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In the Fall 2020 issue of the International Monetary Fund’s Finance & Development journal, Joseph Stiglitz, Columbia University professor and Nobel Memorial Prize in Economic Sciences recipient, wrote an opinion piece titled, “Conquering the Great Divide”. In it, Stiglitz shares that the pandemic has exposed and exacerbated the gap between the rich and the poor.

Even prior to the pandemic, Stiglitz had written about inequality in America. His 2016 book, “The Great Divide”, diagnoses what he believes are the causes of this inequity and suggests ways that the U.S. can create a more equal society, one where everyone prospers. Now, Stiglitz persists that the “great divide” has only widened, as COVID-19 has disproportionately affected the poor. He goes on to conclude that, unless action is taken now, inequality will continue on this upward trend.

Stiglitz proposes various solutions to this issue. First, he suggests that we must accelerate upskilling as the job market shifts towards automation. Second, he argues that we need to rewrite the rules of the economy. This includes monetary policies that emphasize low unemployment across all groups, corporate governance laws that focus on providing value for all stakeholders, and globalization rules that protect workers and the environment.

Just as the pandemic has shown the extent of the “great divide” within countries, it has also exposed the vast inequality across countries. Those countries with lesser developed economies have disproportionately been affected by the pandemic, as they have poorer health conditions and less prepared health systems. Moreover, they do not have the necessary resources to respond to the economic aftermath. Thus, Stiglitz calls on the more developed countries to provide assistance to the developing countries in order to expedite the economic recovery process. Specifically, he suggests the use of Special Drawing Rights (SDRs).

Stiglitz maintains that equality is crucial for a growing and stable global economy, and we must adapt our policies and actions to deal with the long-lasting implications of the pandemic.

To read more about the Hunt Institute’s work to develop future-focused solutions to some of the world’s biggest problems, please click here. For the latest news on the Hunt Institute, follow our social media accounts on LinkedIn, Facebook, Twitter, and Instagram. We invite you to listen to our Podcast called Sages & Seekers. If you are considering engaging with the institute, you can donate, or sign-up for our newsletter by emailing huntinstitute@smu.edu.

Five months ago, on May 27, 2020, the Dallas City Council unanimously passed the Comprehensive Environmental & Climate Action Plan (CECAP) to outline a plan for addressing environmental issues here in Dallas.

According to the World Bank, in 2015, Texas emitted a total of 626,500,000 metric tons of carbon dioxide, the most of any state in the country. The city of Dallas alone contributed to about 3% of those emissions, releasing 19,529,600 metric tons of carbon dioxide. Dallas’ greenhouse gas (GHG) emissions mainly come from buildings and energy (64%) and transportation (35%).

If no action is taken, Dallas is expected to experience increasingly severe weather, including hotter temperatures and severe droughts in the summers, and colder, wetter winters. The Federal Reserve Bank of Dallas cites that this increased weather variability will negatively impact our food system and water supply. Additionally, the Dallas Fed states that climate change is likely to have significant economic implications in the long term.

Despite the U.S. backing out of the Paris Agreement, Dallas, along with 466 other cities, committed to upholding the agreement’s goal of reaching carbon net neutrality by 2050 in order to limit the level of global warming to 1.5 degrees Celsius or less. The CECAP proposes 97 actions that the city can take in order to reach this goal. The actions are organized into 8 sectors – buildings, energy, transportation, waste, water, ecosystems, food & agriculture, and air quality. Some actions include: updating the city’s building code to support solar-ready construction and transitioning the city’s buses to be 100% electric.

In addition to defining actions the city will take, the plan suggests what residents and businesses can do to help the city reach its goals in each of the 8 areas. For example, did you know you can recycle electronics such as computers, TVs, printers, etc.? To find out which items can be recycled and where, check out the Dallas Electronic Recycling Program. Another suggestion is for businesses and individuals to volunteer their time with Texas Trees Foundation to plant trees in order to help keep our community cool.

Pharr Andrews, Senior Climate Coordinator at the City of Dallas, says that the city’s focus for the first year of implementation is around capacity building. “The city cannot achieve these goals on our own. We need businesses and the community to join us in making this plan a success.”

To read more about the city’s plan to address climate change and what you can do to help combat its effects, see the full CECAP here.

 To read more about the Hunt Institute’s work to develop future-focused solutions to some of the world’s biggest problems, please click here. For the latest news on the Hunt Institute, follow our social media accounts on LinkedIn, Facebook, Twitter, and Instagram. We invite you to listen to our Podcast called Sages & Seekers. If you are considering engaging with the institute, you can donate, or sign-up for our newsletter by emailing huntinstitute@smu.edu.

Climate Week NYC, hosted by the Climate Group in collaboration with the United Nations and New York City, took place last week, Sept. 21-27, 2020. This year’s annual summit featured over 450 panels, workshops, art shows, and film screenings focused around 10 themes: clean energy transition; transport and infrastructure; industry and built environment; finance, investment, and jobs; food and land use; nature and science; US and international policy; youth, public mobilization and justice; sustainable travel and tourism; and climate impacts and adaptation. The event brought together more than 20 countries, including Colombia, India, the United Kingdom, and Australia.

To kick off Climate Week, artist-activists Gan Golan and Andrew Boyd revealed the Climate Clock. Displayed on the Metronome in Union Square, the Climate Clock shows how long until Earth burns through its carbon budget based on current rates of emissions. The clock expresses the urgency with which we must take action in order to keep the Earth from reaching the 1.5 degree Celsius global warming threshold. At a level greater than 1.5 °C, the world would experience even more frequent and intense weather extremes, including droughts, rainfall, heatwaves, floods, and more. This would significantly impact our health as well as our ecosystems, water supply, and food production systems. In fact, we are already seeing the effects of climate change today with the wildfires blazing across the West Coast and the especially active 2020 Atlantic hurricane season.

