This Changes Everything by Naomi Klein: A Summary (of Part 1)

The focus of this book is on the causes of climate change, some potential solutions, and the dangers of carrying on with ‘business as usual’. More specifically:

  • Chapter two provides an overview of how globalised neoliberal policies helped to cause climate change (chapter two)
  • Chapters three and four explore how governments have a crucial role to play in combating climate change (chapters three and four)
  • Chapter five reminds us of the possible consequences of carrying on with the extractivist logic of the industrial era which underpins the neoliberal exploitation of the environment (chapter five).
  • Chapter one alerts us to the strategies which neoliberals employ to deny climate change in order to prevent the collapse of their neoliberal world order and their fall from world power

NB – I changed the order from the actual book because I think my order makes more sense!

NB2 – I’ve changed the arty subtitles of the chapters so they are more meaningful to a mass audience.

Chapter Two – Hot Money: How Neoliberalism Accelerated Climate Change

Klein argues that the three policy pillars of the neoliberal age (1989 – present day ) are each incompatible with many of the actions we must take to bring our emissions to safe levels and bring climate change under control.

The three main neoliberal policies are:

  1. privatisation of the public sphere
  2. deregulation of the corporate sector
  3. lowering of income and corporate taxes, paid for with cuts to public spending.

These neoliberal ideas lie at the heart of the World Trade Organisation, and many of its policies are incompatible with a sustainable future. Specifically Klein says there are three contradictions between the (neoliberal) goals of the WTO and what’s needed to control climate change.

  • Firstly, the WTO encourages more international trade which has meant a huge increase in fossil fuel burning container ships and lorries. Reduced carbon emissions would require less trade or more local trade.
  • Secondly, the WTO gave TNCs the rights to sue national governments for preventing them from making a profit out of mining/ burning fossil fuels, whereas to protect the environment, governments would need to be able pass laws to protect the environment.
  • Thirdly, the WTO has given western companies stronger patent rights over their technologies – whereas if renewable technologies are to be transferred to the developing world, they would need to make their own cheap copies of those technologies (because they would not be able to afford to buy them).

As general evidence of the link between neoliberal policies and the increase in global warming we have the following stats – ‘Before the neoliberal era, emissions growth had been slowing from 4.5% annual increases in the 1960s to about 1% a year in the 1990s, but between 2000 and 2008 the growth rate reached 3.4%, before reaching a historic high of 5.9% in 2009. (Evidence for this comes in the form of the report below (although growth does slow in more recent years!)

global carbon emissions

To illustrate the link between increasing international trade and global warming Klein gives the following examples:

According to Andreas Malm, China had became the workshop of the world by the year 2000 and by 2007 China was responsible for 2/3rds of the annual increase in global emissions. However, global warming cannot all be pinned on China – because only half of that growth in emissions is down to China’s internal growth, the other half being because of China’s increasing exports to other countries (production being done for TNCs).

This in turn is down to the primary driving force of the trade system in the 1980s and 1990s – allowing multinationals the freedom to scour the globe in search of the cheapest and most exploitable labour force (the ‘race to the bottom’) – it was a journey that passed through Mexico and South Korea and ended up in China where wages were extraordinarily low, trade unions were brutally suppressed and the state was willing to spend seemingly limitless funds on massive infrastructure projects – modern ports, sprawling highway systems, endless numbers of coal-fired power plants, massive dams, all to ensure that the lights stayed on in the factories and the goods made it from the assembly lines onto the container ships in time – A free trader’s dream, in other words, and a climate nightmare.

increasing trade to China
The expansion of China’s ports indicates the increasing volume of trade between China and other countries

Klein suggests that there is a causal link between the quest for cheap labour and rising CO2 emissions – the same logic which works labour to the bone will burn mountains of coal while spending next to nothing on pollution controls because it’s the cheapest way to produce.

As further evidence that it’s the global trade system/ increasing consumption in general (rather than just China) that’s the problem – most of the increase in emissions in the last decade and a half are a result of the globalisation of the trade in food (as observed by Steven Shyrbman a decade and a half ago). The global food system accounts for between 19 and 29% of global greenhouse gas emissions.

At one level this is a result of the increase in food miles that come with shipping food products around the world (for example shipping New Zealand apples to Britain in September), at a deeper level it is about the intensification of production through the industrialisation of agriculture – which has resulted in larger and larger farms devoting themselves to producing one crop (or one animal in intensive meat-factories) which requires not only tractors, but also artificial fertilisers and pesticides, all of which are derived from oil. At deeper level still, the problem lies in the fact that gigantic food companies such as Monsanto and Cargill are major players in writing the WTO rules that allow them to operate this way.

