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(Mike Ely, Revolutionising production itself: for humanity and for the world, , April 24, 2012 )

A horizon beyond scarcity and inequality First: Human beings have suffered, bitterly, from poverty and scarcity. Being dirt poor is awful. Watching your children go hungry and even starving before your eyes is unbearable — or watching a newborn die of dehydration from bad water. Seeing a world of goods, inventions and travel, and yet being pinned (by endless grinding poverty) in dead-end, repetitive, unrewarding labour is maddening — especially when for literally billions of people there seems no way out.¶ Second: Modern productive capacity allows (for the first time in history) a society of common abundance. Previously poverty and starvation were a result of human helplessness in the face of the natural world — our once-limited ability to triumph over rocky ground, or hurricane devastation, or infection, or drought.¶ Now, however, the continued existence of hunger and poverty is a result of the current outrageous and unjust structure of human class society — the existence of class society itself is the cause of the difficult life of the vast majority of humanity. Something else is now possible (a mutual flourishing, radically new forms of egalitarianism, a radical redirecting of social surpluses toward actually solving the vast historic problems of the people around the world).¶ Production is marked by class nature¶ Third: The form of modern production (and consumption) are themselves deeply marked by the class nature of the societies that produced them. It is not just that the surplus of production is alienated from the exploited (by the owners of capital). The whole process of production (its forms, its inputs, its purpose, its outputs, its impacts, its physical engineering, its social constructs of hierarchy and punishments) is marked by the class society within which it emerged.¶ And this is deeply important for understanding how socialist sustainability will also need to revolutionise the inherited patterns of production and consumption.¶ One of the major contributions of [China's] Great Proletarian Cultural Revolution was the insight that the very form of production is itself marked with capitalist or communist directions.¶ Some examples¶ The very architecture of capitalist factories assumes a specific form of hierarchy — and obstructs different, socialist/communist relations in production. In revolutionary China, factories, docks, shipyards, agricultural villages had to be build differently (with meeting rooms, and open spaces, cafeterias, and structural redundancies to allow the workers to actually participate in their own supposed “rule” over society.)¶ The very nature of capitalist assembly lines often assumes that workers are merely cogs in the process (and will not be meeting now and then to make decisions). And it is commonly structured to assume that “work life” for the workers is repetitive, uncreative and subordinate. Just think through how a textile mill in Bangladesh would have to be built differently to better serve society’s revolutionary transformation. (Would there be day care centres? an attached college? A side industry for processing link and toxic waste? Platforms for public speaking in the production buildings?)¶ The class nature is most obvious in the social structures of capitalist production (hierarchy, enforced obedience, threat of firing, experts in command, managers trained in capitalist efficiency, “attention to the bottom line", reproduction of “the colour line”, inherent separations between plant and community, between work and education, the assumptions of “commuting”, the functioning of rotating shifts, etc. etc.)¶ But you don’t get far into a socialist revolution without realising that class nature is also embedded in how machines are designed, or the assumptions of inherited processes. The production we inherit is itself (including physically) shaped by class society. And here we have been discussing the accumulating environmental impact of capitalist production (and the parallel crime of continuing such capitalist methods and assumptions in most previously socialist societies).¶ The fact that there are high communications among managers in industry, but little cross communication among farmers in the fields says a lot about how decisions are made, by whom and for what.¶ The example of coal¶ Let me take something I know about:¶ Coal itself is classless. It is simply a mineral seam in the ground.¶ But everything about coal production and consumption is marked by class (and class struggle) — and (in our current society) terribly marked by the capitalist nature of decision making over production.¶ One extreme current US example is mountain topping — under capitalism it is “profitable” to scar the precious mountains to retrieve coal in small seams — by simply removing the whole top of the mountain. This destroys something irreplaceable (and brings to mind Marx’s use of the word usufructuaries — i.e. we should be stewards of the world around us, and use its “fruits” in a sustainable way). The ratio is simple: under current market conditions, one inch of coal can pay for removing one foot of rock. So if the coal is 30 inches high (which is impossible to mine profitably by underground techniques), these coal pirate corporate pigs can “profitably” remove a mountain top that averages 30 feet high.¶ Karl Marx wrote, ¶ Even a whole society, a nation, or even all simultaneously existing societies taken together, are not the owners of the globe. They are only its possessors, its usufructuaries, and, like boni patres familias, they must hand it down to succeeding generations in an improved condition.¶ [Usufructuraries are those that harvest the fruits of what ultimately belongs to someone else. It is a 19th century legal word that captures some of what we now mean by "sustainable".]¶ Coalmining itself is soaked in the blood of the workers. In the mine where I worked, three men died over the years I was there. And men came out injured daily. Watching the older workers prepare for work you saw them (slowly, painfully) putting on trusses, braces, false legs. You saw missing fingers, or long scars. Capitalist coalmining uses up humans as a raw material.¶ Again: This was expressed in “how the mines were run” (i.e. what the processes were, how the bosses were trained, what was considered “safe”, what specific decisions were made) — but it was also embedded in the very nature of the production process, which had developed and morphed for a century under capitalism.¶ It’s not as if socialist society will simply “take over” the production processes inherited from capitalism, and use them to produce goods and surplus that we will now direct. The production itself has a class character.¶ And further: There are whole branches of industry whose expansion and even existence reflects the decisions of capitalism. The ruling class of the Eisenhower years (emerging from WWII, with the US controlling “cheap gas [petrol]” from the Middle East) decided to build a highway system with suburban sprawl (not a rail system, not compact cities). It was not just the profit making out of that process that was capitalist — the whole structuring of society, the very products being built, reflected capitalism’s values and priorities (including racism and white flight).

