Conference Earth - A decade of action



Clarke's three laws


  1. When a distinguished but elderly scientist states that something is possible, he is almost certainly right. When he states that something is impossible, he is very probably wrong.
  2. The only way of discovering the limits of the possible is to venture a little way past them into the impossible.
  3. Any sufficiently advanced (The practical application of science to commerce or industry) technology is indistinguishable from (Any art that invokes supernatural powers) magic.

Clarke's Law, later the first of the three laws, was proposed by Arthur C. Clarke in the essay "Hazards of Prophecy: The Failure of Imagination", in Profiles of the Future (1962).

Global Futures Scenarios Climate Change 2001:

Intergovernmental Panel on Climate Change (IPCC)


Global futures scenarios do not specifically or uniquely consider GHG emissions. Instead, they are more general "stories" of possible future worlds. They can complement the more quantitative emissions scenario assessments, because they consider dimensions that elude quantification, such as governance and social structures and institutions, but which are nonetheless important to the success of mitigation policies. Addressing these issues reflects the different perspectives presented in Section 1: cost-effectiveness and/or efficiency, equity, and sustainability.

A survey of this literature has yielded a number of insights that are relevant to GHG emissions scenarios and sustainable development. First, a wide range of future conditions has been identified by futurists, ranging from variants of sustainable development to collapse of social, economic, and environmental systems. Since future values of the underlying socio-economic drivers of emissions may vary widely, it is important that climate policies should be designed so that they are resilient against widely different future conditions.

Second, the global futures scenarios that show falling GHG emissions tend to show improved governance, increased equity and political participation, reduced conflict, and improved environmental quality. They also tend to show increased energy efficiency, shifts to non-fossil energy sources, and/or shifts to a post-industrial (service-based) economy; population tends to stabilize at relatively low levels, in many cases thanks to increased prosperity, expanded provision of family planning, and improved rights and opportunities for women. A key implication is that sustainable development policies can make a significant contribution to emission reduction.

Third, different combinations of driving forces are consistent with low emissions scenarios, which agrees with the SRES findings. The implication of this seems to be that it is important to consider the linkage between climate policy and other policies and conditions associated with the choice of future paths in a general sense.

Box TS.1. The Emissions Scenarios of the IPCC Special Report on Emissions Scenarios (SRES)

A1. The A1 storyline and scenario family describe a future world of very rapid economic growth, global population that peaks in mid-century and declines thereafter, and the rapid introduction of new and more efficient technologies. Major underlying themes are convergence among regions, capacity building, and increased cultural and social interactions, with a substantial reduction in regional differences in per capita income. The A1 scenario family develops into three groups that describe alternative directions of technological change in the energy system. The three A1 groups are distinguished by their technological emphasis: fossil intensive (A1FI), non-fossil energy sources (A1T), or a balance across all sources (A1B) (where balanced is defined as not relying too heavily on one particular energy source, on the assumption that similar improvement rates apply to all energy supply and end-use technologies).

A2. The A2 storyline and scenario family describe a very heterogeneous world. The underlying theme is self-reliance and preservation of local identities. Fertility patterns across regions converge very slowly, which results in a continuously increasing population. Economic development is primarily regionally oriented and per capita economic growth and technological change more fragmented and slower than in other storylines.

B1. The B1 storyline and scenario family describe a convergent world with the same global population, which peaks in mid-century and declines thereafter, as in the A1 storyline, but with rapid change in economic structures towards a service and information economy, with reductions in material intensity and the introduction of clean and resource-efficient technologies. The emphasis is on global solutions to economic, social, and environmental sustainability, including improved equity, but without additional climate initiatives.

B2. The B2 storyline and scenario family describe a world in which the emphasis is on local solutions to economic, social, and environmental sustainability. It is a world with continuously increasing global population, at a rate lower than in A2, intermediate levels of economic development, and less rapid and more diverse technological change than in the B1 and A1 storylines. While the scenario is also oriented towards environmental protection and social equity, it focuses on local and regional levels.

An illustrative scenario was chosen for each of the six scenario groups A1B, A1FI, A1T, A2, B1, and B2. All should be considered equally sound.

The SRES scenarios do not include additional climate initiatives, which means that no scenarios are included that explicitly assume implementation of the United Nations Framework Convention on Climate Change or the emissions targets of the Kyoto
Global Trends 2015:

A Dialogue About the Future With Nongovernment Experts


Four Alternative Global Futures

In September-October 1999, the NIC initiated work on Global Trends 2015 by cosponsoring with Department of State/INR and CIA's Global Futures Project two unclassified workshops on Alternative Global Futures: 2000-2015. The workshops brought together several dozen government and nongovernment specialists in a wide range of fields.

The first workshop identified major factors and events that would drive global change through 2015. It focused on demography, natural resources, science and technology, the global economy, governance, social/cultural identities, and conflict and identified main trends and regional variations. These analyses became the basis for subsequent elaboration in Global Trends 2015.

