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Woolsey Fire

A house burns during the Woolsey Fire on Nov. 9, 2018 in Malibu, California. (Photo: David McNew/Getty Images)

As Financial Institutions Grow Concerned About Economic Impacts of Climate Crisis, Activists Target Funders of Fossil Fuel Industry

As one 350.org volunteer put it, if we don't #StopTheMoneyPipeline that finances climate destruction, "it could blow up the economy."

Jessica Corbett

In response to a New York Times report Thursday about mounting concerns from investors and market experts that the climate crisis could cause the next economic meltdown, environmentalists reiterated calls for financial institutions to cut ties with the fossil fuel companies that pollute the planet and drive global heating.

Bill McKibben, co-founder of the advocacy group 350.org, took to Twitter to rewrite the Times headline, "Climate Change Could Cause the Next Financial Meltdown." Instead, he proposed, "Financial Systems Could Cause the Next Financial Meltdown," given that major world banks pour billions of dollars into the fossil fuel industry.

McKibben also highlighted the "Stop the Money Pipeline" a campaign launched earlier this month by 350.org and other organizations, which urges banks, insurers, and asset managers to stop financing fossil fuel companies. The longtime activist was far from alone in using the Times report to call out funders of planetary destruction, draw attention to the new campaign, and demand that society at large urgently act to prevent the worst possible impacts of the climate crisis.

In a tweet that linked to the report, Vermont-based climate activist Greg Dennis, who has volunteered for 350.org, warned that if we don't #StopTheMoneyPipeline that finances climate destruction, "it could blow up the economy."

Shana Gallagher, national student organizing director for Sen. Bernie Sanders' 2020 presidential campaign, tweeted: "Ensuring that our economy works for everyone, and not just the 1%, means confronting the climate crisis. We need a #GreenNewDeal."

American youth climate leader Jerome Foster II—who is involved with the groups One Million of Us, Fridays for Future, and Zero Hour—pointed to the Times piece as an example of how "everyday" the United Nations Intergovernmental Panel on Climate Change's special report that warned of climate catastrophe in the absence of global action "is proven more and more correct."

Referencing the young activists like Foster who have taken to the streets worldwide for over a year to demand bolder climate policies from elected leaders, major institutions, and corporations, writer Rebecca Fishbein sarcastically remarked, "You meddling kids, we can't afford the Green New Deal!"

Environmental Voter Project executive director Nathaniel Stinnett shared the report in a tweet and simply used dollar signs to illustrate the costs of implementing a Green New Deal versus "doing nothing."

Ross Macfarlane—who is on the board of the Sierra Club, Climate Solutions, and the Clean Energy Transition Institute—suggested that based on the Times' reporting, while scientists' warnings about how the climate crisis threatens the environment, wildlife, and humanity may be ignored by powerful financial players, concerns that it could also crash the global economy and banking system appear to have garnered some attention.

As the European Central Bank concluded a two-day meeting in Frankfurt, Germany on Thursday, the Times reported:

Climate change has already been blamed for deadly bush fires in Australia, dying coral reefs, rising sea levels, and ever more cataclysmic storms. Could it also cause the next financial crisis?

A report issued this week by an umbrella organization for the world's central banks argued that the answer is yes, while warning that central bankers lack tools to deal with what it says could be one of the biggest economic dislocations of all time.

The book-length report, published by the Bank for International Settlements [BIS] in Basel, Switzerland, signals what could be the overriding theme for central banks in the decade to come.

Summarizing the BIS report, which was published Monday, the Times explained that "central banks spent much of the last 10 years hauling their economies out of a deep financial crisis that began in 2008. They may well spend the next decade coping with the disruptive effects of climate change and technology."

The Times suggested that the climate crisis could have an even greater impact on the world economy than the 2008 financial collapse, noting that "by some estimates, global gross domestic product could plunge by 25 percent because of the effects of climate change. Central banks have enough trouble dealing with mild recessions, and would not be powerful enough to combat an economic downturn of that scale."

The BIS report said that "central banks alone cannot mitigate climate change" because it "requires coordinating actions among many players including governments, the private sector, civil society, and the international community." However, central banks can play a key role "in helping coordinate the measures to fight climate change."

Measures mentioned in the report include "carbon pricing, the integration of sustainability into financial practices and accounting frameworks, the search for appropriate policy mixes, and the development of new financial mechanisms at the international level." According to BIS, "All these actions will be complex to coordinate and could have significant redistributive consequences that should be adequately handled, yet they are essential to preserve long-term financial (and price) stability in the age of climate change."

Bloomberg noted Monday that the BIS report, "published just after the world's warmest decade on record, adds to a growing body of central bank-related analysis calling for authorities to better prepare for finance-related risks stemming from climate change."

As Common Dreams reported last week, U.S. and international scientists released new data confirming that 2019 was the second-hottest year and wrapped up the warmest decade since record-keeping began. Those findings, like the Times report on Thursday, provoked fresh calls for governments, the financial industry, and private companies to commit to bolder climate policies like a Green New Deal.


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