Sustainable Development: Burden or Incentive?

I am amused when people lambaste Al Gore for profiting from investments in clean technology. The ability to adapt to and profit from change has been at the core of American capitalism since the 19th century. Even more amusing is when those same people contradict themselves by stating that investments in clean technology are counterproductive to economic growth. I guess they shouldn’t worry then with Al Gore’s ability to profit from clean technology.

The fact is that clean technologies, GHG mitigation, and sustainable development are disciplines where big government, big business, and venture capital, are investing a lot of resources.

GE is investing billions in clean technology, and venture capital is on the same wavelength.

On the government front, a report entitled The Economic Benefits of Investing in Clean Energy (PERI and CAP, June 2009) states that the American Recovery and Reinvestment Act (ARRA) and the American Clean Energy and Security Act (ACESA) together will result in new investments of approximately $150 billion per year over the next decade, hence creating around 2.5 million new jobs.

Furthermore, cap-and-trade legislation in effect in the EU, and modeled by the U.S. and other jurisdictions, has created a carbon trading market that the World Bank assessed to be worth $64 billion in 2007. Its value surged 84% to $118 billion last year according to market research firm New Carbon Finance, who predicts that a U.S. system of mandatory emission caps will spawn a $1 trillion carbon market by 2020.

I can understand why those who oppose GHG mitigation are upset. It seems that their arguments against emission caps are failing. Or are they? Despite the fact that carbon mitigation and sustainable development are hot business commodities, Congress may prevent the passage of ACESA. Rather than communicating the message that ACESA actually stimulates economic growth and employment, the perception is that it is yet another business tax. There seems to be a disconnect between the administration and voters.