The second workshop developed four alternative global futures in which these drivers would interact in different ways through 2015. Each scenario was intended to construct a plausible, policy-relevant story of how this future might evolve: highlighting key uncertainties, discontinuities, and unlikely or "wild card" events, and identifying important policy and intelligence challenges.

Scenario One: Inclusive Globalization:

A virtuous circle develops among technology, economic growth, demographic factors, and effective governance, which enables a majority of the world's people to benefit from globalization. Technological development and diffusion - in some cases triggered by severe environmental or health crises - are utilized to grapple effectively with some problems of the developing world. Robust global economic growth - spurred by a strong policy consensus on economic liberalization - diffuses wealth widely and mitigates many demographic and resource problems. Governance is effective at both the national and international levels. In many countries, the state's role shrinks, as its functions are privatized or performed by public-private partnerships, while global cooperation intensifies on many issues through a variety of international arrangements. Conflict is minimal within and among states benefiting from globalization. A minority of the world's people - in Sub-Saharan Africa, the Middle East, Central and South Asia, and the Andean region - do not benefit from these positive changes, and internal conflicts persist in and around those countries left behind.

Scenario Two: Pernicious Globalization

Global elites thrive, but the majority of the world's population fails to benefit from globalization. Population growth and resource scarcities place heavy burdens on many developing countries, and migration becomes a major source of interstate tension. Technologies not only fail to address the problems of developing countries but also are exploited by negative and illicit networks and incorporated into destabilizing weapons. The global economy splits into three: growth continues in developed countries; many developing countries experience low or negative per capita growth, resulting in a growing gap with the developed world; and the illicit economy grows dramatically. Governance and political leadership are weak at both the national and international levels. Internal conflicts increase, fueled by frustrated expectations, inequities, and heightened communal tensions; WMD proliferate and are used in at least one internal conflict.

Scenario Three: Regional Competition

Regional identities sharpen in Europe, Asia, and the Americas, driven by growing political resistance in Europe and East Asia to US global preponderance and US-driven globalization and each region's increasing preoccupation with its own economic and political priorities. There is an uneven diffusion of technologies, reflecting differing regional concepts of intellectual property and attitudes towards biotechnology. Regional economic integration in trade and finance increases, resulting in both fairly high levels of economic growth and rising regional competition. Both the state and institutions of regional governance thrive in major developed and emerging market countries, as governments recognize the need to resolve pressing regional problems and shift responsibilities from global to regional institutions. Given the preoccupation of the three major regions with their own concerns, countries outside these regions in Sub-Saharan Africa, the Middle East, and Central and South Asia have few places to turn for resources or political support. Military conflict among and within the three major regions does not materialize, but internal conflicts increase in and around other countries left behind.

Scenario Four: Post-Polar World

US domestic preoccupation increases as the US economy slows, then stagnates. Economic and political tensions with Europe grow, the US-European alliance deteriorates as the United States withdraws its troops, and Europe turns inward, relying on its own regional institutions. At the same time, national governance crises create instability in Latin America, particularly in Colombia, Cuba, Mexico, and Panama, forcing the United States to concentrate on the region. Indonesia also faces internal crisis and risks disintegration, prompting China to provide the bulk of an ad hoc peacekeeping force. Otherwise, Asia is generally prosperous and stable, permitting the United States to focus elsewhere. Korea's normalization and de facto unification proceed, China and Japan provide the bulk of external financial support for Korean unification, and the United States begins withdrawing its troops from Korea and Japan. Over time, these geostrategic shifts ignite longstanding national rivalries among the Asian powers, triggering increased military preparations and hitherto dormant or covert WMD programs. Regional and global institutions prove irrelevant to the evolving conflict situation in Asia, as China issues an ultimatum to Japan to dismantle its nuclear program and Japan - invoking its bilateral treaty with the US - calls for US reengagement in Asia under adverse circumstances at the brink of a major war. Given the priorities of Asia, the Americas, and Europe, countries outside these regions are marginalized, with virtually no sources of political or financial support.

Generalizations Across the Scenarios

The four scenarios can be grouped in two pairs: the first pair contrasting the "positive" and "negative" effects of globalization; the second pair contrasting intensely competitive but not conflictual regionalism and the descent into regional military conflict.

  • In all but the first scenario, globalization does not create widespread global cooperation. Rather, in the second scenario, globalization's negative effects promote extensive dislocation and conflict, while in the third and fourth, they spur regionalism.
  • In all four scenarios, countries negatively affected by population growth, resource scarcities and bad governance, fail to benefit from globalization, are prone to internal conflicts, and risk state failure.
  • In all four scenarios, the effectiveness of national, regional, and international governance and at least moderate but steady economic growth are crucial.
  • In all four scenarios, US global influence wanes.