(Claudia R. Williamson, THE CULTURAL OPPOSITION TO CAPITALISM: MYTHBUSTING THROUGH OUR PAST, , 2007)

Coal miners performed a dangerous job. They faced higher safety risks than workers in most¶ other industries. Before 1930, three to four men were killed per 1,000 workers each year.¶ Accident rates varied across states, but were higher in West Virginia than any other state east¶ of the Mississippi River. Why would anyone choose to be a coal miner given these¶ conditions? It’s quite simple; the job paid well. Coal miners received higher hourly earnings¶ than workers in other industries precisely because of the danger involved. If a specific job or¶ company was considered more dangerous, miners would be less likely to accept these jobs.¶ Therefore, miners required higher wages to work under these conditions.¶ The fatal accident count stayed relatively constant in the U.S. before 1930. However,¶ this is somewhat deceiving. In 1910, the U.S. Bureau of Mines was created with a focus on¶ mainly large-scale accidents, defined as gas and dust explosions and other accidents killing¶ more than five men. State mining legislation was also mainly concerned with these types of¶ accidents. This resulted in a decline in large-scale accidents, but an increase in small-scale¶ accidents, which received less publicity but accounted for more deaths overall.¶ Figure 4.2 below shows data on fatal accident rates in coal mining. The fatal accident¶ rates shown in the figure are the number of accidents per 10 million man hours worked. The¶ data show that small-scale accidents (such as roof falls, hauling accidents, small explosions,¶ and electrocutions) accounted for the vast majority, or 84 percent (17.6 ÷ 20.9), of fatal¶ accidents. Large-scale accidents accounted for only the remaining 16 percent.¶ Most small-scale accidents occurred in a miner’s room due to a roof fall or a misfired¶ explosive and were the result of the choices made by the miners themselves about the¶ individual safety precautions they took on their jobs. Miners were paid by the amount of coal¶ they could dig out and were given a significant amount of independence to decide the best¶ way to achieve this. Thus, miners faced a direct tradeoff between income and safety and were¶ left free to decide how much safety prevention to undertake.3¶ Though incorrect, it is common to see ‘greedy’ mine operators as the reason that¶ mines could be quite dangerous. Often times, both miners and operators chose to ignore¶ safety decisions in order to increase productivity, because it meant more income for both the¶ mine owner and the miners themselves. Nevertheless, due to the dangerous work conditions¶ in coal mining, government decided to regulate the industry with safety legislation. However,¶ the effects of this legislation were mostly disappointing (Graebner 1976).

John Buell, Coal and Predatory Capitalism, the Bangor Daily News (Maine), https://www.commondreams.org/view/2010/04/27April 27, 2010

Just days after the worst U.S. coal mine disaster in a quarter-century, the World Bank approved a $3.75 billion loan to South Africa to build one of the world’s largest coal-fired electric power plants. Though both South African and U.S. environmentalists had urged the U.S. to vote no, abstention was the best they could achieve. Coal plays an outsized role in our politics. Just how and with what consequences are questions that must be addressed if we are to enjoy sustainable growth. Coal’s advocates argue that it provides the cheap electricity that can lift the poor both here and abroad out of poverty. Coal, however, is far less cheap than its advocates suggest once a full accounting of its social costs is included. Over the last century, mine accidents have killed more than 100,000 miners. Since miners’ compensation seldom reflects the job’s risk, miners and their families in effect subsidize our cheap energy. The effects of coal mining, however, do not stop with death from mine disasters. A family friend, Sarah Vekasi, an ecochaplain in West Virginia, put the case eloquently after the tragedy: “Imagine if the national press came in and camped out at our local elementary school every time we reported that 30 men in our community were diagnosed with Black Lung and 30 children have missed an inordinate amount of days of school due to unidentifiable illnesses caused by drinking polluted water and breathing toxic air? This is a national emergency and the issues reach further back than just how this particularly horrible mine explosion happened to how a single industry has dominated this region and what we, as a national and re-gional community are going to do to change that.” Economic domination and environmental degradation may worsen as jobs in coal country become scarcer. Mining corporations resort to job blackmail and routinely buy political influence. Coal mining today reflects and is part of a transformation in U.S. capitalism from a system of regulated and countervailing powers to what economist James Galbraith labels predatory capitalism. In the wake of President Ronald Reagan’s assault on the air traffic controllers, Massey Energy joined the growing group of U.S. corporations that used every technique, legal or illegal, to bust its unions. Neither regulations nor unions were to limit profits. The strategy paid off, giving Massey mines liberty to slash wages and flout safety rules. Massey CEO Don Blankenship is right out of Vince Lombardi’s playbook where “winning isn’t everything; it is the only thing.” Lives rather than football games, however, are at stake here. Blankenship’s notorious memo instructing mine superintendents to put coal production ahead of all other considerations encouraged cut-ting corners on worker safety at every turn. Unionized mines are safer because miners who spot and seek to address safety concerns cannot be arbitrarily fired. Preventing future disasters and addressing coal’s environmental impact depends on activism on several fronts and across several national and ideological boundaries. Even with a sensible energy policy, some min-ing will continue. It is imperative that the right of miners to unionize be protected. Mine standards must be strengthened and enforced.

Cutting across all corporate insertions into the environmental debate is the assumption that the basic instruments for responding to ecological crisis are technology and the market. The technological fixation has been a constant of capitalist development. Initially focused on maximizing labor productivity, it is continuously replenished by ever more miraculous applications, especially in the spheres of communication and of genetic engineering. The unending proliferation of innovations - a hallmark of late capitalism7 - lends credence, in public perception, to the idea that there is no challenge that technology cannot overcome. The unstated premise behind such claims is that the selection of any technology will continue to reflect corporate interests, which in turn reflect the goals implicit in market competition, i.e., profit-maximization, growth, and accumulation. While green technologies - e.g., renewable energy sources - may attract a degree of corporate attention (thanks mainly to social/political pressure), nothing short of a change in the basic locus of economic decision-making will stop certain corporations from continuing to pursue established (non-green) lines of production. Insofar as they must nonetheless try to present themselves in green clothing, they will not hesitate to misrepresent the questions at stake and to invoke technological "solutions" that have little chance of being successfully implemented. A revealing and economically important illustration of this dynamic is the advocacy of so-called "clean coal." To begin with, much of the coal industry's PR emphasis is placed on the removal of specific impurities (such as sulfur and particulates) from coal-burning emissions, overlooking the biggest problem: the combustion process itself, and the resultant rise in atmospheric concentration of carbon dioxide. When this unavoidable "bottom line" can no longer be ignored, the industry, not wishing to be restrained even by such modest disincentives as a carbon tax, will assert, as did CEO Steven Leer of Arch Coal Inc., that "the enabling technology for stabilizing carbon dioxide levels in the atmosphere is carbon capture and sequestration. There is not another option."8 Carbon capture and sequestration, however, is an unproven technology, with problems not unlike those associated with any toxic byproduct that has to be disposed of in very large quantities. While it is possible to isolate carbon dioxide emissions and to pump them into out-of-the-way sites (whether underground or perhaps even under the ocean), the potential blowback from such undertakings, once they exceed a certain threshold, is uncertain, incalculable, and possibly catastrophic.9

