THE FUTURE OF FINANCE BLOG

Open Letter to President Obama

December 6, 2010

I was privileged to co-sign this Open Letter to President Obama as the UN Climate Change Conference opened in Cancun last week.  It calls for the US to live up to its prior commitment to support climate change funding for mitigation and adaptation in the developing world.  I signed the letter for two reasons:

1.  As the present leader of the Industrialized world, and by far the most egregious carbon emitter, the United States has a duty to lead.  This includes public support in the face of severe fiscal challenges we brought on ourselves, as well as facilitating critical private sector investments in solutions.

2.  The two co-signers above and below me are distinguished leaders of the faith-based community, Reverend Richard Cizik, an Evangelical Christian, and Rabbi David Saperstein of the Jewish faith.  I am honored to join them in signing the letter.

It is essential that all faith-based communities recognize that social justice imperatives, no matter how desirable, mean nothing in a world where physical laws of finite biospheric boundaries are breeched.  Equitable distribution of insufficient water in a lifeboat still means everyone dies.  Too many people in a lifeboat with equitable distribution of food will still sink the lifeboat[1].

Too often, the so-called “environmental movement” has been at odds with “social justice” advocates, and irrelevant to the message one hears at our houses of worship.  This is reductionist thinking at its worst.

I can think of no greater moral cause than to raise awareness of the unsustainable nature of our economic system.

Rather than religious fundamentalism driving a wedge through society, my hope is that enlightened spiritual leaders such as the co-signers of this letter (but there are many more from all faiths), will engage with our political leaders, and leaders from the scientific community, the business community, and yes, the financial community to raise awareness of the fundamental challenge we face, and to join in the search for practical and ethical solutions.

My own quest to understand sustainable economics and finance began with a question:  how do we reconcile the Invisible Hand with the Golden Rule.  Still working…

The world we have made as a result of the level of thinking we have done thus far creates problems that we cannot solve at the same level at which we have created them…. We shall require a substantially new manner of thinking if humankind is to survive.”    

– Albert Einstein


[1] I’ve heard all the arguments that technology and our human ingenuity will save the day. Economists tell us that resource productivity gains are the answer, and all we need to do is get prices right and allow the market to work its wonder.  My short response is to review the Jevons Paradox (1865) which explains the “rebound effect” that comes with improvements in energy efficiency (more efficiency drives down price stimulating more demand at the micro level, while increasing growth at the macro level, further stimulating energy demand), and the more contemporary Khazzoom-Brookes Postulate which expands upon this work.

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