Pentagon Plans for Rapid Climate Change Event:

Fortune Magazine



The Pentagon's Weather Nightmare

The climate could change radically, and fast. That would be the mother of all national security issues.

FORTUNE Magazine, January 26, 2004

Global warming may be bad news for future generations, but let's face it, most of us spend as little time worrying about it as we did about al Qaeda before 9/11. Like the terrorists, though, the seemingly remote climate risk may hit home sooner and harder than we ever imagined. In fact, the prospect has become so real that the Pentagon's strategic planners are grappling with it.

The threat that has riveted their attention is this: Global warming, rather than causing gradual, centuries-spanning change, may be pushing the climate to a tipping point. Growing evidence suggests the ocean-atmosphere system that controls the world's climate can lurch from one state to another in less than a decade -- like a canoe that's gradually tilted until suddenly it flips over. Scientists don't know how close the system is to a critical threshold. But abrupt climate change may well occur in the not-too-distant future. If it does, the need to rapidly adapt may overwhelm many societies --thereby upsetting the geopolitical balance of power.

Though triggered by warming, such change would probably cause cooling in the Northern Hemisphere, leading to longer, harsher winters in much of the U.S. and Europe. Worse, it would cause massive droughts, turning farmland to dust bowls and forests to ashes. Picture last fall's California wildfires as a regular thing. Or imagine similar disasters destabilizing nuclear powers such as Pakistan or Russia -- it's easy to see why the Pentagon has become interested in abrupt climate change.

Climate researchers began getting seriously concerned about it a decade ago, after studying temperature indicators embedded in ancient layers of Arctic ice. The data show that a number of dramatic shifts in average temperature took place in the past with shocking speed -- in some cases, just a few years.

The case for angst was buttressed by a theory regarded as the most likely explanation for the abrupt changes. The eastern U.S. and northern Europe, it seems, are warmed by a huge Atlantic Ocean current that flows north from the tropics -- that's why Britain, at Labrador's latitude, is relatively temperate. Pumping out warm, moist air, this "great conveyor" current gets cooler and denser as it moves north. That causes the current to sink in the North Atlantic, where it heads south again in the ocean depths. The sinking process draws more water from the south, keeping the roughly circular current on the go.
But when the climate warms, according to the theory, fresh water from melting Arctic glaciers flows into the North Atlantic, lowering the current's salinity -- and its density and tendency to sink. A warmer climate also increases rainfall and runoff into the current, further lowering its saltiness. As a result, the conveyor loses its main motive force and can rapidly collapse, turning off the huge heat pump and altering the climate over much of the Northern Hemisphere.

Scientists aren't sure what caused the warming that triggered such collapses in the remote past. (Clearly it wasn't humans and their factories.) But the data from Arctic ice and other sources suggest the atmospheric changes that preceded earlier collapses were dismayingly similar to today's global warming. As the Ice Age began drawing to a close about 13,000 years ago, for example, temperatures in Greenland rose to levels near those of recent decades. Then they abruptly plunged as the conveyor apparently shut down, ushering in the "Younger Dryas" period, a 1,300-year reversion to ice-age conditions. (A dryas is an Arctic flower that flourished in Europe at the time.)

Though Mother Nature caused past abrupt climate changes, the one that may be shaping up today probably has more to do with us. In 2001 an international panel of climate experts concluded that there is increasingly strong evidence that most of the global warming observed over the past 50 years is attributable to human activities -- mainly the burning of fossil fuels such as oil and coal, which release heat-trapping carbon dioxide. Indicators of the warming include shrinking Arctic ice, melting alpine glaciers, and markedly earlier springs at northerly latitudes. A few years ago such changes seemed signs of possible trouble for our kids or grandkids. Today they seem portents of a cataclysm that may not conveniently wait until we're history.

Accordingly, the spotlight in climate research is shifting from gradual to rapid change. In 2002 the National Academy of Sciences issued a report concluding that human activities could trigger abrupt change. Last year the World Economic Forum in Davos, Switzerland, included a session at which Robert Gagosian, director of the Woods Hole Oceanographic Institution in Massachusetts, urged policymakers to consider the implications of possible abrupt climate change within two decades.

Such jeremiads are beginning to reverberate more widely. Billionaire Gary Comer, founder of Lands' End, has adopted abrupt climate change as a philanthropic cause. Hollywood has also discovered the issue -- next summer 20th Century Fox is expected to release The Day After Tomorrow, a big-budget disaster movie starring Dennis Quaid as a scientist trying to save the world from an ice age precipitated by global warming.

Fox's flick will doubtless be apocalyptically edifying. But what would abrupt climate change really be like?

