Three cheers for the oil price hike!

Fear of global warming has led us to invent a new planet-wide doctrine.

It consists of half a dozen observations, analyses, conjectures and conclusions that have come to be presented as an indivisible whole, although it is useful to consider them separately for they do not all carry the same scientific weight. They are as follows.

The earth’s average temperature has been rising ever since the Industrial Revolution, with a very marked acceleration in recent decades; this phenomenon is largely a result of human activity producing CO2 emissions that accumulate in the upper atmosphere and cause a ‘greenhouse effect’; the consequences are catastrophic and irreversible for the earth in general and the human race in particular, with the poorest countries in the front line; neither the inherent biological forces of plant and animal life (mutation, migration or the emergence of new species) nor human societies’ traditional avenues of recourse (to migration, scientific innovation or tried-and-tested market mechanisms) are capable of offsetting – never mind halting – the literally apocalyptic process that is now under way; humanity as a whole therefore needs to make an unprecedented effort, entailing radical changes in methods of production and ways of life; if our generation can pull that off, the apocalypse will be averted.

These six premises enjoy the level of acceptance in Europe, and particularly in France, that used to be reserved for the Ten Commandments: they are articles of religious faith. The analogy may disconcert some readers in our supposedly secular society, but what, short of religious faith, can explain our collective acceptance of this six-link conceptual chain – for to question any one link is to pull the whole construct apart – and our interpretation of it as a moral, rather than a political, imperative? In this new religion, the prophets of the godless gospel are elevated to the modern equivalent of sainthood – beatification by television – while the few unbelievers are condemned to the direst form of contemporary torment: they are flung to the media lynch mob. Doesn’t it feel good, for instance, thoroughly to despise Claude Allègre, a geologist bold enough to esteem his science above the holy images venerated on our TV screens!

Alright then! Let us agree – as an alternative to lynching – to share in this mystic revelation on an unprecedented scale. Let us decide to see it as the first expression of a genuine desire for worldwide solidarity. Let us rejoice that, just as the dawn of globalisation breaks around us with all its attendant risks of conflict and crisis, we can make a spontaneous response, pulling the whole world together in a miraculously peaceful common endeavour. Let us marvel at the scientific community, the churches and even the multinationals – those normally discordant voices – singing from the same hymn sheet in a harmonious global refrain. Let us bear in mind that many human projects – from the building of the pyramids through major discoveries to the conquest of space – have been inspired by passion rather than pure reason, and that there are few examples of inspiration as non-belligerent as this. Let us extend the benefit of the doubt to the learned meteorologists who apply the precautionary principle, on the one hand, to claim only 50% probability for their own seven-day forecasts and, on the other, to predict the global temperature in the year 2100 with total certainty. Let us be neither doubting Thomases nor grumpy party-poopers! No. Let us join with the rest and bask in the glow of brotherly consensus.

And let us raise our first ‘hallelujah’ – for the price of oil, brothers, is ascending, faster even than the temperature of the atmosphere! The earth is saved!

The earth is saved because, since the climate gurus met in Rio and Kyoto to conclude regretfully that the short-term economic interest driving a CO2-emitting energy binge was irreconcilable with the long-term interest of the planet, the price of our ‘dirty’ energy has risen tenfold! And the cream of our economic experts and industrial leaders are now telling us that we must come to terms with expensive energy as part of our way of life.

The earth is saved because this general rise in the price of hydrocarbons has occurred spontaneously, affecting all forms of energy, worldwide. It afflicts Americans and Europeans, Chinese, Indians and Brazilians alike. It has created the possibility of immediate action to counter global warming without the risk of displacing production and jobs. It has put the whole world on a ‘good behaviour’ warning and has aligned our selfish small-time concerns with our highest human aspirations. Industry, the transport sector, farmers, motorists and families all have good reason now to save energy and to pursue ‘clean energy’ options.

Yet the genuine enthusiasm of the newly converted is hard to sustain for, instead of other voices hailing the victory, what do we hear? This unexpected blessing has been greeted with grumbling from manufacturers, discontent among consumers, indignation on the part of the most energy-hungry trades, and determined promises from governments to nip the whole thing in the bud: overnight, the very brains that were busy inventing taxes to penalise ‘dirty’ energy have been redeployed devising fiscal mechanisms to make it cheaper!

Understandably, the suddenness of the oil-price hike caught us off guard and the swiftness of its impact might well be considered problematic at a time when our key concern is with purchasing power. But if the earth truly faces the threat as depicted, then surely this is a wonderful opportunity for teaching us to mend our ways! And would it not be splendidly serendipitous if – for the unexpected reason that fossil fuels are in relatively short supply – the market price alone managed, at a stroke, to produce the very outcome we had dreamed of achieving through long years of effort: the conversion of our societies from the principle of waste to that of sustainable development?

Permit me, with all the humility of the recent convert, to put two suggestions to our high priests.

First, let us be bold enough – on this subject as on others – to be honest. For too long, politically correct messages about construction standards, cleaner energy options, environmental charges, green taxation systems and the need to counter competitive currency devaluation have sustained the notion that, if we listen and learn, we can save the planet through good behaviour alone: by sorting and recycling our rubbish, by using environmentally friendly cosmetics or converting our fuel-hungry ‘fair-trade’ 4x4s from diesel to LPG. But all that, of course, is dishonest! The Kyoto process and the cross-party consensus on environmental challenges come with a price tag, as will the agreement to be reached, with luck, in Copenhagen next year. Companies will pay the price as their costs increase, families will pay it as the cost of accommodation rises, along with transport, heating and food costs. No one would dispute the need to spare the most vulnerable from the worst of the burden, yet surely we never imagined that this radical transformation of our production systems and our way of life could be achieved at zero cost!

Whether the inevitable extra expense is imposed through regulation or taxation, or whether it is simply reflected in market prices, the dent in our profits and purchasing power will be the same.

There is, however, one important difference: only by relying on market prices can we ensure that the necessary effort is fairly shared across all nations and all sectors of the economy.

And that brings me to my second suggestion. Given the fortuitous reality that the market, all by itself, is in the process of imposing the greatest, most widespread and fairest of the constraints deemed necessary for the planet’s salvation, might we not at least review the perceived need to persist with the bureaucratic, taxation-based and unilaterally European policies we have been pursuing for some years now? A clearly understood agreement with the countries that produce polluting fuels – not to cut their prices but, on the contrary, to keep them permanently high – might spare us the Kafkaesque exercise of introducing an arbitrary system to distribute ‘pollution rights’, with the attendant risk of eliminating from Europe not just pollution but also jobs. More generally, it might spare us a mountain of red tape and a deluge of so-called environmental taxes – not to mention torrents of moralising verbiage – all rendered redundant simply by pegging the price of oil above 100 dollars a barrel!

Alain Lamassoure, 21st July 2008