Maja Göpel was the federal government’s environmental adviser. From November, he will be the political economist as director of research at Hamburg’s The New Institute. To the question What does Corona do with capitalism? let’s also talk to a market critic, a cruise manager, and a theorist of capitalism.
Mrs Göpelová, after the economy was blocked – was there another accident?
This is a prophecy, because we can no longer assess the evolution of the virus … We should therefore look carefully at which cooperation between the state, business and society is useful for economic stability, social security and restructuring towards sustainable value creation. The last thing we have now broken is the ideological debate on socialism and capitalism. I’m more interested in: What drivers of unsustainable development can we change now?
What happens are they off?
Consumption of CO2 and resources is reduced, but not sufficient or necessarily sustainable. It is therefore important to learn from the changed routines and procedures caused by the crisis: How much mobility do we really need when the home office is simplified? If many people wanted permanently reduced working hours and less stress, how would that be possible?
So how can we strive for a really high quality of life and then strive for the lowest ecological footprint? This is the pattern of progress. Then I can ask: what technologies, business models and partnerships do you need for this? And what economic tools.
If we see price as such an important indicator, then it must tell the truth, that is, real cost accounting. Companies must value the natural consumption of their products, ideally also the social aspects of their practice. Then the balance sheets would also look different.
And in GDP, a clearer distinction should be made between spending on improvement and spending on destruction or repair. To do this, we need inventory data that shows us how many resources can still be used without high collateral damage, ie natural capital accounting …
What is it?
This is the idea of ecosystem load limits: for example, calculating water and soil pollution from oil production, almost as “collateral damage”, or to what extent the destruction of natural areas becomes too narrow for the species to conserve.
If we are not foresighted – keyword: straighten the curve! – Act, but only when the consequences of destroyed regeneration patterns can be clearly felt will irreversible changes occur. For example, if the rainforest shrinks too much for further deforestation, cloud formation no longer works – we have a completely changed ecosystem.
So the “flattening of the curve” in the pandemic was a positive example of quick reactions?
Exactly, then we finally began to explain nonlinear developments in a broader sense. And that we have to react before it really hurts. In economics, models must focus on such scientifically determined places of congestion, cycle reversals, and then find economic tools that adequately protect them. So avoid market failures before irreversible changes occur, or think of management solutions other than the market.
What would change with the products?
We need the best solution to meet people’s needs. And they are not the same as owning as many things as possible. Take the SUV debate, for example. We can design individual mobility, the human need associated with it, much better in terms of engineering.
With much smaller side effects on ecology and public space or money from road construction taxes. So it is not just a debate about freedom of consumption, but about producer responsibility and the issue of social standards.
There are people who are worried that the SUV will be banned for them. Will it not be difficult for society?
We see that the debate is difficult. By the way, we have also introduced TÜV in other areas, or in other product and safety standards, among other things, the fleet values for CO2, but they are too high. Why should we offer worse products than necessary? If products produce disproportionate amounts of CO2 and alternatives are available, where exactly is the deprivation of liberty?
So sustainable mobility instead of big and faster cars.
Yeah, yeah, we signed an international agreement and we have to take responsibility. In some debates, we find liberalism that has a denial of responsibility. Freedom must also mean taking responsibility. In the case of car companies, it is clear that they have not campaigned sufficiently to achieve climate goals, but continue to lobby for rapid restructuring.
However, the pandemic has also helped large companies such as Amazon increase their market shares.
Yes, that is very worrying. If you like a market economy and at the same time want diversity, then it is a tendency towards concentration, which obviously needs to be corrected. We have a terrible alliance of overhangs and financial corporations that will one day increase the likelihood of bubbles and lead to gigantic creative power.
It also has to do with the relationship between the market and the state, and it is not just about business freedom versus the state of a nanny. If we ban monopolies such as Amazon, then this would be an exception for many other companies – and a benefit for the diversity of providers and solutions, ie the power of innovation and, in case of doubt, the resilience of markets.