On a technological as well as a policy level, the instruments for reducing global warming are a part of the problem, rather than the solution. Because emissions reductions are designed to enable the con- tinuous economic growth on which capitalism is predicated, “going green” means, more than anything else, a shift from fossil fuel energy to renewable energy on a massive, industrialized scale. But renewable energies on an industrial scale are also extremely destructive.

Hydroelectric power is currently the foremost renewable energy source. Hydroelectric dams are extremely destructive to build. They require a huge amount of concrete, production of which is one of the main greenhouse gas emitters, they cause the loss of huge amounts of forest and farmland, they kill off riverine species such as salmon, they disrupt natural flooding cycles necessary to many ecosystems, and their reservoirs emit large quantities of methane.

The Green New Deal is the main proposal on the Left, and in a social democratic framework it makes a lot of sense. It directs massive public spending to pay for a total infrastructure overhaul, completing the tran- sition to renewable energy, while also increasing social spending to ameliorate the inequalities that have provoked growing crises in nearly all the world’s democracies. At the same time, government-subsidized production may be enough to trigger a new industrial expansion and leave behind the crisis of accumulation global capitalism has been dragging in its wake since 2007, and in some senses since the 1970s. In a stroke, the Green New Deal could resolve the three interconnected crises that threaten the state: the ecological crisis, democracy’s crisis of legiti- macy, and capitalism’s crisis of accumulation.12

In truth, the GND should be catechism for the most ardent defenders of the current system, toppling as it is, but it seems that nearly everyone is one long step behind events. Conservatives, locked in their perpetual existential crisis, are too threatened by the updating of their privileges that they are further destabilizing the system they are trying to protect, as always.13 Centrists are trying to preserve a middle ground where there is none. And so it has fallen on progressives, many of them avowed anti- capitalists, to become capitalism’s last line of defense.

With carbon emissions not slowing down in time to avoid surpassing 2°C of warming, a large number of climate experts and entrepreneur- ial capitalists are turning to questions of geoengineering and carbon removal. In After Geoengineering, Holly Jean Buck provides a useful review of many of the methods being developed and the difficulties and limitations they entail. Since carbon capture is being sold as a way to buy more time, she poses the question, time for whom or for what? Are we buying more time for endangered species, threatened habitats, and vulnerable human populations? Or are we buying more time for govern- ments and companies to continue enriching themselves and to slowly wean themselves off of fossil fuels when it is convenient to their profit margins and geopolitical strategies? As she makes clear, “the polluters are first in line to benefit from carbon capture.”62

Currently, the predominant strategy for carbon capture is through “natural” methods, namely reforestation, which comes with its own problems. But other strategies, many of them classified as geoengi- neering, are increasingly gaining attention, and sometimes, funding. Examples include injecting carbon pulled out of the atmosphere into cement or into bedrock, where it mineralizes; liquefying carbon and storing it in old gas and oil wells; constantly seeding the upper atmo- sphere with aerosols that will reflect sunlight; dusting agricultural soils with ground up minerals that increase carbon retention; or running huge offshore plantations for genetically modified algae to be used as a fuel source. The main real usage of any of these technologies, at the moment, is by the fossil fuel industry injecting captured carbon into its wells to displace oil or gas and increase output, known as enhanced oil recovery. I agree that we need to consider all of these proposals since it is a matter of stopping mass starvation and saving species from extinction, but only if we can do so fully aware of their true dimensions.

These existing critiques sometimes give the impression, however, that the North has been dictating climate change policy to a ‘helpless’ South. As recent climate change negotiations have shown, however, nothing could be further from the truth. What we see, instead, are Southern elites – particularly those in the BRICS countries – pushing for the extension of carbon markets. Given Marini’s insights into the pressures driving sub-imperialism within the periphery of the world-economy, it is not at all surprising that the development of the CDM, as well as VOM projects, is dominated by the BRICS countries today (Ganguly & Bandyopadhyay, 2011). More than 70% of all those CDM projects that have been registered so far, for example, are located in Brazil, China and India (UNFCCC, 2012). As contributions to Böhm and Dabhi (2009) show, many of these CDM and VOM projects (all put forward as climate change mitigation projects) involve the development of big industrial plants; these plants have significant negative effects on local communities and ecosystems in the South that are situated in close proximity to them. And of course, these plants are owned by Southern elites, who are benefiting financially by selling carbon credits to polluters in the most developed industrial countries. As Lohmann puts it, ‘heavy polluters and local corporate “bad citizens,” such as India’s Tata Group, ITC, Birla, and Jindal, Korea’s Hu-Chems Fine Chemical, Brazil’s Votorantim and South Africa’s Mondi and Sasol, become stars of heroic green narratives,’ while villagers and local communities continue to see their local livelihoods and environments destroyed by these heavy-weight industrial companies (Lohmann, 2008a, p. 364). This ‘green’ façade is supported by national governmental agencies in these countries, such as the DNAs. While these agencies are meant to monitor CDM projects and ensure that local sustainable development goals are achieved, the DNAs are instead run like pro-business agencies that see the CDM projects as welcome economic development and as opportunities to enhance the profits of domestic firms (Gilbertson, 2009; Cabello, 2009). Elite social groups in the BRICS countries have an inherent interest in expanding carbon markets, because they profit directly from them, without having to feel any of the pain of climate change mitigation themselves. Newell and Paterson (2010) welcome this aspect of the broadening global support for carbon markets. In their view, these kinds of financial incentives – which attract powerful economic and political groups to the cause of climate change mitigation – will help capitalism to decarbonize itself and hence avoid the climate change abyss. We are, however, less convinced that much is to be celebrated in the way that capitalism has embraced carbon markets. We see these tools as essentially providing new profit opportunities for elite actors, by financializing a new commodity (essentially air) in the form of ‘carbon allowances’ and ‘carbon credits.’ These commodification processes are, in turn, facilitating processes of dispossession, uneven development and sub-imperialism in the South, while simultaneously exacerbating ecological degradation and unsustainable, crisis-prone development paths in many of the localities in which the new ‘clean development’ projects are based.

