Thanks Katta O’Donnell for destroying the climate movement and doesn’t realize that. Now it will be more difficult for financially incontinent politicians to borrow money.

From Watts Up With That?

Essay by Eric Worrall

A green lawsuit which likely does more good than harm, by making it more difficult for financially incontinent politicians to borrow money.

A world-first case, brought by a young law student, has forced the federal government to acknowledge its failure to declare the risks to the value of its debt as a result of climate change. By Katta O’Donnell.

Government settles climate bond lawsuit

…

Three years ago, with the help of Equity Generation lawyers, I sued the federal government. In my view, it was not fully disclosing the financial risk the climate crisis poses when it issued bonds – that is, raised money from the banks, institutions, super funds and retail investors that typically buy its debt.

…

This is the first time a country with an AAA credit rating has acknowledged that climate change is a systemic risk that might affect the economy and, therefore, the value of its debt. If a country’s debt is considered less valuable, that increases the amount of interest investors will demand to hold it, and that pushes up the government’s debt service costs – an especially unwelcome development if it needs to borrow more in future, to pay for the physical and social infrastructure of the essential rapid transition to adapt to the effects of the climate crisis.

…

“I doubt that it will be as difficult as the Commonwealth submits to establish that global warming and climate change gives rise to real, systemic risks to the Commonwealth’s coffers and therefore to the value of the change traded government bonds,” the judgement said. “For the purposes of the application I take judicial notice of the fact that the consensus position of leading climate scientists around the world is that global warming and climate change brings risks of more frequent and more intense bushfires, storm surges, coastal flooding, inland flooding, cyclones, droughts and other extreme weather events.

“To my mind, it seems likely that such events will give rise to a huge drain on Commonwealth resources and on the tax base over a very lengthy period, perhaps forever, and therefore also weigh on forecasts in relation to the Commonwealth’s financial and economic position.”

…Read more: https://www.thesaturdaypaper.com.au/news/environment/2023/10/21/government-settles-climate-bond-lawsuit#mtr

Katta O’Donnell, the brilliant young lawyer who brought this lawsuit, seems to think she has forced governments to finally take the climate crisis seriously. I suspect her mistake is believing the climate crisis is real. She doesn’t realise that what she has actually done is to destroy the climate movement.

Which option is easier:

a) Spending the money required to actually reduce global emissions, satisfying courts that the climate crisis has been addressed.
b) Simply accepting it just got more difficult to borrow money to buy votes.
c) Downgrading the climate crisis: Convincing the courts climate change no longer poses a risk to bond repayments, then switching horses to a new imaginary crisis to wrangle the voters.

I’m guessing politicians will go with option c).

In the short term, to win votes in 2024, left wing politicians might go with another virus scare. There is an outbreak of Nipah virus, deadly contagious encephalitis, which is currently spreading through Asian tourist spots. With a little spin, Nipah fear might stampede voters in the next election, as Covid did in 2020. But a real replacement for the climate crisis would need to be much more durable than gambling on people falling for another virus crisis.

And there is a candidate fake crisis, with much broader bipartisan appeal, which is just itching to be exploited: Fear of malevolent artificial intelligence.

The signs are there that the AI crisis is gathering momentum. China just launched its Global AI Governance Initiative, at a conference attended by Russian and Taliban representatives, apparently an attempt to pressure the USA into relaxing AI chip export controls which just went into effect. The UN has also been publishing articles about the risk of uncontrolled AI, and the need for more regulation. Hollywood did its bit to prepare the ground for the new fake crisis, with movies like the Terminator franchise.

Sure politicians might buck at the harness a bit, try to breath life into the climate crisis which served them for so long, toy with passing laws to exempt themselves from having to make climate financial disclosures, but the real damage has already been done. Passing laws which tell creditors you don’t have to explain risks to them doesn’t really help smooth the progress of your loan application. Thanks to Katta O’Donnell’s lawsuit, creditors now have a new stick with which to beat debtor nations into paying higher interest rates, or to demand a portion of the borrowed money be immediately spent on their mandatory “climate repayment insurance”.

Eventually even the dumbest politicians will in the end accept that the climate crisis has outlived its usefulness.