Throughout the week, many new promises were made by governments across the globe. China will aim for carbon neutrality by 2060, and the European Union pledged to reach the same goal by 2050. Corporations also committed to reducing their emissions of greenhouse gases. Walmart announced it will target net-zero emissions by 2040, with Morgan Stanley aiming for the same mark by 2050, and General Mills outlined a plan to reduce food waste by 50% over the next 10 years.

In speaking to the responsibility of corporations to be a part of the solution, Maria Mendiluce, CEO of the We Mean Business coalition, said:

“Business only has a short window of time left to prepare for the zero-carbon future, so now is the time to step up. For business, climate action builds resilience, increases innovation, cuts costs and attracts investment. We are seeing companies from even the most challenging sectors taking climate action and reaping the rewards. We now need to see this new level of leadership from business across the board – increasing its level of ambition, action and advocacy to drive us forward at the pace needed.”

The We Mean Business coalition, a group of nonprofit organizations fighting climate change, issued a new guide last week outlining what corporate climate leadership looks like in the 2020s. The three main tenets, which Mendiluce eluded to in the above quote, are that business leaders must respond to the climate crisis ambitiously, deliver on their goals through action, and promote widespread change through advocacy.

To learn more about global warming and the impacts of reaching a level of warming greater than 1.5 °C, check out this Intergovernmental Panel on Climate Change (IPCC) special report. Stay tuned to the Hunt Institute Digest for next week’s post about the Dallas Climate Action Plan and resources you can use to combat the effects of climate change in your own community.

To read more about the Hunt Institute’s work to develop future-focused solutions to some of the world’s biggest problems, please click here. For the latest news on the Hunt Institute, follow our social media accounts on LinkedIn, Facebook, Twitter, and Instagram. We invite you to listen to our Podcast called Sages & Seekers. If you are considering engaging with the institute, you can donate, or sign-up for our newsletter by emailing huntinstitute@smu.edu.

 

Capitalism is defined as “an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, a price system, private property and the recognition of property rights, voluntary exchange and wage labor” by Wikipedia. The power of our free-market economy has been corrupted by inequalities in part by the rise of monopolies, duopolies, and oligopolies. Is it time to reimagine what our capitalism is today?

Back in 2012, Mindy Lubber, CEO and president of Ceres, a sustainability nonprofit organization, wrote an article in Forbes titled, “Ending Quarterly Capitalism”. Quarterly capitalism is a form of capitalism that focuses on short-term performance and delivering value for shareholders. In the article, Lubber shares that since CEO’s are incentivized based on quarterly or annual company performance, most are reluctant to invest in decisions that may benefit the company in the long run. However, she predicts that with growing risks related to climate change, CEO’s will be forced to consider the long-term implications of their business decisions.

Likewise, in 2016, Dominic Barton, global managing partner at McKinsey & Company, Dr. Dezso J. Horvath, dean of the Schulich School of Business at York University, and Matthias Kipping, chair of business history at the Schulich School, released a book titled “Re-imagining Capitalism: Building a Responsible, Long-Term Model.” In it, they question whether America’s current form of capitalism is still creating wealth and benefiting a majority of citizens. The authors argue that quarterly capitalism is to blame for the significant discrepancy between the rich and the poor, and they echo Lubber’s sentiment that opportunities for long-term value creation have been ignored in the pursuit of short-term profits. Despite these problems, in an interview with McKinsey, Horvath shares optimism for the future based on the upcoming generation’s awareness of social and environmental issues. The upcoming generation understands the vital importance of sustainability — the balance between society, economy, and the stewardship of the environment.

Now, in 2020, with the global coronavirus pandemic, increasing natural disasters due to climate change, and the compounding effects of racial oppression in America, the examination of our current representation of capitalism in our economy has once again been brought to the forefront.

The Omidyar Network, a social change venture co-founded by Pierre Omidyar, founder of eBay, proposes a five-pillar approach to reimagining capitalism in America. The Omidyar Network seeks to create a more democratic form of capitalism by: 1) grounding the economy in new ideas, shared values, and inalienable rights 2) building an explicitly anti-racist and inclusive economy 3) creating counterweights to economic power 4) rebalancing the relationship between markets, government, and communities and 5) building a resilient economy that accounts for 21^st century context.

Rebecca Henderson, Harvard Business School professor and economist, also posits in her new book, “Reimagining Capitalism in a World on Fire”, that now is the time to build a more equitable and sustainable version of capitalism.

Additionally, The World Economic Forum is calling for a “great reset”, stating that the coronavirus pandemic presents the world with a unique opportunity to redefine our economic and social systems to create a more equitable, sustainable, and prosperous future.

As Richard Davies, economist and fellow at the London School of Economics, stated in this article in the Organization for Economic Cooperation and Development (OECD) Forum, “The COVID-19 pandemic is a reminder that economics is a discipline that we must constantly renew and improve”.

If you are interested in being a part of a network of like-minded professionals who are working to leverage market principles and social entrepreneurship for a more inclusive economy here in Dallas, consider joining the Inclusive Economy Consortium (IEC). Cofounded by Dr. Eva Csaky, Executive Director of the Hunt Institute, and Anna Clark, President at Heirloom Digital, the IEC empowers change agents from the private, public and non-profit sectors to connect, share and act.

To read more about the Hunt Institute’s work to develop future-focused solutions to some of the world’s biggest problems, please click here. For the latest news on the Hunt Institute, follow our social media accounts on LinkedIn, Facebook, Twitter, and Instagram. We invite you to listen to our Podcast called Sages & Seekers. If you are considering engaging with the institute, you can donate, or sign-up for our newsletter by emailing huntinstitute@smu.edu.