Aspiring to bring the poor into the fold of the global economy, in the way that inclusive green growth advocates, detracts from the deeper issue of how, in the first instance, the poor are unequally incorporated into the free market economy as casualties of the principle of competition driving economic relations. Add into the mix the aims of the inclusive green growth paradigm (developing new green technologies or a free market in carbon offsets) to solve environmental harms by commercializing or putting a price on them and we are left with a potent, albeit misplaced gesture of inclusive governance that sets out to solve the twofold problems of poverty and environmental injustice in one fell swoop whereby the source of the problem is used as the solution. Inclusive green growth extends the power and reach of the free market (competition, privatization, commodification) that establishes the unequal location of people and the exploitative situation of the environment in the global economy, hereby reproducing the self-same political rationality and system of power relations. Capital accumulation and the logic of competition driving social and environmental injustices are no longer viewed through a political lens as the cause of these injustices; rather, using an economic frame that views capital and competition as the solution to injustice simply depoliticizes the economic practice of accumulation and competition. When the principle of competition reappears as part of another discourse around resiliency the biopolitical character of inclusive green growth is exposed. On the one hand, inclusive green growth policies and actions are endorsed as promoting more resilient economies. On the other hand, resilience 'has emerged as an important reference point when discussing appropriate responses to the increasing levels of risk faced by societies and economies'.42 In this way, the model of inclusive green growth neatly aligns with the growing popularity around producing resilient subjects who are better positioned to fend off the catastrophic effects of climate change, environmental degradation, and impoverishment.43 A resilient subject is flexible and better equipped to adapt to the variegated landscape of threats, crises and emergencies. Brad Evans and Julian Reid uncover the political implications of resilience theory, skilfully describing how it places the responsibility for security squarely back in the court of the world's most vulnerable subjects, who it should be noted are unequally impacted by environmental harms and the cycle of economic boom and bust.44

It is no wonder that a Shell Oil executive was caught boasting about how they helped write the Paris Agreement, particularly the sections that allow for carbon trading.21 As Laura Terzani writes, “net zero emissions is not zero emissions.”22 In practice, net zero usually means wealthy countries passing the responsibility for their emissions on to poorer countries through creative accounting. When we pare down the ecological crisis to the demands of climate reductionism, talking about capitalism is dismissed as “off message.” Should it be any surprise, then, that climate policy has just become a new scam allowing the wealthy to make even more money?

It’s worse than mere profiteering, as a social war analysis would lead us to suspect. Carbon trading creates a market for major land grabs across the Global South, a final nail in the coffin of the world’s peasants, and a continuation of the colonial dynamics that export the costs of the ecological crisis to poorer countries. It is also a key part of “payment for ecosystem services,” a way of “quantifying and constructing the natural environment as a ‘service provider’ commensurable with financial markets,” which in turn constitutes a pillar of “property-based counterinsurgency,” the pernicious and often brutal repression of movements to defend the land.23

Inclusive green growth presumes economic growth is an a priori social good. The assumption rests with the argument that each and every day the economy serves more and more people. Namely, economic growth can be neatly aligned with a rise in living standards and a fall in poverty rates. In the words of World Bank Group President Jim Yong Kim: We live in a time of great contrasts, when fewer than roo people control as much of the world's wealth as the poorest 3. 5 billion combined. But we also live in a time when many developing countries have the strongest growth rates in the word, which each year helps millions of people lift themselves out of extreme poverty." The primary policy tools used to achieve economic growth in the service of an inclusive green agenda include: eco-tax reform, subsidies, green stimulus investments, investments in green infrastructure, eco-tourism schemes, improved natural resource management, socially inclusive development, and research and development that will address knowledge gaps. The suggested approach is integrative and systemic, using the principles of efficiency and maximizing market solutions. Unsurprisingly, proponents of inclusive green growth view one of the challenges to realizing significant efficiency gains as 'a lack of instruments to "monetize" the benefits of conservation and efficiency and to reward sustainable consumption' .13 The solution to this is to introduce more innovative financing tools and to substantially increase investments in economic activities that improve natural capital. Emphasis is placed on the importance of public-private sector partnerships, whereby the private sector is viewed as an 'active partner of governments', in addition to the institutionalization of local knowledge and politics which has triggered a gamut of new political actors such as non-profit and non-governmental organizations, communities and religious groups entering the political frame of economic policy making. l4 Despite ambitiously setting out to bring social, economic and environmental concerns into balance by adopting a multi-scalar approach to governance that institutionalizes local political actors, the inclusive green growth model continues to push the neoliberal idea that the role of government is to encourage economic efficiency and privatization. 15 Unsurprisingly, one of the primary strategies of green growth is the privatization of the commons. By putting a price on what are otherwise common pool resources such as water, forests and ecosystem services, the model puts its faith in market mechanisms to solve social and environmental issues without defusing the circuitry of structural violence driving social inequity and environmental degradation. Environmental degradation and climate change are problems we share in common with people in different parts of the world, with other species, and future generations. These are therefore potentially solidarity-building issues. Although proponents of inclusive green growth acknowledge the common at the core of environmental issues, by analyzing the situation from the vantage point of economic efficiency and by using criteria such as surplus value, private property, and price, the commoning condition of the problem is appropriated and privatized. In the name of saving the commons, inclusive green growth takes the self-sufficient character of a commons and inscribes it with the law of the market, hereby denying the commons its distinctly autonomous condition. Accordingly, the commons is rendered non-common. In the process the violence capital inflicts on all life forms, a violence environmental degradation and climate change forces out into the open, becomes invisible and inaudible once more. It is at this juncture where the political significance of prioritizing economic growth and efficiency comes into the light of day. Predictably, the assumption driving inclusive green growth is that economic growth is value neutral. Namely, that it is an unquestionable good in and of itself. However, as Piketty demonstrates, economic growth is not a reliable predictor of justice and equality and the reason is not just economic; it is political.

