It’s a question that fascinated the Crikey office this week: will a global economic slowdown help or harm the environment? Will a momentary break in the consumption of oil and the production of plasma screen TVs help the fight against climate change, or hinder it? Well, it turns out you shouldn’t put your credit card away or cancel that driving holiday. In an interview with environmental economist Professor Quentin Grafton of the ANU, Crikey discovered why.

We are likely to see a reduction in the growth of greenhouse gas emissions from the current global economic slowdown.

It sounds like good news, but any reduction in greenhouse gas emissions resulting from an economic slowdown is environmental protection by accident. It’s not a solution. What we need is a deliberate set of policies folded into the economy as a whole that have a long term impact.

As the economy goes into recession, people naturally become more concerned about the security of their job and asset prices. In that situation, the environment, which may be a high level concern, tends to drop down one or two levels. That’s not to say it is completely forgotten about; it may still be a high priority, but it falls from the top of the list.

The real action needed for tackling environmental problems is good policy, such as the right tax measures. If we generate pollution, it’s important that we pay its full cost. Good policy must focus on the long term, and a recession, which from a political standpoint demands immediate attention, is not the right circumstances in which to develop it. We need an economic situation in which people are able to demonstrate to political leaders that the environment matters and that there needs to be policy enacted to sustain it.

US President George Bush recently announced a stimulus package to put money into people’s pockets. The Federal Reserve has dropped interest rates again this week, this time by a quarter of a percent. These actions address the economic concerns held by consumers and business people. But in doing so, the politicians are also redirecting their efforts to what are viewed as the priorities of the time, illustrating again the short term perspective.

For the candidates in the current presidential election, the economy is a major issue. There’s only so much space in the media for each candidate, which limits what they can talk about, and by extension, what voters will hear. Environmental matters will by necessity then get pushed off the front page.

We should also remember that here is an inherent conflict between tackling an issue like climate change and resuscitating a slowing economy – the timescales are completely different. The former is long term and the latter is immediate, and that’s why politicians will tend to focus on recessions. In relative terms, they are a short term phenomena and have a very direct impact on electoral outcomes, whereas climate change is a 100 year project. Even other environmental problems require long term solutions. The fact is, there is no quick fix. Each problem requires its own set of carefully calibrated policies over time, and by “time” we don’t mean between now and the next polling day.

Get Crikey for $1 a week.

Lockdowns are over and BBQs are back! At last, we get to talk to people in real life. But conversation topics outside COVID are so thin on the ground.

Join Crikey and we’ll give you something to talk about. Get your first 12 weeks for $12 to get stories, analysis and BBQ stoppers you won’t see anywhere else.

Peter Fray
Peter Fray
Editor-in-chief of Crikey
12 weeks for just $12.