Scientists generally refuse to say much about that, citing a data deficit. But recently, renowned Department of Defense planner Andrew Marshall sponsored a groundbreaking effort to come to grips with the question. A Pentagon legend, Marshall, 82, is known as the Defense Department's "Yoda" -- a balding, bespectacled sage whose pronouncements on looming risks have long had an outsized influence on defense policy. Since 1973 he has headed a secretive think tank whose role is to envision future threats to national security. The Department of Defense's push on ballistic-missile defense is known as his brainchild. Three years ago Defense Secretary Donald Rumsfeld picked him to lead a sweeping review on military "transformation," the shift toward nimble forces and smart weapons.

When scientists' work on abrupt climate change popped onto his radar screen, Marshall tapped another eminent visionary, Peter Schwartz, to write a report on the national-security implications of the threat. Schwartz formerly headed planning at Royal Dutch/Shell Group and has since consulted with organizations ranging from the CIA to DreamWorks -- he helped create futuristic scenarios for Steven Spielberg's film Minority Report. Schwartz and co-author Doug Randall at the Monitor Group's Global Business Network, a scenario-planning think tank in Emeryville, Calif., contacted top climate experts and pushed them to talk about what-ifs that they usually shy away from -- at least in public.

The result is an unclassified report, completed late last year, that the Pentagon has agreed to share with FORTUNE. It doesn't pretend to be a forecast. Rather, it sketches a dramatic but plausible scenario to help planners think about coping strategies. Here is an abridged version:

A total shutdown of the ocean conveyor might lead to a big chill like the Younger Dryas, when icebergs appeared as far south as the coast of Portugal. Or the conveyor might only temporarily slow down, potentially causing an era like the "Little Ice Age," a time of hard winters, violent storms, and droughts between 1300 and 1850. That period's weather extremes caused horrific famines, but it was mild compared with the Younger Dryas.

For planning purposes, it makes sense to focus on a midrange case of abrupt change. A century of cold, dry, windy weather across the Northern Hemisphere that suddenly came on 8,200 years ago fits the bill_its severity fell between that of the Younger Dryas and the Little Ice Age. The event is thought to have been triggered by a conveyor collapse after a time of rising temperatures not unlike today's global warming. Suppose it recurred, beginning in 2010. Here are some of the things that might happen by 2020:

At first the changes are easily mistaken for normal weather variation_allowing skeptics to dismiss them as a "blip" of little importance and leaving policymakers and the public paralyzed with uncertainty. But by 2020 there is little doubt that something drastic is happening. The average temperature has fallen by up to five degrees Fahrenheit in some regions of North America and Asia and up to six degrees in parts of Europe. (By comparison, the average temperature over the North Atlantic during the last ice age was ten to 15 degrees lower than it is today.) Massive droughts have begun in key agricultural regions. The average annual rainfall has dropped by nearly 30% in northern Europe, and its climate has become more like Siberia's.

Violent storms are increasingly common as the conveyor becomes wobbly on its way to collapse. A particularly severe storm causes the ocean to break through levees in the Netherlands, making coastal cities such as the Hague unlivable. In California the delta island levees in the Sacramento River area are breached, disrupting the aqueduct system transporting water from north to south.

Megadroughts afflict the U.S., especially in the southern states, along with winds that are 15% stronger on average than they are now, causing widespread dust storms and soil loss. The U.S. is better positioned to cope than most nations, however, thanks to its diverse growing climates, wealth, technology, and abundant resources. That has a downside, though: It magnifies the haves-vs.-have-nots gap and fosters bellicose finger-pointing at America.

Turning inward, the U.S. effectively seeks to build a fortress around itself to preserve resources. Borders are strengthened to hold back starving immigrants from Mexico, South America, and the Caribbean islands -- waves of boat people pose especially grim problems. Tension between the U.S. and Mexico rises as the U.S. reneges on a 1944 treaty that guarantees water flow from the Colorado River into Mexico. America is forced to meet its rising energy demand with options that are costly both economically and politically, including nuclear power and onerous Middle Eastern contracts. Yet it survives without catastrophic losses.

Europe, hardest hit by its temperature drop, struggles to deal with immigrants from Scandinavia seeking warmer climes to the south. Southern Europe is beleaguered by refugees from hard-hit countries in Africa and elsewhere. But Western Europe's wealth helps buffer it from catastrophe.

Australia's size and resources help it cope, as does its location -- the conveyor shutdown mainly affects the Northern Hemisphere. Japan has fewer resources but is able to draw on its social cohesion to cope -- its government is able to induce population-wide behavior changes to conserve resources.

China's huge population and food demand make it particularly vulnerable. It is hit by increasingly unpredictable monsoon rains, which cause devastating floods in drought-denuded areas. Other parts of Asia and East Africa are similarly stressed. Much of Bangladesh becomes nearly uninhabitable because of a rising sea level, which contaminates inland water supplies. Countries whose diversity already produces conflict, such as India and Indonesia, are hard-pressed to maintain internal order while coping with the unfolding changes.