Thus far, capitalism has shown a capacity to recover from the economic and environmental crises it has produced. This resilience may well be the reason why some people have come to believe that effective solutions for combatting climate change can only come through a process of capitalist reform, such as the introduction of new market mechanisms. We argue, however, that, even if a decarbonized capitalist ‘green economy’ were possible, such an economy would be characterized by uneven growth and disparities of income, and by the unequal distribution of economic, social and environmental risks that global markets produce. We put forward this argument by reviewing four key Marxist approaches, provided by Foster (1999, 2000, 2002), Moore (2010, 2011a, 2011b), Harvey (2003, 2006) and Marini (1977, 2005). We employ the analytical tools of these writers in order to assess, 1) to what extent carbon markets form part of broader trends in the historical development of capitalism, 2) how carbon markets function within the contemporary regime of capitalist accumulation, 3) what effects they have on ecological transformations around the world, and 4) what role countries and elites in the Global South are playing in the contemporary emergence of what Newell & Paterson (2010) call ‘climate capitalism’.

The aim of this paper has been to argue for the value of a Marxist critique of carbon markets, which positions these politico-economic tools within the broader history of global capitalist development and its relation to nature. While some authors see carbon markets as the manifestation of a new phase of ‘greener’ and more sustainable capitalism (Michaelowa & Dutschke, 2000; Stowell, 2005; Yamin, 2005), we see these emerging politico-economic tools as part of a historically continuous process. Discussing the work of Marxists such as Foster, Moore, Harvey and Marini, we have shown that carbon markets are best understood as part of a trajectory of capitalist dynamics structuring human relations to the natural environment in specific ways, while producing and re-producing processes of inequality within and between countries. We argue that carbon markets correspond to, and manifest the logic of, capitalism in its historical development, a logic driven by the need for constant expansion of opportunities for capital accumulation. These specific markets indicate both the creativity and continuity of capitalist development. They are creative in the sense that they create new goods to be traded in the new markets which these policy innovations bring to life. The CDM, for example, is an immensely innovative tool, allowing the commodification of carbon emissions and their trade across the globe. However, carbon markets are also continuous with previous forms of commodification and capitalist expansion in the sense that they, 1) exacerbate preexisting inequalities, through the unequal distribution of new carbon commodities, enhancing opportunities for capital accumulation by some as opposed to others, 2) subsidize environmentally destructive ecological activities (like dams and the use of chemical fertilizers, mentioned above), and, 3) distribute exposure to the negative ecological effects of productive activities unevenly, through processes of dispossession and uneven development. Thus, while those designing and benefiting from carbon markets may perceive them to be successful ecological ‘fixes,’ populations suffering the consequences of negative externalities (including climate change) are materially and politically disempowered, and find it increasingly difficult to respond in politically meaningful ways. In this way the politico-economic dynamics of carbon markets are not really new. What Marxists have been arguing for a few decades now is that capitalism, as a socio-ecological system, involves unequal forms of global development; these uneven forms of development often constitute creative new ‘neo-colonial’ practices, which dispossess people in so-called developing countries, while elites, especially powerful elites of the Global North, enrich themselves. There is sufficient evidence in the existing literature that shows that the ‘green’ development solutions being financed through carbon markets such as the CDM, which are allegedly being explicitly designed to further sustainable development goals, are, instead, perpetuating this capitalist pathology. This is in line with Banerjee’s (2003, 2008) exploration of the contradictions inherent in the idea of ‘sustainable development.’ He argues that, despite claims of a paradigm shift towards a ‘greener’ and more equitable capitalism, the sustainable development paradigm is ultimately based on an economic, rather than an ecological, rationality, which entails, as a result, very concrete negative outcomes, particularly for the environment and for non-elite groups, such as indigenous people, peasants, subsistence farming communities and workers. To distinguish the specific roles played by different countries in the contemporary development of capitalism, we have argued that it is of particular importance to understand the central place of ‘emerging economies,’ such as the BRICS countries, in the politics of carbon markets. Uneven processes of development within the South can be increasingly observed, driven by exploitative strategies within the periphery. To fully comprehend this development, we need to adopt a theoretical framework which can comprehend the evolving role of nation states within the international division of labor. The Marxist theory of dependency, which looks at the roles played by different countries in the international division of labor (e.g. Moyo & Yeros, 2005, 2011), has already explained why these Southern economies have become export-oriented and hence dependent on the Global North. The contribution of an application of Marini’s theories of sub-imperialism to current developments in the South, is to elucidate the impossibility of sustainable or ‘green’ development for these Southern countries, given their particular embeddedness in the international division of labor. While the BRICS articulation might give us a sense of the emergence of some of these countries as increasingly important to the global economy, we have argued that it is mostly the elites of these nations that profit from carbon markets, in the same way that they profit from other commodity-based export strategies (Haque, 1999). Huge sections of the population as a whole, however – in the BRIC countries, in the periphery of the global economy, and increasingly, within the core industrial economies themselves – remain deprived, impoverished and exploited, while the environment continues to be degraded and appropriated for the purpose of accumulation gains (Rice, 2009). Carbon markets might wear ‘green’ clothes, but the realities on the ground in the Global South suggest that they are anything but ‘green’ in practice. Many authors, including Newell and Paterson (2010), have expressed the hope that capitalism might be able to decarbonize and ‘green’ itself, effecting a dramatic transformation of its own business practices. Maybe they will be proven right; perhaps carbon markets will be able to achieve some degree of decarbonization of the global economy – although the signs are currently not propitious. The main aim of this paper has been, however, to discuss the contradictions, as well as economic, social and economic costs associated with the particular ‘decarbonization’ strategies being implemented through carbon markets. We have argued that carbon markets, rather than transforming capitalism, are reproducing and deepening unequal relations between North and South, and benefiting Northern and Southern elites while perpetuating uneven development and dispossessing non-elites.

