The new global economy and Russia’s place in it

MOSCOW, 27 Oct 2021, RUSSTRAT Institute.

Many have heard about the “Sustainable Development Goals” presented by the UN and the “Green Deal” promoted by Western countries. However, not everyone understands what exactly follows these common goals, and how it will affect every person in the world. Rae Kwon Chung, a Nobel Peace Prize laureate and former chief adviser to the UN Secretary-General for climate change, is well versed in this issue. It was he who developed the concept of “Net Zero 2050” to achieve zero carbon emissions into the atmosphere by 2050.

Rae Kwon Chung has repeatedly spoken in Russia on the topic of climate change, but his speech at the October “All-Russian Science Festival” clearly went beyond the announced framework, and was filled with so many frank statements that it deserves the closest attention.

At the very beginning of his speech, Chung “took the bull by the horns” and said that in order to achieve zero carbon emissions into the atmosphere by 2050, one cannot rely on traditional science, for this a new science is needed. Later, in the course of his speech, he explained that science is not only technology, but also social sciences, which are much more important to him than natural sciences.

According to Chung, our civilisation is built on cheap, very cheap fossil fuels and previously we did not notice the contribution of carbon emissions into the atmosphere affecting the climate, but now climate change, especially temperature rise, has reached a fundamental level and this cannot be ignored, as it calls into question the survival of mankind. I can’t help but dot the I’s in these statements made by Chung.

Firstly, I would immediately focus on his words about cheap fossil fuels. This has not always been the case, and the “oil wars” are proof of this. Such a manipulative step by Chung is by no means accidental – this will be clear further from his speech. Secondly, the main role of anthropogenic impact on the climate in Chung is by default, although scientists have not yet come to a consensus, even on the dynamics of temperature increase in the atmosphere.

Then Chang tried to explain to the audience that “Net Zero 2050” is a new paradigm of human development, which received a new impetus after Joe Biden took office as president of the United States, and the COVID-19 pandemic became another reason to get away from the old rules of “free market capitalism” and the absorption of a huge amount of hydrocarbons, in order to now take into account the cost of carbon emissions in the final price.

This is how the “market economy of sustainable development” will look like, as well as during the speech, Chung gave it the name “climate economy”. Then Chung made another loud statement – that new viruses will definitely appear, due to the melting of permafrost in Canada and Russia.

According to Chung, in the current free market economy, the climate issue is a zero-sum game, where there is necessarily one of the losers. When there is a need to pay for carbon emissions, profits decrease, which is why countries themselves did not strive to reduce carbon emissions, as this would reduce their GDP. Therefore, it is necessary to move on to the game with a positive amount, when everyone is in the black – both the climate and the economy.

Then Chung switched to the topic of technology, where, as he thinks, a huge ocean of opportunities opens up for decarbonising the world, and most importantly for developing an economical way to extract hydrogen. He said that states and private companies are striving to become leaders in the production of hydrogen, since hydrogen energy is cheaper. It is hydrogen that will help to move to the game with a positive sum between the climate and the economy.

This passage should be singled out separately, that is, first Chung says that an economical technology for hydrogen extraction has yet to be developed, and it really does not exist yet. However, then he says that hydrogen energy is one of the cheapest.

Chung sees the future of Russia in the development of hydrogen energy. Earlier in his speeches, he had already talked about this, focusing on the industrial scale of our country, since small European countries are not even adapted for storing hydrogen. Rising temperatures in the Arctic zone, melting permafrost in Siberia and related outbreaks of anthrax make Russia one of the main stakeholders in the climate agenda, according to Chung.

After that, Chung returned to the global economy, blaming all governments and businesses for the short-term nature of their plans to grow the economy and extract profits, which is why climate problems remain unresolved. That is why the UN has proposed a new paradigm of the goals of “sustainable development and green growth”. Chung believes that investments in the fight against climate change will spur economic growth. At the same time, he admits that in this way achieving zero carbon emissions into the atmosphere by 2050 is probably a big question.

The next problem that Chung suggested thinking about was: Will we be able to maintain economic growth if we reduce carbon emissions? However, he did not give a substantive answer to this question, but gave an example of Britain, which transferred heavy industry with its harmful emissions to China.

Answering his own question about whether it is possible to significantly reduce carbon emissions in the world, Chung explained that it depends on our choice. Of course, you will have to pay for carbon emissions, but for him personally it is not a matter of technology or another factor, it all depends only on the choice of a person.

After finishing his lecture, Chung began answering questions from the audience. The first question concerned the research of a number of economists who said that, with a reduction in carbon emissions by 5% per year, economic growth in the world is not expected. Chung said that he did not believe (a good excuse of a “scientist”) these economists, since their research is based on static models that do not take into account innovations and structural changes in the economy.

In his opinion, traditional economists can’t even predict the inflation rate next month, so you can’t trust them. Such economists deceive and misinform people. That is why we need a new economy that has a dynamic character, we cannot rely on economists, it is better to rely on the humanities, and not on economic calculations, Chung explained. We need to get rid of these misconceptions, otherwise we will not live to see the future, he warned.

In response to the next question about environmental activists in South Korea, Chung said that the concerns of businesses and citizens about rising energy bills should be compared with the question of their actual survival. In South Korea, 70% of the population are willing to pay $20 more for electricity in order to combat climate change. Thus, he stressed once again that the price of the climate issue does not matter.

I think one more remark should be inserted here to understand the course of Chung’s thoughts. The fact is that speaking in June of this year at St. Petersburg Polytechnic University, Chung said that the current efforts to decarbonise undertaken by society are clearly not enough and the transition to electric cars will definitely not save, people will have to abandon personal transport altogether and use only public transport.

Listening to this lecture, I assumed a lot, but it became a revelation to me that those who dictate the global agenda to the world are often guided not even by controversial scientific research, but by their own ideological attitudes that completely ignore natural sciences. Rae Kwon Chung has been dealing with climate issues since 1991, and he was clearly not the only one in the UN structures with such approaches, since his ideas are embodied in the UN strategy.

As a result, I personally have even more confidence that the issue of combating climate change is motivated more by the far-fetched agenda of part of the global political and business elite than by a real threat to humanity.

Institute for International Political and Economic Strategies – RUSSTRAT

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