Speaking of Keynes, are you surprised that Europe ended up so far on the other side of, so to speak, the Keynes curve?
No. I know the Germans. They’ve never believed in any of this. They’re at a point that doesn’t exist in our spectrum. Here, people are either pro-Keynesian economics and pro-strong welfare state or they don’t believe in Keynesian economics and they believe in social darwinism. The German thing is rigorous, you-must-balance-your-budget and a belief in a strong welfare state. And they’ve always been that way. Famously, there was a conference where the late-Rudi Dorbusch came down with someone from the Bundesbank for breakfast and said, “and stable prices to you, sir!”
Let’s step back for a moment. What do you think we should be worrying about in 10 years?
I really think 10 years from now the signs that we’re on a runaway climate change will start to become a lot more obvious. It won’t be big rises in temperature yet, but will be enough to make people look around and say, oh my God. But by then, it will be very hard to bring it under control.
I’m a technological optimist in that I think if we had appropriate pricing, we’d find it remarkably easy. The cost of getting out of rising emissions would be much lower than legend has it. But I’m not politically optimistic that we’ll do that.
There ya go. It's all about the politics which is all about the money. The goose that lays the golden eggs does not want change, only money and power.