1) Skepticism toward activist government is baked in the cake In the early 1990s, Bill Clinton declared that "the era of big government is over." The idea was that Democrats had abandoned their vestigial socialist tendencies, their knee-jerk preference for more regulations and more spending, and embraced the power of markets. They would pursue liberal goals, based on liberal values, they said, but use the power of markets to keep costs down. This was an alleged "third way" between heartless conservatism and spendthrift liberalism. This kind of thinking is sometimes referred to as "neoliberalism," tracing back to Charles Peters's original 1983 manifesto in Washington Monthly. The term has been mangled and overused lately, to the point that it probably ought to be abandoned, but it does seem to apply here. The broader (and especially younger) left has, of late, rejected neoliberalism with great vigor. It has seen that markets are not always great at solving social problems, that market-based policies are often a veneer for steering public money into private hands, and that markets, unrestrained by vigorous progressive governance, generate huge inequalities of wealth and opportunity. That's part of what the Sanders insurgency is about. So the new left fixation on a carbon tax is at least facially peculiar, since, it seems to me, the policy issues from classically neoliberal instincts. It is a way of achieving a social goal (less carbon) while minimizing interference in markets. The impetus for minimizing interference is a deep-seated belief that attempts to meddle in markets via industrial policy, "command and control" regulations, and targeted spending tend to backfire, distorting the economy and slowing growth. A (politically conservative) skepticism toward activist government is baked into the neoliberal cake. Reinforcing that skepticism is not a wise long-term strategy for climate hawks, because I can guarantee that climate change is eventually going to require activist government. No market-based policy is going to equitably resettle the residents of Miami. Of course, it's entirely possible to support carbon taxes without buying into the larger neoliberal worldview. And, hell, maybe some climate hawks really do have that kind of faith in markets. But I get the sense that lots of carbon tax enthusiasts, especially on the left, haven't really thought through all the implications. 2) There are no free markets Even if you accept the premise that free, competitive markets are always or almost always better at allocating resources than legislators or regulators, it's questionable just how far that gets you on energy policy. Carbon taxes are meant to remedy one market failure: unpriced carbon emissions. But those familiar with US energy markets will attest that they are ridden with such failures. They bear virtually no resemblance to idealized neoclassical markets. The US electricity sector, for instance, is a Rube Goldberg contraption of overlapping jurisdictions, regulated monopolies, and quasi-markets. Coal, oil, and gas are extracted from public land and transported over public right-of-ways, leaving behind an array of local pollutants. At every stage from extraction/production to transportation to consumption, all forms of energy are heavily regulated and dependent on public subsidies and public infrastructure. In fact, there are so many market failures in energy, one almost wonders whether beginning with an idealized market and working backward through its "failures" is a fruitful way to approach policy thinking. Hmm. Unpriced carbon is a market failure, if you want to look at it that way. But real-life markets, not just in energy but in transportation and agriculture, are failures all the way down — irrational behaviors, asymmetrical information, barriers to entry, monopoly control, and more. Then layer on top of that complicated regulatory systems, legacy policies and infrastructure, and the distorting influence of status quo interests, and you've got quite a mess. One can look at the task ahead as painstakingly correcting an almost endless series of market failures. Or one can look at it as actively shaping and designing new markets to produce better social outcomes. Either way, the "set it and forget it" schemes of hardcore tax advocates are a fantasy. It's a blunt-force tool. It will do wonders in some sectors (driving coal out of electricity) but very little in others (driving oil out of transportation). It will not do all the necessary work in any sector. Different markets are different; they have their own idiosyncrasies, their own failures. Believing a single tool will accomplish everything requires seeing the economy as a frictionless machine, a spreadsheet, not what it is: a path-dependent accretion of past decisions and sunk costs, to be tweaked and unwound. One other thing: The neoclassical model of a perfectly efficient economy depends on full employment, which hasn't been the case in the US for a very long time. Resources are being left slack, capital is cheap, and deficit spending is likely to boost growth. But when it comes to carbon and clean energy, many economists default to the knee-jerk stance that government spending is distortionary and only price-based instruments are legitimate. 3) Marginally reducing carbon emissions is one thing; mounting a high-speed Industrial Revolution is another It is somewhat misleading to describe the goal of climate change mitigation as "reducing carbon emissions." Reducing carbon emissions is easy; lots of policies can do that. We need to reduce emissions a lot — to zero, or close to it — as fast as possible. That's going to require more than changes at the margins. It's going to require phasing out virtually our entire installed industrial base and replacing it with new, low-carbon technologies and practices. It's going to require an explosion of innovation and building, the likes of which hasn't been seen since the Industrial Revolution — only much, much faster, constrained by a tight carbon budget. We know price-based policies like Pigouvian taxes (and cap-and-trade programs) can efficiently generate marginal changes. Economists don't just love them because of theory; they work, especially in bounded markets where demand is elastic or substitution is cheap. The economic literature on that score is copious. But carbon isn't just one pollutant from one product category. It's the whole economy. The whole world economy. Can price-based policies drive economy-wide energy transitions? History doesn't seem to offer any examples. Large-scale energy transitions of the past have generally been driven by industrial policy and technology innovation; none have been driven by increases in the prices of existing energy sources. (Vaclav Smil is the go-to scholar on this.) In a recent critical review of the new book from economist Nicholas Stern, Alex Trembath puts it nicely: History reveals that prices and scarcity have rarely, if ever, driven large-scale energy transitions. We transitioned away from whale oil after discovering much more abundant and useful petroleum-derived kerosene, not because we were running out of whales. Electricity and the internal combustion engine emerged after decades of technological toiling and created whole new uses for energy. War, perhaps the most state-directed of all enterprises, accelerated the diffusion of several key energy technologies, most notably the internal combustion engine, jet turbines, and nuclear reactors. Today, hydraulic fracturing in shale emerged from government-funded labs and has diffused because of its usefulness in cost-effectively accessing previously hard-to-reach natural gas deposits. This is the work that governments have done since Alexander Hamilton invented industrial policy, not as a corrective to proliferating market failures, but as foundational and continuous policy to create and shape markets themselves. Note the difference in perspective: not gingerly correcting markets, striving to return them to their edenic state of perfect efficiency, but creating and shaping markets that work better to achieve outcomes chosen (ideally) through democratic deliberation. It has been proactive government, developing and diffusing technologies, sculpting markets through regulations and investments, that has sparked industrial shifts in the past. Maybe we can engineer such a transition, faster than all the previous transitions, using a price-based instrument as our primary tool. But that is a very big gamble, not something we can confidently predict based on economic theory. At the very least, it seems novel and uncertain enough that we might not want to put all our eggs in that basket. It is entirely possible to share all the reservations I describe above and still support putting a price on carbon. (I do!) It is, after all, one way of proactively shaping markets. But it is dangerous to believe that a carbon price, or any single market-based policy, will do the work for us, rendering other efforts superfluous or unnecessary. There's a lot of messy, frustrating work ahead, involving any number of political compromises and kludged, suboptimal policies. No way around it. Creating a whole new world is hard. Tax or no tax, our children and their children will still be working at it. And they will need every tool they can get their hands on.

