NEW MARKET HYPOTHESISRISK COST OF CARBONCENTRAL BANK DIGITAL CURRENCY

NEW MARKET HYPOTHESIS

How to manage climate systemic risk

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RISK COST OF CARBON

Pricing climate risk into the global financial system

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CENTRAL BANK DIGITAL CURRENCY

The case for a positive carbon price

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Human Rights

Please cite this page as:
Chen, D. B (2016). Global 4C – Monetary Policy for Climate Change Mitigation. www.global4c.org
Youtube videos cited in this webpage do not imply endorsement of Global 4C by the people in those videos or anybody associated with those videos.

Updated 10 February 2018

A solution to the climate crisis will require a global response that can minimise impacts on societies and the environment. The Global 4C policy has yet to be discussed in the mainstream, because the policy is based on a new market hypothesis and involves a parallel currency. Global 4C is a global reward scheme to complement carbon taxes and regulations for limiting greenhouse pollution. Global 4C will offer a parallel currency—called Complementary Currencies for Climate Change (4C) and also called the Solar Dollarto market actors for greenhouse mitigation. Global 4C is based on the idea that market-based environmental policies exist as a ‘family’ of policies, with the two major policies being (a) the carbon tax for pollution, and (b) the global carbon reward for mitigation.

Global 4C aims to establish a progressive global social-and-environmental movement through a 4C currency. The Global 4C policy is to encourage information sharing and education as an integral part of mitigation. The Global 4C rewards can be weighted for improved biodiversity protection, agricultural sustainability, cultural resilience, and social cohesion. The policy could have major benefits for people living in developing countries where there is mobile phone coverage for micro-financial transactions. Protecting human rights will be an objective of the Global 4C reward scheme. Below we discuss the implications of Global 4C for the rights of people living in urban, remote, and rural areas, and especially for indigenous peoples living on or near their native lands.

The policy will be designed to ensure that firms and community groups will be able to interact through the policy over a decentralised network for assessments, auditing, and micro-financial payments. Co-benefits of doing mitigation work may include improving social resilience, protecting bio-diversity, improving the local environment, improving agricultural methods, and sharing scientific information. Global 4C is a genuine alternative to REDD, but Global 4C rewards will not be used as carbon offsets. All carbon will be retired immediately and will be debt-free, and will not be traded in cap-and-trade schemes.

REDD was developed with good intentions and may generate positive outcomes, however it can also create problems for indigenous people and communities because it is not a ‘pure’ reward. It is not a ‘pure’ reward because the finance is provided through carbon markets and is prone to centralised decision-making. Global 4C will be financed independently of existing carbon markets. For this reason the Global 4C policy will use assessment rules and an administrative system that promotes transparency and decentralised participation.

Global 4C will offer polluters a financial reward for reducing emissions at source, and this will create a new pathway for deep decarbonisation. By comparison, REDD is a zero-sum game for mitigation because its purpose is to offset carbon pollution (CO2) in developed economies. The REDD approach allows industrial pollution to continue at a marginally cheaper cost. The Global 4C approach is different to REDD because Global 4C will be financed by a global inflation levy that spreads the cost of mitigation across the world economy. Global 4C will raise the price of carbon in conventional carbon markets, by reducing the supply of carbon offsets. The supply of carbon offsets will fall, because under the Global 4C policy a growing proportion of global carbon emissions will be mitigated at the polluting source, and more carbon will be removed from the atmosphere based on the 4C reward incentive. The carbon mass that is rewarded with 4C will be immediately retired from carbon markets and will not be traded as carbon offsets.

A weakness of REDD and REDD+ policies, is that they do not address the growing demand for natural resources which encourages deforestation, forest degradation, and mono-crop agriculture. Global 4C will regulate global economic growth through a price feedback mechanism that transfers purchasing power into the 4C currency (also called the Solar Dollar). The Global 4C policy does not predetermine rates of economic growth or de-growth, because 4C price will be operationally managed to achieve a specific climate mitigation goal. This goal is framed as a global climate systemic risk management objective.

Global 4C will give people rights and responsibilities. For example, each community member may be offered a geo-statistically determined financial reward in the form of digital currency over their mobile phone. The authority to accept the reward is decentralised to the individual. Communities will need to self-organise and establish their own mitigation projects in open markets and then submit their data to a public network for assessment. The same will apply to firms, and market actors in all geographic locations and all sectors of the eocnomy (i.e. transport, primary energy, land management, agriculture, education, etc.).

The following interviews highlight the human rights issues that can result from a reliance on centralised planning and financing of REDD or REDD+. Note that the proposed Global 4C digital administrative network, called the World Tree, will seek to have a decentralised decision-making architecture that mimics the biophysical traits of living trees.

 

(Interview 1) Tom Goldtooth answering press questions at COP21 in Paris on his opposition to REDD:

“…these forested areas are now used for carbon credits that allow polluters in the North to continue to pollute.”

“There is no way to make the REDD project better, it cannot be fixed. It is not a solution. It involves a climate market regime that has been part of a big capitalist market system that has never protected front line communities, indigenous peoples, fisher peoples. And that’s why we have to look for other alternatives to product the trees but not in these market systems that just allowed more dumping of pollution in the North.”

“As indigenous people we’re saying enough is enough we’re not going to get exploited anymore.”

 

(Interview 2) Brazilian indigenous leader Chief Ninawa Huni Kui (Brazil) commenting on REDD:

Carbon Trading Scheme “REDD” a False Solution to Climate Change. The controversial carbon trading scheme known as REDD, or Reducing Emissions from Deforestation and Forest Degradation, has set off protests not only in Africa, but also in South America, especially in the Amazon region. 

https://www.youtube.com/watch?v=fAp5m9JaNwE

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