To illustrate the second point above: How TNCs use the WTO to sue governments Klein cites the following:

(Firstly some context) Fossil fuel companies lie firmly at the heart of the global capitalist system, and presently receive $775 billion to $1 trillion in annual global subsidies, but they pay nothing for the privilege of treating our shared atmosphere as free waste dump.

Are oil companies to blame for environmental decline?

In order to cope with these distortions (which the WTO has made no attempt to correct), governments need to take a range of aggressive steps – such as price guarantees to straight subsidies so that green energy has a shot at competing.

However, green energy programmes which have been instigated under nation states are increasingly being challenged under World Trade Organisation rules. For example:

In 2010 the United States challenged China’s wind powered subsidy programs on the grounds that it contained supports for local industry considered protectionist. China in turn filed a complaint in 2012 targeting various renewable energy programmes in mainly Italy and Greece.

In short, the WTO encourages nation states to tear down each others windmills while encouraging them to subsidise coal burning power stations.

The sad thing is, when governments subsidise green energy – it works – Denmark has the most successful renewable energy programs in the world, with 40% of its energy coming from renewables, mostly wind, but its programme was rolled out in the 1980s, with most installations being subsidised at 30%, before the WTO was established. Now such subsidies are illegal under WTO rules because it’s ‘unfair’ to fossil fuel companies.

Climate Change Treaties – The 1990s to the Present Day: Free Trade Trumps Environmental Protection

Klein notes that there is startling parallel between the emergence of international treaties on climate change and the neoliberal agenda free-trade agenda advanced by the World Trade Organisation.

1992 marked the date of the first United Nations Earth Summit in Rio – the first UN Framework Convention of Climate Change was signed.

1995 marked the date of the establishment of the World Trade Organisation, which formally put in place all of the above rules which effectively prevent any country doing anything about climate-change.

However, the commitments made in the climate negotiations all effectively functioned on the honour system, with a weak and unthreatening mechanisms to penalise countries which failed to keep their promises. The commitments made under trade agreements, on the other hand, were enforced by a dispute settlement system with real teeth, and failure to comply would land governments in trade court, often facing harsh penalties.

The hierarchy was so clear that the 1992 Rio Earth Summit agreement made clear that ‘measures taken to combat climate change… should not constitute a disguised restriction on international trade.’

To illustrate how weak the measures to combat climate change actually are Klein cites the fact that there are fundamental flaws with the way CO2 emissions are monitored:

Countries are bound by voluntary agreements to keep CO2 emissions low – but the emissions counting system on which nation states are judged is fundamentally flawed because it doesn’t take account of emissions from transportation across borders – and container shipping has increased by 400% over the last 20 years.

Also countries are judged by the emissions which take place in their boarders – not for the pollution produced in the manufacturing of goods which are shipped to their shores – for example the TV set in my living room is not counted on the UK’s emissions count, but on China’s, where it was produced.

Basically, Klein sees the lack of effective monitoring as allowing countries to under-report their CO2 emissions, and thus dodge responsibility.

What can we do?

We need to consume less, straight away, and aim to reduce our emissions to the levels of the 1970s, if we wish to be staying alive…

Chapter Three – Public and Paid For: Arguments and Evidence that Ground-Up Social Democracy Is The Most Effective Way to Combat Climate Change

Much has been written about Germany’s renewable energy transition – It is currently undergoing a ‘transition to green’ – with 25% of its energy coming from renewables. This is up from only 6% in 2000.

Though rarely talked about there is a clear and compelling relationship between public ownership and the ability of communities to get off dirty energy.

In Germany, this has taken the form of local citizens groups taking control of their own energy supplies from multinational corporations. There are about 200 of these in Germany, and they take the form of locally controlled energy companies which are concerned with public interests, not profit, which was democratically controlled by citizens, with money earned being returned to the city, rather than lost to shareholders of some multinational.

This movement is actually more widespread than Germany (there are even some cities in America have done this, such as Boulder in Colorado which have gone down this route), and is most prevalent in the Netherlands, Austria, and Norway, and these are the countries with the highest commitment to coming off fossil fuels and pursuing green energy alternatives.

On the other hand, according to John Farrel, the attitude of most private energy companies has been, and still is ‘we’re going to take the money we make from selling fossil fuels and use it to lobby as hard as we can against any change to the way we do business’.