Central bank officials around the world have said taming inflation is their top priority, but rising prices have turned out to be stickier than originally expected.

The U.S. economy saw a pickup in inflation that  amid pandemic-induced supply chain issues. But the current inflation story seems to be more about services than demand constraints.

As the CBO study noted, employers will respond to higher labor costs.

Higher wages increase the cost to employers of producing goods and services. The employers pass some of those increased costs on to consumers in the form of higher prices, and those higher prices, in turn, lead consumers to purchase fewer goods and services.

(Carl Zulauf Department of Agricultural, Environmental and Development Economics Ohio State University Gary Schnitkey, Nick Paulson, and Krista Swanson Department of Agricultural and Consumer Economics University of Illinois, “US Labor Market and Labor Wage Inflation,” farmdoc daily (12):1, pg online @ https://farmdocdaily.illinois.edu/2022/01/us-labor-market-and-labor-wage-inflation.html //um-ef)

This article presents evidence that (a) US labor force participation has been declining in the 21st Century and (b) lower labor force participation has historically been associated with higher hourly earnings. Some, perhaps a notable part, of the 21st Century decline in US labor force participation may be due to retiring Baby Boomers having a greater propensity to work than succeeding generations. If so, employers will need to raise wages to attract more workers. Moreover, the Federal infrastructure bill creates new jobs, likely adding to labor wage inflation. The proposed “Build Back Better” bill also contains programs that creates new jobs, for example early childhood educators. The preceding points imply a key question, “Is labor wage inflation an emerging US issue?” Many factors that impact inflation are transitory in nature, such as reductions in crop output due to weather and higher energy prices due to a weather-related surge in demand or reduction in supply. The distinction between transitory and on-going inflation is why economists often remove farm, food, and energy prices to calculate what is called the core inflation rate. However, it is important to note that farm, food, and energy prices can contribute to on-going inflation, especially if demand is growing faster than supply. Labor wage inflation is less likely to be transitory and more likely to be sustained, especially if the cause is a structural change in labor supply or demand. Declining labor force participation is a structural change in labor supply. Labor wage inflation often translates into higher general inflation. Workers have more income to spend which translates into more demand. Assuming all else remains the same, higher demand means higher prices for goods and services. If expectations for continuing inflation takes hold, often called inflation psychology; inflationary pressures mount further as consumers buy now to avoid paying higher prices in the future. Moreover, over the last two years, the inflation adjusted 10-year US Treasury Bond interest rate has been negative (December 22, 2021 farmdoc daily). The combination of inflation and negative real interest rates discourages investment in interest rate instruments such as bank CDs since earned interest will not cover inflation price increases. It is reasonable to assume that some, maybe a lot, of money in this safe investment will move to riskier investments, such as stocks and real estate. Once inflation takes hold, it is difficult to cure. For example, when the US finally decided to cure its inflation problem in the late 1970s, it took a sustained period of high real interest rates to cure it. High Federal outlays for interest on US debt materially constrained US policy and spending, and real estate investments, such as farmland, and stocks struggled with low returns and declining values. Another potential solution to inflation is new technology that improves labor productivity, such as robots.. Faster growth in output increases supply, thus dampening general price inflation. However, the history of US labor productivity as presented in Figure 2 prompts caution regarding this option. Another solution is increased immigration to increase US labor supply, but political discord prompts caution regarding the feasibility of this option at this time. In closing, it is too early to know if sustained higher inflation, in particular labor wage led inflation, is an emerging, on-going US problem. If it is an emerging, on-going problem; it may take several years before the US decides to act or is forced to act by markets. Nevertheless, it is not too early to track labor wage inflation as an early warning signal.

