new public/private partnerships and align the interests of a range of stakeholders. 

There is no doubt that the challenges generated by climate change are extremely complex; they involve a large number of variables associated with the economy, industry, urban development, public health, social inclusion and so forth. Levels of responsibility – between global actors engaged in implementing emissions reduction policies and local actors focused on efforts to adapt to/mitigate the effects of climate change – are also diverse and interrelated.

Confronting these themes necessitates a holistic and multidisciplinary approach that encompasses policy-makers, business interests, the national health service, the national scientific research system, citizens and consumers. It is imperative to be able to move from protest to concrete action, disseminating the knowledge of best practices and an agenda of awareness among the population. Unfortunately, the systems that impart knowledge and training in Italy – the essential underpinning of any attempt to formulate policy – seem unprepared to bring a multidisciplinary approach to the challenges posed by climate change to our societies today.