Finley: CEOs should worry about climate change
The warming Earth is not what’s troubling the international CEOs gathered in Davos, Switzerland, this week to palaver on the world's economic condition.
Chief executives are most worried about overzealous regulators, according to a poll by financial services group PwC. That's followed by trade wars, an unskilled workforce and populism in politics.
Climate change doesn't even crack the Top 10 — it ranked 11th, up one spot from last year. This, despite a Davos agenda dominated by climate change. Political leaders held high-level sessions on what to do about global warming. And teen crusader Greta Thunberg showed up to deliver her fevered prophecies of doom.
But the business titans see more immediate threats to their enterprises, most notably government regulations that could slow growth and make it harder to make money.
They may be short-sighted in not recognizing the potential impact of global warming on their profits. There’s a direct link between climate change hysteria and their worries about regulations and political populism.
The war on global warming promises to generate the greatest regulatory boom the economy has ever seen, as politicians respond to constituencies convinced the Earth will become virtually uninhabitable in a decade if drastic steps aren’t taken today.
If they aren’t fretful that such urgency in policymaking will lead to disastrous outcomes, they need only to watch the reruns of the Democratic presidential debates.
Every major Democratic candidate is on record as favoring limits and tighter regulations on hydraulic fracturing, the revolutionary process of extracting oil and gas from shale that has flooded the United States with cheap, reliable energy and helped fuel a decade of economic growth. Two of the frontrunners — Vermont Sen. Bernie Sanders and Massachusetts Sen. Elizabeth Warren — would ban fracking altogether, and former South Bend Mayor Pete Buttigieg would ban any new fracking.
A fracking ban would end U.S. oil and gas exports and send worldwide petroleum prices soaring. The Manhattan Institute predicts, “If the U.S. imposed a fracking ban, the supply disruption would trigger the biggest oil and natural gas price spikes in history ... which in turn would tip the world into recession. Even the expectation that a ban could be enacted would destabilize markets.”
And yet the party that could well be calling the shots in Washington this time next year has placed a bullseye on fracking.
The Democrats’ Green New Deal will require a host of new rulemaking to implement, including restrictions on energy production, carbon cap and trade schemes, retrofitting all factories and commercial buildings, switching to a zero-emissions transportation fleet, among many, many other demands.
The cost is pegged at $52 trillion to $93 trillion over the next decade. Much of the price tag will be paid by business.
So the CEOs at Davos would be smart to add climate change to their worry beads, even if they don’t fear the world is on the brink of incineration.
They should not be reluctant to aggressively counter policies driven by fanaticism.
Their voices and expertise will be needed to assure that in saving the planet, we don’t destroy the economy.
Catch Nolan Finley on “One Detroit” at 7:30 p.m. Thursdays on Detroit Public Television.