(Jeanna, “Rising Wages Are Good News for Workers but Keep Pressure on the Fed,” pg online @ https://www.nytimes.com/2022/04/01/business/economy/jobs-fed-wages.html //um-ef)

While the strong labor market has given policymakers confidence that they can slow the economy somewhat without causing a recession, rapid pay gains could also perpetuate price increases by helping to sustain consumer demand and by prodding companies to raise prices as they try to cover higher labor costs. “The promise of wages moving up is a great thing,” Jerome H. Powell, the Fed chair, said after the central bank’s decision to raise interest rates last month. But the increases are “running at levels that are well above what would be consistent with 2 percent inflation — our goal — over time.” The March employment report showed wages increasing at an even faster annual rate than when Mr. Powell made his remark. Investors had already expected a half-point increase in May, but after the report’s release on Friday markets became more resolute in that prediction. Odds of a big interest rate increase at the central bank’s June meeting also increased. Pay is quickly climbing as employers compete for a finite pool of workers. There are roughly 1.8 job openings for every unemployed worker, and companies complain of struggling to hire across a range of skill sets and industries. Over the past year, pay has picked up most notably for workers in the leisure and hospitality industry, climbing 14.9 percent, and workers in transportation and warehousing have also received double-digit pay gains. Those figures are for workers who are not supervisors. Wages again climbed markedly in leisure and hospitality last month, while pay also picked up sharply for workers in the financial and durable goods industries. Some economists took heart in the fact that monthly wage gains, while still rapid, seem to have slowed somewhat this year compared with the high rates they touched last year. But several pointed out that the current pace, on the heels of a year of rapid gains and paired with continued labor constraints, is probably enough to keep the Fed on high alert. “If it remains this tight, a wage-price spiral will only accelerate from here,” Mr. Feroli said. Of the Fed, he said, “I do think they probably think it is unsustainable.” Fast wage growth is a boon for many workers, though families are finding that their paychecks, while bigger, no longer buy as much as prices rise. Pay gains are not quite keeping pace with inflation for many workers. Even so, President Biden talked about the rapid progress in the job market and wage gains as a positive for the economy and a “statement of the type of economy we’ve been fighting for” while setting policy. “After decades of being mistreated and paid too little, more and more American workers have real power now to get better wages,” Mr. Biden said. “Some people see this as a problem — we’ve had this discussion in the past. I don’t. I see it as long overdue.” But the White House is also worried about inflation. The Biden administration is releasing oil from strategic reserves to try to bring down gas prices. The government is also going to allow a slightly larger number of seasonal workers from abroad to come to the United States this summer in a bid to reduce labor shortages. Hot demand is not the only driver behind rapid inflation — prices have also risen because supply chains fell behind early in the pandemic and have struggled to rebound. But the fact that people want to buy furniture, clothing and restaurant meals is helping to keep inflation climbing. As the economy adds jobs at higher pay rates, many households have more money coming in than they otherwise would. That could keep consumer demand strong, even as the Fed begins to raise interest rates. “That’s a lot of spending power to fight,” said Diane Swonk, the chief economist at Grant Thornton. “The labor market is a very significant part of the overall story.” Gene Lee, the chief executive at Darden Restaurants, said during a March 24 earnings call that he expected consumers to be able to continue eating out even as pandemic-related government stimulus faded from view and as gas prices rose, chipping away at household budgets. Darden’s brands include Olive Garden, LongHorn Steakhouse and Yard House. While the restaurant chain lifted prices 6 percent in the final quarter of its 2021 fiscal year compared with a year earlier, wages at the lower end of the earnings spectrum were increasing more than that. “We believe that wage inflation throughout the country is rising at a pretty rapid rate,” Mr. Lee said. “And so we believe that the consumer can handle that right now.”

(Congressional Research Service, “Where Is the U.S. Economy Headed: Soft Landing, Hard Landing, or Stagflation? ,” pg online @ https://crsreports.congress.gov/product/pdf/IN/IN11963 //um-ef)

A hard landing could occur in two ways. If high inflation expectations become entrenched and a wageprice spiral occurs, the Fed may have to overcorrect with tightening to restore price stability. Alternatively, it could overdo it by tightening too quickly when inflation would have eventually subsided with less tightening. Since the last recession ended in 2020, this scenario is also called a “double dip recession.” Double dip recessions are rare, but there are parallels between the last one in the early 1980s and today. The early 1980s was the last time inflation exceeded 7%. The second recession in that episode is widely attributed to the Fed rapidly increasing interest rates, peaking at over 19%, to reduce inflation. Inflation had far to fall to restore price stability, and therefore interest rates remained high until 1982, causing an unusually long and deep recession.

(Wolf, “Wage Inflation is Finally here, and it’s Toxic for the Fed,” pg online @ https://wolfstreet.com/2018/02/02/wage-inflation-is-finally-here-and-its-toxic-for-the-fed/ //um-ef)

Yet the moment wages tick up, suddenly it gets his attention. It gets every Fed governor’s attention. Wage increases give them the willies. Creating asset price inflation, including the most glorious housing bubble imaginable, became the Fed’s publicly stated policy goal under Chairman Bernanke – his infamous “wealth effect” doctrine. And consumer price inflation must always be high enough to eat up wage gains and help companies show growing revenues, but not so high that it blows down the whole house. But wage inflation is toxic for the Fed. Wage inflation means that people get paid more for the same amount of work. A higher income due to promotions, for example, is not part of wage inflation. So Kashkari explained to CNBC why he voted against every rate hike last year: “We’ve been undershooting our inflation target for basically 10 years. And there has been very muted wage growth.” So to “assess supply and demand in the labor market,” you “start by looking at the price. And the price of labor – wages – had not been climbing. This jobs report now at least shows some signs of wages picking up.” While “there might still be some slack in the labor market,” he said, “the wage measure is really important.” In its statement after the January 31 meeting, the Fed specifically pointed at the “low” unemployment rate, and some Fed governors have said that the unemployment rate, at 4.1% for the past four months, might inch down to 3.9% by the end of the year and stay there in 2019, and that these levels would put further pressure on wages as employers might have to raise wages to attract workers. When wage inflation picks up, the Fed steps on the brakes. Even Kashkari. While he rotated into a non-voting slot at the FOMC this year, he will be just as active during the discussions and in his public appearances. But now, even the most fervent dove is watching wage inflation with a worried eye. And if wage inflation continues to rise, expect some fireworks.