Climate Capitalism1

Peter Newelll Matthew Paterson

Whether we like it or not, for the foreseeable future at least, responses to climate
change will be developed in a context of global capitalism. What does this imply
in political and strategie terms and how can we make sense of this theoretically?
In this chapter we try to nuance eco-Marxist claims which might result from this
more or less banal, if perhaps depressing, observation about capitalism's hold
over climate politics. There is now a substantial and rapidly growing such litera-
ture on climate politics, which has increasingly focused on the commodification
of climate change, through the establishment of markets in emissions allowances
or credits, and which is, reasonably enough, highly critical of such commodifica-
tion processes (prudham 2009; Castree 2003; Lohmann 2005). Tbere are also a
number of analyses rehearsing well-known ,second contradiction of capitalism'
(O'Conoor 1994; Kove1l2002; Benton 2000 Sandler 1994) or ,treadmill ofpro-
duction' arguments (Roberts et al 2003; Gould et al 2008) in relation to climate
change - suggesting !hat capitalism' s growth-addiction and fossil fuel depend-
ence means !hat it cannot possibly decarbonise. We seek here to nuance the de-
pressing conclusions !hat can be drawn from such analyses and ask under what
conditions might we be able to imagine capitalism decarbonising?
Our starting point for such an analysis is the observation that judged by the
number of initiatives and levels of finance now being committed, many capital-
ists and state elites, for a range of different reasons, now have a political and
financial stake in the project of decarbonisation. To be sure, there is a whole
swathe of greenwash to wade through, but it is nevertheless the case !hat a tangi-
ble constituency of ,climate capitalists' with a material interest in decarbonisa-
tion exists. Tbey may currently be relatively marginal to business-as-usual mod-
els of capitalism, but it is worth posing the question about whether and under
what conditions a carbon economy might develop into a project of climate capi-
talism in which growth is achieved through low carbon development.

I This chapter is an elaboration, with significantly more theoretica1 engagement, of the main argu-
ments of our bock Climate capitalism: global warming and the transformation 01 the global economy
(Newell and Paterson 2010). That book was written for a broad popular audience and thus contains
little ofthe explicit theorisations we try to develop here.

E. Altvater, A. Brunnengrber (Eds.), After Cancn, DOI 10.1007/978-3-531-94018-2_2,

VS Verlag fr Sozialwissenschaften | Springer Fachmedien Wiesbaden GmbH 2011
24 Peter Newell / Matthew Paterson

Projeets 10 decarbooise capitalism don't of course emerge from a void. They

rather start from a particular moment in time with its attendant stroctoral fea-
tores. Climate politics refleets both the structoral featores of capitalism in gen-
eral and the legacy of neo-liberaIism in particular because it is as a result of these
structores, institutions and practices that responses to climate change have started
to emerge. It is also the case, however, that the imperative of addressing c\imate
change and moving towards low carbon development paths require new forms of
capitaIism. What this means politically is thst strategies and actions 10 tackle
c\imate change have 10 gain traction with social forces and actors thst wield
significant power within contemporary forms of capitalism. That this will be a
contradictory, messy, and problematic process is obvious; but our working con-
tention here is that we ought 10 take seriously thst it might not be impossible.
In this chapter we look first at some of the principal characteristics and fea-
tores of capitalism in general and of neo-liberaIism in particular !hat are pertinent
10, and structore the opportunities for, action on c\imate change. Second, we look
at the ways in which some ways of tackling c\imate change have won out, been
,natoralised' and come to be seen as more effective and legitimate ways of re-
sponding 10 the issue than others. We do this through two short case studies of
emissions trading and carbon offset markets. Third and fina\ly we explore ways
in which we might understand these dynamics theoretically.

1 Capitalism and Climate Change

Perhaps more than any other environmental issue, c\imate change appears 10
place in stark reliefthe limits of capitalism's ability 10 deal with the environmen-
tal problems that it generates. Whereas new markets and products could relative-
Iy quickly and easily be created for alternatives 10 ozone-depleting chemicals
such as CFCs, and technological fixes were available to address acid rain, the
centra\ity of energy use based on widespread use of fossil foels means action on
c\imate change potentially disrupts capitalism's ability, indeed necessity, 10
grow. Hence while strategies of ecological moderuisation demonstrate the ability
of capitalism to deliver growth without increased emissions, through innovative
use of technology and realising efficiency gains, tackling c\imate change means
producing and consuming less of the very sources of energy !hat have foelled the
industrial revolution, colouialism and post-war economic growth. It is for this
reason !hat many have suggested !hat addressing c\imate change and continuing
with capitalism are mutua\ly exc\usive: you cannot have both (Kovell 2002).
Much of this claim is based on the centrality of fossil foels, and especially the
properties of oil, 10 capitalism (Altvater 2006: 39-41). Whether c\imate change