As the decade progresses, pressures to act become irresistible -- history shows that whenever humans have faced a choice between starving or raiding, they raid. Imagine Eastern European countries, struggling to feed their populations, invading Russia -- which is weakened by a population that is already in decline -- for access to its minerals and energy supplies. Or picture Japan eyeing nearby Russian oil and gas reserves to power desalination plants and energy-intensive farming. Envision nuclear-armed Pakistan, India, and China skirmishing at their borders over refugees, access to shared rivers, and arable land. Or Spain and Portugal fighting over fishing rights -- fisheries are disrupted around the world as water temperatures change, causing fish to migrate to new habitats.

Growing tensions engender novel alliances. Canada joins fortress America in a North American bloc. (Alternatively, Canada may seek to keep its abundant hydropower for itself, straining its ties with the energy-hungry U.S.) North and South Korea align to create a technically savvy, nuclear-armed entity. Europe forms a truly unified bloc to curb its immigration problems and protect against aggressors. Russia, threatened by impoverished neighbors in dire straits, may join the European bloc.

Nuclear arms proliferation is inevitable. Oil supplies are stretched thin as climate cooling drives up demand. Many countries seek to shore up their energy supplies with nuclear energy, accelerating nuclear proliferation. Japan, South Korea, and Germany develop nuclear-weapons capabilities, as do Iran, Egypt, and North Korea. Israel, China, India, and Pakistan also are poised to use the bomb.

The changes relentlessly hammer the world's "carrying capacity" --the natural resources, social organizations, and economic networks that support the population. Technological progress and market forces, which have long helped boost Earth's carrying capacity, can do little to offset the crisis -- it is too widespread and unfolds too fast.

As the planet's carrying capacity shrinks, an ancient pattern reemerges: the eruption of desperate, all-out wars over food, water, and energy supplies. As Harvard archeologist Steven LeBlanc has noted, wars over resources were the norm until about three centuries ago. When such conflicts broke out, 25% of a population's adult males usually died. As abrupt climate change hits home, warfare may again come to define human life.

Over the past decade, data have accumulated suggesting that the plausibility of abrupt climate change is higher than most of the scientific community, and perhaps all of the political community, are prepared to accept. In light of such findings, we should be asking when abrupt change will happen, what the impacts will be, and how we can prepare -- not whether it will really happen. In fact, the climate record suggests that abrupt change is inevitable at some point, regardless of human activity. Among other things, we should:

  • Speed research on the forces that can trigger abrupt climate change, how it unfolds, and how we'll know it's occurring.
  • Sponsor studies on the scenarios that might play out, including ecological, social, economic, and political fallout on key food-producing regions.
  • Identify "no regrets" strategies to ensure reliable access to food and water and to ensure our national security.
  • Form teams to prepare responses to possible massive migration, and food and water shortages.
  • Explore ways to offset abrupt cooling_today it appears easier to warm than to cool the climate via human activities, so there may be "geo-engineering" options available to prevent a catastrophic temperature drop.

In sum, the risk of abrupt climate change remains uncertain, and it is quite possibly small. But given its dire consequences, it should be elevated beyond a scientific debate. Action now matters, because we may be able to reduce its likelihood of happening, and we can certainly be better prepared if it does. It is time to recognize it as a national security concern.

The Pentagon's reaction to this sobering report isn't known -- in keeping with his reputation for reticence, Andy Marshall declined to be interviewed. But the fact that he's concerned may signal a sea change in the debate about global warming. At least some federal thought leaders may be starting to perceive climate change less as a political annoyance and more as an issue demanding action.

If so, the case for acting now to address climate change, long a hard sell in Washington, may be gaining influential support, if only behind the scenes. Policymakers may even be emboldened to take steps such as tightening fuel-economy standards for new passenger vehicles, a measure that would simultaneously lower emissions of greenhouse gases, reduce America's perilous reliance on OPEC oil, cut its trade deficit, and put money in consumers' pockets. Oh, yes --and give the Pentagon's fretful Yoda a little less to worry about.

Email: dstipp@fortunemail.com

Time for Plan B
Lester R. Brown

The Earth Policy Institute is dedicated to providing a vision of an environmentally sustainable economy - an eco-economy - as well as a roadmap of how to get from here to there. - Lester Brown, President


Against rising temperatures and falling water tables, farmers will struggle to feed a surging world population in the coming decades. The technologies and strategies needed to sustain civilization in the 21st century are ready, but time may be running out.

From Plan B: Rescuing a Planet Under Stress and a Civilization in Trouble, published this September by W. W. Norton. This text appeared in The New York Press, Volume 16, Issue 37.

From the Earth Policy Institute

The list of information resources relevant to Plan B would swamp any Web site. Lester R. Brown's organization alone makes available a rich collection. We encourage readers to begin their explorations with a visit to the Earth Policy Institute site.

We need a massive mobilization to deflate the global economic bubble before it bursts. This will require an unprecedented degree of international cooperation to stabilize population, climate, water tables and soils - and at wartime speed.

