Innovations: The year of the wince

Nik Blosser

Australia is to blame. First, they have a record drought that reduced their commodity crop yields by percentages never seen before. This caused worldwide commodity prices to increase, which affected the cost of, well, just about everything.

Even the Great Harvest Baking franchise across the street from my Portland office, which earlier this year so proudly announced the use of organic wheat in their bread, reversed course two months ago and stopped using it.

The only way to tell organic wheat was out was one day the fine print on the chalkboard above the register was quietly changed. But even though it’s Australia’s fault, biofuels get blamed for everything nowadays, including the cost of corn tortillas in Mexico and pasta in Italy. The fact that oil is at or near $100 a barrel and transportation costs can be a significant portion of commodity pricing has nothing to do with it, of course. (Full disclosure: I own stock in a biofuel company, Pacific Ethanol.)

But this is just the latest in a long series of smear campaigns against sustainable industries, some orchestrated and some unclaimed. And that brings me to my personal list of trends, opinions and random thoughts for the year ahead.

2008: The year of smear
Paralleling the most important presidential election in a generation, the smear campaign against sustainable industries will rise to heights never seen before in 2008. More than one top executive of a major polluter is currently thinking, “If we can’t change the definition of green building, organic farming or renewable energy to benefit us, we’ll smear them instead.” If Vietnam vet John Kerry can be turned into a traitor, any green industry can be made brown or irrelevant with a few million well-placed marketing dollars.

The Triple Bottom Lie
Cleantech venture capitalists will not accept a lower rate of return for investments in sustainable business. Having social benefits may be a differentiator for consumers, but I have yet to meet an investor of any type who equates it with dollars. And I know a lot of wonderful people.

Friends, there is no triple bottom line. There is only cold, hard cash. So 2008 will be the year when many business activists finally accept that they can invest in sustainable business, but they need to turn to government and regulation to solve society’s problems. Their investments won’t do it.

1,000 days
Or 24,000 hours. That’s how much time the head of the UN climate change panel says we have to make serious course corrections on greenhouse gas emissions. At a Seattle conference on clean technology investing sponsored in October by the Stoel Rives law firm, the Washington, DC–based head of the American Council of Renewable Energy (ACORE), Mike Eckhart, said he had it on good account from a close friend of President Bush that “the one thing he regretted” was that he (meaning the President) hadn’t done anything on climate change, and that something would be done in 2008. Upon hearing this comment, the audience winced audibly.

Now I would like to take a moment to describe this wince for you, for I believe it represents the current state of affairs of sustainability writ large. Most immediately, the wince had elements of astonishment and violent reaction, as if to say “are you fu#$@*in’ kidding?!” This came from the real activists or those with relatives serving in Iraq. Very quickly conflicting with this initial reaction were elements of genuine laughter, as if something quite comical but not in any way harmful was just said. Rounding out the wince were delayed reactions dominated by sneers of absurdity and farce but also including the random hopeful “Huh.”

But mostly, people were just silent.

That’s a pretty standard reaction, I suppose. That’s why we’ll start 2009 with only about 650 days left, as nothing significant will be done in this country on climate change in 2008.

You can wince now.

China shows us the way
But if the United States won’t do anything, will China? A number of detailed reports, including MIT’s "The Future of Coal" and "Coal in a Changing Climate" from the Natural Resources Defense Council, came out in 2007 that covered China and its dominant energy source. China and the United States are almost mirror images of each other with respect to internal forces with respect to climate change. In China, you have the central government providing genuine leadership on climate change and issuing specific demands for improvements, including one for increasing national energy efficiency by 20 percent in the next five years. But as the Massachusetts Institute of Technology report authors state, “overriding norms of economic growth maximization” permeate the country’s regional bureaucrats and business leaders, which seem to find ways to build a coal plant every week to meet electricity demand.

But 2008 will be the year when you see serious crackdowns by the central government in China over pollution and climate change, much like you’ve seen them do recently with respect to food and product safety. Unlike our central government, the one in China is serious about climate change and will be making even more difficult decisions in 2008.

Australia redeemed
Which brings us back to Australia. In 2008, the United States will be the last remaining industrialized country in the world that has not ratified the Kyoto treaty. Australia’s election in November threw out their government that had stonewalled it, and the new Prime Minister promised swift action. So I guess it’s no longer all Australia’s fault.

Happy New Year.