In 2009 Mark Z. Jacobsen and Mark A Deluchi authored a road map for how 100% of the world’s energy for all purposes could be supplied by wind, water and solar resources, by as early 2030. There are numerous studies which confirm the possibility of this, but the biggest barriers to change are social and economic.

Increasing Natural Disasters Require Strong Public Institutions to Manage

In the course of the 1970s there were 660 reported disasters around the world, including droughts, floods, extreme temperature events, wild-fires and storms. In the 2000s there were 2,322 – a fivefold boost…. There is not doubt that man-made climate change has caused this increase.

Yet these are three decades in which governments around the world have been chipping away at the health and resilience of the public sphere – the problem with this is that governments are realistically the only institutions that are up to the challenge of responding to natural disasters (during disasters most people tend to lose their free market religion and wants to know their government has their backs).

A case in point here is the devastation caused by the the floods of 2013-14 – These were particularly awkward for the coalition government because a year earlier David Cameron had gutted the Environment Agency, which was responsible for dealing with flooding. Since 2009, approximately 25% of its workforce has been axed or were lined up to be axed and nearly 300 flood defence schemes had been left unbuilt due to government budget cuts.

The worldwide costs of coping with weather extremes are astronomical – In 2011 the global cost stood at $380 billion.

Given this it is clear that public money needs to spent urgently on reducing the carbon emissions which are causing these crises – and much of that needs to spent in developing countries – and who should pay? The polluters!

The Polluter Pays Principle

A 2011 Survey by the U.N.’s Department of Economic and Social Affairs concluded that it would cost $1.9 trillion dollars a year for the next forty years to overcome poverty, increase food production to eradicate hunger without degrading land and water resources and avert the climate change catastrophe, and at least half of that would have to be spent in developing countries.

The problem is that public spending has been going in the opposite direction, and the fossil fuel companies who profit from climate change have blocked moves to sustainability on every turn.

These companies are very profitable – the top five oil companies pulled in $900 billion in profits from 2001 to 2010. These companies are rich because they have dumped the cost of cleaning up their mess on regular people, and this needs to fundamentally change.

So who should pay?

Oil and Gas companies should be forced to pay by putting in place a steep carbon tax, and laws to prevent these companies from polluting – If these companies are going to stop polluting, it will be because they are forced to do so by law.

The United States – because the US military is the biggest consumer of petroleum in the world, arms companies should also pay.

The 500 million richest of us are responsible for about half of all emissions – so we are going to have to pay for our pollution.

Other suggestions for raising the almost $2 billion annually include:

  • A low rate financial transaction tax (would raise $650 billion)
  • Closing tax havens ($190 billion)
  • A 1% billionaires tax ($46 dollars annually)
  • Slashing the military budgets of the top ten military spenders ($325 billion)
  • A $50 tax per metric ton of CO2 would raise $450 billion
  • Phasing out fossil fuel subsidies – $775 billion.

If these measures were taken, they would raise more than $2 trillion annually.

Our current political class is probably not going to sort out climate change – because

  • They are not prepared to challenge big money Corporations
  • They are not prepared to engage in long term planning (real market fundamentalists don’t plan – the market sorts all that out!

Chapter Four – Planning and Banning: Arguments that Governments will need to Plan and Regulate Corporations to Combat Climate Change

In short – Governments need to plan for jobs.

The gist of this section is that the public sector needs to put green jobs creation at the centre of its green strategy – investment in renewables and local agriculture, as well as the renationalising of private companies (like in Germany, but also extended to rail networks in countries like Britain) could create millions of jobs worldwide, many more than a continued dependency on fossil fuels.

Governments need to plan for power (the transition to green energy)

We need to depart from neoliberal ideology to bring about the green transition – like is being done in Germany – this means engaging in long term national planning and deliberately picking green energy, and fixing prices to help young start up renewable companies.

However, what we don’t need is massive state owned energy companies – The highest rates of renewable energy have been achieved in Germany and Denmark with lots of smaller locally run co-operative businesses.

One threat to the green transition is cheap gas – In the US fracking has damaged Wind Power’s position in the new energy market – down from 42% of the market in new energy in 2009 to 32% in 2011.

Governments also need to plan for food.

Here Klein cites the important role agroecology which is about small scale, organic, local production, increasing as far as possible the species diversity on farms, in sharp contrast to the monocultures preferred by big international food companies, which are heavily dependent on fertilisers and pesticides.

In Malawi, agroecology has led to a doubling or tripling of Maize yields, and to date projects world-wide have shown a crop yield increase of 80% in 57 developing countries, with an average increase of 116% for all African projects.