Our only hope now is rapid systemic change - change based on market signals that tell the ecological truth. This means restructuring the tax system: lowering income taxes and raising taxes on environmentally destructive activities, such as fossil fuel burning, to incorporate the ecological costs. Unless we can get the market to send signals that reflect reality, we will continue making faulty decisions as consumers, corporate planners and government policymakers. Ill-informed economic decisions and the economic distortions they create can lead to economic decline.

Business as usual offers an unacceptable outcome - continuing environmental degradation and disruption and a bursting of the economic bubble. The warning signals are coming more frequently, whether they be collapsing fisheries, melting glaciers or falling water tables. Thus far the wake-up calls have been local, but soon they could become global. Massive imports of grain by China - and the rise in food prices that would likely follow - could awake us from our lethargy.

Stabilizing world population at 7.5 billion or so is central to avoiding economic breakdown in countries with large projected population increases that are already overconsuming their natural capital assets. The keys here are extending primary education to all children, providing vaccinations and basic healthcare, and offering reproductive healthcare and family-planning services in all countries.

Shifting from a carbon-based to a hydrogen-based energy economy to stabilize the climate is now technologically possible. Advances in wind-turbine design and in solar-cell manufacturing, the availability of hydrogen generators and the evolution of fuel cells provide the technologies needed to build a climate-benign hydrogen economy.

On the energy front, Iceland is the first country to adopt a national plan to convert its carbon-based energy economy to one based on hydrogen, while Denmark and Germany are leading the world into the age of wind. Denmark, the pioneer, gets 18% of its electricity from wind turbines and plans to increase this to 40% by 2030. Germany has developed some 12,000 megawatts of wind-generating capacity. Its northernmost state of Schleswig-Holstein now gets 28% of its electricity from wind. Spain is also moving fast to exploit its wind resources.

Japan has emerged as the world's leading manufacturer and user of solar cells. With its commercialization of a solar roofing material, it leads the world in electricity generation from solar cells and is well-positioned to assist in the electrification of villages in the developing world.

The Canadian province of Ontario is emerging as a leader in phasing out coal. It plans to replace its five coal-fired power plants with gas-fired plants, wind farms and efficiency gains. This initiative calls for the first plant to close in 2005 and the last one in 2015, with a resultant reduction in carbon emissions equivalent to taking 4 million cars off the road.
Stabilizing water tables is particularly difficult because the forces triggering the fall have their own momentum. Arresting the fall depends on quickly raising water productivity. It is difficult to overstate the urgency of this effort. Failure to stop the fall in water tables by systematically reducing water use will lead to the depletion of aquifers, an abrupt cutback in water supplies and the risk of a precipitous drop in food production. In pioneering drip irrigation technology, Israel has become the world leader in the efficient use of agricultural water. This unusually labor-intensive irrigation practice, now being used to produce high-value crops in many countries, is ideally suited where water is scarce and labor is abundant.

In stabilizing soils, South Korea and the United States stand out. South Korea, with once denuded mountainsides and hills now covered with trees, has achieved a level of flood control, water storage and hydrological stability that is a model for other countries.
The U.S. record in soil conservation is also impressive. Beginning in the late 1980s, U.S. farmers systematically retired roughly 10% of the most erodible carbolated, planting the bulk of it to grass. In addition, they lead the world in adopting minimum-till, no-till and other soil-conserving practices. With this combination of programs and practices, the United States hasreduced soil erosion by nearly 40% in less than two decades.

Thus all the things we need to do to keep the bubble from bursting are now being done in at least a few countries. If these highly successful initiatives are adopted worldwide, and quickly, we can deflate the bubble before it bursts.

Adopting Plan B is unlikely unless the United States assumes a leadership position, much as it belatedly did in World War II. The nation responded to the aggression of Germany and Japan only after it was directly attacked at Pearl Harbor. But respond it did, and after an all-out mobilization, the U.S. engagement helped turn the tide, leading the Allied Forces to victory within three-and-a-half years.

In his State of the Union address on January 6, 1942, one month after Pearl Harbor, President Roosevelt announced ambitious arms production goals. The United States, he said, was planning to produce 60,000 planes, 45,000 tanks, 20,000 anti-aircraft guns and six million tons of merchant shipping. He added, "Let no man say it cannot be done."
The year 1942 witnessed the greatest expansion of industrial output in the nation's history - all for military use. Early in the year, the production and sale of cars and trucks for private use was banned, residential and highway construction was halted and driving for pleasure was banned.

In her book No Ordinary Time, Doris Kearns Goodwin describes how various firms converted. A sparkplug factory was among the first to switch to the production of machine guns. Soon a manufacturer of stoves was producing lifeboats. A merry-go-round factory was making gun mounts; a toy company was turning out compasses; a pinball machine plant began to make armor-piercing shells.

