As President Obama heads to the Arctic to discuss climate change, just mere weeks after approving Shell Oil’s bid to drill for oil in the treacherous Chukchi Sea, a very different group is sounding the alarm over the dangers of a warming climate. That group, surprisingly, is Wall Street bankers.

Citibank has released a new report showing that taking action now against the growing threat of climate change would save an astonishing $1.8 trillion by the year 2040. Conversely, the report says that if no action is taken, the economy will lose as much as $44 trillion during that same time period.

As Think Progress points out, the Citibank report takes into account the potential lost revenue from leaving resources in the ground — including 80% of coal reserves, half of the world’s gas reserves, and a third of global oil reserves — and still concludes that the global economy would see a net gain.

This report offers a very stark contrast to the typical talking point that we hear as to why we can’t take action on climate change — that action would simply cost too much. 

But this is not the first time that financial leaders have warned about the financial dangers of climate change.

Earlier this summer, a group of current and former Wall Street executives and former U.S. Treasury Secretaries warned that a 2 degrees Celsius increase in global temperatures could result in property losses in the state of Florida totaling $23 billion by the middle of this century. On top of the economic losses from property being underwater, the Southeast would also begin to see an alarming rise in yearly deaths due to extreme heat, with some estimates putting the yearly death toll as high as 35,000 people a year.  Agricultural losses could be as high as 20% of current yield.

If Wall Street understands the threat of climate change, even if only in terms of dollars, then this begs the question as to why they continue to fund climate change denying politicians.

Since 2014, Wall Street banks, real estate firms, and insurance companies — all industries that have expressed enormous concern over the financial threat of climate change — have poured an astonishing $507 million into political campaigns and lobbying activities.  62% of this money went to Republicans.

The reason that Party split is significant is because we have more climate change-denying members of the House and Senate then at any other point in time, and nearly every single one of them are members of the Republican Party.  According to an analysis by Think Progress, 53% of Republicans in the U.S. House of Representatives deny that climate change is real, and 70% of Republicans in the Senate refuse to admit that climate change is real.

If they want to be taken seriously, and if they want their financial concerns addressed by politicians, then Wall Street bankers need to immediately stop the flow of corporate campaign cash that is going to climate change deniers. As long as those people hold seats of power in Washington, D.C., then we will continue to see action stalled year after year.

Image source – Huffington Post UK.

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After years of economic crisis and the rise of social movements like Occupy Wall Street, the idea that there is something rotten in the financial sector has become commonplace. Banks that were too big to fail before the bailouts are bigger than ever, and investment in oilsands expansion, fracking, arctic oil exploration and deep-sea drilling continues at an alarming pace.

Financial activist Brett Scott describes the situation succinctly: “The financial sector right now is crap at social justice and crap at ecological sustainability.” But Scott believes there’s another crucial point that often gets overlooked in critiques of the financial system.

"Even if the financial sector was socially just and sustainable, there is still the sense that we actually have no democratic access to it," says Scott. "Politicians always seem fixated about how to make the sector into a more benign dictatorship, rather than focusing on how to increase people's sense of personal participation in it."

Reducing the sense of personal alienation that people feel in relation to the financial system was one of the goals that motivated Scott to write The Heretic’s Guide to Global Finance, published last year by Pluto Press. The book explains the basic functioning of financial markets in language that’s easy to understand, and provides ideas to contest the power of big money in determining the shape of our collective future. Since the continued growth of the fossil fuel industry relies heavily on investment from major financial institutions, Scott’s work provides a much-needed critical counterpoint to the system.   

Compared to the popular portrayals of stockbroker decadence in films like The Wolf of Wall Street, Scott’s book doesn’t rely on a story of bad behavior to explain why the financial system produces such spectacularly negative effects. Speaking as someone who has worked in the financial sector, Scott insists that most traders bear little resemblance to exaggerated cinematic villains like Gordon Gekko. When it comes to character or moral bearing, “there’s nothing fundamentally different between the people in the financial sector and those in the rest of the world,” Scott says.

For Scott, both moral judgment and technical discussions about how the financial system could be better regulated are less important than figuring out how to make finance more democratic.

“I’m not actually that interested in the big battles over the regulatory stuff, or how good or evil some particular CEO is,” he says. “I’m more interested in the power dynamic between the person on the ground and the financial sector.”

It was the unequal power dynamic between financial insiders and outsiders that motivated Scott to find out firsthand what makes the world of finance tick. Hailing from a background in activism and NGO work in South Africa, Scott had grown frustrated with the fact that he was fluent in macro-level critiques of the financial system, but still didn’t really understand the details of how money gets invested in concrete projects like mines and oil and gas operations.

Intent on figuring out the game from the inside, Scott moved to London in 2008 to join a start-up derivatives brokerage firm, where he spent two years learning the ropes of high finance. While he was on the phone persuading clients to buy derivatives, Scott was also doing a kind of activist research, learning how different financial products work and studying the relationships between financial professionals.

One of the key take-home points from his anthropological foray inside the financial sector is that investment decisions are not just about business, but are always inherently political. “One thing I always try to get across to activists is that fund managers are making political decisions with their money,” says Scott. “You’re deploying resources that you could deploy somewhere else, in a way that benefits some people and not others, and that’s incredibly political.”

Decisions about where to invest are ultimately decisions about what kind of a world we want to live in. If the financial system functioned under democratic oversight, putting money into projects like building desperately needed renewable energy infrastructure would be a no-brainer.

But as it stands, investment decisions are made by a small moneyed aristocracy of bankers and their corporate and political allies—which is why money continues to flow into profitable but destructive dirty energy.  

As Scott sees it, the undemocratic power concentrated in the financial sector is reinforced through the vocabulary of economic rationality that shapes our everyday lives. “The pseudo-scientific language of the financial sector is one way that people distance themselves from thinking about the underlying exploitation,” Scott explains.

We’ve become so accustomed to hearing endless reports about economic growth, yield spreads and returns on equity that it’s easy to lose sight of the human and ecological reality underneath the jargon.

A useful strategy for waking ourselves up to the social relationships that actually constitute economic activity is to denaturalize the language we use. Instead of talking about money, Scott refers to “COGAS”: claims on goods and services. It’s a simple linguistic move, but one that can help to break the spell of finance and get us thinking about the fact that money is ultimately just a socially-constructed medium of exchange, not some magic totem with unquestionable power over our lives.

Scott views strategies such as the oilsands divestment campaign in much the same way. Rather than use divestment as a tool to actually starve companies working in oil and gas extraction of operating funds, Scott sees the campaign as a means of changing the cultural consensus around fossil fuels.

“That to me is a really key thing about divestment, is how do you start to make it increasingly socially unacceptable to assume that it’s normal to invest in destructive projects. I don’t think the divestment projects in themselves are going to stop it, but they challenge the notion that something is normal,” he says.

Both in his book and on his blog Suit Possom, Scott’s writing is full of ideas for how to challenge the daunting authority of the financial sector, and experiments that could help to create better systems of sharing, exchange and investment that can go beyond the logic of profit. Somewhere between radical activist and entrepreneur, Scott is informed by what he describes as a “hacker ethos.”

“A hacker approach involves exploring a system and developing an acute sense of how you’re connected into it,” Scott says. Whether you’re into cryptocurrencies like BitCoin or disruptive forms of shareholder activism, The Heretic’s Guide to Global Finance offers some solid tools for taking control of the financial system.

You can find more of Brett Scott’s writings on financial activism and alternative economics on his blog, including plans for a London School of Financial Activism, due to launch this year.

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