Governments will need to learn to say no to big oil companies.

For example, companies simply should not be given permits to frack, period. Some studies have found that the methane emissions from fracking are 30% higher than those associated with natural gas, and that the warming potential once the gas is emitted is 86 times greater than carbon dioxide.

The government should also say no to projects such as the Keystone XL pipeline which is being built to pump shale gas from Canada to the US – this will require massive acts of civil disobedience to achieve.

Meanwhile, big oil companies are investing in extracting projects like never before, and spending a fortune on lobbying governments – One study found that they spend $400 000 a day lobbying.

Chapter Five – The Decline of Nauru – The Consequences of Carrying on with Business as Usual

In this chapter Klein provides us with a brief history of the tiny Island of Nauru, which offers us a useful warning against the extractivist logic of the industrial era.

Few places on earth embody the suicidal results of building our economies on polluting extraction more graphically than Nauru. Thanks to its mining of phosphate, Nauru has spent the last century disappearing from the inside out; now, thanks to our collective mining of fossil fuels, it is disappearing from the outside in: I covered this in a previous post – The Island of Nauru…..


Chapter OneClimate-Change Proves that Neoliberal Policies are Killing the Planet and Us With It – thus Neoliberals Deny Climate Change in Order to Cling on to Power.

Neoliberals know full well that our global economy is created by and reliant on the burning of fossil fuels and that to change this requires the opposite of neoliberalism – It will require governments to intervene heavily in business – with such measures as

  • sweeping bans on polluting activities
  • deep subsidies for green alternatives
  • pricey penalties for violations
  • new taxes
  • new public works programmes
  • reversals of privatisations.

There is however, little motivation for neoliberals to adopt climate change policies because climate change will affect the poor more than the rich…

For starters, in the wealthier countries we will be able to protect our cities from the effects of sea level rise with expensive flood barriers, and then there’s the fact that climate change will affect poor countries in the South more than rich countries in the North.

And more drastically, in the words of Naomi Klein….

‘Since people who scare Americans are unlucky to live in poor, hot places, climate change will cook them, leaving the United States to rise like a phoenix from the flames of global warming.’

So instead of changing anything, neoliberals have established institutions which fund people to do research which counters the overwhelming (97%) scientific consensus that climate change exists.

The premier institute for doing this is The Heartland Institute, which hosts annual gatherings of climate change deniers, during which little serious scientific debate takes place, with the most popular speakers being right-wing (neoliberal) ideologues who present the issue of climate change as a hoax being perpetuated by the left in order to force people into giving up their high-consumption lifestyles.**

Worryingly, these think tanks seem to be very influential in shaping public opinion – A 2007 Harris poll found that 71% of Americans believed that the continued burning of fossil fuels would alter the climate. By 2009 the figure had dropped to 51%. In June 2011, to 44%. This is one of the largest shifts in a short period of time seen in public opinion in recent years.

Two Possible Futures…

Klein believes that we have a choice….

If we stay on the road we are on, we will get the big corporate, big military, big engineering responses to climate change – the world of a tiny group of big corporate winners and armies of locked-out losers that we have imagined in virtually every account of our dystopic future, from Mad Max to The Children of Men, to The Hunger Games, to Elysium.

Or we can choose to heed climate change’s planetary wake-up call and change course and steer away not just from the emissions cliff but from the logic which brought us that precipice.

That means laying out a vision of the world that competes direclty with neoliberalism….. that resonates deeply with the majority of the people on the planet because it is true: that we are not apart from nature, but of it. That acting collectively for a greater good is not suspect, and that such common projects for responsible for our species’ greatest accomplishments. That greed must be tempered by both rule and example. That poverty amidst plenty is unconscionable.

** That their position on climate-change is not objective is suggested by four facts:

  • Transnational Corporations which are responsible for climate change (and so benefit from it) such as Koch and ExxonMobil fund such think tanks, to the tune of almost $1bn a year.
  • Many of the companies funding climate change denial are at the same time insuring themselves heavily against the future consequences of climate change.
  • A 2013 study by political scientist Peter Jacques found that 72% of climate denial books, mostly published since the 1990s, were linked to right-wing think tanks such as the Heartland Institute.
  • One’s political outlook predicts one’s views on climate change more so than anything else – only 11% of Americans with hierarchical/ individualistic (right-wing) worldviews rate climate change as high risk, while 69% of those with egalitarian and communitarian worldviews rate it as high risk.)


Naomi Klein: This Changes Everything

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