In retrospect, the speed of the conversion from a peacetime to a wartime economy is stunning. Winston Churchill often quoted Sir Edward Grey, Britain's foreign secretary: "The United States is like a giant boiler. Once the fire is lighted under it, there is no limit to the power it can generate."

This mobilization of resources within a matter of months demonstrates that a country and, indeed, the world, can restructure its economy quickly if it is convinced of the need to do so. Many people - although not yet the majority - are already convinced of the need for a wholesale restructuring of the economy. The issue is not whether most people will eventually be won over, but whether they will be convinced before the bubble economy collapses.

The key to restructuring the economy is the creation of an honest market, one that tells the ecological truth. The market is an incredible institution - with some remarkable strengths and some glaring weaknesses. It allocates scarce resources with an efficiency that no central planning body can match. It easily balances supply and demand and it sets prices that readily reflect both scarcity and abundance. But the market also has three fundamental weaknesses. It does not incorporate the indirect costs of providing goods or services into prices, it does not value nature's services properly, and it does not respect the sustainable-yield thresholds of natural systems such as fisheries, forests, rangelands and aquifers.

With the sevenfold expansion in the world economy over the last half-century, the failure to address these market shortcomings and the irrational economic distortions they create will eventually lead to economic decline.

As the global economy has expanded and as technology has evolved, the indirect costs of some products have become far larger than the market price. The price of a gallon of gasoline, for instance, includes the cost of production but not the repair bill from acid rain damage. Nor does it cover the cost of rising global temperature, ice melting, more destructive storms, or the relocation of millions of refugees forced from their homes by sea-level rise.

If we have learned anything over the last few years, it is that accounting systems that do not tell the truth can be costly. Faulty corporate accounting systems that overstate income or leave costs off the books have driven some of the world's largest corporations into bankruptcy, costing millions of people their lifetime savings, retirement incomes and jobs.
We now have a faulty economic accounting system at the global level, but with potentially far more serious consequences. Economic prosperity is achieved in part by running up ecological deficits, costs that do not show up on the books. Some of the record economic prosperity of recent decades has come from consuming the earth's productive assets - its forests, rangelands, fisheries, soils and aquifers - and from destabilizing its climate.

For gasoline, calculating the true costs to society means including the medical costs of treating those who are ill from breathing polluted air; the costs of acid rain damage to lakes, forests, crops and buildings; and, by far the largest, the costs of climate change. Higher temperatures can wither crops and reduce harvests. They can melt ice and raise sea level, inundating coastal cities, low-lying agricultural lands and low-lying island countries. The interesting question is: What is the cost to society of burning a gallon of gasoline?

Some of the looming costs associated with continued fossil fuel burning are not only virtually incalculable, but the outcome is unacceptable. The World Bank reports that a one-meter rise in sea level would inundate one-half of Bangladesh's riceland. How much is this land worth in a country that is the size of New York state and has a population half that of the United States? And what would be the cost of relocating the 40 million Bangladeshis who would be displaced by the one-meter rise in sea level?

Another challenge in creating an honest market is to get it to value nature's services. For example, after several weeks of flooding in the Yangtze River basin in 1998 - flooding that eventually inflicted $30 billion worth of damage and destruction in the basin - the Chinese government announced that it was banning all tree-cutting in the basin. It justified the ban by saying that trees standing are worth three times as much as trees cut. This calculation recognized that the flood-control service provided by forests was far more valuable than the timber in them.

Once we calculate all the costs of a product or service, we can incorporate them into market prices by restructuring taxes. If we can get the market to tell the truth, then we can avoid being blindsided by faulty accounting systems that lead to bankruptcy. As Øystein Dahle, former vice president of Exxon for Norway and the North Sea, has pointed out: "Socialism collapsed because it did not allow the market to tell the economic truth. Capitalism may collapse because it does not allow the market to tell the ecological truth."

The need for tax shifting - lowering income taxes while raising taxes on environmentally destructive activities - in order to get the market to tell the truth has been widely endorsed by economists. The basic idea is to establish a tax that reflects the indirect costs to society of an economic activity. For example, a tax on coal would incorporate the increased healthcare costs associated with breathing polluted air, the costs of damage from acid rain and the costs of climate disruption.

With this concept in hand, it is a short step to tax shifting - that is, reducing taxes on income and offsetting this with taxes on environmentally destructive activities. Nine countries in Western Europe have already begun the process of tax shifting, known as environmental tax reform. The amount of revenue shifted thus far is small, just a few percent. But enough experience has been gained to know that it works.

One of the better-known changes was a four-year plan adopted in Germany in 1999 to shift taxes from labor to energy. By 2001, this had lowered fuel use by 5%. A tax on carbon emissions adopted in Finland in 1990 lowered emissions there seven% by 1998.

Environmental tax reform is spreading, with the reform process now under way throughout Europe, with isolated cases elsewhere. The United States, for example, imposed a stiff tax on chlorofluorocarbons to phase them out in accordance with the Montreal Protocol of 1987. At the local level, the city of Victoria, British Columbia, adopted a trash tax of $1.20 per bag of garbage, reducing its daily trash flow 18% within one year.

Environmental tax shifting usually brings a double dividend. In reducing taxes on income, labor becomes less costly, creating additional jobs while protecting the environment. This was the principal motivation in the German four-year shift of taxes from income to energy. The shift from fossil fuels to more energy-efficient technologies and to renewable sources of energy reduces carbon emissions and represents a shift to more labor-intensive industries. By lowering the air pollution from smokestacks and tailpipes, it also reduces respiratory illnesses, such as asthma and emphysema, and healthcare costs - a triple dividend.

Tax shifting also helps countries gain the lead in producing new equipment, such as new energy technologies or those used for pollution control. For example, the Danish government's tax incentives for wind-generated electricity have made Denmark, a country of only five million people, the world's leading manufacturer of wind turbines.

Some 2500 economists, including eight Nobel Prize winners in economics, have endorsed the concept of tax shifts. The editorial board at the Economist has also recognized the advantage of environmental tax shifting and endorses it strongly: "On environmental grounds, never mind energy security, America taxes gasoline too lightly. Better than a one-off increase, a politically more feasible idea, and desirable in its own terms, would be a long-term plan to shift taxes from incomes to emissions of carbon."

In Europe and the United States, polls indicate that at least 70% of voters support environmental tax reform once it is explained to them.

Just as there is a need for tax shifting, there is also an urgent need for subsidy shifting. Each year the world's taxpayers underwrite $700 billion of subsidies for environmentally destructive activities, such as fossil-fuel burning, overpumping aquifers, clearcutting forests and overfishing. A 1997 Earth Council study, Subsidizing Unsustainable Development, observes that "there is something unbelievable about the world spending hundreds of billions of dollars annually to subsidize its own destruction."

Some countries are eliminating or reducing climate-disrupting subsidies. Belgium, France and Japan have phased out all subsidies for coal. Germany reduced its coal subsidy from $5.4 billion in 1989 to $2.8 billion in 2002—lowering its coal use by 46%. China cut its coal subsidy from $750 million in 1993 to $240 million in 1995.

Further shifting coal and oil subsidies to the development of climate-benign energy sources such as wind power, solar power and geothermal power is the key to stabilizing the earth's climate. Shifting subsidies from road construction to rail construction could increase mobility in many situations while reducing carbon emissions.

In a troubled world economy facing fiscal deficits at all levels of government, exploiting these tax and subsidy shifts with their double and triple dividends can help balance the books and save the environment. Tax and subsidy shifting promise both gains in economic efficiency and reductions in environmental destruction, a win-win situation.

History judges political leaders by whether they responded to the great issues of their time. For today's leaders, the issue is how to deflate the world's bubble economy before it bursts. This bubble threatens the future of everyone, rich and poor alike. It challenges us to build an eco-economy.

Among national political leaders, none has articulated the new agenda better than UK Prime Minister Tony Blair. He believes that environmental degradation is the issue for our generation, noting that climate change is "unquestionably the most urgent environmental challenge." Arguing that the Kyoto Protocol was not radical enough, he calls for a 60% reduction in carbon emissions worldwide by 2050. Summing up, he calls for a "new international consensus to protect our environment and combat the devastating impacts of climate change."

French President Jacques Chirac, a political conservative, has suggested the creation of a world environment organization to coordinate efforts to build an environmentally sustainable economy.

Some corporate leaders are also beginning to urge efforts to deal with global poverty. Juergen Schrempp, CEO of DaimlerChrysler, said in a speech at the U.S. Chamber of Commerce that the world needed a new Marshall Plan. The question for the industrial world, he said, was not, "Can we afford another Marshall Plan?" but rather, "Can we afford not to have another Marshall Plan?"

There is a growing sense among the more thoughtful political and opinion leaders worldwide that business as usual is no longer a viable option, that unless we respond to the social and environmental issues that are undermining our future, we may not be able to avoid economic decline and social disintegration.

We have the wealth and know-how to avoid catastrophe. What we do not yet have is the leadership. And if the past is any guide to the future, that leadership can only come from the United States. By far the wealthiest society that has ever existed, the United States has the resources to lead this effort.

Unfortunately, the United States continues to focus on building an ever-stronger military as though that were the key to addressing these mounting threats. A reordering of priorities means restructuring the U.S. foreign policy budget. The challenge is not just to provide a high-tech military response to terrorism, but to build a global society that is environmentally sustainable and socially equitable. Such an effort would more effectively undermine the spread of terrorism than a doubling of military expenditures.

We can build an economy that does not destroy its natural support systems and a global community where the future needs of all the earth's people are satisfied. This is entirely doable. In the words of Franklin Roosevelt, who called America to greatness during a different crisis, "Let no man say it cannot be done."